Privatization of Liquor

Full Report

Executive Summary
Press Release

 

Draft City Club Report Recommends Not Privatizing
Liquor Sales as Proposed


“Deeply flawed” measures would jeopardize the state budget, endanger local industries, and likely cost consumers more.

 (Portland, Ore.) The City Club of Portland today released a draft research report that found deep flaws with two state initiative petitions that sought to privatize liquor sales in Oregon. Although the chief petitioners withdrew the petitions, they indicated they would continue to pursue privatization either in the legislature or through another initiative. City Club therefore released this report to inform discussion about future privatization efforts.

A committee of eight City Club member-volunteers spent four months studying the issue. Had the two petitions appeared on the ballot, the member-volunteer committee that studied them would have recommended “No” votes.

 “The current Oregon Liquor Control Commission system is not broken. While the OLCC could streamline and improve, [the proposed measures] did not pose a more efficient or equitable warehousing, distribution and sales alternative to Oregon’s current state-controlled system,” the report stated.

The committee was particularly concerned that the proposals did not adequately address challenges to state revenue. They lacked provisions for auditing and collecting the taxes and fees meant to replace OLCC liquor revenues, placing Oregon’s third-largest source of revenue at risk.

The committee also found that consumers in rural communities could lose access in a privatized market.

The report recommends further in-depth study of liquor privatization so that Oregonians might better understand the costs and benefits for future discussion. That might help
ensure that reforms benefit consumers, retailers, local government, local economies, and craft distillers.

“These liquor privatization proposals would have benefited only ‘big box’ retailers,” said Committee Chair Serena Stoudamire Wesley. “The suggested benefits to everyone else were dubious at best. Meanwhile, privatization would bring huge risks to the state.”

The committee interviewed 13 witnesses on both sides of the issue and reviewed more than two dozen relevant documents. The full draft report, which includes a witness list and citations, is available online at http://www.pdxcityclub.org/ballotmeasures-liquor.

Member-volunteers who served on the committee were Serena Stoudamire Wesley (chair), Dan Keppler (vice-chair), Laura Doppelt (lead writer), Sean Cruz, Tom Markgraf, Paul Meyer, Paul Milius and Nancy Thomas. Carmel Bentley served as research advisor.

City Club members will debate and vote on this and nine other election-related recommendations at a “Ballot-Palooza” from 5:30 p.m. to 9 p.m. on Wednesday, Aug. 20 at Oregon Public House (700 NE Dekum St.). The event will be open to the public, but only City Club members may vote on the recommendations. Outcomes of the votes will be published on the City Club of Portland's website and reported in the City Club Bulletin, released Aug. 26.

City Club member-volunteers have researched more than 400 state and local ballot measures since 1916. City Club’s Research Board screened all researcher applicants for conflicts of interest, and participants affirmed that they are unbiased on the ballot measure they sought to study.

City Club of Portland brings together civic-minded people to make Portland and Oregon better places to live, work and play for everyone. For more information about City Club of Portland, visit www.pdxcityclub.org or call 503-228-7231.