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The union, the beer magnate, and the state senator

In April 2010, there was a party in Newtown, Bucks County — a political fundraiser, like dozens or perhaps hundreds of similar events held across the state that election cycle. But this was different, an illustration of how complicated Pennsylvania politics can be.

State Sen. Charles McIlhinney, R-Bucks, is at the center of the liquor privatization fight.
State Sen. Charles McIlhinney, R-Bucks, is at the center of the liquor privatization fight.Read more

HARRISBURG – In April 2010, there was a party in Newtown, Bucks County — a political fundraiser, like dozens or perhaps hundreds of similar events held across the state that election cycle.

But this was different, an illustration of how complicated Pennsylvania politics can be.

It was held at the Temperance House, an ironic name, perhaps, since the restaurant is owned by Pasquale "Pat" Deon, a businessman who owns a chain of beer distributors in the Philadelphia suburbs. Deon also chairs the board that governs SEPTA, serves on the Pennsylvania Turnpike Commission and is a major player in Republican politics.

The event raised money – tens of thousands of dollars, according to campaign finance reports – for a political action committee, the Lower Bucks Leadership Fund.

This particular night, the biggest check written to the fund came from the campaign committee attached to the IBEW Local 98, the politically powerful Philadelphia-area union representing electrical workers. The head of the union, John "Johnny Doc" Dougherty, is a major player in Democratic politics in the city and, by extension, the state.

Dougherty's union that night gave $25,000 to the Lower Bucks Leadership Fund, a political action committee.

Two days later, the fund wrote a $25,000 check to state Sen. Charles McIlhinney, R-Bucks.

Now, as was the case during that fundraiser in 2010, McIlhinney finds himself at the center of an issue combining the big money of politically prominent Pennsylvania businessmen and unions across party lines — the privatization of the state liquor stores.

Ideology doesn't rule the day

Pennsylvania is a politically moderate state, a fact frustrating to those on the right as well as the left.

"Not everything breaks down along ideological lines. There are always economic interests at play," said Terry Madonna, pollster and professor of political science at Franklin and Marshall College.

It's not unusual for members of the General Assembly to get cash from prominent donors on both sides, and the general perception in the state Capitol is big unions and big business interests have undue influence over policy matters.

That situation has played out in Bucks County.

During the 2010 cycle, the Lower Bucks Leadership Fund got contributions from businesses leaders as well as unions. In addition to McIlhinney, the PAC funded — to the tune of thousands of dollars — the campaigns of state Sen. Tommy Tomlinson, R-Bucks, and Lt. Gov. Jim Cawley, another Bucks County Republican and former county commissioner.

Three years later, as the new chairman of the Senate's Law and Justice Committee, McIlhinney is arguably the most important vote, at least now, in the ongoing battle to privatize Pennsylvania's state-owned and operated liquor store system.

Unions, led by the UFCW Local 1776, which represents about 3,000 liquor store employees, oppose privatization. Beer distributors, such as Deon, are not exactly thrilled at the prospect of liberalizing a market that offers a carved and protected niche.

But plenty of McIlhinney's fellow Republicans – including Gov. Corbett and the 105 members of the state House who voted for the bill on March 21 – favor the privatization effort.

As do many business groups and other statewide Republican and conservative activist groups, which play an increasingly important role in electoral politics.

What's a guy like McIlhinney to do?

In an interview Wednesday, McIlhinney said he wants to move forward with a plan to allow grocery stores to sell wine if they have a license to sell beer, which some already do. He wants to allow beer distributors to sell six-packs, in addition to cases and kegs.

Still, he sees little reason to immediately close state liquor stores — it would  "disrupt hundreds of peoples' lives," he says – when Pennsylvania's beer and liquor market could first be liberalized in other ways. The state could phase out the liquor stores, he said, but he did not provide a time frame.

"I can't say that I'm just agreeable to selling alcohol like any other product. It's a drug and it should be regulated," McIlhinney said. "There is a social impact; that's undeniable. It's not going to be treated like bread."

But last week, the first hearing on the issue Tuesday morning was stacked with opponents of privatization, without so much as a single person who testified in favor of the plan.

Afterward, privatization supporters raised plenty of questions about McIlhinney's intentions – Was he trying to kill momentum for the issue? He said no, defended the lineup of testifiers Tuesday and promised that supporters of privatization would get their say later.

Another hearing is scheduled this month, and a third is planned for early June.

McIlhinney's self-imposed deadline for placing a proposal on the table comes two weeks after the third hearing.

Union contributions questioned

Some are openly questioning whether McIlhinney's campaign contributions from big unions might change the course of the privatization bill.

The IBEW Local 98 is an electoral heavy-hitter in Pennsylvania. During that same 2010 cycle, the union spent more than $4.5 million on political contributions, according to the Center for Responsive Politics, which aggregates political spending.

That $25,000 McIlhinney got from the IBEW was one of the four largest sources of contributions to his 2010 re-election campaign, according to campaign finance records. The top three came from Republican sources.

Rob Ciervo, a Republican township supervisor from Bucks County who is on the record as considering a 2014 primary challenge to McIlhinney, has openly criticized the state senator for failing to take swift action on the privatization plan.

Ciervo said he was "deeply troubled" by the money McIlhinney apparently received from the powerful IBEW union.

"Once again we see that Mr. McIlhinney is a member of the union party, seeking to block much-needed reforms in Harrisburg and doing the bidding of special interest groups from Philadelphia instead of looking out for the taxpayers of Bucks County," Ciervo said.

McIlhinney said any attempt to connect those three year-old contributions to his work on liquor privatization were "ridiculous."

"It certainly seems like Mr. Ciervo is wearing his tin-foil hat," McIlhinney said Wednesday. "I didn't ask the IBEW to give me that money."

Facing heat from all sides

McIlhinney is also facing pressure from a conservative campaign group – the Citizens Alliance of Pennsylvania – which is running television ads encouraging constituents to call the senator and voice support for liquor privatization.

Meanwhile, the UFCW is running a million-dollar statewide television and radio campaign trying to kill the bill, though those ads are aimed at Corbett and more broadly attack the issue.

Deon probably plays a big role, too.

Though Deon has been publicly silent about the liquor privatization plan, there is ample evidence he is pulling strings behind the scenes. Beer distributors disliked the initial plan put forth by Corbett and withheld their support until the House changed the rules, keeping in place rules giving beer distributors a protected market in Pennsylvania.

Deon's influence will likely be felt in the state Senate, too, as Deon and McIlhinney are known to have a close relationship. He did not return calls for comment.

McIlhinney also took issue with the perception he is "Deon's guy" in the process.

If anything, the bill passed by the state House – which gave beer distributors a deeply discounted license to sell wine and liquor while preventing grocery stores from selling beer – was more of a giveaway to the beer distributors than anything he has proposed, the senator said.

When the liquor bill passed the state House in March, defeated Democratic leaders proclaimed that night to be the end of the "moderate Republican," with electoral forces threatening defeat to any member of the party who did not move to the right on ideological issues such as the state's role as sole distributor and retailer of liquor and wine.

The fate of the liquor bill in the state Senate will test that thesis – or determine that moderates indeed still rule the day in Pennsylvania.

Madonna said polls show most Pennsylvanians would prefer a privatized liquor system, but the issue is not one that carries a lot of weight for most voters. It would be surprising to see any member of the General Assembly lose his seat over the outcome of the liquor debate, he predicted.

McIlhinney gives the impression of a man who is taking it all in stride as the state's powerful political forces swirl around him.

"You just handle it like any other issue," he said.

Boehm can be reached at and follow @PAIndependent on Twitter for more.