Downtown Monticello intersection project had negative sales impact on municipal liquor

Financially, Monticello’s Hi-Way Liquors traveled a short stretch of rocky road during the middle of last year.

Downtown intersection construction affected Highway 25 traffic, turning away customers during a four-month period, Manager Randall Johnsen told city leaders Feb. 13.

Finance Director Wayne Oberg didn’t waste any time mentioning that fact during his portion of the pair’s annual city council department update.

“We experienced steady municipal liquor store growth up until 2016,” Oberg told city leaders. “That’s because the city threw a highway project in Randall’s way early in the year. That caused about four months of below-average sales.”

Overall, the city’s municipal liquor operation tallied almost $5.5 million in sales, and gross profit of almost $1.4 million. The bottom line? After expenditures, Oberg said the liquor store dropped almost $600,000 into the city’s coffers last year.

“I stand before you a humble man,” Johnsen added during his report. “I can’t tell you that we grew from last year, and that hurts greatly. We are going to maintain and grow this next year. Highway 25 is our lifeblood.”

Johnsen reported that May 2016 sales dropped 7.7 percent, June sales 0.8 percent, July sales 2.8 percent, and August sales 1.7 percent, attributing those downturns to road constuction.

Nevertheless, the year ended on several positive financial notes and record-setting performances, he said.

Hi-Way Liquor’s best single day ever for sales occured on Dec. 23, 2016, with $71,192. December 2016 ended up being the store’s best month ever at $605,509, a 6 percent increase.

“We installed new software in 2015, and we were getting better with it last year,” Oberg added.

During discussion, Mayor Brian Stumpf asked Johnsen about the potential impact of the Seventh Street and Highway 25 project.

“Are you looking at another slowdown?” Stumpf asked.

Johnsen replied, “Yes. [That project] is right on a nearby intersection. It will hurt us.”

Johnsen summarized 2016 as a flat year for sales, but gross and net profits were in line.

Councilmember Lloyd Hilgart asked Johnsen if he had been keeping an eye on the Minnesota Legislature regarding a repeal of the state’s Sunday liquor sale ban.

Earlier this week, the Minnesota Senate voted 38-28 to legalize Sunday liquor sales.

The proposed legislation would allow liquor stores to open on Sundays starting in July. Gov. Mark Dayton has said he would sign the Sunday liquor legislation.

Minnesota is one of 12 states that prohibits Sunday sales. North Dakota, South Dakota, Iowa, and Wisconsin all allow Sunday sales.

“We’ve been watching it like everyone else,” Johnsen told Monticello city leaders Feb. 18 “I’ve shared my thoughts with Wayne. It’s not something I’m in favor of. [Bill proponents] preach increased revenues and benefits, but it’s been proven over and over in different states that isn’t the case. I don’t think people from Monticello are cruising to Wisconsin to buy Sunday beer. We aren’t going to capture money seven days a week. Since Hi-Way Liquors is city-owned, we could probably handle it, but Small Mom and Pop’s won’t.”

Contact Tim Hennagir at [email protected]