Like The Herald Business Journal on Facebook!
The Herald of Everett, Washington
Heraldnet.com

The top local business stories in your email

Contact Us:

Josh O'Connor
Publisher
Phone: 425-339-3007
joconnor@heraldnet.com

Jody Knoblich
General Sales Manager
Phone: 425-339-3445
Fax: 425-339-3049
jknoblich@heraldnet.com

Jim Davis
Editor
Phone: 425-339-3097
jdavis@heraldnet.com

Site address:
1800 41st Street, S-300,
Everett, WA 98203

Mailing address:
P.O. Box 930
Everett, WA 98206

HBJ RSS feeds

State justices uphold liquor initiative, 5-4

SHARE: facebook Twitter icon Linkedin icon Google+ icon Email icon |  PRINTER-FRIENDLY  |  COMMENTS
By Associated Press and Jerry Cornfield
Herald Writer
Published:
OLYMPIA -- A divided state Supreme Court today upheld the voter-approved initiative putting sales and distribution of hard liquor in the hands of the private sector.
The 5-4 ruling clears the way for supermarkets and warehouse retailers such as Costco and Wal-Mart to begin selling bourbon, vodka and other spirits beginning Friday.
Opponents had filed suit, arguing that it violates state rules requiring initiatives to address only one subject because it included a provision to set aside $10 million for public safety.
The state Supreme Court ruled against the challenge saying the disputed "portion of I-1183's ballot title is not palpably misleading or false."
The ruling added that the court will not void a law duly enacted by voters based upon "the technical significance of a word, where it can hardly be contended that anyone was likely to be deceived."
The entire measure would have been nullified if the court had determined that voters would have rejected the initiative without the public safety provision.
Michael Subit, attorney for the plaintiffs, expressed disappointment with the ruling and said he hopes it doesn't set a precedent for the integrity of the initiative process.
Subit filed suit in December on behalf of the Washington Association for Substance Abuse and Violence Prevention, the landlord to a state-owned liquor store in Cowlitz County and two Red Apple stores in Kitsap County.
Subit said initiative sponsors "pulled a fast one," tricking voters into unwittingly supporting hundreds of millions of dollars in new taxes.
The measure imposed an additional 10 percent distributor fee and a 17 percent retail fee on spirits to reimburse the state and local governments for millions of dollars in lost revenue.
"And if the initiative sponsors -- powerful corporations -- can do it, it's something lawmakers in Olympia can do," Subit said.
Nearly 20 states control the retail or wholesale liquor business. Some, such as Iowa and West Virginia, have relinquished partial control in recent years, but Washington will be the first in that group to abandon the liquor business entirely.
Four justices dissented in two separate opinions.
In an opinion signed by three justices, Justice Charles K. Wiggins wrote that the measure imposes new taxes and contains a $10 million earmark that has nothing to do with liquor.
"An initiative can impose new taxes, but the ballot title cannot misleadingly imply that it does not," Wiggins wrote.
He also wrote that state law likewise precludes combining a substantive liquor privatization law with an earmark that has no rational relation to liquor privatization and may have been included only to win votes.
"This initiative would violate the constitution if our legislature had passed it, and it is equally unconstitutional as an initiative of the people," Wiggins wrote.
In a separate dissenting opinion, Justice Tom Chambers concurred with the majority that there is a "rational unity" between liquor regulation and public safety. But he ultimately agreed with the dissenters that the initiative was unconstitutional because the title failed to mention a new tax.
Under the new law, a business must have at least 10,000 square feet of retail space to be able to apply for a license to sell hard liquor. However, existing contract liquor stores are grandfathered in. Also, those who bought a state-owned store through a May auction also are exempt from the requirement.
The new law bars sales of hard liquor between the hours of 2 a.m. and 6 a.m. which leaves 20 hours a day in which it can be bought -- far more than available now.
What privatization means for prices is unclear. Absent state control, retailers can charge what they want and it appears the price of most bottles of booze will be higher starting Friday.
Majority decision
www.courts.wa.gov/opinions/?fa=opinions.disp&filename=871884MAJ
Dissenting opinion
www.courts.wa.gov/opinions/index.cfm?fa=opinions.showOpinion&filename=871884Di1
Story tags » State Supreme CourtAlcohol

MORE HBJ HEADLINES

CALENDAR

Share your comments: Log in using your HeraldNet account or your Facebook, Twitter or Disqus profile. Comments that violate the rules are subject to removal. Please see our terms of use. Please note that you must verify your email address for your comments to appear.

You are logged in using your HeraldNet ID. Click here to update your profile. | Log out.

Our new comment system is not supported in IE 7. Please upgrade your browser here.

comments powered by Disqus

Market roundup