As the Verndale City Council struggles with what to do with its two municipal liquor stores, a state auditor's report for the year concluded Dec. 31, 2008 shows Verndale lost the fifth-highest amount of money from operations in all of Minnesota.
Verndale had a net loss of $58,863 in 2008, according to the report. Other area towns' liquor stores also made the list of 42 that lost money instead of made it in '08: Parkers Prairie ($18,137 loss), Sebeka ($10,320) and Bertha ($5,012).
Verndale is trying to beef up operations at its U.S. Highway 10 location, which was badly in the red in 2009. It is also tussling with a potential legal issue. The council met in special, closed session Thursday night and had just one item on the agenda: "Discuss Preliminary Allegations against an employee subject to Council Authority." When this issue was discussed in open session at the March 1 city council meeting, it was clear the allegations had to do with a liquor store employee.
In most cases, municipal liquor stores make money and subsidize other city operations. In fact, the auditor's report showed that Minnesota's municipal liquor stores reported a 13th consecutive year of record sales in 2008, totaling $303 million, $17.8 million of which was used by the cities for other ventures. The report also said that over the past five years, net profits have increased 9.9 percent statewide at municipal liquor stores. Among off-sale stores, there was a 23.5 percent increase in net profits, while on-sale stores showed a decrease of 46.3 percent.