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Alcohol distributors spend against Costco liquor-privatization initiative

Post by Jordan Schrader / The News Tribune on Aug. 22, 2011 at 5:18 pm | 3 Comments »
August 22, 2011 5:21 pm

The group fighting Costco’s liquor-privatization initiative looks like it has found a benefactor.

The Wine and Spirits Wholesalers of America contributed more than $3.6 million this month to the political committee opposing Initiative 1183.

The D.C.-based trade group for distributors released this statement:

The Wine & Spirits Wholesalers of America opposes I-1183 because that measure is designed to disable an effective regulatory structure that balances consumer demand with appropriate control over the distribution of alcohol and the licensed players in the Washington state market. A similarly ill-considered deregulatory initiative backed by Costco was rejected just last year, but they have chosen to ignore the message delivered by the citizens of that state and their elected representatives who drafted legislation to allow for limited privatization while maintaining strong regulatory control.

Alcohol distributors were also the main checkbook fighting last year’s Costco-backed initiative, but most of the money came from the beer industry — which also opposes this one, but hasn’t spent money against it.

Authors of this year’s initiative say it was carefully drawn to avoid affecting beer. But it does allow wineries to bypass distributors and sell directly to restaurants or retailers like Costco, a provision that has drawn support from a group of local wineries but opposition from the distributors.

Here’s what the supporters say about those provisions:

Initiative 1183 does not affect the sale or distribution of beer. There are provisions in I-1183 that will update certain laws dealing with wine distribution. I-1183 will allow wine distributors and wineries to offer volume discounts and to sell directly to retail stores and restaurants if they choose. These changes will benefit many small Washington wineries, increase competition and help reduce the prices consumers pay for wine.

What’s more, the initiative also allows those same manufacturer-to-retailer sales when it comes to hard liquor — so distributors wouldn’t have an automatic place in Washington’s brand new private market for liquor.

Unions have provided most of the rest of the funding for the anti-1183 group, including $215,000 so far from the United Food and Commercial Workers, whose members work at the state-run liquor stores.

On the supporters’ side, Costco has provided most of the $2.4 million raised.

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