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The Utah Department of Alcoholic Beverage Control (DABC), grappling with a $500,000 cut, will continue to use attrition as a way to balance its budget, a move that frustrates many employees of the highly profitable agency and has one lawmaker seeking a legislative remedy.
Last week, one of DABC's three area supervisors retired and rather than hire a replacement, "the two remaining regional managers will assume the responsibilities," Deputy Director Tom Zdunich wrote in a letter to store managers and assistants.
Doing away with the third regional manager "is a cost-savings measure to assist DABC in meeting the $500,000 budget shortfall," said department spokeswoman Vickie Ashby.
During the 2015 legislative session, lawmakers cut the DABC budget by about $500,000; DABC Executive Director Sal Petilos and his staff are trying to find ways to save money before the next fiscal year begins July 1.
Two regional managers will now monitor all 43 state-owned liquor stores in Utah. Zdunich's letter said stores will get unannounced reviews four times each year instead of bimonthly.
"The reduction in checklist reviews," he wrote, "will allow store managers and assistant managers to dedicate more time to training personnel."
Employee attrition also is being used at the liquor-store level. Recently, the manager at the Sandy liquor store quit and rather than hire a replacement, a manager from another store will take on his duties, said Ashby.
"It is part of DABC's efforts to give more financial and growth opportunities to store personnel," she said. "It will allow the department to increase the pay of store personnel whose performance merit an increase."
Asking managers to do double duty has been going on for several months. Eight DABC store managers are responsible for two stores each.
With managers spread across multiple stores, critics say assistant managers are being called upon to take on more tasks at a time when liquor stores are already understaffed and are often unable to keep up with increased demand. Employees have complained they are unable to stock shelves in a timely manner and customers wait in longer checkout lines. The situation, according to critics, has a chilling effect on already-low morale.
"Employees hate this and feel they are being asked to do more with less," said Kerri Adams, a retired DABC employee who worked as the liquor department's human-resource specialist and training manager. Adams said she still gets frequent calls from employees asking for advice on how to deal with DABC employment issues.
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Legislative remedy? • Last month, Sen. Karen Mayne, D-West Valley City, questioned the use of having one manager oversee multiple stores. She asked the state liquor commission to review that policy as well as several other controversial personnel issues that have plagued the department in recent months.
Mayne said she plans to sponsor two bills in the next legislative session that will address many of those concerns.
The first would be to create to an ombudsman office — separate from the DABC leaders — where liquor employees, restaurants, brokers and customers could take complaints without fear of retribution.
The second bill would require the DABC to follow the best practices agreed upon in the retail industry.
Mayne already has asked business experts to help her look at all sorts of issues, from proper ratios for full- and part-time employees, employee training, turnover and adequate pay.
"We are in the business of selling liquor, and we need to make sure it is effective," she said. "Obviously, if we have financial issues, then we need to feed that."
In the past, the Legislature has been reluctant to make substantive changes to Utah liquor laws. Mayne, however, said she believes her bills should not be as divisive as past proposals such as adding club licenses, which make liquor more available, or removing the restaurant barriers known as "Zion Curtains," which are designed to keep liquor out of view of minors.
"This is nothing like that," she said. "It's about good business practices. We need to have a conversation about whether we are running a business that gives us millions and millions of dollars the right way."
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Record profits • Cuts to the DABC budget come at a time when the department is making record profits for the state.
During the 2013-2014 fiscal year, state liquor sales were $367.2 million, a jump of nearly 6 percent from the previous 12 months. Sales figures for the first nine months of the current fiscal year — July 2014 through March 2015 — have shot up nearly $21 million or about 7.56 percent, DABC reports show.
State law requires the DABC to return all its profits to the state, and the Legislature sets the department budget.
Most of the liquor funds go into the general operating fund, and sales-tax revenues go toward the school-lunch and public-safety programs.
One of the larger cost-saving measures the DABC will take is to hire a single provider for all store security. Currently, it contracts with individual police officers from the cities where the stores are located. For the current fiscal year, the liquor department is expected to spend $460,000 on security.
Ashby said the office is looking at everything from less travel for staff to furloughs for warehouse and administrative employees — not store employees.
"There hasn't been a decision, yet," she said, "but everything is on the table."