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City liquor stores take edge off of your taxes

Although the profits aren't flowing in like they used to, Alexandria's two city-owned liquor stores continue to save taxpayers money.

Sales at Downtown Liquor and Plaza Liquor totaled $4.4 million in 2012, according to a clean liquor store audit that was presented to the Alexandria City Council Monday night by Dennis Schmitz with CliftonLarsonAllen.

That's a drop of about 4 percent from 2011's sales of $4.6 million but the city helped make up for the dip by cutting back on the alcohol it bought. Those costs dropped 5 percent, from $3.61 million to $3.43 million.

As a result, the gross margin on sales was 22.1 percent, which is right on the liquor industry's average, Schmitz said.

"I commend management and the [city] liquor commission for adjusting costs," said Schmitz.

Operating expenses at the stores totaled $732,089 last year, a drop of 1.7 percent from 2011's expenses of $745,137.

This left the stores with a net operating income of $242,277, about $9,000 less profit than the previous year but enough to transfer $200,000 into the city's general fund, the same amount as 2011.

Having more money in the general fund means a slightly lower tax burden on property owners.

Sales have dipped considerably at liquor stores throughout the country since the economic plunge in 2009, Schmitz said, but Alexandria's stores continue to make a profit.

Since 2004, the two stores have transferred just over $3 million into the general fund.

Council member Virgil Batesole commended Liquor Store Manager Carol Lanigan for keeping a close eye on the books. "About half way into the year, she knew sales were way down so she cut way down, and we were able to make a profit," he said.

Beer continues to be the beverage of choice at the liquor scores, accounting for $2 million or 48 percent of the sales. Liquor was next with $1.45 million, followed by wine with $675,000.

As in past years, Plaza Liquor was the busier of the two stores, bringing in nearly $2.6 million in sales, compared to Downtown Liquor's $1.8 million.

Plaza Liquor reported a profit of $173,064, up 11.2 percent from last year's $155,578, while Downtown Liquor's profit was $69,213, a 27.6 percent decline from 2011's $95,625.

Al Edenloff
Al Edenloff is the news and opinion page editor for the Echo Press. He was born in Alexandria and lived most of his childhood in Parkers Prairie. He graduated with honors from Moorhead State University with a degree in mass communications, print journalism. He interned at the Echo Press in the summer of 1983 and was hired a year later as a sports reporter. He also worked as a news reporter/photographer. Al is a four-time winner of the Minnesota Newspaper Association's Herman Roe Award, which honors excellence in editorial writing.  
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