This past December the Northwest Grocery Association filed petitions to initiate legislation allowing stores over 10,000 square feet to stock liquor, in a move similar to the new liquor privatization laws in Washington. As chief petitioners of this legislation, Fred Meyer stores imply that they intend to bankroll this legislation, similarly to how Costco supported the Washington legislation with over $20 million in support. Fred Meyer President Lynn T. Gust filed the petition with the Secretary of State on Feb. 6.
The goal of this legislation is to take liquor sales out of the hands of the OLCC, by allowing liquor to be sold in grocery stores across the state. Five separate petitions were originally filed, the two that are still being considered include the above named task of minimizing the OLCC, but this legislation also intends to establish harsher punishment for selling alcohol to minors.
These petitions require a minimum of 1,000 signatures each, at which point the NW Grocery Association will decide which one to back. Whichever one they chose will have to earn over 87,000 signatures to actually make it on the ballot.
Keep My Booze Crafty Please
By Candy Smith
There are many problems with this type of legislation. If we use this past year in Washington as an example, this legislation is likely to dramatically increase the cost of alcohol for consumers in our state, driving more business to border states such as California and Nevada. While nothing is final in the Oregon bill, it is likely they will include similar cost hikes, as these costs hikes in Washington were made to pay for the cost of systems changes.
In Oregon, we face an even bigger problem; this legislation could destroy our booming craft distillery market. Oregon-based distilleries made up 12% of the $1 billion income the state made on alcohol sales between 2011 and 2013. In Benton County, we are fortunate to have craft distilleries that produce some of the highest quality liquors in the country—we house several internationally medaled craft distilleries. We need to encourage a market that protects these small business owners in our community.
According to local distilleries, protections by the OLCC are what have allowed their spirits to make it out of the warehouses and onto the shelves. Dudley Clark, owner of Hard Times Distillery, says this issue is bigger than it appears: “If the grocers have their way, then the small distillers will disappear, and with them will go choice… the OLCC is providing us with a guardianship role, protecting us from monolithic corporations determining what we consume.”
Another distillery owner, who estimated that about half of the craft distilleries in Oregon would go out of business, echoed this fear. The aftermath of this legislation in Washington put a dent in the income of many distillers. “Yes, big grocery stores would now be able to sell liquor, but it would only be large corporate brands like Smirnoff, Jim Beam, and Burnett’s. They won’t carry local spirits, they don’t have the shelf space. Let’s face it; a large grocery store isn’t going to care about a small craft distillery that doesn’t have the ‘name’ of a well-known brand.” He also understands why people would want to have this convenience (and a lack of government intervention in their liquor sales). “What people hear is ‘The government shouldn’t be in the booze business and it’ll make spirits cheaper and we can buy it at any grocery store!’ It doesn’t work like that… Crime has increased in Washington. It’s easier to sneak a bottle in a backpack in a store that has spirits next to Jell-O packets, but in a liquor store, it’s easier for those employees to manage theft and dissuade underage drinking.” The Walla Walla Police Department has reported a 175% rise in liquor theft since the law went into effect.
For those of us who would rather drink tasty booze with fresh, sweet, Oregon products, the clear choice is to support legislation that would allow modernization of the OLCC, instead of unfortunate legislation backed by big corporations that would provide us with aisles of low-grade rubbing alcohol like Burnett’s and Black Velvet.
Who Needs the OLCC & Micros Will Still Thrive
By Ygal Kaufman
The state spirit excise tax rate for Oregon for 2013: $22.73 a gallon. That was the second highest in the country. And not like a wee bit higher than other states either; only 10 states were even over the $10 a gallon mark, and of those 10, seven were still under $20 a gallon. What do almost all of the higher tax states have in common? State-run liquor sales.
This is basic economics: the Oregon Liquor Control Commission (OLCC) can only exist, providing a layer of bureaucracy, with increased taxes. So for whatever good people claim they do, they cost money.
The argument being presented by proponents of State control is fundamentally unsound. They argue that the OLCC not only works some sort of miracle for us by regulating liquor sales, but also somehow keeps prices down, despite all the evidence to the contrary.
Local distillers are undoubtedly benefactors of this government winner-picking. And I certainly don’t begrudge them their support of laws that benefit them. In their position, I would feel exactly the same. But the idea that letting supermarkets sell liquor puts the craft distillers out of business because it gives people the choice to drink whatever they want at a competitive price is only a tragedy if you think we should be propping up industries with tax dollars.
No more OLCC, no more archaic drinking age laws, and no more onerous taxes. A fair and sensible tax level will keep funds flowing into tax coffers and will keep anyone who can compete (with good booze for a good price) happily in business.
It’s telling that opponents of privatization cite the price increase in Washington as proof that it’s a bad idea. As if there’s no way we could possibly buy and sell liquor without paying the state a huge chunk.
I agree Washington is doing it badly; they’re number one on the excise tax list, at $35.22, the only state that charges more than we do. The choice isn’t between high prices and state control. We don’t need either.