Costco

Costco Wholesale Logo

Costco would benefit from the passage of I-1100, but Washington would lose

Costco Wholesale, headquartered in Issaquah, Washington, is a national warehouse club chain which originally began in Seattle. It is now America’s third largest retailer, and the world’s ninth largest, with five hundred and sixty seven locations around the globe. (Most are in the United States). Costco sells food, apparel, furniture, office supplies, fine wine, tires, gasoline, books, movies, exercise equipment, jacuzzis, vitamins, cakes, and a wide variety of other products. The company is known for treating its workers better than its main rival, Wal-Mart, which owns its own warehouse chain (Sam’s Club). It is also known its no-frills style; its warehouses are sparsely decorated and merchandise is sold in bulk, sometimes even in the packaging it was shipped in.

Assets in Washington State

Costco’s major assets in Washington State include:

  • twenty six warehouses (including the original in south Seattle);
  • two business centers; and
  • its headquarters, located at 999 Lake Drive, Issaquah, WA, 98027

Lobbying

Costco does not spend a significant amount of money lobbying at the federal level. Nor does it have a federal political action committee. Its executives, James Sinegal and Jeffrey Brotman, are major Democratic donors, however.

Costco’s lobbyists in Olympia are Greg R. Hanon and Gary Robert Gardner. Costco’s lobbying expenses for 2009 in Washington amounted to $101,584.59 (PDC data).

What Costco Wants

Two different sets of rogues are funding initiatives to close state liquor stores. Costco is the ringleader and main driver of the first set; the company’s executives want to be able to sell hard spirits in Costco’s Washington warehouses. Costco poured more than a million dollars into Initiative 1100, collecting several hundred thousand signatures in just a few short weeks. Ironically, while Costco is known for treating its workers well (as mentioned above), the closure of state liquor stores would result in hundreds of workers losing their jobs.

Not that Costco cares. If Initiative 1100 passes, they’ll make more money, while we have to deal with the inevitable costs that result from increasing the availability of liquor. Increased availability leads to increased consumption, and increased consumption of alcohol leads to an increase in crime, especially DUIs. There is a correlation, despite what Costco and its “Modernize Washington” front say.

Having publicly controlled and managed liquor stores also helps keep hard spirits out of the hands of children, thereby preventing underage drinking.

The Keep Our Kids Safe Coalition explains:

The Washington State Liquor Control Board’s has a 94% no-sale-to-minors compliance rate which is the highest in the nation. The private-sector compliance rate for alcohol sales is much lower, with rates ranging from 76% to 84%.  Deregulation creates an incentive to sell more alcohol which means more access to teens.

The lawyers who drafted Initiative 1100 were evidently under orders to write a measure that was as favorable to Costco as possible, because the initiative’s ramifications are more widespread than the initiative’s billing suggests.

Consequently, I-1100 is opposed by many individuals and organizations that actually support privatizing liquor stores. The Washington Brewers Guild describes I-1100 as “the greatest threat the Washington craft brewing industry has experienced in a decade.”

The Guild notes that I-1100 is “actually a sweeping proposal that repeals 39 State Laws, enabling the biggest retailers, distributors, and producers to own and give favorable pricing to each other, which would eliminate the level playing field small businesses need to grow and prosper in our state.”

As noted earlier, Initiative 1100’s harmful impact on small businesses is no concern of Costco’s. Costco will profit from Initiative 1100; if breweries are hurt by the measure, that’s just not Costco’s problem. But the consequences will be our problem.

Corporate Profile

  • Company Type: Public
  • Traded on: NASDAQ (COST)
  • Contribution Address: 999 Lake Drive Issaquah, WA 98027
  • Chief Executive: James Sinegal
  • 2010 1st Quarter Revenue: $18.7 billion
  • 2010 1st Quarter Net Profit: $2.3 billion

Contribution History for 2010 Cycle

From Public Disclosure Commission records…
Amount Date Initiative/Sponsor Committee Given To
$25,000 08/01/2010 1100 (T Song) Modernize Washington
$47,200 07/14/2010 1100 (T Song) Modernize Washington
$110,769 (In Kind) 06/30/2010 1100 (T Song) Modernize Washington
$161.91 (In Kind) 06/27/2010 1100 (T Song) Modernize Washington
$1,955.33 (In Kind) 06/20/2010 1100 (T Song) Modernize Washington
$200,000 06/16/2010 1100 (T Song) Modernize Washington
$81,180.40 (In Kind) 06/13/2010 1100 (T Song) Modernize Washington
$185,000 06/09/2010 1100 (T Song) Modernize Washington
$76,690.54 (In Kind) 06/06/2010 1100 (T Song) Modernize Washington
$52,106.03 (In Kind) 05/31/2010 1100 (T Song) Modernize Washington
$15,000 (In Kind) 05/31/2010 1100 (T Song) Modernize Washington
$11,432.96 (In Kind) 05/31/2010 1100 (T Song) Modernize Washington
$28,582.40 (In Kind) 05/30/2010 1100 (T Song) Modernize Washington
$350,000 05/27/2010 1100 (T Song) Modernize Washington

Total amount shelled out by Costco for electioneering: $1,185,078.57

Comments are closed.