Promotion or enforcement? Alcohol regulation sparks contradictory claims

Dermot Cole

FAIRBANKS — The state board charged with regulating the alcohol business in Alaska doesn’t belong under a state agency that promotes business, the head of the Alaska Mental Health Trust Authority said here Tuesday.

Jeff Jessee, chief executive officer of the trust, said the recent flap over a rewritten job description for the director of the Alcoholic Beverage Control Board and comments by the former director back up his view that the state Department of Commerce is interfering with the mission of the board. He spoke at a meeting of the ABC board in Fairbanks.

The job description, later revised by the state to exclude this language, said the mission of the board included ensuring the “responsible growth in the beverage industry” through a variety of means. Former ABC board director Shirley Cote, who resigned in May, wrote in Alaska Dispatch News early this month that Commerce Commissioner Susan Bell wants to go easy on enforcement.

Last week, the Associated Press quoted an email from a deputy Commerce commissioner saying the alcohol agency needed an outreach effort “focused on education and assistance to the business community rather than primarily enforcement.”

Referring to the Department of Commerce, Jessee said, “This type of interference is beyond the scope of their legitimate exercise of administrative oversight of the board.”

Bell has denied that anything has changed since she wrote in 2012 that the ABC board's move from the Department of Public Safety to Commerce — mandated by the Legislature — would keep the board’s authority and responsibility to enforce the law the same.

The Parnell administration and key legislators said in 2012 that whichever agency the ABC board was placed under, it would continue to act as it had before. But some opponents and supporters of the change have seen other forces at work in trying to balance regulation and business expansion.

Dale Fox, executive director of the Alaska Cabaret, Hotel, Restaurant and Retailers Association, said in a phone interview Tuesday afternoon that the ABC board hasn’t been under Commerce long enough to understand how it will work.

“Right now, other than a disgruntled former employee, I’m not sure what the challenges are” of keeping it in Commerce, the CHARR director said, referring to Cote’s complaints.“From my perspective, there hasn’t been much change,” he said, adding that Cote relayed that same message to lawmakers before she resigned.

Cote wrote in the Alaska Dispatch News that she assumes the governor is unaware that the Department of Commerce “is actively assisting CHARR in changing the direction of the board's efforts.”

Fox, who lobbied for the move to Commerce, said CHARR is not seeking a reduction in enforcement. But he said the group is pushing for more communication and education.

 He said there are 25,000 people in Alaska who sell or serve alcohol and need to be kept up to date.

 “Every time we change a rule, 25,000 people need to learn that new rule. The thought process of, ‘We just write it into regulations and they should know it,’ is ridiculous. We have to go out with a communications plan,” Fox said.

“There’s a definite missing link,” he said, adding that putting more effort into education does not mean enforcement has to be cut back.

Administrative changes

In the past 11 years, the ABC board has moved from the Revenue to Public Safety to Commerce departments, with complaints at every stop along the way. Each move came about because some people believed the agency needed to change the way it operated.

The move to Public Safety from Revenue came about after a study said the purpose of the Department of Revenue was to raise revenue, not to assist law enforcement. Gov. Frank Murkowski and all but three legislators agreed in 2003 that Public Ssafety would be a better place for the alcohol regulatory effort.

An extended industry campaign that claimed Public Safety was an adversary and didn’t show respect to the alcohol industry led the Legislature and Gov. Sean Parnell to move the agency in 2012 to the Department of Commerce.

After the 50-10 vote in the Legislature, the chief bar and restaurant lobbying group said in its 2012 annual report that it expected Commerce “to take a more business friendly approach to helping licensees.”