Unions Fight Privatization of Liquor Sales

SEATTLE (CN) - Fighting to save almost 1,000 union jobs, the Teamsters and United Food and Commercial Workers sued Washington state, challenging enforcement of an initiative that will privatize liquor sales and close state-run liquor stores.

The unions say the measure is unconstitutional because it violates the "single subject" rule.

Initiative 1183 was approved in November by 59 percent of voters.

Costco, hoping to get a piece of the lucrative liquor business, contributed $22 million to the cause, setting a state record for spending on an initiative.

The measure privatizes Washington's system of hard liquor distribution and sales, requires the closure and sale of the state's liquor distribution center and allows private entities to distribute hard liquor.

It requires the closure and sale or auction of state liquor stores, allows private retailers with stores 10,000 square feet or larger to sell and warehouse hard liquor and includes an exception that permits smaller stores to sell hard liquor under certain circumstances.

I-1183 also imposes new taxes on liquor sales, imposes fines and penalties for selling alcohol to minors, grants franchise protection for hard liquor distributors, allows wholesale pricing and central warehousing, strips the Washington State Liquor Control Board of its authority to restrict price advertising on alcohol and allocates $10 million each year to border areas, counties, cities and towns to enhance public safety programs.

General Teamsters Local Union No. 174 and UFCW Local Union No. 21 say the initiative, which must be implemented by June 2012, violates the Washington Constitution because it "embraces multiple subjects and contains subjects within its body that are not embraced by its title."

"Contrary to the ballot title, which states that I-1183 would 'regulate' licensees, I-1183 actually deregulates licensees by repealing and/or amending numerous regulations currently governing hard liquor sales, including but not limited to provisions governing uniform pricing and limiting hours and location for the sale of hard liquor," the complaint states.

"I-1183 levies a seventeen percent (17%) tax on gross hard liquor sales. I-1183 § 103(4). I-1183's ballot title, however, does not refer to taxes. Instead, the ballot title misleadingly refers only to the 'set(ting) of license fees based on sales,'" according to the complaint.

The unions sued the state and Gov. Christine Gregoire in King County Court. They want the initiative declared "null and void" and an injunction preventing enforcement.

The unions are represented by Dmitri Iglitzin with Schwerin Campbell Barnard Iglitzin & Lavitt.

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