The House two-year budget isn't likely to contain any proposal to privatize the state liquor system. At least initially.

House Ways and Means Chairman Ross Hunter, D-Medina, said he's looking at competing proposals and doesn't expect to include either one in the budget, which is due out next week. "I'm not trying to book speculative revenue into this budget," he said.

Two ideas have emerged.

Costco, which tried and failed to get the state out of the liquor business last fall with Initiative 1100, is lining up sponsors in the state House and Senate for a less sweeping proposal.

John Sullivan, Costco's vice president, said a key difference in the proposed legislation is that liquor licenses would only be issued to retailers that have 9,000 or more square feet. He estimate about 1,100 licenses would be issued total.

"The prior initiative said that essentially that any beer and wine retail license holder could get the spirit license. So it would be a substantial reduction," he said.

The proposal would generate money for the state through licensing fees, business and occupation taxes, and existing liquor taxes.

A competing measure being considered in both chambers would raise money by leasing the state distribution system to a private company, but leave the state to handle the retail stores.

Backers for both proposals say they can generate several hundred million dollars in revenue for the state, at a time when the state Legislature is looking for ways to close a $5.1 billion budget shortfall.

Senate Ways and Means Chairman Ed Murray, D-Seattle, said he was leaning toward the proposal to lease the distribution system over the Costco proposal, in part because it avoids a fight with labor and other backers of state control of the retail business.

Some form of liquor privatization is the only proposal so far that lawmakers in the House, Senate and governor's office have expressed interest in that could raise significant amounts of money for the state.