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Committee seeks answers on Liquor Commission plans

State House Bureau

October 03. 2012 9:26PM

CONCORD - Members of a House investigative committee grilled state Liquor Commissioners about their plans for a Concord liquor warehouse.

Last spring, the commission issued a request for proposals to provide warehouse services to store liquor and wine before it is distributed to state liquor stores and restaurants.

A 25-year contract with the current warehouse provider Law Warehouse Inc. ended in May but has been extended 18 months until a new contract is awarded, now scheduled to be announced Nov. 14.

There are five bidders on the contract that does not require the state to pay for the warehouse services. Instead the contract holder charges suppliers bailment fees to store and transport their products until the commission buys it.

The state also owns its own warehouse in Concord, providing the state with about $600,000 a year in revenue.

Members of the Special House Committee to Evaluate the NH State Liquor Commission wanted to know if the agency intended to close the Concord warehouse when a new contract is issued.

However, the commission's director of administration, Craig Bulkley, did not answer the question, saying that doing so could compromise the integrity of the on-going bidding process.

Committee chairman Rep. Lynn Ober, R-Hudson, explained that the commissioners, Chairman Joseph Mollica and Michael Milligan, and Bulkley could not answer questions about the on-going bidding process but they were able to answer questions on the request for proposals (RFP).

But she refused to allow Senior Assistant Attorney General Michael Brown to sit with the commissioners when they testified.

Committee member Rep. Ben Baroody, D-Manchester, asked if the RFP indicates the commission intends to get out of the warehouse business entirely.

Bulkley warned lawmakers not to read too much into the section outlining two scenarios one for a single warehouse and one for two or more warehouses.

'No decision has been made on the Concord warehouse,' Bulkley said, adding that the section allows the commission to explore many options now and into the future.

Several years ago, the commission proposed closing the Concord warehouse but lawmakers rejected the idea that would have eliminated 14 positions.

At Tuesday's meeting, Rep. Shawn Jasper, R-Hudson, said it was clear to him from the RFP that the commission intends to shut down the Concord warehouse.

But Bulkley explained the RFP is based on volume of liquor not individual facilities, but Jasper said he was growing more frustrated that the commission was not answering a simple question.

Rep. Brandon Giuda, R-Chichester, tried a different track, asking specifically about the RFP and the possibility that the Concord facility would be closed once the contract was awarded. 'This has nothing to do with the bidding process,' Giuda said.

Bulkley left the room to talk to Brown and returned reading a statement saying he could not answer the question and the RFP speaks for itself.

'I challenge that answer and I'd like your attorney to explain why,' said Giuda, an attorney. 'I'm asking you again to answer the question.'

When Bulkley again explained an answer would jeopardize the bidding process, Giuda said 'I tired of you skirting the question.'

'I try to give people the benefit of the doubt, but no more' he said.

'When you are asked a question, you should be open and honest, but you people are not.'

Giuda and several other members of the committee asked if the commission had done a formal study to see if it would benefit the state if the commission took over all warehouse operations.

Mollica said that in the past, when the commission approached the Legislature about including a new warehouse facility and its equipment in the capital budget, lawmakers did not approve that.

Bulkley said the state would benefit from running all warehouse operations but a new warehouse would cost about $30 million.

The committee's attorney Mark Howard, reviewed the RFP with members before they questioned the commissioners.

Howard noted the 20-year contract was appropriate because the winning bidder would need a commitment of that length to go to a bank and receive financing.

Earlier in the day Rep. Laura Pantelakos, D-Portsmouth, appeared before the committee to complain about the commission's licensing practices.

'You have a rogue agency over there,' she told the committee.

The committee will take up the issue of licensing when it meets again Wednesday.

The committee is to report its recommended legislative changes by Nov. 1 so legislation can be proposed for next session.

Business General News Concord Manchester

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