OLYMPIA, Wash. (AP) — A Costco-backed measure to get Washington state out of the business of selling hard alcohol was trailing Wednesday, after voters overwhelmingly rejected a competing liquor privatization initiative.
With more than half of the vote counted Tuesday night, Initiative 1100 was losing by 52 percent, while Initiative 1105 was rejected by 63 percent of voters.
Yes on I-1100 spokesman Ashley Bach said that the campaign was encouraged by the lead in populous King County, where the measure was winning by 51 percent and where about half the vote was still yet to be tallied.
"There's a lot of public will behind the fact that our state government should not be in the liquor business," he said.
Both I-1100 and I-1105 would abolish the state's current monopoly on liquor distribution and sales in favor of private businesses.
But I-1100 goes further, allowing retailers like Costco to buy beer, wine and spirits directly from manufacturers instead of going through distributors. It also eliminates price controls and other regulations, such as bans against volume discounts and paying on credit, that exist for beer and wine distribution and sales.
I-1105 would have kept in place state laws that protect beer and wine distributors, and would also have kept in place prohibitions on bulk discounts for beer and wine but would have allowed them for sales of hard liquor.
The I-1100 campaign battle had mainly been between Costco Wholesale Corp. and other big box stores, and distributors who don't want to disrupt the current system. It was a big-money battle with lots of out-of-state donations from groups like the Washington, D.C.-based Beer Institute and dozens of state distributor groups giving money to the opposition campaign, which spent $8.8 million on the "no" campaign. The "yes" campaign spent nearly $6 million, with more than $4.8 million coming from Issaquah-based Costco in money and in-kind contributions.
A coalition of several groups opposed both initiatives, including unions, the Washington state Council of Firefighters, and several craft breweries and wineries, citing concerns ranging from public safety to the potential effect on state and city budgets. I-1100 removes the liquor markup imposed by the state, and I-1105 would have removed the markup and all additional liquor taxes.
Andy Grow, a spokesman for the No on 1100/1105 campaign, said that he was "cautiously optimistic" about the numbers but wouldn't declare complete victory just yet. But he said the early results on I-1100 show that voters are "clearly concerned about the revenue implications and the increase in hard liquor outlets."
Washington is among 18 so-called "control" or "monopoly" states that exercise broad powers over wholesale distribution of hard liquor. Of those states, 12 — including Washington — are also involved in retail alcohol sales through either state-run liquor stores, outlets operated by private contractors, or both.
While the liquor privatization debate hasn't been able to gain traction in Washington state until this year's initiative measures, the state Legislature has already made several changes to the three-tier system over the years, including allowing brewers and wineries to sell directly to consumers, and allowing retailers to buy directly from wineries and brewers.