AUGUSTA (AP) – Setting a basic price of $125 million, the state is giving bidders until Dec. 18 to submit proposals for operating Maine’s wholesale liquor business for 10 years.

Proceeds from the planned privatization are to be used to help balance the current two-year state budget.

A final contract approval is expected by March 19, 2004, with the winning bidder taking over operations by July 1, 2004.

Fixing a set amount as “the maximum and the minimum” was done “primarily because we wanted to have the emphasis on who has the best plan,” Commissioner Rebecca Wyke of the Maine Department of Administrative and Financial Services said Friday.

A winning bidder for the exclusive right to distribute alcoholic beverages and fortified wines within Maine would be subject to continued price regulation by the Bureau of Alcoholic Beverages and Lottery Operations.

The private operator would be responsible for warehousing and shipping liquor products – receiving orders from agency liquor stores, making deliveries and collecting payment.

Maine has nearly 300 agency stores.

The state’s request for proposal holds open the possibility of “other payments” by a successful bidder in addition to the $75 million due within a week of a contract’s execution and the $50 million due on July 1, 2004.

A bidder “may propose a revenue sharing mechanism to benefit the state to differentiate itself from other competitors,” the request for proposal says. “There is no specified format for this mechanism.”

A successful bidder also would be expected to have a plan for employing workers from the state’s wholesale liquor business for two years following privatization.

In scoring bids, a bidder’s quality of service plan would be worth 40 percent, with various financial plans and filings worth a combined 50 percent.

Worth 5 percent each would be proposals for additional revenues and references.

Bidders “are free to identify additional services that will improve the existing system,” the state request for proposal says.

The Department of Administrative and Financial Services reserves a limited option to negotiate certain points with a successful bidder and the right to alter deadlines as necessary.

Subject to legislative review, the Department of Administrative and Financial Services could negotiate franchise renewals for up to 10 years.

A state review committee has scheduled a conference in Augusta on Nov. 21 to give bidders and some other parties a chance to raise questions about the state’s solicitation.

Legislative panelists are expected to be briefed on the status of the privatization effort later this month.

Liquor control has a long history in Maine.

Maine became the first state in the nation to outlaw the sale of alcoholic beverages in 1851 and remained a dry state until 1934, shortly after the nationwide Prohibition was repealed.

AP-ES-11-07-03 1508EST