, Corbin, KY

January 8, 2013

ABC administrator replaced

Reed responsible for picking Corbin’s winning liquor licenses

The Times-Tribune

CORBIN — By Jeff Noble / Staff Writer

The man who selected the winning applicants for Corbin’s three package liquor stores last summer is now looking for a new job.

Danny Reed, the distilled spirits administrator with the Kentucky Department of Alcoholic Beverage Control, was not reappointed for a new four-year term last month. Reed was replaced by ABC Commissioner Tony Dehner, who was also named acting commissioner. Like Reed, Dehner’s four-year term expired Dec. 31.

In a memo to state Public Protection Cabinet and ABC personnel on Dec. 19, and obtained through an open records request made by the Times-Tribune, state Public Protection Cabinet Secretary Robert Vance said, “I want to publicly thank Danny for the work he has done for the agency. He has done a good job as distilled spirits administrator and I ask that you join me in wishing Danny well as he pursues other opportunities. Tony will continue as acting commissioner as we seek and name his replacement. Please join me in congratulating Tony on his appointment.”

The Department of Alcoholic Beverage Control is a part of the state Public Protection Cabinet (PPC).

In a phone call from Frankfort last Thursday, PPC Executive Director of the Office of Communications and Public Outreach Dick Brown confirmed that Reed was not re-appointed. He also confirmed that Dehner was appointed to replace Reed as distilled spirits administrator, and that Dehner would remain acting ABC commissioner.

When asked if the turnover of ABC administrators and commissioners are a normal occurrence, Brown said “It’s pretty normal. It’s not out of the ordinary for someone’s term not to be renewed.”

Along with Dehner, the ABC Board is presently made up of Malt Beverage Administrator Stephanie Stumbo. All ABC Board Members serve four-year terms and they are appointed by the governor.

Last year, a total of 12 applicants filed to get one of three package liquor licenses allocated by the ABC to Corbin. Liquor World, with stores in Richmond and Manchester and an applicant for one of the licenses in Somerset, was one of those who did not get a Corbin license.

“I can assure you this. It cannot stand the way it stands. In my opinion, Reed did not leave on his own accord. If he wasn’t fired, why was he (Reed) let go 11 days before his term expired,” said Liquor World owner Wesley Morgan in a phone interview from Richmond last Thursday.

In December, a lawsuit by Morgan wanting to make the issuing of package liquor licenses to Corbin’s three liquor stores invalid was dismissed in Franklin Circuit Court. The judge said Morgan lacked standing in the case, meaning the legal right to initiate a lawsuit. Morgan had asked the ABC to grant him an evidentiary hearing before the board to see if the applications of Liquor King, Ernie’s Wine and Spirits and Liquor Mart — the three stores that were awarded the licenses by the ABC — had deficiencies. The ABC and Reed were named as defendants in Morgan’s lawsuit.

Morgan noted Liquor World has filed an appeal to the state Court of Appeals, asking them to reverse the judge’s decision last month, adding, “the ABC didn’t want to hear it.”

According to the Kentucky Revised Statutes, the governor appoints “as commissioner a person with administrative experience in the field of alcoholic beverage control.” The statutes also say two persons are appointed to the ABC Board by the secretary of the Public Protection Cabinet with the Governor’s approval. They, too, are to have administrative experience in alcoholic beverage control.

At the ABC, Reed was first sworn in as malt beverage administrator in early 2008. A news release from the state agency at the time pointed out that Reed had experience in law enforcement as a veteran of the Kentucky State Police, along with administrative experience with the state Tourism Cabinet. In January 2009, Reed then filled the position of distilled spirits administrator in place of Jeff Middendorf, whose term expired at the end of 2008. Stumbo replaced Reed as malt beverage administrator at that same time. A separate agency news release said Stumbo had previously served as executive director of the Kentucky Public Service Commission, with extensive management experience in state and local government.

When appointed in May 2009 to head the ABC, a news release from the PPC stated Dehner had more than 30 years experience in the judicial and criminal justice system.

The rush to get package liquor licenses in Corbin began last spring. After the Corbin City Commission approved the city’s amended alcohol ordinance on April 10 to allow the sale of liquor, beer and wine by the package, the ordinance became law four days later, on April 14.

That coincided with the ending of the 60-day waiting period set up by the ABC to give the city time to prepare the revised ordinance, along with giving those wanting to get a license time to prepare their presentations to the city’s ABC administrator assistant, Corbin Police Chief Bruce Rains.

Rains had to go through the applications turned in, weeding out those unqualified to sell or operate liquor, wine and/or beer by the package. When that was finished, the applications of those who made the cut went to Frankfort, where Reed, after conferring with city officials, selected the winning licenses.

In a story May 14, ABC spokesman Nathan Jones said when the package liquor applicants were submitted, state law requires each applicant to have either deeded or leased property for the term of no less than the license period. Once the applications are received in Frankfort and if they comply to all laws and requirements, the state (distilled spirits) administrator considers factors to determine which applicants are approved. They include the area involved, type of transportation available and area traffic, as well as public sentiment in the area, the number of licensed outlets in the area and the area’s financial potential.

Each applicant was asked to provide an economic impact study, which answers questions like how an applicant getting the license would affect the area’s economic growth and development. The study also asked the applicant how many people the store would likely hire and how the appearance of the area would be improved, which included rehabilitating any run-down areas. Other questions included how adequate local police protection would be to serve the area involved, the time frame anticipated to put the license to use, and other information on how the applicant’s store would enhance the community.

In a phone call last Thursday, Dehner said, “Before we do anything on the state level, we start local, by talking to the local people. They know their community better that we do.”

Dehner added the distilled spirits administrator is the person responsible for reviewing and approving the applications in Frankfort.

“One person is responsible, and it’s written in the statutes (Kentucky Revised Statutes). The statutes were the measures in place to ensure the person responsible for the review was fair and impartial.”

On July 11, Ernie’s Wine and Spirits, Liquor Mart (then Tri County Liquors) and Liquor King were awarded package liquor licenses for Corbin by the ABC.