Expensive battle brewing over Wash. liquor sales

Expensive battle brewing over Wash. liquor sales

VANCOUVER, Wash. - About $10 million is being spent in Washington to convince voters to pass Initiative 1100 or Initiative 1105, initiatives that would allow stores that sell beer and wine to also sell hard liquor.

Washington and Oregon are two of only 18 states that have a monopoly over hard alcohol.

I-1100 would also eliminate the distributors who act as middlemen while I-1105 would keep that in place. It both pass, the Legislature would have to hammer out the differences.

What’s at stake is millions of dollars in revenues for the state and stores.

Grocery stores that include Safeway, Fred Meyer and Albertsons want to be able to take the place of state liquor stores and be able to sell hard alcohol to customers in Washington.

Costco has been the major instigator of the move, pouring thousands of dollars into the campaign after losing a court battle to break down the current system. In June, supporters of the “Costco Initiative” brought in almost 400,000 signatures to privatize the liquor business.

 “What it does get rid of is an outrageous 52 percent markup, which is the hidden tax they don’t want you to talk about,” said Joe Gilliam, Northwest Grocery Association. “There will still be a markup, but it’s going to be driven by competition, not a monopoly state-run business.”

There are 315 state liquor stores in downtown Vancouver, and they are moneymakers. So, it’s no wonder private businesses want a piece of the pie.

But Washington’s governor, Chris Gregoire, said the state will lose much-needed revenue.

“We are in a tough time right now and to anticipate that we would lose another $300 million is troubling to me,” Gregoire said. “And I don’t know what benefit it gives the consumer.”
But supporters tell the state not to worry.

“They would actually save several hundred million dollars by closing the state liquor stores,” said Glenn Avery, with Modern Washington. “Our initiative does absolutely nothing with the tax base. It leaves that intact.”

Both the sheriff of Clark and Cowlitz counties are against it because they say they are concerned with increased rates of drunken driving and underage drinking.

“When you have 15 times as many liquor outlets, when you can sell liquor at a gas station, or at every convenience story and every neighborhood store, there are going to be that many more opportunities for kids to get their hands on liquor,” said Sandeep Kaushnik, with the No on Initiative 1100 campaign.

There are also less consequential issues like whether grocery stores will stock $200 bottles of scotch and keep a large selection of vodka.