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Scathing Liquor Board audit finds disarray, inspections of defunct bars

April 4, 2013

The Office of Legislative Audits dropped a thick and scathing performance audit on the Board of Liquor License Commissioners, the Baltimore-based state agency that polices the bars and liquor stores in the city.

Among the April 3 findings: The liquor board has no written policies and procedures for its inspectors. It also has two or three times the number of inspectors that it needs. It does not monitor these inspectors’ activities or work habits (one part time inspector reportedly turned in 24 inspections of 15 bars that were defunct. “This inspector completed the Part-Time Inspector’s Reports indicating the licensees met the required inspection attributes,” the auditors drolly noted, “and did not note that the establishments were closed.”)

The board has not collected the fines it should have, or the license payments. It failed to check to make sure license seekers had the requisite business licenses, or had paid their taxes. It did not always document that the required criminal background checks on license applicants were done.

There was a notary public in the office who, for $2, would notarize stuff for applicants without verifying their identity.

The audit goes on and on like this: 91 pages worth:

Finally, the audit disclosed that BLLC did not properly document the investigation and resolution of inspections performed as a result of complaints registered through the City’s 311 Customer Service Request System. Our test of complaint investigations found that BLLC often did not document the investigation results and the disposition or resolution of the complaints. For example, of 118 complaints tested from the months of May 2011 and February 2012, 59 complaints had no documentation of any investigative efforts undertaken as of May 2012.

Lots of people who have made complaints via 311 about the strip club next door will say “AHA! I knew it!” And, indeed, in the report, auditors say liquor board employees told them they pencil-whipped complaints “because inspectors were not investigating complaints timely and it did not want this to reflect poorly on BLLC in the City’s 311 statistics.”

Then there was the inevitable, ongoing problem of the Licenses That Won’t Die. State law says you can’t hold on to a dormant liquor license—that’s a license for a bar or store that is not operating—for more than a year. The Liquor Board routinely grants “hardship” extensions to license holders anyway, keeping the licenses, which can sell on the open market for $50,000, alive for years on-end. The auditors found one license that was kept alive for 706 days.

Sam Daniels, who supervises the inspectors and runs the office, called back City Paper late on the day the audit was released to say the audit is a “good thing” but to caution that no one should believe everything in it, as it was conducted by auditors who don’t know the ins and outs of the liquor board’s business.

“It hopefully will stir inertial forces into accepting some degree of modernization,” Daniels said. “In many ways it could sound awful, it really isn’t. Not to diminish it, but the idea that we allow licenses to exist in direct violation of state law . . . That’s bullshit.”

Daniels was on the way to city hall and promised to talk more today. We’ll update the story in next week’s paper.