News

Spirits and the material world

by MARK ST.J. COUHIG
Sequim Gazette

After years of unsuccessful attempts, the voters of Washington have now agreed that state government should no longer be in the business of selling liquor. While a similar measure was defeated just one year ago, Initiative 1183 won big, with approximately 60 percent of Washington voters going for it. Clallam County voters mirrored those results: The latest count shows 15,911 voting to approve it, and 10,677 voting no. As a result of the passage of Initiative 1183, Sequim’s state liquor store will close on May 31, 2012, costing five jobs. Workers at the store declined to be interviewed for this article, referring all questions to a spokesman in Olympia.

Complex negotiations

The new law is complicated. For example, it’s possible the existing liquor store simply will re-open the next day, June 1, operating as a private enterprise.

 

Under the new law a liquor license is attached to the location, with the license to be auctioned off some time early next year. It will go to the highest bidder, if there is one.

 

The sale is uncertain, said Brian Smith, a spokesman for the Washington State Liquor Control Board, because the owner of the new store almost certainly would be in competition with the Walmart nearby, which is expected to seek its own liquor license.

 

No one was willing to go on the record at this point, but it also is likely that in Sequim the QFC and Safeway will seek licenses. Though local managers won’t confirm their plans, Costco, which spent $22 million statewide promoting the passage of the initiative, almost certainly also will pursue a license for its Sequim store.

 

The managers of both the Rite Aid and Walgreens said this week they haven’t yet discussed with higher-ups the possibility of applying for a license.

 

Hard liquor won’t be showing up in Sequim convenience stores because licenses are restricted to stores that are 10,000 square feet or larger.

How it works

Smith said the Sequim store should remain fully stocked through New Year’s Day. After that, the inventory likely will begin to decline. Smith said they are trying to work out arrangements with suppliers, but the negotiations are made more difficult because suppliers will “have to physically pick it up on the last day.”

 

In the meantime, the Liquor Control Board will be hard at work creating the new regulatory structure that will allow for sales of liquor by private entities. That effort begins with the creation and sale of liquor distributor and retail licenses, which both will be available by Feb. 8, 2012. There is no limit to the number of licenses that can be issued statewide, officials note.

 

Licenses also will be made available for the contract stores now in place in smaller markets around the state.

 

Smith said the Liquor Control Board will continue functioning, though the number of employees is expected to drop significantly from the 900-1,000 it now employs. The board will handle the new licensing chores as well as enforcement of liquor laws and the board will continue to set liquor policy for the state.

Dollars and cents
Though there is no established limit on licenses, Liquor Control Board officials have prepared estimates. They now “assume” there will be 184 licensed liquor distributors within the state, a figure based on the current number of licensed beer and wine distributors, wine distributors, distilleries and liquor importers.

They estimate 1,428 retail liquor licenses will be issued.

 

While noting the figures are difficult to estimate precisely, the fiscal impact statement for Initiative 1183 suggests total state General Fund revenues will increase by an estimated $230 million over the next six years, as total local revenues will increase by an estimated $200 million.

 

In a letter announcing their plans, Liquor Control Board members said, “Our state liquor stores have among the highest no-sale-to-minors compliance rate in the nation at more than 94 percent. The private sector’s overall compliance rate is 77 percent. We hope the private sector will treat this public safety responsibility with the utmost importance.”

 

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