Objective or a waste? New alcohol study called into question

By Adam Ulbricht | Watchdog.org

A new debate is heating up over a multimillion-dollar taxpayer-funded study designed to track the health effects of Washington state’s decision to privatize liquor sales.

The National Institute on Alcohol Abuse and Alcoholism, or NIAAA, awarded a five-year grant totaling more than $3.2 million to the Alcohol Research Group under the guidance of William Kerr.

“We’re doing this to better understand what happened in Washington,” Kerr told Watchdog.org recently. “Nothing like this, a full privatization of the liquor industry, has occurred before in American history, so it’s extremely important.”

But Kerr’s relationship with another group is raising red flags for some over a possible conflict of interest at the expense of taxpayers.

The National Alcoholic Beverage Control Association is a leading advocacy group for state-run liquor sales. The group previously paid Kerr to produce studies on the health impacts of alcohol.

In 2011, NABCA funded a Kerr study where he concluded, “Control over alcohol sales provides the means to limit availability in ways that can reduce consumption and problems.”

It is that partnership that has critics like Leonard Gilroy, director of government reform at the Reason Foundation, questioning the validity of the new grant. The Reason Foundation is a free-market think tank based in California.

“Based on his previous work, we likely know what the results will be of this study,” Gilroy said. “I think objectivity of the research is really challenged.”

But the NIAAA is standing by its selection of Kerr, who holds a Ph.D. in economics, and his funding.

“It is not surprising that Dr. Kerr may be sought as a consultant by organizations seeking to advance their understanding of specific issues that would benefit from Dr. Kerr’s expertise,” the NIAAA said in a statement to Watchdog.org. “Any experience as a consultant should not interfere with Dr. Kerr’s ability to conduct high-quality scientific research.”

Kerr and the Alcohol Research Group was the sole applicant for the NIAAA’s $3.2 million grant.

The grant was awarded in May and will run until April 2018, when the study is expected to be complete.

Much has been made of privatization since Washington state voters approved Initiative 1183 more than two years ago. So far the results have been better than expected.

Privatization opponents raised fears of increased criminal activity if the measure was approved, but research by the Washington Policy Center shows alcohol-related arrests, such as driving under the influence and minor consumption, have decreased since liquor sales went private.

A similar scene is playing out involving revenue flowing into the state. The Northwest News Network reports Washington state is expected to take in $369 million in revenue from alcohol taxes and fees for fiscal year 2014. That’s about $60 million more than the state collected in its final year of control.

Washington state charges a tax of 20.5 percent sales tax on spirits. Additionally, the state collects a 13.7 percent tax on purchases made by a restaurant or bar from a distributor.

Eighteen states across the country control the sale of spirits, wine and beer.

Washington could serve as a test for others, as states like Oregon and Pennsylvania consider releasing their hold on its liquor industry.

Contact Adam Ulbricht at aulbricht@watchdog.org

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