Mike Mower, long-time Republican political operative, hustles up a Capitol staircase to a meeting. “I love it,” he says of his job as Gov. Gary Herbert’s deputy chief of staff. “As a kid in Ferron, I would have never have believed that someday I would be working in this beautiful building.”
Mower is good at his job. You would never guess from his Boy Scout enthusiasm that he was handed the nightmare job of controlling the spreading public rage at Utah’s dysfunctional Department of Alcoholic Beverages. On this sunny afternoon, Mower cheerfully explains that the his office’s scrutiny of the DABC is just a part of an state-wide efficiency program being implemented by Kristen Cox, director of the Governor’s Office of Planning and Budget.
In truth, DABC’s problems are vastly more political. Besides the avalanche of complaints, Mower is faced with DABC Commission meetings at which former employees, wine lovers and even a state senator, leveled charges of employee mistreatment and gratuitous firings, inept customer service, security problems, inventory shortages and arrogant disregard of the state’s tourism economy that depends on providing quality wine and liquor. Utah hoteliers and restaurateurs bitterly complain that after a short period of progress under former Gov. Jon Huntsman Jr., Utah is again the laughingstock of the nation for its puritanical and absurd liquor laws.
In short, the reputation that you “can’t get a drink in Utah” is alive and well.
“The morale at the DABC has never been lower,” says Brent Clifford, retired wine buyer at the agency for 37 years, who has become one of DABC management’s angriest and most knowledgable critics. “Employees feel they are under siege and badgered to constantly do more. And the current leadership is clueless.”
Sen. Karen Mayne, a West Valley City Democrat, tore into the DABC Commission over “email after email” she had gotten from employees complaining of a culture of arrogant managers who spy on and bully them. Two wine experts quit the Metro Wine Store downtown in protest of their work environment and the decline in quality of selection. “[Selling alcohol and wine] is a skilled craft and should be treated that way,” Mayne told the commissioners at their April public meeting. “We [the state] are generating millions of dollars from your business.”
The roiling controversy at the DABC has spread far enough to splatter Herbert.
“That’s how I got involved,” Mower explains his role. “If there isn’t enough time for people to meet with the governor, I meet with them. I look to see if some changes need to be made. I said, ‘Let’s get Kris’ team on the ground. Let’s see if there are changes that should be made—operational stuff.’ ”
But Clifford, who resigned from the DABC, protesting the agency’s short-sighted shift to profits over quality in 2011, and other critics inside and outside of the agency aren’t optimistic Herbert will do much. “Mower’s one of the best political handlers out there,” says Clifford. “Gary Herbert wants the bad press to go away. He wants it to happen before he runs [for reelection] next year. I don’t believe he’s serious about fixing the issues down there.”
Others, including retired DABC Human Resources Specialist Kerri Adams, who has brought the employee complaints to the commission and Mower, also fears the governor’s office is doing little more than letting employees vent, hoping it will mollify them. After all, only the Legislature can make meaningful fixes and Adams and Clifford agree there is little appetite on the Hill for significant law changes to make liquor sales easier.
A Peculiar Situation
It speaks volumes about the culture of the DABC that many restaurant, bar and club owners refused to speak on the record for this article. As one put it, “You have no idea of the power of the DABC. They have long memories and they arevindictive.”
But Joel LaSalle, who is an owner of several restaurants and bars and is president of the Salt Lake Area Restaurant Association, was clear. First and foremost, he says, the absurd Zion Curtain requirement must be eliminated. He’s talking about the Legislature’s 2010 requirement that a partition be erected between restaurant patrons and bartenders preparing drinks to prevent non-drinking customers from witnessing drinks being made. Former Sen. John Valentine, ironically dubbed “Mr. Liquor” as thepoint man for the law changes, the governor and other lawmakers feared that the entertaining spectacle of cocktail mixing would lure children into drinking.
Restaurant owners—and about two-thirds of Utahns surveyed by Utah Policy.com—say the Curtain should come down. “The biggest single issue is the Zion Curtain because it is a barrier that is sitting out there for everyone to see,” LaSalle says of the partition’s symbolic power. “It’s in our customers’ faces. And it’s an absolute embarrassment for us in serving people coming from out of town.”
From a restaurateur’s point of view, the Zion Curtain is a financial burden, too. LaSalle says the partition at Current cost $16,000 to install. And it impact doesn’t stop there, he says, “It costs us thousands of dollars a month in sales—I can’t seat people at the bar—they don’t want to sit six or seven inches from a glass wall.”
Another absurdity for diners and restaurant owners is the “intent to dine” requirement, which forces restaurant servers to quiz patrons on whether they intend to order food before they can serve them a drink. Like many of the state’s vague liquor laws, it annoys customers and ultimately is probably unenforceable. As one beverage manager asked, “What can I do if they get up and leave before they order food?”
LaSalle is more to the point: “A judge in a court of law would be hard pressed to go against a restaurateur who said, ‘We own a restaurant, we serve food and they asked for a table—we could only assume food was what they were there for.’
Mower deflects such frustrations by patiently explaining that Utah’s monopolized liquor regulations really are not that much different from the 17 other states that directly control liquor sales. And, he points out, these fixes can only be implemented by the Legislature. “I’m not here to defend or change the liquor laws,” Mower says. “The Legislature will do that.”
But Utah diners, imbibers and restaurants say that’s a simplistic brush off—Herbert is complicit in the status quo. Huntsman obviously was able to push through liquor changes. “Things like this make us look like idiots,” the owner of one of Utah’s trendiest restaurants says of the international perception of Utah liquor laws.
LaSalle puts it more diplomatically: “It’s not very welcoming.” And, he says, it hurts the state’s economy. “We have a convention center, a new performing arts center and huge hotels, yet we still aren’t able to compete with Seattle, Denver, Phoenix or even Portland because this state has reinforced a misconception that you can’t get a drink in Utah.”
Spies and Bullies
Beyond the state’s irrational laws, the DABC has internal problems.—The employees point to arrogant, incompetent managers who spy on and intimidate them, driving out knowledgable store managers and employees and undermining customer service. A “metrically” guided ordering system has reduced the inventory of fine wines and alcohol. And a budget cut last year exacerbated the situation with poorer pay, dependence on part-time workers and requiring store managers to take on two or more outlets. “The new clerks know zero about wine and liquor,” says one bar owner.
For purveyors of new and unusual liquors and exceptional wines and residents who seek out products not in the stores, the state’s special ordering system that was supposed to allow them to bring in case lots has been a fail. “If you really want to satisfy these customers, you need to hire enough staff, but they won’t,” Clifford says of the issue. “The system was set up to fail.”
Cox says that while some of the allegations are employee “grousing” and finger pointing, “When they’re legitimate, we’ll look at them.” Cox’s office’s review of DABC operations (completed in November but not released before Salt Lakemagazine went to press) may clear up many of the employee problems and customer service issues—including special ordering, Cox says. “It will take effect over 18 months,” she says. “The work is never done.”
Cox explains she wants to instill an efficient, yet compassionate environment at the DABC. “We want to meet customer demand, to be profitable for the state and to have a culture where our employees feel respected and honored and feel like they are contributing and feel like they are paid fairly,” Cox says. But she defends the Legislature- and Herbert-driven “improvements” made six years ago that led to many of the issues the DABC faces now. “There were changes that needed to be made down there. There are people who were impacted by those changes that are upset by the current management. They have made their opinions loud and clear.”
Many of those opinions were about DABC Director Sal Petilos and his team, whom Herbert-appointed Acting-director Christine Giani installed after—what its victims refer to as the “Reign of Terror.” Deputy Director Tom Zdunich, whom employees called Petilos’s “Dick Cheney,” resigned last summer in the middle of the controversy. Mower says a search is being conducted to replace him. But many critics and employees don’t think that any real change is possible at the DABC if Petilos and his minions stay.
Christine Giani declined to be interviewed for this article. Petilos’s Adminstrative Assistant Vickie Ashby put off interviews with Petilos until a week before the deadline for this article, only to report a few hours before the interview that Petilos had taken sick. She explained that DABC Chairman John T. Nielsen, who also had agreed to a meeting, declined to be interviewed without Petilos present.
Mower and Cox were reticent to discuss DABC personnel issues. But when Cox explained the DABC needs effective and compassionate managers who made “employees feel respected and honored,” it seemed fair to ask if Petilos fits that description.
“Yes, I think he’s a compassionate man. He does a good job,” Cox says, after prodding. “He needs to have a strong deputy on the operations side and he needs to work on some of the cultural issues—which I think he is addressing. It’s just this issue of respect. Management needs to respect employees and on the flip side, employees need to realize that management has constraints as well.” Most of all, Cox said she wanted the finger pointing to stop.
Mower and Cox launched a series of “reviews” into DABC operations. Salt Lakemagazine obtained the reports through a Government Records Access and Management Act request, but employee complaints, allegations or suggestions were not included.
Utah’s Alcohol Czar
Utah’s contorted drinking politics are impossible to compare to other states. In the dominant Mormon culture, the consumption of alcohol, like tobacco and coffee, is forbidden. Making alcohol a moral issue produces a backlash from the non-Mormon population, who complain of the puritanical control of the Legislature—and by extension the LDS Church. One indication of how peculiar the subject is is that the media specifically identifies the rare DABC commissioner who is “a social drinker.” (Two of the seven current commissioners imbibe—licensees consider this an unusually progressive panel.) Commissioners are appointed by the governor, and, by law, none can be involved in any aspect of the liquor business. (It is worth noting that the Utah Air Quality Board includes representatives of mining and oil-refining industries.)
On the other hand, Utah’s monopoly on the sale of alcohol brings ever-increasing treasure to state coffers—$396 million in 2015. Though state leaders are regularly jeered as cash-driven hypocrites—lawmakers say Utah’s regulations are it the best way to control alcohol abuse. In any event, Utah’s state booze trust is going nowhere soon.
Critics of the DABC, including Clifford, say that under an overwhelmingly teetotaling Legislature, real improvement in liquor distribution is unlikely because any alcohol consumption is considered dangerous and immoral. Many of the controversial liquor regulations were created under former Sen. John Valentine and former Senate President Michael Waddoups, a Mormon whose wife was seriously injured by a DUI driver. In just a couple of legislative sessions, they turned Huntsman’s so-called liberalized approach to providing alcohol on its head. (Huntsman signed his 2009 changes into law in the New Yorker restaurant’s bar. Core to the liberalization was the elimination of Utah’s “club” law that required imbibers pay to join a private club before they could order liquor.)
As the DABC controversy continues with lobbyists massing this month for the 2016 session, the Legislature has a new point man on liquor laws, Sen. Jerry Stevenson. G.O.P. leaders selected the Layton Republican “Mr. Alcohol”—point man for all drinking laws.
“When John [Valentine] walked in here and said I was the guy, he said it was because I was fair,” Stevenson says. “The selection is an informal thing—he passed the gauntlet.”
Stevenson is a non-drinking Mormon, but has relatives who imbibe and says he isn’t offended by social drinking. Still, he has a steep learning curve ahead. “Two weeks ago, I didn’t know what a flight of beer was,” he says. To get up to speed, Stevenson read Toward Alcohol Control, a 1933 study commissioned by John D. Rockefeller Jr. shortly after Prohibition ended.
If nothing else, Stevenson is frank. “Alcohol is a touchy issue in the state of Utah. [But] I don’t know that Utah liquor laws are that far off center,” he says. “It started with the Olympics—we spend a lot of money welcoming the world. We want people to come. We say we want them to like us—but we really want them to spend their money here. So, we want to make things comfortable for them.”
But the state also is at the low end for DUIs, binge drinking and other alcohol abuse. “We don’t want that to change,” he says.
Stevenson declined to be specific about legislation that may emerge in the session beginning this month, but said his approach to making changes would be piecemeal—a couple fixes—rather than the sweeping omnibus-bill approach that Valentine favored. His goal, he says, to get three alcohol-related bills through.
“There’s a lot of tweaks that could make things much friendlier. But I don’t think we need to wholesale tear things apart and put them back together again. Let’s not choke on the elephant, let’s eat it a bite at a time. Some bills will deal with administration and most of them make sense, and we’ll move them forward under my name,” he says, then jokes: “I don’t think they’ll throw me out of church.”
One of his biggest challenges in fixing liquor regulation, Stevenson says, is that the players—bar, restaurant, distillery, brewery and resort owner—can’t agree on what they want changed. “If you walk into four different places downtown, you get four different conceptions on what needs to be done,” he says. He has spoken with LaSalle and the owners of Alamexo, the Gastronomy group and resort owners. “These are real business guys,” Stephenson says. “They want different outcomes if I run legislation than the people who sell beer and pizza.”
LaSalle says all players agree on one issue: tearing down the Zion Curtain. “I have high hopes for this Legislature,” LaSalle says. “I’m all for working with these people. I don’t think legislators know the harm that is being done [by the law].”
But Stevenson sees the issues more broadly than home-grown restaurateurs and barkeeps. For instance, more than an annoyance to local businesses, he fears some state liquor laws may be causing large resort and restaurant chains to pass over Utah because they run counter to their business models—including forcing modifications of restaurant architecture to meet the Zion Curtain requirement. Stevenson acknowledges that many Mormon legislators may be resistant to liquor law changes, but dealing with the Church of Jesus Christ of Latter-day Saints, he insists, isn’t much different than working with any other special interest. “The church has a set of gentlemen on Capitol Hill who are lobbyists.” Still, he acknowledges, “The LDS Church has a dog in this fight—their welfare program has seen the problems of over-use of alcohol.”
Surprisingly, Stevenson admits that some of the issues at the DABC are, indeed, the result of punitive actions by the Legislature. DABC managers had been “doing things that weren’t quite kosher,” he says of Giani’s removal of top DABC managers for questionable financial dealings. When all state agencies were told to take a 7 percent funding cut, Stevenson says, “We had a [DABC] director who basically said, ‘We produce a lot of revenue for the state. We aren’t going to do this.’
“I said, ‘I bet you do’ —we control the pursestrings.”
When state revenues came in better than expected, every agency saw the cuts returned to them—except the DABC. Stevenson admits it exacerbated the problems. “We made an error last year and part of it is my fault,” he says. “For some reason, we kept a half million dollars from DABC. Sometimes the Legislature punishes, for lack of a better word. DABC needs that money back if they are going to operate in an efficient way.” He vows the $500,000 in cut funding, and perhaps more, will return to the DABC.
“We are going to go through this. We are going to sort this out,” he says. “Besides this, I’m dealing with prison relocation—so I can take any kind of bullet you shoot.”
Still, Utah’s alcohol history has shown that Stevenson may be rashly confident.