By John ~ September 24th, 2010.
A month ago, I was fairly certain how I would vote on both of these initiatives. Today, I’m not as sure. How about you?
Earlier this month, a good, concise summary of the two initiatives appeared in the Seattle P-I Online. It said in part, “I-1100 would eliminate Washington’s ‘three-tiered’ liquor control system, which segregates the manufacturing, distributing and retailing of spirits. Bans against volume discounts would be repealed and retailers like Costco and Wal-Mart would be allowed to buy directly from manufacturers [without going through a distributor]. The other measure, I-1105, would privatize the liquor retail system but keep in place state laws that protect the liquor distributors, who are behind 1105.”
Studying the two initiatives, it appears to me that I-1100 is pro-consumer, while I-1105 is pro-the middleman. I-1100 preserves the existing liquor excise tax, while I-1105 repeals it. It also appears that I-1100 will provide more funds for liquor enforcement and education, but I-1105 does not.
Traditionally, I’ve found it helpful to “follow the money” when I’m deciding how to vote on something like these initiatives. Seeing who is backing them financially gives me a good feel for who will benefit the most and whether or not I agree that it is for the greater good.
Following the money shows a group called “Modernize Washington” has raised almost $2 million to support I-1100. Costco, Wal-Mart, and Safeway are its largest donors, according to the Public Disclosure Commission. “Washington Citizens for Liquor Reform” has raised about $2.2 million to support I-1105. The group’s donors (virtually 100%) are liquor distributors Odom Southern Holdings and Young’s Market Company. And a group called “Protect our Communities,” a somewhat disingenuous name considering its main donors are beer and wine wholesalers, has raised about $6 million to oppose both initiatives.
After following the money, studying what the initiatives do and don’t do, and since I am a big proponent of dismantling the archaic three-tiered system that exists primarily for the benefit of distributors and for getting the state monopoly out of the wine retail business, I had concluded that I’m for I-1100 and against I-1105.
I have been especially incensed that Rick Garza of the Washington State Liquor Control Board (WSLCB) has been traveling around the state on state time and money campaigning against both initiatives. It’s not surprising given that his and other jobs may be at stake, but it “walks and talks” like a clear violation of state ethics legislation.
Quite honestly, as a small businessman myself for many, many years, I thought it would be a slam-dunk for wineries and winemakers around the state to be in favor of I-1100. However, in recent weeks, I’ve learned that they are divided on the issue. The Family Winemakers of Washington group is strongly pro I-1100, while the Washington Wine Institute is equally vehement in its opposition. Darby English of Darby Winery, James Mantone of Syncline Cellars, and Caleb Foster of Buty Winery have come out on TV (English) and print (Mantone and Foster) against I-1100. I don’t know English personally and his ad appeared to be paid by the wholesalers’ group, so I discounted it somewhat. On the other hand, I did believe Mantone and Foster’s objections deserved careful study. If I understand correctly, their objections revolve around concerns about the elimination of both uniform pricing and the requirement for immediate cash payment for wine. Since almost every other business in the world offers volume discounts and extends short-term credit to its customers, I’m not sure I understand the anguish. Besides, I don’t believe the initiative requires a winery to extend credit. And most wineries already offer case discounts to consumers, which is the same in principle as volume discounts to merchants.
I respect Mantone and Foster personally and as talented winemakers, so their concerns made me reconsider my position. However, after further study and reflection, I still believe the benefits outweigh the concerns about I-1100. I’m still leaning toward a “yes” vote on I-1100 and a “no” vote on I-1105.
Have you made up your mind about these initiatives? Please weigh in with your thoughts and tell me if you think I should reconsider my position.
Filed under: American Wine, Miscellaneous, Washington State Wine