RALEIGH — Top ABC officials in Greensboro and High Point accepted meals from liquor company executives who do business with the local liquor control boards, according to receipts gathered as part of an ongoing investigation by state liquor regulators looking into local ABC boards.
Katie Alley, the Greensboro ABC board’s general manager, said she did nothing wrong in dining with Diageo executives and followed ethics guidelines as they were laid out at the time.
“Pursuant to a Commission’s 1996 memo to ABC Boards, meals were permitted,” Alley wrote via e-mail.
Receipts submitted by Diageo to state investigators show Alley dined at least three times at the company’s expense, most recently in July. The biggest expense was a $425 dinner for Alley and two liquor company executives at Bistro Sofia in January 2009.
Another receipt in the same package shows officials at the High Point ABC board met with company officials at Liberty Steakhouse & Brewery, a more modestly priced restaurant, once in April.
None of the meals approach the extravagance of one that landed Mecklenburg County ABC officials in trouble and led to the resignation of that board’s chairman.
Legal and ethical guidance for local ABC boards comes from the state board, which also runs a warehouse through which all liquor in the state is sold. Although beer and wine can be sold at grocery stores and the like, only ABC boards appointed by local governments can open stores to sell liquor from the state warehouse.
In 1996, a memo from the state board called receipt of unsolicited meals “an accepted business practice” and excluded such meals from an existing gift ban. But that same memo went on to tell local ABC officials “it is never inappropriate, and frequently prudent, to decline any gift offered by an industry member.”
According to reports in the Charlotte Observer, liquor officials in Mecklenburg County might have crossed that murky legal line by accepting several meals, including a $9,000 party at Del Frisco’s steak house.
Public outcry has also erupted surrounding Wilmington’s local ABC board, which paid a father and son six-figure salaries to run that business.
In response to the problems in Charlotte and Wilmington, the state ABC Board asked local boards this month to adopt a total gift ban. Gov. Bev Perdue put such a ban in place for all state employees when she took office at the beginning of 2009, but it did not apply to officials working for local ABC boards.
Skip Warren, a former Greensboro city attorney who is now chairman of the city’s ABC board, said his agency will comply with the new rules. He added that the Mecklenburg County affair was “outrageous” but said Alley had done nothing wrong.
“For years, it’s been a customary practice,” Warren said of the meals. Warren said he wasn’t aware Alley had accepted the meals until called by a reporter.
To be clear: Greensboro’s ABC board doesn’t appear to have the problems experienced in Charlotte or Wilmington. Alley’s salary is $117,860 — far less than the $232,200 paid Wilmington’s former ABC head. As for the Jan. 29, 2009, dinner in Greensboro, the $425 tab included tip, $113 in alcoholic beverages along with soup, main course, dessert and coffee.
Although common practice in the business world, such meals raise concerns in the government arena because they could be seen as currying favor in exchange for official action. In this case, an ABC official might be seen as predisposed toward stocking a particular company’s products.
“This kind of thing has been evolving over the last year or two, that’s one of the problems with looking at it retrospectively,” said Rebecca Klase, a political science
professor at Greensboro College. Just as recent turmoil in state government has made lawmakers put themselves under stricter ethical guidelines, so doctors have curbed their dealings with drug industry representatives, she said.
While things may be accepted practice in the world of private business, Klase said, those working for public agencies need to be aware of appearances and the law.
“Officials, whether they are following standards or not, need to be aware of how things look and sometimes they’re not,” Klase said.
Warren said that regardless of such meals, he didn’t believe Alley would have been influenced.
“It has nothing to do with whether we buy their products or not,” Warren said. “We buy what the public wants.”
Contact Mark Binker at (919) 832-5549 or mark.binker@news-record.com
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