Spin Control

OFM: Pass on both bids for liquor warehouse

OLYMPIA -- After studying two proposals for taking over the state's liquor distribution system, the state Office of Financial Management is calling for a pass on both.

In a letter to the Liquor Control Board, OFM Director Marty Brown says the proposal's "do not represent 'net positive benefit' to the state or local governments."

Selling the state's liquor warehouse has been a popular proposal in the Legislature, where many members believe the state has no business in the liquor business. Some budget proposals in the last session counted on revenue from the sale of the warehouse to help close the gap between expected revenues and scheduled expenses, but critics questioned whether the revenue estimates were realistic.

Opposition to state control of liquor has generated three ballot initiatives in the last two years, the most recent being Initiative 1183 on the Nov. 8 ballot and would get the state out of the wholesale and retail end of liquor sales

Before I-1183 was filed, the Legislature passed a law requiring a study of the possible financial benefits of selling or leasing the state's warehouse and distribution system, while maintaining its retail stores.  Companies were invited to submit bids, and OFM was directed to examine them and make a recommendation to the Liquor Control Board, which has ultimate authority over the state's booze business.

Only two companies bid. . .

To read more of this post, go inside the blog.

Both had proposals that gave the state and local governments a good financial outcome under some scenarios, but could cost money under other scenarios, the analysis said.

"An award on either proposal...is not in the best interest of the state," Brown's letter says.

OFM says the recommendation means the Liquor Control Board would not be able to accept the bid from either company,  Washington Beverage Co., LLC, and Washington State Beverage Logistics, LLC.

(Note: A previous version of this story incorrectly said the bidders could appeal over the next week and the Liquor Control Board had 60 days to consider whether to follow the recommendation. OFM officials say that's not an option because neither was recommended, and the process is over.)




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