Voters brace for liquor battle

2010-09-25T22:45:00Z 2011-02-09T16:33:47Z Voters brace for liquor battleBy Erik Olson / The Daily News Longview Daily News
September 25, 2010 10:45 pm  • 

Two initiatives that would end the state's monopoly on liquor have stirred up an expensive debate: Proponents argue a more open market would mean more variety and lower prices while opponents say jobs, taxes and safety are at stake.

Supporters and critics are pouring more than $10 million into the Initiative 1100 and 1105 campaigns that polls show are too close to call a few weeks out from the Nov. 2 election.

If one or both ballot measures are approved, the state would lose $360 million in liquor taxes and markup fees, which go to the state's general fund and local governments for health and education programs. In Longview, liquor sales brought in $455,000 into city coffers, and Kelso collected $149,000. Cowlitz County depends on $215,000 in liquor sales in its budget.

Privatization proponents, who include grocers, restaurateurs and bar owners, say the state-run system is an outdated relic of the post-Prohibition era. Washington is one of 18 states that still control liquor sales and distribution.

Eliminating state control will lead to lower prices for consumers and help to grow businesses, according to supporters.

"Open up the market, and have free healthy competition. That's the best way to grow the economy," said David Ruiz, owner of Splits Bowling in Kelso.

Opponents have rallied against both 1100 and 1105, saying they are will divert liquor profits from local communities and into the hands of large, out-of-state businesses, which is one reason the Longview City Council recently voted to oppose the measures.

They also fear more access to hard liquor is dangerous for minors and could lead to more alcohol abuse.

"Lives do not equal dollars. It just doesn't. It's not worth the convenience that some people want to access alcohol," said Cowlitz County Sheriff Mark Nelson, one of four elected sheriffs from around the state to publicly oppose both measures.

‘Not an essential service'

The more popular of the two initiatives is I-1100, according to state polls. It also is the most aggressive, cutting the state out of liquor sales and distribution. It would close the state's 300 liquor stores by 2012 and make liquor licenses available to about 3,300 retailers.

"There is a very strong feeling, when we ask the voters, that this is not an essential service of government," said Joe Gilliam, president of the Portland-based Northwest Grocery Association, which represents Fred Meyer, Safeway, Costco and other grocers.

The state's 51.9 percent liquor markup is too high, and private retailers could bring down costs with lower markups ranging from 10 percent to 20 percent, Gilliam said.

Critics of the initiatives point out that parts of I-1100 also would eliminate price controls. For example, it's currently illegal for large retailers such as Costco Wholesale to get better deals on wine and beer than a mom-and-pop store down the street can.

If either initiative passes, 930 people are expected to lose their jobs. About 550 of them are sales clerks making $11.35 to $15.30 an hour. The entrepreneurs who run almost half the state's 315 liquor stores are worried, too.

However, Gilliam said I-1100 would direct retailers' licensing fees to the state's Liquor Control Board to support alcohol-education programs and enforcement. Without the responsibility of selling liquor, the state board could divert it's employees toward regulating alcohol and ensuring strict compliance by retailers, he said.

"They shouldn't be in the business of selling booze when they regulate booze," Gilliam said.

The Washington Restaurant Association, the lobbying group for 5,000 restaurants statewide, has endorsed I-1100 but come out against I-1105.

I-1100 would create competition among retailers, distributors or manufacturers of spirits, which leads to better selection and prices for restaurateurs, said Bruce Becket, the restaurant association's director of government affairs.

Also, I-1100 would allow restaurants and bars to buy liquor when they need it, not just when the state-run store is open, said Mary Ann Truluck, owner of Henri's Beachway Carousel in Longview.

"When I run out of liquor at 8 o'clock in the evening, I can go grab more," she said.

I-1105, backed by two of the largest liquor distributors in the United States, also would close all state-run liquor stores but require a middle man - a licensed distributor - to sell to retail outlets. Most restaurants and bars buy liquor through distributors anyway, but I-1105 requires one - meaning no late-night runs to a store for bar owners when a bottle runs dry.

I-1105 eliminates both the state liquor tax and the markup, but it offers no plan to replace the lost revenue. Instead, the initiative punts and directs the Legislature to develop a new liquor tax next year to fill the gap.

Confusion on the ballot

In the fine print, I-1100 and I-1105 are a confusing cocktail of contradictions. They differ on the distribution of spirits, destination of tax revenue and enforcement of liquor laws, and the confusion could spell doom come Election Day, pollster H. Stuart Elway said.

"It's very difficult to tell what the difference is between them. The old conventional wisdom is (that) confused voters vote no," Elway said.

Recent polls shows both initiatives leading but failing to win a majority because of a large block of undecided voters.

In an Elway survey of 500 likely voters conducted about two weeks ago, 45 percent said they favored 1-1100, 34 percent would vote no and 21 percent remained undecided.

I-1105 fares worse than its fellow liquor-privatization measure in the Seattle-based Elway poll, with 41 percent favoring passage, 33 percent voting no and 26 percent undecided.

Perhaps not surprisingly, I-1105 proponents are trying to latch onto the popularity of I-1100.

"If voters have any confusion, their safest bet is to send a message to the Legislature and get the state out of the liquor business," said Charla Neuman, spokeswoman for the Washington Citizens for Liquor Reform, 1105's lobbying group.

If both measures pass, the Legislature likely will be called on to resolve the conflicts next year, said David Ammons, spokesman for Secretary of State Sam Reed, the state's chief elections official.

Initiatives at less than 50 percent favorability at this stage of the campaign are in trouble, Elway said. Many ideas sound good when they are first introduced, but voters tend to sour on initiatives the more they learn about them, he said.

High-proof campaign spending

Mix in a healthy splash of special-interest dollars and campaign ads from both sides are likely to make voters a little punchy.

Southern Wine and Spirits of Miami, Fla., the largest liquor distributor in the U.S., and Young's Market of Los Angeles have spent more than $2 million together to bring I-1105 to the ballot. Costco, Walmart and Safeway have all contributed to the $2.2 million campaign for I-1100, and Fred Meyer's parent company, the Kroger Co., has pledged $100,000.

Meanwhile, the Washington, D.C.-based Beer Institute and Virginia-based National Beer Wholesalers Association have pumped in more than $4 million to defeat the campaigns and protect their shelf space in grocery stores. Protect Our Communities, which opposes both measures, has raised $6.1 million so far.

Opponents of privatization include law enforcement, church groups and labor unions.

Sheriff Nelson and three other county sheriffs - Steve Boyer of Kitsap County, Garry Lucas of Clark County and John Lovick of Snohomish County - all oppose both measures. The Longview City Council voted unanimously Thursday to oppose both measures because of the potential loss of revenue and public safety concerns.

Nelson said he understands the argument to bring private competition to the liquor market but not at the expense of public safety. Cowlitz County has five state-run liquor stores - one in Castle Rock, Kalama and Woodland, and two in Longview - and the small number makes liquor access easier to track, he said.

Outside the state-run Triangle Center liquor store, customers also worried about the dangers of changing the current state-run system.

Polo Charles, 41, a meat cutter from Longview, said he's worried that drunken people would come to supermarkets to buy liquor if they had the option.

"It might attract the wrong crowd into stores. It just makes it dangerous," Charles said Monday.

Others objected to having liquor for sale in grocery stories frequented by large numbers of minors.

"I personally like to have the liquor separate from the minors," said James, 32, a laborer from Longview who declined to give his last name, on Monday.

Trulock, who bought Henri's restaurant a year ago, said opponents are exaggerating the danger of expanded access to liquor for minors. Enforcement at private stores would still be strict, and the state can't prevent underage minors from obtaining alcohol from older relatives and friends who are of age, she said.

"If kids want it, they're going to get it," Truluck said.

Ruiz, the Splits owner, lives in California, which has allowed private liquor sales for years. The stores card purchasers more heavily, he said, and alcohol seems to be demonized less because it's out in the open in every corner store.

"Take it away from kids and see how much they want it," Ruiz said.

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