Lots of opposition, no decision on liquor store at new Wegmans
With construction going on around him, Mike Smith stands in his liquor store located in the same building as Wegmans. (Photo by Nate Pesce / May 2, 2012)
A May 1 hearing that could have ended with the tentatively named "Upstairs Spirits" getting its liquor license instead lasted for 4 1/2 hours and concluded without a vote, as members of the county's Alcohol Beverage Hearing Board listened to testimony on the proposal — most of it in opposition.
The county's Alcohol Beverage Hearing Board will reconvene on June 14 at 5:30 p.m., just three days before the Wegmans grocery store off McGaw Road and Snowden River Parkway will hold its grand opening. More people are expected to testify in June, with legal arguments for and against the license also anticipated.
Most of the testimony this week on the proposed 9,800-square-foot liquor store came from liquor store owners in Howard County and elsewhere in the region, who argued that such a large store could hurt their business. Their argument was bolstered by two attorneys representing The Kings Contrivance Liquor and Smoke Shop in Columbia, Glenwood Wine & Spirits in Glenwood and The Perfect Pour in Elkridge.
Nearly 100 people were present at the meeting at the county government headquarters in Ellicott City and more than 70 people signed up to speak in opposition to the shop. About a dozen of those opponents spoke, and one person testified in support.
Opponents also questioned whether the shop itself is legal under state law, noting that the public face of the liquor store, R. Michael Smith, a 63-year-old Ellicott City man, would only own 10 percent of the liquor store. The remaining 90 percent would be controlled by a New York man, Christopher O'Donnell, who is the husband of Wegmans' president, Colleen Wegman.
The 90 percent officially belongs to IAD LLC, which is wholly owned by O'Donnell and registered in Delaware, according to testimony at the hearing; O'Donnell also owns at least one liquor store near a Wegmans in New York, according to Syracuse newspaper The Post-Standard.
A potential issue is a Maryland law that says supermarkets and chain stores cannot have certain kinds of beer, wine and liquor licenses.
Smith said that is not an issue, however. "Everything that we've done is consistent with the letter and the spirit of the law," he said after the meeting. The liquor store would be in the same building as Wegmans, but not part of the grocery store itself, though people would be able to walk through doors between them, he said.
Opponents' concerns largely come out of "their desire to avoid competition," Smith said.
But Amran Pasha said the ownership set-up makes it seem as if Wegmans is attempting to circumvent the law.
"They've come up with a way to do it," said Pasha, who owns the Exxon gas station on Minstrel Way in Columbia and who used to own a liquor store. "This gentleman is going to have 10 percent and they're using their brother-in-law. It's obvious he's a front for Wegmans."
Pasha said he was concerned that other supermarkets and companies would attempt to set up similar situations, potentially hurting smaller, local businesses.
Smith is a lawyer who started doing labor employment law work for Wegmans when the supermarket chain began moving into the Washington area about a decade ago, he told the Howard County Times. In his free time for nearly 20 years, he has made his own beer and wine at home.
Wegmans executives knew of his beer- and wine-making hobby; he'd brought samples in for them in the past. They asked him if he'd be interested in owning a liquor store as part of the company's entry into Columbia, he said.
"It was something that hadn't occurred to me before Wegmans broached the subject, but as soon as it was broached, I told myself it was feasible and this was something I wanted to do," he said.
Smith said during the hearing that he was first introduced to O'Donnell, whom he described as a venture capitalist, about eight to nine months ago. Smith asserted that he would play a role in the hiring and firing and day-to-day operations of the store, and that Wegmans itself would have no say in any element of the business.
Board members asked Smith and his attorneys to clarify at the next hearing what O'Donnell's role would be, and also to consider bringing representatives from Wegmans in to testify.
Beyond the issue of ownership, some area liquor store owners worried about the effect the new liquor store could have on them.
"Just a little bit of a small percentage of losing money would put us in a position where the only thing we could do is pay the rent and pay the employees, and probably we won't be able to pay all that," said Alicia Harrison, an Oakland Mills resident who co-owns Kings Contrivance Liquor and Smoke Shop.
"It would put us out of business," she said.
Should the proposed liquor store get a license, what would be called "Upstairs Spirits," "Upstairs Wine and Spirits" or "Upstairs Wine, Liquor and Beer," would need six to eight weeks after the approval in order to open, Smith said. He plans to have about 25 full- and part-time employees.
The 9,800 square feet, which is larger than area stores, would include storage, coolers and office space, and be larger than other local shops, Smith said.