The D.C. City Council, in the face of an intense election-year lobbying campaign by restaurant and liquor store owners, is expected to reconsider today -- and possibly throw out -- a bill that would permit premium beer distributors to collect from retailers for credit purchases in half as much time as now allowed.
The decision to reconsider the bill, which was given tentative approval only two weeks ago, came after owners of liquor stores and restaurants such as Clyde's, The Hawk and Dove and Timberlake's complained through their trade associations that the proposal was special interest legislation designed to help four of the District of Columbia's largest beer wholesalers.
They maintained that the provision, if enacted into law, would drive up the price of beer, create serious cash flow problems for retailers and possibly force some stores and restaurants out of business.
Under current city law, all liquor, beer and wine wholesalers can permit their customers up to 45 days to pay for credit purchases. If the bill is not paid to any one wholesaler, the customer is forbidden from buying on credit from any wholesalers until the debt is paid.
Under a provision sponsored by Charlene Drew Jarvis (D-Ward 4) and tentatively approved by the council on June 8 on an 8-to-5 vote, the beer wholesalers would be allowed to collect in 20 days.
The Jarvis plan was tacked on to a proposal strongly favored by liquor dealers because, among other things, it would lengthen liquor store hours and permit them to make credit card sales.
Last Friday, Nadine P. Winter (D-Ward 6), who voted with Jarvis for the wholesaler-backed bill, changed her decision and introduced a proposal that would delete the Jarvis amendment from the retail liquor bill. Earlier, H.R. Crawford (D-Ward 7) had said that he would also reverse his stand and vote against the Jarvis amendment.
Late yesterday, Jarvis said she has decided to seek withdrawal of the entire retail liquor bill, including her amendment, so that a compromise bill could be drawn up for action.
Jarvis said she decided to ask for a delay after representatives of the restaurateurs and the wholesalers met for about an hour in her office yesterday.
"This is the kind of dialogue that should have been occurring a long time ago," Jarvis said. "If I hadn't moved the amendment , I don't think these guys would have ever sat down."
Spokesmen for the restaurateurs and liquor stores said yesterday that they would oppose withdrawal of the whole bill.
"The original bill has many fine provisions. We consider any effort to hold those fine provisions hostage to the wholesalers' backed provisions to be most unfortunate," said Stephen J. O'Brien , the lawyer for the 100-member D.C. Licensed Restaurant Group.
Lou Kressin, a spokesman for the Washington, D.C., Retail Liquor Dealers Association, said, "She knows her amendment is going down to defeat; it's a stalling tactic."
Both Kressin and O'Brien said their groups favor deleting Jarvis' amendment and then having the council adopt the original retail liquor bill, which would allow liquor stores to remain open longer, accept credit cards and advertise prices in windows
James M. Christian, a lawyer representing the four wholesalers seeking the change, said his group agrees with Jarvis' decision to withdraw the entire bill.
Distributors of four of Washington's premium beers, Schlitz, Budweiser, Miller's and Stroh's, have contended that their delinquent accounts are growing at an unacceptable rate that already has resulted in higher than necessary beer prices.
There are more than 1,600 retail establishments licensed to sell beer in the city.
Robert B. Washington Jr., a former city Democratic chairman who is the wholesalers' chief lobbyist, said beer distributors must pay their suppliers within 10 days of delivery as opposed to the maximum of 45 days allowed to liquor stores and restaurants.
He said the shorter pay period for distributors often forces them to get high-interest bank loans to stay afloat while waiting to be reimbursed.
Federal liquor rules permit retailers up to 30 days to pay for beer bought on credit, except in jurisdictions, such as Washington, that have their own laws.
Retailers argue that wholesalers should deny credit to late-paying customers, which they have the power to do, instead of trying to change the law. But distributors are reluctant to revoke a customer's credit because they fear the customer would switch to a competitor, said O'Brien, lawyer for the restaurant group.
Washington said federal antitrust laws prevent distributors from exchanging credit information and agreeing to deny credit to a particular customer. Thus, he said, they were forced to turn to the city council for help.