Cities & counties hurt by liquor privatization

Liquor privatization has hurt local governments and their ability to provide alcohol-related public safety services according to an opinion published in today’s Seattle Times.

Though I-1183 proponents promised more money to address alcohol-related harms, funding was cut.   “In 2012, the state Legislature was balancing its budget and chose to ignore the voters and I-1183’s clear wording. Lawmakers diverted more than $100 million in liquor revenue from cities and counties to the state’s general fund,” write the authors.

They go on to note, “City and county law enforcement currently handle half of all DUI arrests, and cities employ two-thirds of the state’s public safety personnel. The Legislature’s action to reduce liquor revenues for local government is a direct cut to funding for local law enforcement.”

As those of us who advocate for substance abuse-related policy know, diversion of dedicated revenue is nothing new.  The state’s highly successful tobacco prevention program was decimated a few years ago when the legislature diverted dedicated prevention funding to the general fund.

Since even recent history apparently repeats, it is not surprising that public health advocates are concerned about marijuana revenue.  I-502 dedicates marijuana revenue for prevention programming, but how long will it be before it is diverted to the general fund, especially considering our state government still needs to fill holes in their budget?  

Local jurisdictions also have concerns about the impact of I-502 on their budgets.  The opinion piece states, “Marijuana legalization will add new costs for local law enforcement to police legal sales, crack down on the illegal black market and to enforce impaired-driving laws. However, to add insult to the injury of the liquor-revenue cuts, the Legislature has ignored cities’ and counties’ requests to recognize the local impact from marijuana legalization, and share some of the estimated millions of dollars a year in new tax revenue.”

Liquor privatization & marijuana legalization: The impact of policy change on youth

This morning, the WA House Early Learning & Human Services Committee held a work session about youth access to alcohol and marijuana since the adoption of Initiative 1183 (liquor privatization) and Initiative 502 (marijuana legalization.)



Data collected by the Division of Behavioral Health and Recovery (DBHR) indicate that since the adoption of I-1183:

• Pro-alcohol attitudes among youth increased significantly;
• Perceived access to alcohol among youth increased;
• Emergency department visits for alcohol-related conditions significantly increased among minors;
• In King County during the first 16 months post-privatization, emergency departments reported an estimated additional 5,500 visits for alcohol-related conditions; 
• Our state has more than 1,000 new places to buy liquor;
• Theft of liquor, including theft by minors, increased.   

Though not enough time has passed since the adoption of I-502 to be able to analyze long-term effects, early data indicate that youth perceptions of risk associated with marijuana use significantly declined.  With retail stores scheduled to open this year, researchers expect increased availability of marijuana among minors.

The report from DBHR was followed by compelling testimony from people working with youth in local communities about what they see happening.

News reports about liquor privatization and DUI cases are misleading

The recent headline: Fall of DUI Cases Continues after Liquor Sales Privatization is misleading.  As is the case with most changes to public policy, it is difficult to make a direct correlation between the change in alcohol policy with a change in DUI cases within a year of the change taking place. 

Are police staffing issues related to a decrease in DUI arrests?

Most of the article states that the privatization of liquor sales after the passage of I-1183 has had no affect on arrests for driving under the influence (DUI).  However, when you reach the end of the article it states:

A spokesman for the state patrol urged caution about drawing correlations between DUI arrest and collision rates and broader public behavior.

"The biggest reason for arrest data to change is police staffing," said the patrol's Bob Calkins.

Did the increase in liquor prices affect consumption?

We know that the price of alcohol has an impact on how much is consumed.  Along with privatization, liquor prices in our state increased. It may be that the increase in price balanced with the increase in availability and prevented an increase in consumption. 

Do other new policies decrease the amount of time police spend on the roads?

A decrease in DUI arrests could mean that police officers don’t have the time to arrest more drunk/high drivers because of the time it takes for them to process each case.  From the time a person is pulled over for a possible DUI violation, it takes about four hours to process the DUI.  

Why does it take so long?  Watch this video to find out: 

• Recent legislation requires officers to impound vehicles, increasing the officer’s time on the DUI case because he/she has to wait for a tow truck.
• With marijuana related cases and breath test refusals, officers are encouraged to obtain blood tests.  This means that officers need to take DUI suspects to hospitals for blood draws.
• A recent court decision mandates that officers obtain warrants for each blood draw.  Contacting a judge, especially at night, adds a lot of time to the process.

Extra time spent processing a DUI means less time out on the road finding DUIs.

Will final numbers tell a different story?

DUI data for 2012 are still preliminary. For example, the Fatality Analysis Reporting System (FARS) from the National Highway Traffic Safety Administration, which tracks fatality collisions, is still receiving crash reports for 2012 and their data won’t be finalized until January 1, 2014.  Other data sources are the same – reporting and data analysis lag behind DUI incidents. 

November legislative work sessions regarding alcohol & marijuana

In November, two legislative committees will meet to discuss issues related to state alcohol and marijuana policy.  Committee meetings are usually available to watch online at http://www.tvw.org/.

November 22, 1:30 p.m.

House Government Accountability & Oversight Committee Meeting

Agenda:

~ Streamlining Liquor License Issuance Fees & Taxes

~ Market Conditions and Impacts on Former Contract Liquor Stores & Former State Liquors

~ Update on I-502 Rulemaking by Liquor Control Board

November 22, 8:00 a.m.

Senate Commerce & Labor Committee Meeting

Agenda: Implementation of I-502

Liquor & marijuana discussed by WA House Government Accountability & Oversight Committee

The Washington House Government Accountability & Oversight Committee met today and discussed liquor and marijuana issues.

Liquor
Representative Hurst opened the meeting stating that prior to the adoption of Initiative 1183, state-run liquor stores had very low rates of liquor "loss" (theft).  He noted that, right now, many private stores that sell liquor  are reporting very high loss rates.  The problem is worst along the Interstate 5 corridor and is mostly related to organized crime.  Rep. Hurst went on to say that if this loss problem isn't addressed before January that the legislature will have to take action.

Jim Cooper from WASAVP and Thurston County Together! provided testimony.

• There has been a 5-fold increase in liquor outlets in our state since the adoption of I-1183.  
• He suggested that the Committee consider mandating retail models that prevent liquor thefts.  
• He stated that a mandatory Responsible Vendor Program should be established.  
• Money is needed at the local level to enforce laws related to alcohol and address related problems -- promised funds have not been realized by local jurisdictions.  
• Finally, he noted that new data about the effect of liquor privatization on youth are soon to be released.  He asked that the Committee not make changes to the system until they review data dealing with youth use, hospitalization, and theft.

Rick Garza from the Liquor Control Board reported that a recent news article reports that the Port Angeles area has seen a significant increase in youth theft of liquor within the last year.  Liquor theft is not just an I-5 corridor and organized crime problem.

Marijuana
Mr. Garza noted that, among many sources of information, the Liquor Control Board looked at the Colorado medical marijuana model, which is highly regulated, when thinking about what the WA recreational marijuana model should look like.  In CO, about 50% of medical marijuana retailers failed within the first few years.  When asked why so many marijuana businesses failed, Randy Simmons from the LCB said that, among other reasons, many of the CO medical marijuana dispensaries were too small to survive.  Market forces favored larger businesses.

When discussing marijuana retail outlets, Mr. Garza noted that the number of proposed outlets is similar to the number of liquor stores prior to I-1183.  For example, prior to I-1183 King County had 60 liquor stores and the LCB plans to license 61 marijuana stores in the county.

Some Committee members expressed concerns about whether the number of stores will be able to meet market demand.  Mr. Garza stated that 24% of the current marijuana market is people who are under the age of 21 and that the LCB's plans for marijuana retailers do not include serving this part of the market.

The LCB plans to spend time in all marijuana businesses to gain compliance with I-502 rules.  It was suggested that it will be up to local law enforcement to address other related problems.

Concerns expressed by Committee members included:

• targeting youth in advertising;
• banking;
• large amounts of cash in businesses and the possibility of armed robberies;
• firearms on premises of marijuana businesses;
• not enough information about prevention, education, and treatment; 
• marijuana business interests expecting that they can change the initiative  in two years;
• the development of Big Marijuana;
• who will get business licenses.

Jim Cooper testified that:

• The alcohol and tobacco systems do a poor job keeping the substances out of the hands of kids.  
• Prevention, intervention, and treatment services and programs have been decimated by the economy.  
• The success of I-502 should be declared only if not one more kid starts using marijuana.  
• Prevention and education funding needs to be put in place now.  
• A ban on commercial advertising of marijuana should be put in place.  
• Public smoking laws need to be enforced.
• The medical marijuana law should be repealed or medical marijuana should only be available through pharmacies.   

Medical marijuana & recreational marijuana systems
Rep. Hurst expressed skepticism about the medical marijuana market and its ability to function with I-502 in place.  While some people may be accessing medical marijuana for health reasons, the vast majority use it for recreational purposes.  

When working on the Legislature's budget proviso about the medical and recreational marijuana systems, Rick Garza reported that the Department of Health will deal with health-related items, including age requirements, while the Liquor Control Board will deal with the business side of things.

A representative from the Washington State Department of Health noted that there is "not much" regulation of medical marijuana in our state.  She also reported:

• "Intractable pain" is the most common reason for medical marijuana authorizations in Washington.  
• None of the dispensaries today are legal under state and federal law.  
• The DOH has no regulatory ability to shut down illegal dispensaries.  The Department or Revenue, the Liquor Control Board, and the federal government do have the authority.  

Rep. Condatta asked that the DOH address prescription drug abuse as well as marijuana abuse.  The DOH representative listed several initiatives they have implemented to address the issue.

The representative from Department of Revenue closed the meeting stating that they have not taken any targeted action against medical marijuana businesses but are gearing up for actions in the future.

WA Representatives get an update about marijuana legalization and liquor privatizaion

Earlier this week, the Washington House Government Accountability & Oversight Committee held a work session about the implementation of Initiatives 502 (marijuana) and 1183 (liquor).

The first part of the work session dealt with the implementation of I-502 during which Liquor Control Board staff provided a progress report and answered questions from Committee members.

Here are a few notes about what was discussed regarding marijuana:

When discussing the public safety aspects of the Liquor Control Board's draft rules for I-502, Representative Hurst commented that the Board is off to a good start and that he expects that there will be a need to "go back and make changes" to the rules at a later date.

Rick Garza from the Liquor Control Board noted that substance abuse prevention advocates and the Governor both expressed serious concerns about advertising.  He noted that it's unlikely that they will be able to do anything about advertising through social and electronic media.

A discussion about a possible lottery for retail license applications and how that might affect the density of stores in certain geographical areas starts at around 41:00.

A discussion about the costs to cities and towns associated with implementing I-502 starts at about 54:00.

At about 1:12:00, Alison Holcomb from the ACLU discusses public health concerns and their efforts to reach out to substance abuse prevention and treatment providers.

To close the discussion about marijuana, Ms. Holcomb and Rep. Hurst discussed the problems associated with dabbing.

Liquor Control Board seeking input about I-1183 rules

The Washington State Liquor Control Board would like your input on proposed rules to implement Initiative 1183 which privatized liquor sales in Washington. The following chapters in WAC 314 will be addressed in this rule making:

• WAC 314-05  Special Occasion Licenses
• WAC 314-11  General requirements for licensees
• WAC 314-13  Retail licensees purchasing beer, wine, and spirits
• WAC 314-24  Domestic wineries and domestic wine distributors
• WAC 314-27  Interstate Commercial Common Passenger Carriers
• WAC 314-30  Manufacturers
• WAC 314-36  Importers, Public Storage Warehouses and Importation of Liquor
• WAC 314-37  Non-state liquor stores
• WAC 314-38  Permits
• WAC 314-42  Liquor Control Board operations
• WAC 314-44  Licensed Agents
• WAC 314-45  Serving and donating liquor by suppliers at trade conventions of licensees
• WAC 314-52 Advertising
• WAC 314-64  Liquor samples
• WAC 314-76  Special orders

Public Comment

Please forward you initial comments to the Liquor Control Board by June 27, 2012.

Public Hearing

June 27, 2012, 10:00 a.m.

Washington State Liquor Control Board – Board Room

3000 Pacific Avenue SE, Olympia, WA

If you have any questions, please contact the Liquor Control Board at rules@liq.wa.gov.

Notes From the Liquor Control Board Health & Safety Forum

On Tuesday, March 13, the Liquor Control Board hosted a Public Health & Safety Forum about the implementation of I-1183, the initiative that privatizes the sale of liquor and further deregulates marketing wine and liquor in Washington. The forum was well attended not only by public health and safety advocates but by representatives of the businesses that will benefit from I-1183 including Costco, Target and the Grocers Association.

Following are some notes from the hearing.

Trade Area
The initiative states that stores selling liquor must be 10,000 square feet or larger. Exceptions will be made if such a store does not exist in a "trade area". Trade area is not defined. The Liquor Control Board (LCB) will look at defining trade area after June 1, 2012. Previously, the LCB determined if a new liquor store should be opened if (1) there was significant population growth in an area, (2) if travel time for customers was more than 15 minutes, and (3) customer satisfaction surveys indicated that people were unhappy about how far they had to travel to get to a store.

It is estimated that the number of stores selling liquor in Washington will increase from 340 to about 1300-1400 once I-1183 is implemented.

Hours of Sale 
Currently, most liquor stores close at 10:00 p.m. I-1183 does not contain a provision limiting the hours of sale of liquor -- grocery and other large stores may sell liquor as long as they are open for business.

Responsible Vendor Program 
The LCB is instituting a Responsible Vendor Program that encourages liquor licensees to put in place store policies meant to prevent the sale of liquor to minors. The program is free, voluntary and self-monitoring. The LCB will only check compliance with the program if they receive complaints about the business. Of the more than 1,000 businesses that have applied for liquor licenses around the state as of the beginning of the month, only about 30 have applied to be a part of the Responsible Vendor Program.

Enforcement
No additional funds have been allocated to the Liquor Control Board to provide increased enforcement. Currently, there are 300 liquor licensees per LCB officer. They will focus their efforts on licensees near schools and colleges and those about which they receive complaints.

A message for our legislators

Clean up the alcohol privatization mess and allocate funding to prevent substance abuse and support youth!

Alcohol privatization is creating more harm than expected: I-1183, the initiative that privatized the sale of hard alcohol, may have sounded simple, but the actual initiative is 60 pages long and mandates sweeping changes to liquor sales, wine sales, regulatory enforcement and advertising. I-1183 makes Washington the most deregulated state in the nation and implementing it is turning out to be quite costly.

Prevention funding has been cut: Meanwhile, since 2005, funding for substance abuse prevention was reduced by more than 70% -- community-based prevention services (Community Mobilization) by 73% and school-based prevention/intervention services (Student Assistance Program) by78%! 

Stop the harm BEFORE more is created! To restore both programs to 2005 levels of funding, $15Million per year is needed. Funding for substance abuse prevention is necessary BEFORE alcohol and other drugs become more accessible to our children and youth…

• BEFORE more bills are passed that normalize the use of alcohol in everyday life;

• BEFORE alcohol is fully privatized;

• BEFORE marijuana is legalized.

This can be done! An I-1183 clean up bill should:

• Designate alcohol revenue for a balanced approach to prevention, treatment, and enforcement by the Liquor Control Board.

• Add a standard sales tax on top of liquor taxes to generate revenue for cities.

• Establish a statewide cap on alcohol outlet density, as numerous studies across the nation have shown that an increase in outlet density – how many stores are in a certain area -- can lead to increased alcohol-related public health problems.

• Raise licensing fees by 30%, generating $6M for Community Mobilization and prevention and intervention services in schools. A 30% increase would result in a typical grocery store paying $195 per year.

• Increase the long-stagnant beer tax rate.

Enough is enough! It’s time to stop the erosion of a system that protects our children and youth and provides communities and schools the resources they need!

Liquor Control Board seeks comments on responsible vendor program

From the Washington State Coalition to Reduce Underage Drinking: 

Last fall Washington voters passed Initiative 1183. Among other things, it privatizes Washington’s hard liquor distribution and sales system. Currently the WA State Liquor Control Board is developing new guidelines and procedures which will help govern implementation of I-1183. Here are responses to key questions.

Will we have more outlets selling spirits (hard liquor)?
It’s very likely there will be a significant increase in stores selling hard liquor. Your local Walmart, Safeway, or any other large outlet (over 10,000 sq. ft.) can apply for a retail spirits license. If there are no stores that large in your area, smaller stores may apply for a license to sell hard liquor.

Will it be easier for young people to get alcohol in stores?
Currently there is no requirement about training clerks to check ID. More than 95% of Washington’s state liquor stores passed liquor sales compliance checks. The rate in non-state stores was less than 80%.

Will there be more Liquor Control Officers enforcing liquor laws?
No, the Initiative does not require the addition of enforcement officers to deal with the increased number of sales outlets. Your local city or county will receive additional funds for public safety but they are not required to use those funds for enforcement of liquor laws and regulations.

Will the hours for selling alcohol be increased?
We don’t know. The Initiative requires the Liquor Control Board to develop a Responsible Vendor Program. That program can include standardized sale hours and require training of all employees. The LCB is soliciting comment now.

How can I provide my input to the Liquor Control Board about the Responsible Vendor Program?
The Liquor Control is taking comment on the new rules now. To comment, send an email with your recommendations about training criteria, standardized store hours, location of spirits products, and other concerns to rules@liq.wa.gov. Make sure to type Responsible Vendor Program in the subject line of your email.

2012 legislative priorities

WASAVP's 2012 legislative priorities were posted earlier this month.  Below is more information about these priorities. 

1) Prevent liquor privatization and further deregulation. 
Evidence from multiple studies indicates that the more stringent the regulations in a community, particularly the ones affecting availability and marketing, the lower the prevalence and frequency of adolescent alcohol consumption and the higher the age of first use.

While Washington State voters recently approved Initiative 1183 to privatize the sale of liquor and to remove important price regulations, there are still ways that the Liquor Control Board (LCB) can regulate alcohol to reduce access among adolescents. WASAVP will work with the LCB and the state legislature to ensure that regulations are instituted to protect public safety, especially the safety of the children in our state. 

2) Support designation of all ATOD (alcohol, tobacco and other drugs) fees and taxes going towards enforcement, prevention and treatment in communities, not into the general fund. 
Evidence-based prevention, treatment, and enforcement of drug laws have proven to reduce underage drinking and drug use in communities. However, largely due to recent government budget reductions, many of these evidence-based practices have been eliminated.

At the same time, major changes to our state's drug and alcohol policies, which are proven methods for preventing substance abuse, have been eliminated or significantly changed. These changes have created an environment where youth may have more access to drugs and alcohol, resulting in harms such as increased driving under the influence, assaults, and barriers to learning.

WASAVP supports the designation of ATOD fees and taxes going towards enforcement, prevention and treatment as a way to mitigate the harms created by dismantling these systems and to reinstate funding for successful prevention activities.

3) Reclassify medical marijuana so that it may be regulated and sold in pharmacies like other prescription medications.
In 1998, Washington State voters approved the use of marijuana for certain medicinal purposes. While many prevention advocates do not agree with this legislation, it is law in Washington and WASAVP is committed to working towards preventing youth access to marijuana.

Currently, the regulation of medicinal marijuana is inadequate. Different communities have different laws and regulations concerning medicinal marijuana. In the communities where dispensaries are allowed to operate as businesses, there is little, if any, regulation of them. Like alcohol and prescription drugs, medicinal marijuana needs to be highly regulated to prevent youth access.

WASAVP supports the reclassification of marijuana so that it will be regulated like any other prescription medication and allowed to only be sold in pharmacies. Doing so will create a barrier to youth access.

4) Oppose state and federal budget cuts to community and school-based prevention programs.
Over the past few years, communities and schools have been hit hard by reductions in funding for evidence-based youth substance abuse and violence prevention programs. Evidence-based prevention programs are an important component of creating and sustaining safe and healthy communities. WASAVP opposes further cuts to prevention programs that reach all students and that support healthy youth development in communities.

Monitoring: WASAVP members identified the following issues to monitor during the 2012 legislative session.

• Healthy Youth Survey sustainability

• Prescription drug take-back program funded by pharmaceutical companies

• Marijuana legalization

• Social and emotional performance measures on the K-12 school report card

• School safety policy and funding

• School dropout prevention, intervention and re-engagement policy and funding

• Bullying prevention policy and funding

• Suicide prevention policy and funding

• Funding for school-based prevention-intervention specialists

• Statewide social host law