Initiatives 1100-1105

[hammerhead]

I am seeing ads against these initiatives from the local wineries in Washington. I am all for local wines, but I love the idea of having hard alcohol in grocery stores.

Can some tell me how bad this can be for the wineries in Washington state.

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[maplesyrup]

Not sure if it affects wineries as well but I read something recently from a local distiller who said that it will negatively affect him because he currently can sell at retail without having the same restrictions the WSLCB stores have. With 1100 he’d lose that advantage.

Of course it would also mean that he would be able to sell at wholesale to more outlets, if I’m not mistaken.

Anyway I’m all for 1100. The role of the state government is not to run retail operations and any revenue shortfall can be made up in additional liquor taxes if the legislature so desires.

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[maplesyrup]

This might answer your question. In short, they’re worried that it will give retailers and restaurants the ability to negotiate prices based on volume.

http://seattletimes.nwsource.com/html/businesstechnology/2012960050_liquor22.html

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[DP]

This thread deserves more attention, so I’m chiming in . . .

The main impact of I-1100 and I-1105 on wine sales would be that local wine producers would lose the marketing advantage they currently enjoy over out-of-state wineries in state liquor stores.

Will this hurt Washington’s wineries? In the short term, I would say yes. I suppose it could even put some of them out of business. The strong will survive, though, just as they always do.

The second impact of these initiatives would be to float the price in the retail market. Outfits like Costco, who buy wine by the swimming-pool-full, would now be able to offer deep discounts on local wines to their customers.

It’s hard to predict the long-term impact of market pricing on local wineries. If they sell more wine overall, it could be good for their bottom line, but the downward pressure on prices might also put some of the smaller ones out of business.

From discussions I’ve heard so far, Washington’s wine producers are split on this, but the larger ones, represented by the Washington Wine Institute, are against both I-1100 and I-1105.

Here’s a Web page from which you can download several PDFs explaining why WWI is against these measures:

http://www.washingtonwineinstitute.org/announcements.html

There is at least one other industry group, and it claims to represents smaller wineries. It’s called “Family Wineries of Washington” and its Web site has a lot of I-1100 related info:

http://www.familywineriesofwashington.com/

For a good general discussion on both these initiatives (and many others), go here:

http://ballotpedia.org/wiki/index.php/Washington_2010_ballot_measures

At the bottom of the Ballotpedia page you will find more than a dozen editorials discussing the pros and cons of each initiative.

—David

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[Jiggers]

na

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[squareeyes]

Was just reading up on both initiatives this week.

From an article in publicola.net:

Initiative 1100 doesn’t allow the state to control prices of liquor at any stage in the selling process, which large wholesalers like Costco prefer because it allows them to purchase liquor at volume discounts, and in turn dominate the market.

Initiative 1105, on the other hard, allows the state to set price controls, preventing massive volume discounts, which would supposedly benefit smaller retailers. I-1105 also allows the state to set the price of liquor licenses as a percent of volume of liquor sold by a vendor, meaning large stores like Costco would pay more for their licenses than small mom and pops. This aspect of I-1105 would also benefit the state, as it would supposedly gain more revenue through the volume-based license fees. I-1100 sets a flat fee of $1000 for liquor licenses.

The above taken from: http://tiny.cc/ddm0o

Here is collected information for both initiatives: http://tiny.cc/5czsf

So far I’m more in favor of 1105 which, upon first reading, seems fairer to smaller retailers.

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[Jiggers]

I hate going into A State controlled liquor store here because I know I’m getting hosed even before I walk in. :(

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[WorldCitizen]

I sell wine for a living. I’ve sold wine in many states

I have to say, the consumers in Washington (and in most wine-centric states) are all the same. They would adjust their buying habits as a result of this new law, just not in the way the opposition to 1100 would have you believe. The buyers of the lower-end wine would buy more at cheaper prices. These people would be happy and the wineries who mass produce wine would be able to afford the discounted volume sales as their overall budgets would not take an unreasonable hit.

This is not the demographic driving sales of small wineries in Washington State or any other Wine region. The buyers of boutique wines, or small production wines are an entirely different customer. These consumers aren’t going to stop buying from these excellent growers/winemakers just because they can get jug wine cheaper. They don’t drink jug wine in the first place. The boutique wineries aren’t going to be forced to artificially lower their prices. The boutique wine buyer realizes what goes into the bottle they are buying and by and large willing to pay for that quality.

It’s what happens in California and I would be so bold as to say California has a fairly successful wine industry. The vast majority of wine made in Cali is jug wine. I really want to stress that … the VAST MAJORITY!! The smaller quality wineries have been “competing” with these massive labels for decades and have produced world class wines that have stood the test of time. Liquor restrictions don’t affect the palates of wine drinkers. It also doesn’t affect the decisions they make.

I would also suggest the same holds true for the craft beer industry. I dare you to go up to a craft beer drinker with a straight face and say, “Man, why don’t we just get the Coors Light instead of the Boundary Bay…it’s only nine bucks a case!”

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[DP]

So then, WorldCitizen, I take it that you, as a seller of wine, are FOR I-1100. Right?

squareeyes: Thanks for filling in some details on I-1105. I take your point about charging for liquor licenses based on sales volume. For Costco to pay the same price as a mom-and-pop store doesn’t seem fair.

Notwithstanding that, I still don’t like I-1105, because it lets the state keep its foot in the door in a big way (by being able to set prices). So if 1105 is approved (but not 1100) the only difference would be that we’d have more places to shop for booze than before.

I also don’t like I-1105 because it is being sponsored by a couple of large out-of-state alcohol distributors who would be the prime beneficiaries of the new system.

Thus, in my opinion, I-1105 favors big business too much and doesn’t help the consumer enough. I’m against it. Conversely, while I-1100 favors a few big businesses (like Costco), it also favors consumers. So I’m for it.

We haven’t even touched on the issues of loss of state revenue and increased underage drinking that the initiatives’ opponents have raised. Personally, I think both of these are straw-man arguments. The state will still be allowed to impose as much tax as it needs to on alcohol, and anyone who sells alcohol to a minor will still be in deep shite.

Cheers!

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[WorldCitizen]

Yes…yes on 1100.

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[yeah-me]

I could be totally mistaken, but I also believe that these laws will allow small wine (and all alcohol) businesses that are not in Washington to finally get into our state. As is stands now, if you make an excellent Vodka, but only in small, high-end amounts, you really can’t get into the WA market.

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[hammerhead]

Thank you so much for all of the info, I have a tough time reading through the “Big” words. LOL

I don’t drink jug wine and have no problem paying for a nice bottle of wine or beer for that matter.

Thanks again

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[Cascadianone]

I am voting for 1100.

Bring on the http://www.bevmo.com mega-discount retail stores with their cheap booze, wine and beer!!!

:D

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[StringCheese]

AT WHAT COST? The money you will be saving on your liquor will be coming out of the funds for services for those in need.

I don’t mind paying extra for something I don’t really need if the funds are going to worthy programs. With few exceptions, they are. From the WSLCB website:

**Each year, revenues earned through the sale and taxation of alcohol are returned to the state. In Fiscal Year 2010, the WSLCB sent more than $360 million to the State General Fund, cities and counties, prevention programs, and research.

Cities and counties receive more than 18 percent of this money. The money returned to local governments is used for prevention programs, law enforcement support, affordable health care coverage and health benefits for children and pregnant women, and many other related programs and services.**

I was listening to a KUOW conversation about this. Some guy called in to support these initiatives. He was irate because it was “inconvenient” that he couldn’t get a special brandy for a recipe at any hour of day or night. Wow. Let’s slash funding for protective services so he can avoid having to think ahead…

NO! NO! NO! on these initiatives!

In this outrageous time of unemployment and budget woes, do you really want to stand up and say that paying less for your whiskey is more important than funding the social services that are only needed more than ever?

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[JustSarah]

But StringCheese, *why* are such important services reliant on people purchasing alcohol, anyway? I think that’s a poor scenario in the first place. Is that the real reason the state developed their liquor stronghold – to wrest more money from its “sinful” citizens who should choose to imbibe? I think that’s the greedy part of the equation. If the state needs more money, make it up somewhere else. Well, really I’d prefer it if they could use the money they get more efficiently, but if higher taxes are really what’s needed, so be it. I just cannot abide a dependence on liquor revenue for our state to provide necessary services. That argument really rubs me the wrong way.

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[JoB]

heaven forbid the state should make money on liquor sales and pour a great deal of it into medical programs that those who imbibe use at a higher rate than the rest of us…

how dare they!

heavy sarcasm alert..

go on.. admit it.. you have missed me.

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[JustSarah]

JoB, I find it difficult to engage in that debate when your premise is faulty. Alcohol consumption does not automatically equate to higher healthcare costs; in fact, moderate drinking is linked to increased longevity and general health compared to teetotalers.

Sources:

http://www2.potsdam.edu/hansondj/InTheNews/MedicalReports/Longevity/1088617919.html

http://www.hsph.harvard.edu/nutritionsource/what-should-you-eat/alcohol/index.html

http://www.sciencedaily.com/releases/2010/08/100824161432.htm

http://www.webmd.com/food-recipes/news/20100519/moderate-drinking-linked-to-better-health

If you really want people’s taxes to be linked to how much they use health care, it seems maybe we should tax alcohol abstainers more than those of us who enjoy a glass of wine or a beer each evening.

Incidentally, I think it’s quite dangerous to say that certain people should pay more in taxes simply because they use more healthcare services. I’m sure my cousin would love to hear that she should be paying higher taxes because her 9-year-old son has medullablastoma and the cost of his care over the past seven years is now in the multi-million dollar range.

For most health conditions/diseases, it is very difficult to determine what is brought on by lifestyle choices and what by genetics or uncontrollable environmental factors.

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[DP]

JoB: Welcome back. (As a matter of fact, we did miss you.)

I wish I could give you my full agreement as a homecomeing gift, but on this one, I’m afraid I have to go with SarahScoot, who obviously cares about this alot.

While I don’t think it’s wrong to tax something like alcohol in order to provide health care for people, I do think it puts the state in a difficult position, morally. It’s like: “OK, we’re going to sell you something that could be bad for you. But then we’re going to tax it to offset the cost to society.”

It’d be like buying OD insurance from your local heroin dealer.

Kind of.

I feel the same way about the Lottery. While Lottery revenue is good for the citizens, problem gambling is bad for them. Therefore, while I agree with the state taxing gambling, I don’t agree with the state promoting gambling. I know several people whose lives have been ruined by problem gambling, so every time I see a billboard where my government is promoting the Lottery, it makes me kind of mad . . .

Fortunately, there’s an easy way out of the quandary as far as liquor is concerned. With private liquor sales, the state can still tax it, and the citizens can get their booze at times and places that are convenient for them.

Frankly, I don’t see a problem here . . .

Oh, and one more thing. I’ve noticed that nobody’s talking about the money the state will save by having hundreds of fewer liquor store employees on the rolls and fewer buildings and business operations to look after. Shouldn’t those savings be factored into any equation of how much I-1100 will “cost” the state?

Seems like.

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