AUGUSTA, Maine — A Republican senator on the Legislature’s Appropriations Committee says he’s “uneasy” with the process the state plans to use to invite vendors to bid on Maine’s wholesale liquor contract, which the state’s Bureau of Alcoholic Beverages and Lottery Operations plans to either renegotiate or terminate in the coming months.
Sen. Roger Katz of Augusta is recommending the state use a more traditional “request for proposals” approach in which the state publishes a detailed, written description of what it’s seeking and interested vendors submit bids in response. A traditional request for proposals also outlines the criteria against which the state plans to score the proposals it receives.
Administrative and Financial Services Commissioner Sawin Millett and Gerry Reid, director of the state’s Bureau of Alcohol Beverages and Lottery Operations, told lawmakers earlier this month that the state plans first to bargain competitively with interested and qualified parties. If that process fails, Reid told members of the Appropriations Committee that the state would resort to the more traditional request-for-proposals system.
“My unease about this approach is that I just do not understand how it works and how losing bidders would know they had been treated fairly,” Katz wrote to Millett in a Sept. 21 letter. “Assume three interested bidders. Are they figuratively in three separate rooms with the responsible state official going back and forth between the three rooms conducting three parallel negotiations?”
A spokeswoman for Millett said late Tuesday the commissioner wasn’t prepared to comment on Katz’s letter.
Maine is one of a handful of states that controls the distribution of hard liquor. In 2004, the state leased its wholesale liquor business for 10 years to Maine Beverage Co. in exchange for a $125 million upfront payment and an annual cut of the sales revenue.
The contract on that lease comes due in 2014, and the current state budget requires the state to renegotiate the liquor contract by June 2013 in order to secure revenue for transportation and drinking water programs as well as state reserves.
Millett and Reid told Appropriations Committee members they plan to negotiate a new deal that secures more revenue for state coffers and results in lower retail prices for consumers, a change that could return some liquor sales to Maine that have traditionally gone to neighboring New Hampshire, where liquor prices are cheaper.
Maine Beverage Co. officials couldn’t be reached for comment late Tuesday.
Ford Reiche, who formed Dirigo Spirit Co. in February in anticipation of bidding on the state liquor contract, told the Bangor Daily News he was fine with whatever process the state uses to award the next contract, “as long as it’s an open, competitive process.”
“Dirigo Spirit Company will work within whatever process the state puts in place and only seeks a level playing field and objective assessments of the proposals, however they are submitted and considered,” he said.
Katz said there are too many unanswered questions about what he called a “negotiated bid” process.
“To what extent is proprietary information of the bidders shared with the others by the [state official negotiating the contract]? Is there any kind of a scoring system in this process similar to the RFP process? What are the appeal rights following such a negotiated bid process?” Katz wrote in his letter. “These are the kinds of questions others and I have been asking, yet no one seems to have clear answers.”
While the request-for-proposals system is a known entity among state officials and vendors, the state’s process for issuing such requests and reviewing the bids has come under scrutiny after the recent decision by a state appeals board to invalidate a state award that would have given Maine Natural Gas the rights to build a Windsor-to-Augusta pipeline that would supply natural gas to state offices.
One of the losing bidders, Summit Natural Gas of Maine, appealed the decision over the summer and a committee threw out the award earlier this month, citing flawed request for proposals and inconsistent scoring processes.
In response, Millett said his department planned a “top-to-bottom” review of the state’s process for putting requests out to bid.
BDN business editor Whit Richardson contributed to this report.
I thought John Baldacci was nuts when he leased out Maine’s Liquor business for 10 years and I told him so to his face. If Maine is going to have a vendor run the Liquor business in the State then Senator Katz is correct it should be done with a request for proposals.
If there was real investigative reporting; someone would be chasing the how the initial agreement with an out-of-state company along with a private equity firm-obtained the state’s business. Maine lost a lot, the out-of-staters gained much. And of course, it was done by the Democrats; ya know – the folks who look out for the little guy !!!!
At this stage of the game, the initial proposal IS MOOT. It has ZERO bearing going forward and would be nothing more than a money wasting witch hunt which.
I know. Moot. We should all just smile and nod. mkay?
Yeah – it’s too late for the truth.
Yeah, pay no attention to the man behind the curtain. The $100,000,000 that the failed Baldacci regime flushed away is nothing to be concerned about. Heck in the scheme of money wasting blunders that that corrupt regime perpetrated on the taxpayers of Maine this isn’t even in the top 5.
Maine Beverage Co. has over priced with limited access to products people may want. We pay a high price and low grade products have been offered to us which benefited them. When I am in other states they have better wines with better prices. We do need a true bidding process which will give us better products at better prices. Not everybody drinks coffee brandy.
Millet and Reid are bringing what LePage has been so loudly calling for for over a year, namely free market competition to a State program. Why Katz is crying is beyond me since if Millet’s and Reid’s approach doesn’t work out the traditional RFP system can still be used. Is the timing lousy or should it have been done earlier ? Probably so, but lousy timing by itself doesn’t require a Maine Agency, that is a Revenue maker no less, to keep making the same mistake over and over and penalizing the State. If Katz has a solid, concrete reason for questionng Millet’s and Reid’s reasons for moving some of Maine’s business practice’s forward then by all means puttem’ out there for all to see and discuss. But to cry and whine, which is what he’s doing, simply because someone “is not comfortable” is pure nonsense, and that’s about as mild as BDN’s guideline’s will allow. It also tells me that someone, who has a vested interest in the current system, is worried that what ever they have going is about to be uncovered. That alone is reason for a new system to be used. Fresh air always cleans out the stale stuff.
Since you think anything that is a revenue maker is good for Maine, why not legalize prostitution and drugs and have the state run those businesses as well. Yep, the TeaPublicans-America’s Anything For A Buck Party.
As an Independent I am almost LMFAO over your comment. And not everything is a good revenue maker. Your push to have dope and hooking made legal shows a complete lack of knowing what you’re talking about. The recent Haynes indictment over weed is a shining example of just what happens when dope is grown. That anybody has seen so far, Haynes is in big you-know-what over the cash he had that was NOT DECLARED. The IRS’s part of that arrest alone should tell you something. As far as hooking goes, are you so ready to have Maine turned into a wooded version of Colombia where hooking is legal ? Maine does not, and surely can do better than there and Nevada. Before the State voter’s go gaga over the Marriage question they might well ask themselves if they are ready for what you propose and what that’s gonna bring to Maine.
Where were you when the failed Baldacci administration was selling off the state liquor business to connected Dem insiders at at fire sale price costing the state at least $10 million a year.
http://bangor-launch.newspackstaging.com/2012/09/24/opinion/other-voices/pay-off-the-hospitals-then-collect-the-cash/
Guess who got the $10 million annually? Baldacci’s cronies. Where was your outrage then cranky? At least the Lepage administration is looking out for the interests of the taxpayers, unlike the Bladacci cabal.
Your selective outrage exposes you for nothing but a partisan hack.
Millett wasn’t prepared to answer? It’s a SIMPLE question and if they are planning to put their process in motion they need to have their ducks in a row RIGHT NOW. The fact that Millett didn’t or wouldn’t answer demonstrates either a lack of competence or considerable evasiveness; either way, there is not justification or excuse.
Other than licensing vendors and collecting taxes on good sold in this State why does the State need to have anything to with who can sell to the vendors in this State?
There doesn’t seem to be any need for this extra level of oversight.
You make a good point. Why can’t stores buy their liquor from multiple sources to get the best price or even buy directly from the maker? Are companies like Sysco (food distributor who delivers to multiple sources) forced into a limited contract? Allowing competition for selling liquor in the state ought to be allowed and it would be better for the consumer. The state ripping us off, they are double dipping. It is bad enough we have to pay taxes on the product then we have to pay higher prices because the company pays off the state $100,000,000. Maybe we should all go to New Hampshire to buy our refreshments!
do away with the control of the liquor distribution.
it essentially legislates a monopoly to one company.
corrupt, crony capitalism.
What a cagey way to distance yourself from our troubled governor in an election year. Our “reasonable” Republican alternative. Have to hand it to you Roger, very shrewd politics!
I almost lost my coffee on that one “reasonable Republican”. Not sure if you were trying to be funny or not but good one never the less.