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Franchot, Md. lawmakers spar over alcohol oversight powers

Sen. Ben Kramer D-Montgomery, right, and Del. Warren Miller R-Howard and Carroll. (The Daily Record / Bryan P. Sears)

Sen. Ben Kramer, D-Montgomery, right, and Del. Warren Miller, R-Howard and Carroll. (The Daily Record / Bryan P. Sears)

ANNAPOLIS —Maryland’s top tax collector and two state lawmakers traded barbs Thursday over a proposal to strip the state’s top tax collector and enforcer of alcohol regulations of some of his authority.

On the eve of a legislative hearing on proposals that would directly affect the operations of his office, Comptroller Peter Franchot restated his claims that the move would prove to be an expensive, taxpayer-funded retaliation against him for supporting the craft beer industry. Meanwhile, in the second of a two-hour set of dueling news conferences, sponsors of the bill portrayed Franchot as a narcissist. Their legislation, they said, was focused on real public health concerns and was not giving Franchot a legislative purple nurple for any real or perceived slights.

“I would simply say the comptroller has chosen to make this issue about him,” said Kramer, speaking to reporters, adding that Franchot has remained silent on public health and safety issues related to alcohol. “Have you ever once recorded this comptroller saying how important it is to prioritize the health, the welfare, the safety of the residents of Maryland when it comes to issues of alcohol?”

Kramer, along with Del. Warren Miller, R-Howard and Carroll, co-sponsored a bill last year that created a commission to determine whether the Office of the Comptroller should continue to enforce liquor laws on distributors and wholesalers. Enforcement on retail licensees, such as liquor stores and bars, is handled by local government.

“We’re not here to throw a temper tantrum like the guy down the street,” said Miller, speaking in a conference room of a building that backs up to the Treasury Building that houses Franchot’s offices.

Kramer, who is now in the Senate, is teaming up with Miller on two bills resulting from that 2018 panel.

Comptroller Peter Franchot and Jeff Kelly, director of the field enforcement division. (The Daily Record / Bryan P. Sears)

Comptroller Peter Franchot and Jeff Kelly, director of the comptroller’s field enforcement division. (The Daily Record / Bryan P. Sears)

An hour earlier, Franchot fired the latest salvo against Kramer, Miller and what he sometimes refers to as the “Annapolis Machine” that he claims has sought to penalize him and his office over any number of issues, from gaming to school construction and regulations on the craft beer industry. Franchot called the legislation “reckless, costly, and unnecessary” and “economic protectionism dressed up as public health.”

“You can try to put lipstick on this thing and try to make it look better, but at its base this is a phony, false piece of legislation that has crocodile tears about public health because everybody is in favor of public health,” he said. “But that’s not what this issue is about. It’s about economic protectionism.”

Kramer’s first bill would strip enforcement of alcohol, tobacco and motor fuel laws and regulations from the comptroller. Enforcement would be moved to a newly created commission appointed by the governor.

“It’s political retribution at the behest of political interests that want to protect their market share,” said Franchot. “That’s why there’s so much excitement, I’d like to describe it, over this issue.”

The comptroller’s more than five dozen field enforcement division employees would be transferred to the new agency, though Kramer and Franchot differ in their descriptions of where the group would be housed.

The new commission proposed in the bill would be appointed by the governor. The new board would be responsible for educating the public on the health implications of alcohol use; ensuring more conspicuous labeling of alcohol products that exceed 4.5 percent alcohol by volume; developing best practices for alcohol regulation; and providing health impact statements on proposed changes to state law.

A second bill would bar the comptroller, members of his staff and officials with local liquor boards from accepting campaign donations.

D. Bruce Poole, a former delegate from western Maryland and chair of the commission that recommended moving enforcement from the comptroller's office. (The Daily Record / Bryan P. Sears)

D. Bruce Poole, a former delegate from western Maryland and chair of the commission that recommended moving enforcement from the comptroller’s office. (The Daily Record / Bryan P. Sears)

Miller said alcohol distributors and wholesalers are fearful of not contributing to Franchot and that Franchot has taken sides with craft brewers.

“I have a number of people in this industry who feel intimidated by (Franchot),” Miller said. “He is an elected regulator that collects money from them to do his job — campaign contributions. They feel if they say or do anything to upset him, there will be retribution.”

Both bills come before the Senate Education, Health and Environmental Affairs Committee and the House Economic Matters Committee Friday afternoon.

Franchot estimates the changes will result in $50 million over five years in direct costs to taxpayers. He added on another $750 million over the same period in potential losses from a two-decade old legal settlement with tobacco companies. Maryland and four dozen other states receive a payout from that fund, provided each state complies with strict enforcement standards.

Franchot stood by the estimate from the Board of Revenue Estimates, which is housed in his agency, but he acknowledged the latter figure is based on assumptions that may or may not happen.

Kramer, quoting legislative analysts, said the cost to taxpayers would top $3 million for establishing a computer system for the new agency and about $700,000 annually after that. He said Franchot’s estimates were tainted, coming from a department that works for his office, and not based in reality.

“Anyone who has heard the spin on the cost of this should look at it with a very, very healthy grain of salt,” Kramer said. The price tag would not be “the $5 or $10 million or whatever the fantasy figure was from the comptroller’s office,” he added.

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One comment

  1. NPR reported that Franchot takes more campaign contributions from the liquor, tobacco, and motor fuel industries than anyone else by far, so regardless of how you feel about the issue overall, that seems to be a pretty straightforward conflict of interest. Am I missing something? And I’m also not sure why the Comptroller thinks he is the right one to continue doing this job. Let someone else take over the regulation part and make it better, so then he can crow about making the overall industry “better” or whatever all he wants.