By Jessie Burchette
jburchette@salisburypost.com
A 10-year glance at the Rowan-Kannapolis ABC system indicates the system is on its way to increased profitability.
And ABC officials assured County Commissioner Tina Hall their goal is to produce more profit for distribution to the county.
Marny Hendrick, ABC Board chairman, said the board set a goal of giving the county $40,000 this year. Thus far, the system has turned over $70,000 and will be able to provide additional dollars this quarter.
Board member Ken Argo welcomed Hall to the table Tuesday evening to hear a report on the system’s finances over the past 10 years.
On Monday night, Hall offered a motion to ask for the resignation of all ABC Board members for the system’s lack of profit and its refusal and delay in providing public records. The motion failed, but commissioners sent a message the county will increase oversight.
Commissioners have invited the ABC Board for meeting July 6 to discuss expectations.
Tuesday evening, Hall and ABC officials exchanged pleasantries.
Argo, a CPA and former treasurer of Cannon Mills, said he undertook the 10-year analysis to get a better understanding of the ABC system, including its operation prior to the expansion into Kannapolis.
Argo was appointed to the board in 2006 following the merger in 2005.
Argo read his two-page report filled with figures taken from audit reports over the past 10 years.
“A major contributor to the run up of operating expenses in 2005 was the merger with Kannapolis to create the Rowan-Kannapolis ABC system,” Argo noted.
Debt, primarily incurred for the opening of new stores, increased from $119,000 in 2000 to $433,000 in 2007.
With an aggressive effort to pay off the debt, it is projected to be reduced to $170,000 at the end of the current fiscal year ó a decrease of 60 percent.
Argo found that operating expenses increased from 19 percent in 1999 to 24 percent in 2005.
But Argo said operating expenses decreased by 2 percent in the past two years.
He pointed out that in the current fiscal year, the ABC system has given the county $70,000 for distribution while reducing debt by nearly $180,000. “Had there been no debt, this could have been distributed to the municipalities,” Argo said.
He cited overall improvements, including an increase in sales of $2.5 million since 1999, a major rehabilitation of the Ketner Center Store and concentrated efforts on preventing underage drinking.
Argo offered a defense of travel by ABC officials, pointing to support from “our systems around the state and in Washington.”
He also noted that competition from neighboring ABC systems, including Mooresville and Concord, makes it impossible to generate the sales and profits the Rowan system produced in the 1950s through 1980s.
The Rowan ABC system turned over $20 million in profits for distribution to the county and municipalities through the 1980s.
Argo said he planned to send copies of the report at his own expense to all commissioners.
Contact Jessie Burchette at 704-797-4254.