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State leaders negotiating on possible new liquor privatization plan

| Tuesday, Jan. 7, 2014, 4:27 p.m.

HARRISBURG — House and Senate leaders are negotiating a plan with the governor's office that eventually could phase out state-owned liquor stores and expand private sales of wine, beer and liquor, a key proponent said on Tuesday.

“It's definitely moving in a positive direction. I feel like a consensus product can be reached,” said House Majority Leader Mike Turzai, R-Marshall, though he noted it's a “work in progress.”

Lt. Gov. Jim Cawley is spearheading discussions, Turzai said. Cawley could not be reached.

Privatizing Pennsylvania's liquor sales has been a priority for Republican Gov. Tom Corbett, who faces re-election in November.

Turzai's acknowledgement was the first public comment by GOP House leaders on a revived effort to privatize liquor sales. Senate Majority Leader Dominic Pileggi, R-Delaware County, last week said he's hopeful lawmakers can send a bill to Corbett's desk early this year.

No one is disclosing details of what lawmakers are negotiating. They likely will devise a formula for determining when some of the 600-plus state stores would need to close.

The state store system was established in 1933, shortly before the end of Prohibition. Then-Gov. Gifford Pinchot wanted to “discourage the purchase of alcoholic beverages by making it as inconvenient and expensive as possible.”

Pennsylvania and Utah are the only states controlling wholesale and retail sales of liquor and wine.

Turzai considers it an antiquated system and said proponents of privatizing sales want to make buying wine and beer more convenient.

Labor unions representing state store clerks oppose privatization.

Wendell W. Young IV, president of the United Food and Commercial Workers Local 1776, expressed skepticism that the legislature is on the verge of passing a liquor bill.

“I hate to sound like a broken record, but there's nothing new here,” said Young, whose union represents liquor clerks. If legislative leaders had the votes they would say nothing until they're ready to vote, he said.

Selling liquor licenses, Turzai said, would bring in money for the 2014-15 budget, which has a projected deficit of $800 million to $1.4 billion.

Senate Democrats on Tuesday said they want to make sure they're included in talks about liquor privatization, the budget and potential changes to the Pennsylvania Lottery.

Senate Minority Leader Jay Costa, D-Forest Hills, said if lawmakers decide to expand gambling with fast-paced games such as keno, he doesn't want the extra revenue to go toward lottery privatization. It should continue to fund senior programs, such as low-cost prescription drugs and rebates on property tax and rent, he said.

Despite Corbett's decision last month to not renew a contract with a British firm, lottery privatization is an issue the governor and GOP legislative leaders likely will push in 2014, Costa said. Keno is one option under consideration to raise more money.

The budget deficit and a re-election year for Corbett, whose public approval numbers are low, have created “desperation” among Republicans in the legislature, said Sen. Vincent Hughes of Philadelphia.

Hughes, ranking Democrat on the Senate Appropriations Committee, said he wants to make sure legislation doesn't get slammed through to meet political agendas.

Senate Democrats would “be OK (with the agenda) if it included a tax increase,” said Mike Barley, Corbett's campaign manager. “Legislators and the administration will be looking at different ways to fix the budget (gap). All I hear from them is ‘raise taxes,' not ‘cut spending.' ”

Brad Bumsted is Trib Total Media's state Capitol reporter. Reach him at 717-787-1405 or bbumsted@tribweb.com.

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