THE OREGON LIQUOR Control Commission (OLCC) has officially dropped Commissioner Amanda Fritz's controversial push to ban sales of malt liquor and paint-thinner wines in downtown, Old Town, and Goose Hollow—citing legal concerns revealed by the Mercury this spring.

The bad news (for the city, at least) came Thursday, June 28, in a letter posted first on Blogtown. In it, OLCC Director Steve Pharo confessed to Fritz and other Portland officials that his agency technically has no right to create booze-ban zones known as "alcohol impact areas."

While the OLCC has claimed that power—according to its internal administrative rules—for nearly 20 years, the Oregon Department of Justice pointed out something sticky: State law, which trumps OLCC rules, never actually says that's okay.

The issue was first raised in January by a 7-Eleven franchisee in downtown Portland unhappy about the ban ["Sobering Up," News, May 17].

"Unexpectedly, we have determined that establishing an [alcohol impact area] under our current rule is not an option," Pharo wrote to Fritz. "Please let me know if you would like to pursue a legislative change."

Fritz, needless to say, was more than a little upset. Both the city and the OLCC had spent close to three years either studying the booze ban or arguing over how to put in it place. The Portland City Council endorsed it in September 2010.

"We've spent thousands of dollars and hundreds of hours on this," Fritz told the Mercury on Friday, June 29. "To be told that after they put us through all these hoops, it's more than disappointing."

Her frustration bubbled all weekend. On Monday, July 2, she issued a stern press release demanding a copy of the OLCC's legal opinion, calling the whole thing a "debacle" and a "bait and switch," and demanding the agency "take action more directly to implement the 'control' requirement in their title."

On Monday, July 2, OLCC spokeswoman Christie Scott said that the board would have to waive its attorney/client privilege to hand over the opinion—but that she wasn't sure when or how that would happen.

The legal challenge wasn't the only setback facing the booze ban. In April, the OLCC announced it was giving up on efforts to broker a compromise between Portland officials and grocery and liquor lobbyists over the shape of the ban. Fritz wanted to target all beer with at least 5.75 percent alcohol or sold in cans 16 ounces or larger, plus "fortified" wines and regular wine sold in boxes or jugs. Lobbyists wanted to ban specific products and brands favored by street drinkers.

That's not a bad idea. That way, for example, responsible Portlanders who want to pick up a tallboy sixer of regular-strength beer on their way home from work or school wouldn't also be punished. The city and the OLCC also had to hash out new boundaries for the ban, lumping in residential areas near NW 23rd ["On the Rocks?" News, Oct 6, 2011] and the Pearl.

Next up? The two might find lawmakers to take up their cause during the 2013 legislative session. Fritz said that will be easier if the OLCC shares its legal advice.

"We cannot fix a statute," she says, "when we don't know how it is broken."