Politics

March 11, 2013

Democrats, LePage swap offers on liquor, hospitals

At issue are proposals for paying hospitals and terms of a new wholesale liquor contract for Maine.

By Jessica Hall jhall@pressherald.com
Staff Writer

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click image to enlarge

Senate President Justin Alfond, D-Portland, left, confers with Speaker of the House Mark Eves, D-North Berwick, after they unveiled a plan to repay state debt to hospitals by expanding the Medicaid program and receiving an upfront payment from the winning bidder of the state liquor contract.

Andy Malloy / Kennebec Journal

click image to enlarge

Gov. Paul LePage addresses the Legislature's Veterans and Legal Affairs Committee Monday at the State House in Augusta. LePage urged lawmakers to pass his proposal to put the state liquor contract out to bid.

Andy Malloy / Kennebec Journal

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John Menario, vice president of All Maine Spirits, spoke against Goodall's bill.

"Anyone who proposes legislation that delivers less than $450 million to the state is sticking it to the state of Maine," Menario said. "If it were left to me, I'd let the governor get along with the (request for proposals) process."

He objected to the non-refundable application fee of $25,000 in Goodall's bill, and the requirement for an upfront payment of as much as $200 million.

Menario said his company could come up with that much money, if needed, but there would be interest costs.

He said that 10 years ago, Maine Beverage Co. delivered to the state "a pill that was sugar-coated cyanide that bought them control of the state liquor business. More than $330 million in profits left the state of Maine."

Sixty percent of Maine Beverage Co. is owned by a New York private equity company; the remaining 40 percent is owned by Massachusetts-based Martignetti Cos.

All Maine Spirits was formed last year by six Maine residents for the purpose of bidding on the liquor contract.

Ford Reiche, president of Dirigo Spirit, said Goodall's requirement of an upfront payment would repeat the mistakes of the past by selling off liquor revenue to a company that writes a big check.

When asked whether the $200 million upfront payment would squeeze out smaller bidders for the liquor contract, Goodall said every publicly known bidder has the financial wherewithal to raise that much money.

If a company can't, it may not have adequate financial resources, he said.

"Cash is king in many negotiations," he said.

Jessica Hall can be contacted at 791-6316 or at:

jhall@pressherald.com

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