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DABC audit finds inventory problems, high turnover rates

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Posted at 10:14 PM, Nov 30, 2014
and last updated 2014-12-01 00:14:46-05

SALT LAKE CITY - A new audit of Utah's Department of Alcoholic Beverage Control has uncovered problems with inventory and high employee turnover rate at state-run liquor stores.

The audit recommended that the DABC rethink how it stocks its shelves. Its goal is to turn over inventory at least once a month, but auditors say more than half of stores can't do that. Instead of the DABC dictating which products appear on shelves and how many bottles of those products, inventory would be determined mostly by consumers.

"We understand it's a model that may work and sure, if we want to turnover product, we need to meet the demands of the public who wants the product," said David Gladwell, chairman of the DABC Commission.

But local liquor makers say a demand-driven model could create its own problems and cut out the 'little guy.'

"All of our DABC stores will be selling budget alcohol produced by mass producers. That never leaves anything for craft distilleries, craft wineries, or even craft breweries to have smaller sections with lower turnover rates," said Jay Yahne, president of the Utah Wineries Association.

The audit also found high turnover at the liquor control agency, and low wages may be a cause. The lowest wage a full-time liquor store clerk makes is $9.60 an hour with benefits.

"I think our employees that work at the DABC stores are grossly underpaid. If you want good performance from these clerks and less turnover, you need to hire more employees with benefits instead of treating them as second-class citizen," said Olivia Agraz, who sits on the DABC Comission.

Despite breaking records with millions in liquor sales, the DABC says it doesn't see any returns. The money goes to state coffers and the state legislature sets the budget.

"I think it's important to reiterate that the department is a budgeted agency and so any changes in terms of salaries has to go through the approval process," said Salvador Petilos, executive director of the DABC.

This is the latest in a series of audits since a financial scandal rocked the DABC a year ago.