OLYMPIA — A union that represents some of the workers who will lose their jobs at state liquor stores is suing to block Initiative 1183, which will begin dismantling the state control of liquor sales next year. The United Food and Commercial Workers Local 21… Read more
Initiative Measure 1183
About this measure
The Law as it Presently Exists
In Washington, the state sells and controls the distribution and sale of “spirits.” The term “spirits” refers to alcoholic beverages also called “hard liquor” (whiskies, vodka, gin, etc.). Spirits include beverages containing distilled alcohol and wines exceeding twenty-four percent alcohol by volume. Spirits do not include lower alcohol content beverages such as flavored malt beverages, beer, or wines containing less than twenty-four percent alcohol by volume.
In Washington, spirits are sold at retail at state-run liquor stores and at “contract liquor stores.” Contract liquor stores are private businesses that sell spirits and other liquor under a contract with the state. Washington has approximately 165 state liquor stores and 160 contract liquor stores.
The Washington State Liquor Control Board (“the Board”) operates the state liquor stores and oversees the contract liquor stores. Among its responsibilities, the Board regulates liquor advertising in the state. The Board, however, cannot advertise liquor sales.
The Board sets the price for spirits sold at state-run and contract liquor stores based on the wholesale cost of the spirits, taxes, and a markup authorized by statute. The Board also collects the taxes imposed on the retail sale of spirits, and collects license fees and penalties. The proceeds received from the sale of spirits, the tax revenues on spirits, and license fees are distributed to cities, counties, and the state. Certain revenues are dedicated to funding programs addressing alcohol and drug abuse treatment and prevention.
In Washington, manufacturers and suppliers of spirits may only sell spirits to the Board. The Board acts as the sole distributor of spirits sold in the state liquor stores and contract liquor stores, and sold by restaurants and certain other licensed sellers. Under a law effective June 15, 2011, the state must examine whether to lease the state’s liquor distribution facilities to a private party, and whether such a lease would produce better financial returns for the state.
Existing law allows private parties to sell or distribute alcoholic beverages that are not spirits, such as wine or beer. Wine and beer sellers are licensed by the state. There are different licenses for each of “three tiers” of the wine and beer business: (1) manufacturing; (2) distribution; and (3) retail sales. Existing law regulates the financial relationships and business transactions allowed between manufacturers, distributors, and retailers. While there are some exceptions, retailers are allowed to purchase wine or beer only from distributors. Similarly, distributors are allowed to purchase only from manufacturers, with certain exceptions.
Existing law requires wine and beer manufacturers and distributors to maintain published price lists and offer the same price to every buyer. This requirement of uniform pricing prevents manufacturers or distributors from selling wine or beer at discounted prices to select customers, such as a quantity discount or other business reason for a discount. Existing law also requires wine and beer retailers to receive all wine and beer at their retail store and to not take delivery or store wine or beer at a separate warehouse location.
The Effect of the Proposed Measure, if Approved
Initiative 1183 allows private parties to sell and distribute spirits, and alters the Liquor Control Board’s powers and duties. It eliminates the Board’s power to operate state liquor stores, to supervise the contract liquor stores, to distribute liquor, and to set the prices of spirits. Initiative 1183 directs the Board to close state liquor stores by June 1, 2012. It directs the Board to sell assets connected with liquor sales and distribution, and to sell at auction the right to operate a private liquor store at the location of any existing state liquor store. Initiative 1183 repeals a 2011 law that directed the state to examine the financial benefit of leasing the state liquor distribution facilities to a private party.
Under Initiative 1183, qualifying private parties may obtain licenses to distribute spirits or to sell spirits at retail. A retail spirits license allows the retailer to sell spirits directly to consumers, and allows the sale of up to 24 liters of spirits for resale at a licensed premise, such as to a restaurant. Initiative 1183 allows private distributors to start selling spirits on March 1, 2012, and private retail spirits sales to start on June 1, 2012.
To obtain a retail spirits license, a store must have at least 10,000 square feet of enclosed retail space in a single structure. However, Initiative 1183 also allows a retail spirits license for a store at the location of a former state liquor store or contract liquor store, even if the store is smaller than 10,000 square feet. It also allows smaller stores where there are no 10,000 square foot licensed spirits stores in the area. Initiative 1183 requires retail stores to participate in training their employees to prevent sales of alcohol to minors and inebriated persons.
Initiative 1183 allows local governments and the public to provide input before issuance of a license to sell spirits. Initiative 1183 preserves local government power to zone and regulate the location of liquor stores.
Initiative 1183 would not change the existing taxes on spirits. Initiative 1183 would require spirits retailers and distributors to pay license fees to the state. Retail stores would pay a fee of seventeen percent of gross revenues from spirits sales under the license, plus an annual $166 fee. Spirits distributors would pay an annual $1,320 fee, plus a percentage of gross revenues from spirits sales under the license. During the first two years of a spirits distributor license, the distributor license fee would be ten percent of the distributor’s gross spirits sales. After two years, the spirits distributor fee would drop to five percent of the distributor’s gross spirits sales.
Initiative 1183 also requires that all persons holding spirits distributor licenses must have together paid a total of one hundred fifty million dollars in spirits distributor license fees by March 31, 2013. If the total license fees received from all distributor license holders is less than one hundred fifty million dollars, the Board must collect additional spirits distributor license fees to make up the difference. This additional fee would be allocated among the persons who held a spirits distributor license at any time before March 31, 2013.
In addition to existing laws controlling the distribution of moneys received by the Board, a portion of fees from retail spirits licenses and spirits distributor licenses would be distributed to border areas, counties, and cities to enhance public safety programs.
Initiative 1183 also changes laws that regulate the retailers, distributors, and manufacturers of wine. Initiative 1183 eliminates the requirement that distributors and manufacturers of wine sell at a uniform price, which would allow the sale of wine at different prices based on business reasons. Spirits could also be sold to different distributors and retailers at different prices. Beer manufacturers and distributors, however, would continue to be regulated by existing laws requiring uniform pricing. Under Initiative 1183, retailers could accept delivery of wine at a retail store or at a warehouse location. Under Initiative 1183, a store licensed to sell wine at retail may also obtain an endorsement allowing the store to sell to license holders who sell wine for consumption on the premise. For example, this would allow the store to sell wine to a restaurant that resells the wine by the glass or bottle to its customers.
SOURCE: Washington Secretary of State’s Office
Last updated: Nov. 15, 7:54 a.m. Election results
About 53 percent of Whitman County ballots supported Initiative 1183, which will effectively close down state-run liquor stores and state liquor distribution centers and open up the opportunity for grocery stores such as Walmart, Safeway and Costco to sell liquor in-store. That means inevitable change for the county’s five liquor stores, found in Pullman, Colfax, Rosalia, Tekoa and St. John. Pullman has the only state-run liquor store. The remaining four could stay in business and in compliance with the law with some significant changes. Read more
Sometime after the first of next year, the impact of the successful initiative ending Washington’s 78-year control of liquor sales will become more apparent. That’s when state liquor stores, which are currently increasing inventory for holiday sales, will start to draw down their inventory. It’s also when contract stores, which are operated by individuals under agreements with the state, will look for new suppliers or decide to go out of business. Read more
Sometime after the first of next year, the impacts of the successful initiative ending Washington’s 78-year control of liquor sales will become more apparent. That’s when state liquor stores, which are currently increasing inventory for holiday sales, will start to draw down their inventory. It’s also when contract stores, which are operated by individuals under agreements with the state, will look for new suppliers or decide to go out of business. Read more
One angle of Initiative 1183 that has not been the subject of millions of dollars worth of commercials for and against is choice – as in will my choice of liquor be better or worse if the measure passes? With campaigns arguing over whether people… Read more
OLYMPIA – Led by a multimillion dollar battle over liquor sales in Washington, initiatives and candidates on the Nov. 8 ballot have spent more than $18 million to sway voters in the past three weeks. This may not surprise state residents who can’t turn on the television without seeing firefighters argue whether voters’ lives will be better or worse if state-run liquor stores go away. Other state initiative campaigns have their own TV messages, and campaigns are filling mailboxes with mailers. Read more
OLYMPIA – Led by a multi-million dollar battle for who controls liquor sales in Washington, initiatives and candidates on the Nov. 8 ballot have spent more than $18 million on trying to sway voters in the last three weeks. This may come as no surprise… Read more
OLYMPIA – It’s apparently all in or all out for Washington state’s involvement in the liquor business. After studying two proposals to take over the state’s liquor distribution system, the Office of Financial Management is calling for a pass on both. Voters could still order that system sold, and remove the state’s involvement in wholesale and retail liquor sales, by passing Initiative 1183. Read more
OLYMPIA – It’s apparently all in, or all out, for Washington state’s involvement in the liquor business. After studying two proposals to take over the state’s liquor distribution system, the Office of Financial Management is calling for a pass on both. Voters could still order… Read more
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… Read more
The multimillion- dollar fight over state-run liquor sales is flooding the airwaves and stuffing mailboxes across the state as both sides in the Initiative 1183 debate try to empty their deep pockets. The fight started months ago with dueling police and firefighters who love or hate the ballot measure. It grew into an argument over whether mini-marts would become magnets for teen drinkers and recently added a dispute over who’s trying to subvert democracy by “buying” the election. Read more
OLYMPIA – In an effort to get voters to end the state’s liquor monopoly, Costco this week made the single-largest political contribution in history – nearly $9 million – to a state ballot campaign. The discount retail giant based in Issaquah, Wash., nearly doubled down on its contributions this year to the Yes on Initiative 1183 campaign. The company had already spent more than $12 million through cash contributions and in-kind services, such as employee time for gathering signatures in less than a month to get the proposal on the Nov. 8 ballot. Read more
OLYMPIA – In an effort to get voters to end the state’s liquor monopoly, Costco this week made the largest contribution in history – nearly $9 million – to a state ballot campaign. The discount retail giant based in Issaquah, Wash., nearly doubled down on… Read more
The campaigns for and against the get-the-state-out-of-the-booze-biz initiative seem in a competition for “first responders” willing to endorse their stance. It started with the ad by Protect Our Communities, the official name of the No on I-1183 committee, which enlisted a county sheriff, a city… Read more
OLYMPIA — The Association of Washington Business, which is occupies the role of the state’s chamber of commerce, likes the ballot measure to turn the state’s liquor business over to private business. It doesn’t like the ballot measure to restrict tolling policies on roads and… Read more
OLYMPIA — For those who are Jonesing for some campaign-style polling, a Seattle political consulting firm is trying to supply a fix. It has a new poll of 500 voters that suggest if the election were held today, Republican Rob McKenna would beat Democrat Jay… Read more
OLYMPIA — Washington would go from having the second fewest liquor stores per capita to the fifth fewest if voters approver a ballot measure this fall, a new study concludes. Initiative 1183 would likely result in a four-fold increase in the number of retail liquor… Read more
OLYMPIA – Washington officials are trying to come up with a way to decide whether it makes good economic sense to let someone else run wholesale liquor operations in the state. About the time they’re ready to make that decision, the voters might take it… Read more
OLYMPIA – This year’s ballot measure to get state government out of the liquor business is shaping up to be another multimillion-dollar fight that will pit one of Washington’s largest retailers against alcohol wholesalers. Also taking sides will be the state’s grocery stores, with some big national chains such as Safeway backing the proposal and some regional chains like Rosauers working against it. Read more
OLYMPIA – This year’s ballot measure to get state government out of the liquor business is shaping up as another multi-million dollar fight that will pit one of Washington’s largest discount retailers against alcohol wholesalers. Also taking sides are the state’s grocery stores, with some… Read more
OLYMPIA – Washington would collect more revenue if an initiative to privatize liquor sales passes, but could pay more for road projects if another ballot measure on toll roads succeeds. That’s the best estimate of the Office of Financial Management, which recently released its analyses of the three measures headed for the Nov. 8 ballot. Read more
OLYMPIA – Washington would collect more revenue if an initiative to privatize liquor sales passes, but could pay more for road projects if another ballot measure on toll roads succeeds. That’s the best estimate of the Office of Financial Management, which recently released its analyses… Read more
OLYMPIA — We may have to stop calling Initiative 1183, the ballot measure that would get the state out of the wholesale land retail liquor business, “The Costco Initiative.” The proposal now has another source of funding: Trader Joe’s. Costco is by far and away… Read more
OLYMPIA — An initiative to turn wholesale and retail liquor sales over to the private sector qualified for the ballot, state elections officials said Wednesday. Initiative 1183, sometimes called the Costco initiative because the discount retailer is among its most ardent supporters, passed a random… Read more
OLYMPIA – Washington voters will likely face proposals on tolls, liquor and home health care workers on the November ballot. But not on chickens or marijuana. Read more