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Originally published October 11, 2010 at 9:39 PM | Page modified October 12, 2010 at 11:10 AM

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The Truth Needle | The Seattle Times has launched a new feature to help voters discern fact from fiction between now and the November election. The Truth Needle will examine the claims of candidates and campaigns in the top races and decide whether they are true or false.

The Truth Needle | True: Claim by campaign against liquor initiatives

It's impossible to know how many more stores in Washington would sell liquor if they could under proposed Initiatives 1100 and 1105.

The Truth Needle

THE SEATTLE TIMES is helping voters discern fact from fiction during this election season. Topics covered so far:

Initiatives

I-1098: Income tax and B&O tax

I-1107: Tax on "grocery items"

U.S. Senate race

• Dino Rossi's claim on Patty Murray's spending

• Murray's statement about teachers' jobs

• Murray's role in the tanker contract

• Rossi's stance on Boeing, Airbus

Read them all and watch for future Truth Needles at seattletimes.com/html/truthneedle

For more political coverage, including candidate profiles, see seattletimes.com/politics

No more state stores, and then some

INITIATIVES 1100 AND 1105 would put the state out of the liquor sales and distribution business. Some ways they differ:

1100: Allows retailers to negotiate with manufacturers and distributors for volume and other discounts; permits distilleries, wineries and breweries to give gifts larger than coasters and T-shirts to retailers; allows warehousing and buying on credit — all things currently prohibited.

1105: Eliminates liquor taxes and calls for new ones. Requires retailers to use distributors. Allows discounts on liquor, but not beer and wine.

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The claim: The campaign against Initiatives 1100 and 1105 — both of which would take the state out of the liquor business and allow grocery and convenience stores to sell liquor instead — says the measures would increase the number of liquor retailers in Washington from 315 today to at least 3,300 and possibly as many as 5,000. One TV ad said that's twice as many per capita as California.

What we found: It's impossible to know how many stores in Washington would sell liquor if they could.

Costco-backed Initiative 1100 says retailers that now sell wine or beer and whose licenses are in good standing could add liquor to their shelves beginning in June.

Currently, that's 5,388 grocery, convenience and other stores, including small-business owners who contract with the state to operate 154 of its 315 liquor stores. (Presumably, state-owned stores would close.)

If everyone who could sell liquor under 1100 decided to do it, the number would top 5,000. That statement by the campaign against the initiatives is true.

At the high end, the state of Washington would have one store for every 1,236 residents — 2.25 times more than California, making the campaign's full statement true. California has 13,321 stores selling liquor, one for every 2,775 residents.

No one believes every store that could sell liquor would, and everyone has a different guess about the likely number.

The state auditor's office guessed the number selling liquor would peak at 3,357.

"Our belief that not all prospective retailers would add liquor was confirmed during legislative testimony earlier this year, when lobbyists for small businesses indicated some of their members might not want to compete for liquor sales with warehouse clubs or other large-volume sellers — especially in nearby locations — because they could not match the discounted prices," said Mindy Chambers, communications director for the Washington State Auditor's Office.

The campaign against 1100 and 1105 figures that 85 percent of the eligible stores would sell liquor. That would be 4,580 stores, not quite twice as many per capita as California.

"We think it's likely that most of them will go into the liquor business," said Sandeep Kaushik, a spokesman for Protect Our Communities. "If you run a little convenience store, you don't have to lay in huge inventory. One or two vodkas and maybe a tequila or a whiskey, and you're in business. Who wouldn't invest a mere $1,000 for such an easy profit center?"

The $1,000 investment is the annual fee that would be required under Initiative 1100. It is unclear how much retailers would pay under Initiative 1105, which calls for a "reasonable" annual fee plus 6 percent of their liquor sales for five years.

Initiative 1105, which is backed by liquor distributors, also is unclear about who would be eligible to sell liquor, other than "applicants who could provide the same degree of safety and security as current state-operated stores." The Yes to 1100 campaign believes fewer than 3,357 stores would sell liquor.

"Keep in mind beer and wine are already very popular and profitable, and especially for many of the smaller outlets it's not going to pencil out to also supply liquor," said Ashley Bach, spokesman for the campaign.

"The liquor market is also very centralized, even more than beer," Bach said. "It's controlled by a small number of conglomerates, like Diageo. So again, it may not make economic sense for many stores to carry it."

Melissa Allison: 206-464-3312 or mallison@seattletimes.com


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