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ELECTION: Costco needs to be more up-front on I-1100

Letter by Howard Glastetter , Olympia on Oct. 22, 2010 at 2:35 pm with 20 Comments »
October 22, 2010 5:59 pm

I’m a Costco member and received an email from Costco the other day. It was encouraging me to vote for I-1100, the initiative to do away with state controlled liquor stores. The five-page email was carefully worded double talk.

I felt their main issue, particularly, twisted the facts. They stated under the heading I-1100 ends price gouging: “In its search for more cash, the state Liquor Control Board charges a 51.9% markup on liquor”. This is not true. The Legislature has ordered that markup. If the LCB reduced the markup they would be going against the legislature.

The markup is not something that goes to LCB employees or the stores where they work. The markup goes to the state general fund, and to the police and firefighters that are some times impacted by those who over consume alcohol and cause problems. The state legislators should be embarrassed about calling a tax a markup, but that is no reflection on how this LCB money is used to support legitimate state needs.

While Costco has an impressive business model, their email colors that image.

Leave a comment Comments → 20
  1. truthbusterguy says:

    I plan to vote for 1100. The state has no bussiness in retail sales. Thanks to costco for sponsering this idea. Tell the state they are fired and vote yes on I-1100.

  2. the3rdpigshouse says:

    Concur – the State has no business in the liquor business or any other retail business!!

  3. MadTaxpayer says:

    Same here. I get tired of bring home booze from California!

  4. readingthelatest says:

    ” The Legislature has ordered that markup. If the LCB reduced the markup they would be going against the legislature.”

    Either way, it is the state government charging 51.9% mark-up. I don’t care if is the LCB or the legislature. Passing 1100 will remove state control of liquor and I have already voted to approve it.

  5. citizen65 says:

    Just make sure you vote no on 1105

  6. Flanagan says:

    I voted yes 1100 and no 1105….I can hardly wait to buy my bourbon with my beef, broccoli and bon bons…no more making a special trip across town, wasting gas and contributing to the traffic mess.

  7. tree_guy says:

    “In its search for more cash, the state Liquor Control Board charges a 51.9% markup on liquor”. This is not true. The Legislature has ordered that markup

    Heh, heh. Howard you’ve revealed for us another distinction without a difference. I’ve already voted yes on I-1100 and no on I-1105.

  8. the3rdpigshouse says:

    Now I won’t have to drive my truck to Reno, lose $1000 gambling, and buy liquor for the holidays!! Did you notice that all of my trip activity involved private citizens making a living in the retail business without subsidizing State government??!! Great concept for Washington citizens!

  9. With all the fees and taxes that people claim pay for police and firefighters one would think we would be flush with police and firefighters.

    “In its (the state) search for more cash, the state Liquor Control Board charges a 51.9% markup on liquor”.

    There, now it’s true.

  10. blakein98402 says:

    This seems semantic to me. The LCB did not order the mark-up, but they do “charge it,” as Costco says — they run the stores. Either way, why is this relevant, since I-1100 would end this role for both the legislature and the LCB? Costco’s statement is true to the letter. Even if you think that “charge” implies that they originated the mark-up, I don’t see why this would make a difference in anyone’s vote. Are there people who would oppose privatization if the legislature did mark-ups but support it if the LCB did? It’s not as if the legislature is under significant citizen pressure on this issue, anyway.

    I would be willing to hear a counter-argument, but I don’t see much “here” here.

  11. “ELECTION: Costco needs to be more up-front on I-1100″

    I disagree. I think we should vote Costco’s initiative into law so we can find out what’s in it.

  12. It is unlikely sales tax, sin tax, or a myriad of other taxes will be dropped on liquor sales if those sales become private. I bet the State will “add” taxes.

    Our elected officials can not reduce the size and cost of State Government so let’s help them. Pass I-1100.

  13. daggercat says:

    Weakest argument to vote yes on this ill conceived initiative is getting the state out of retail business. Costco has lost twice in the courts and now they’re appealing to the lynch mobs. If the citizens of Washington want the state to privatize hard alcohol, it takes a lot more careful thought, with an eye towards long term consequences, or mitigating those consequences, than this initiative allows. Let’s do this another way.

  14. MTP & 3pig – every hear the term ‘bootlegging’?

  15. The Costco email was deceptive. It was worded to appear that the markup was the Liquor Board’s idea. The legislature has been raising the markup over the decades. They have done it because even they are uneasy about how high the per ounce taxes are. I’m sure even some who voted to raise the markup two years ago, had the idea that it might help kill the goose that laid the golden eggs and deliver a windfall into the hands of those businesses that help finance their political careers.

    Careful reading of the other arguments in the email shows the same weak / slanted arguments. The more humorous one is that this “convenience” will help keep people from stocking up booze around the home. That, from a company that sells things by the gallon, that are normally bought in pints.

  16. firemannotfirefighter says:

    “The markup goes to the state general fund, and to the police and firefighters that are some times impacted by those who over consume alcohol and cause problems”


    This argument is being played by the Labor Unions who asked the WSCFF for a favor in helping prevent possible union jobs being replaced by small business.

    The TRUTH and the simple fact is that the money that is generated by the sale of alcohol IS NOT EARMARKED for public safety. The money may go to libraries, or it may go to installing a new bike lane instead of a car lane. I am so tired of this argument. NOWHERE does ANY state law dictate that money generated goes to public safety. The money goes to the municipality fund to be spent as it sees fit. By the way, what about those junior Taxing Districts that receive no money from any entity that receives money from the sale of alcohol?

    I-1100 also mandates that the State come up with a new taxing scheme (it doesn’t dictate to the state what that scheme is. In other words, they can make it revenue neutral).

    As a fireman for a large municipality, let me enlighten you on a very well known fact. When politicians are elected and want to fund their pet projects, they can. When the money that went to those pet projects (that should have been used for public safety), rather than raising taxes or explaining why and where the money went, they cut public safety. Why? Because if you cut police and fire, the citizens will most often vote for new taxes to pay for the same service. Public Safety is cut, because elected officials can spend money elsewhere, cry “We need more Firefighters” and get new taxes.

  17. Well stated fireman. That’s what I vaguely eluded to upthread.

  18. I have already cast my ballot to reject both initiatives. Neither one is better than what exists now. Sure, I’d like to see the state out of the business, but, I do not want to see booze at my AM/PM mini market or grocery store. I’d rather see ‘stand alone’ private liquor stores with liquor control board oversight. I’m sure Costco and Wal-Mart will have quantity price discounts that will drive competition out of business, except in the ‘sticks’ where the local mini market will sell expensive booze along with their expensive ‘smokes.’ The legislature can adopt a better privatization plan.

  19. The letter complains about double talk because the mark-up was ordered by the Legislature rather than the LCB. Gee……can you find any more nits to pick? The result is still the same – a 51% markup.

    And while liquor taxes may increase when the State gets out of the clear conflict of interest of profiting for the sale of liquor while being charged with the control and regulation of liquor, it is highly unlikely that the increased taxes will come anywhere near the current mark-up.

    daggercat – the electorate and the initiative process is equivalent to “lynch mobs”?!!?? And all this time I thought it was direct democracy.

  20. I’m a Costco member

    Oh please……..like “membership” entails any special status other than being able to shop there.

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