Liquor Privatization Passes State House

Mar 22, 2013

A plan to privatize the sale of wine and spirits and gradually phase out state stores passed the state House Thursday evening by a vote of 105 to 90.

Under the bill, grocery stores could sell wine, beer distributors could sell wine and liquor and other private entities could buy licenses to sell wine and liquor after the first year of implementation. The plan allows for the phasing out of state wine and spirits stores as private retailers obtain licenses.

Special permits would allow businesses to sell wine and liquor on Sundays. The bill would allow beer distributors to sell smaller packages of beer, like six-packs and 64-ounce jugs called growlers.

Floor debate went on for more than seven hours. House Democrats uniformly opposed the measure – among them, Representative Bill Keller of Philadelphia, who said he’s skeptical privatization would result in a better deal for consumers.

“I’ll make a prediction—that in five years, we will replace our public monopoly with a private license monopoly, because as all good businessmen know, big business buys out small business,” he said.

Small business in this debate has been code for beer distributors, who have vociferously opposed the plan, even since recently added changes to make the bill more favorable to them.

“No particular group is more benefitted from this legislation than beer distributors, and they oppose it,” said Rep. John Taylor (R-Philadelphia), the prime sponsor of the liquor privatization proposal. “And they oppose it not because of what we did for them, but they oppose it because of what we did for others.”

Beer distributors have said the plan would shut them down before long by allowing entities like corporate big-box stores to buy wine and liquor licenses. Such businesses could also obtain licenses to sell beer, thereby having the same trifecta of products that beer distributors would have – but, as distributors argue — a lot more money to set up and sell in Pennsylvania.

Taylor said he thinks the measure is an attempt to respond to pressure from consumers for more convenience while doing the least amount of damage to those already invested in the current system – state store workers and beer distributors.

Opponents of the bill, among them moderate Republicans, cited concerns about leaving state store workers without jobs and increasing consumer access to alcohol without mandating increased enforcement.

But Rep. Scott Petri (R-Bucks), who began the week with concerns about the bill, reiterated Taylor’s point and lodged his support for the plan, calling it the result of an attempt to strike a balance between all of them.

“We probably would have (chosen) a different way to end Prohibition than what was chosen,” said Petri, “but we are trying to deal with what we are given.”

Gov. Corbett called the bill’s passage in the House historic, and he paid a visit to the House Majority Caucus room shortly after the vote. But he noted he wasn’t claiming victory yet.

“Celebration will occur when I sign the bill,” he said.

House Speaker Sam Smith called the vote a “foundation.”

“We recognize this isn’t complete,” Smith said, “but it definitely shows that there’s support for the cornerstone, the four cornerstones of a private market.”