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Pennsylvania House approves liquor privatization bill

A young couple shops for liquor at the state liquor store on Wharton Street in Pittsburgh's South Side on Feb. 9, 2013. Three former top Liquor Control Board officials breached state ethics rules by accepting gifts and hospitality from alcohol vendors who had business before the LCB, according to a series of long-awaited reports by the state Ethics Commission released today.

Highlights of the bill:

• Grocery stores could buy licenses to sell wine. Based on the county, fees could range from $97,500 to $187,500.

• 1,200 wine and spirits retail licenses would be auctioned.

• Beer distributors get first crack at them and must decide within a year. They would pay fees up to $37,500 for wine and up to $60,000 for spirits.

• Any remaining licenses would be offered to the public. Those public fees for wine may be as high as $187,500 and for spirits, as high as $262,000.

• Convenience stores with eating areas could sell beer.

• As 600 state stores close, the Department of General Services, can decide whether to issue 600 additional wine and spirits licenses.

• Transaction scan devices would be required for anyone buying alcohol who appears to be younger than 35.

• When private stores number twice as many as state stores within a county, the state stores would close.

• When the number of state stores sinks below 100, all would close.

• Beer distributors could sell six-packs, 12-packs and 64-ounce “growlers,” not just cases.

Source: Tribune-Review

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Thursday, March 21, 2013, 1:51 p.m.
 

HARRISBURG — The state House on Thursday night approved a liquor privatization bill aimed at eliminating the state stores and allowing wine to be sold in grocery stores.

It was the first time in state history such a bill cleared the House.

The bill pushed by Republican Gov. Tom Corbett and House Majority Leader Mike Turzai, R-Bradford Woods, would phase out 600 state stores and allow wine sales in grocery stores, along with beer, if the store has an “R” or restaurant license. It would give beer distributors the first chance to purchase 1,200 licenses that would make them the focal point of one-stop shopping. The distributors would be able to sell beer, wine and liquor.

The bill was approved by a 105-90 margin.

Until Thursday, neither the House nor the Senate had approved legislation allowing private sector wine and spirit sales, forbidden since the state took control in 1933 following the end of Prohibition.

“It's huge. It's historic,” said Joseph DiSarro, chairman of the political science department at Washington and Jefferson College. The current system “is just so anachronistic and inconvenient for the average person.”

The outlook in the state Senate is uncertain. There is some support for privatization among Senate Republicans, but many GOP caucus members prefer “modernization” — keeping and improving the state stores, said Senate Majority Leader Dominic Pileggi, R-Delaware County.

House Liquor Chairman John Taylor, R-Philadelphia, predicted an eventual compromise between the House and Senate on how wine and spirits are sold.

Corbett said he and House leaders must “convince the Senate now is the time to move Pennsylvania into the 21st century.”

The governor is halfway to doing something former Republican Govs. Dick Thornburgh and Tom Ridge were unable to do in privatization efforts in 1983 and 1997, respectively.

“Every Republican governor in recent history has tried it but couldn't do it,” DiSarro said.

If successful in the Senate, “it ends the state-run liquor system, which is not a core function of state government,” Corbett said.

The state's residents deserve the same convenience enjoyed by those in 48 other states, Corbett said. Utah and Pennsylvania control wholesale and retail sales.

Pennsylvanians “want convenience, not chaos,” said House Minority Leader Frank Dermody, D-Oakmont. “This bill makes no sense. It truly is March madness.”

“The proposal as amended and here on the floor today is an A-plus product,” Turzai said.

Opponents argue that the bill will cost thousands of state store jobs and increase crime and domestic violence.

The state stores employ about 3,500 clerks. The United Food and Commercial Workers, the union representing clerks, has been the leading opponent.

“There's no good reason to put 3,500 UFCW members on the unemployment line,” said Wendell W. Young IV, who also serves as president of the UFCW PA Wine and Spirits Council.

Turzai and other supporters say state store clerks have skills and knowledge that will be sought by private employers. The bill provides tax credits for businesses that hire displaced workers and civil service preferences for those laid off.

“There are going to be thousands of new private sector jobs,” Turzai said.

House Appropriations Chairman Bill Adolph, R-Delaware County, said license sales will bring in $1.1 billion.

The Senate will carefully consider the liquor privatization bill approved by the House, but Senate Republicans are likely to change the legislation, Pileggi said.

“I don't think anyone expects the Senate to take up the House bill and pass it as is,” he said.

“It's clear there are a large number of Senate Republicans who believe modernization should be the first element of the bill,” Pileggi told reporters in a conference call. He was referring to proposals to improve operations of the state-owned stores and make them more profitable, such as authorizing pricing flexibility and expanding Sunday sales.

The Senate will hold hearings and consider the legislation during the next 30 to 60 days, he said.

Brad Bumsted is state Capitol reporter for Trib Total Media.He can be reached at 717-787-1405 and bbumsted@tribweb.com.

 

 

 
 


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