Pa. liquor often cheaper than in neighboring states

HARRISBURG - It pays to pick up a bottle of rum or wine for that summer barbecue party while vacationing at the Jersey Shore.

The perception in Pennsylvania is that other states have better prices on wine and liquor, so it makes sense to stock up when you're out of state. Maryland stores near the Pennsylvania line say they get plenty of customers from the Keystone State.

But a survey of liquor stores in four states conducted by the Harrisburg Patriot-News reveals that prices aren't always better across the state line. In fact, in some cases, Pennsylvania prices are cheaper.

A 750-milliliter bottle of Bacardi Superior P.R. Rum sells for $14.99 in Pennsylvania and $15.99 at Plaza Wines & Liquors in Manchester, N.J. A Yellow Tail Chardonnay is $7.99 in Pennsylvania and $8.99 at the New Jersey store.

Across the border in Delaware, a 1.75-liter bottle of Johnnie Walker Red is priced at $29.99 at Total Wine & More vs. the $41.99 Pennsylvania shoppers pay.

For consumers, the hotly debated issue of whether or not to privatize Pennsylvania's wine and liquor stores boils down to the question: Will prices and selection improve?

"What I would like is more choice," said Amanda Robinette of Hampden Township.

Take her favorite liqueur, Amarula Cream from South Africa. She can't get it in Pennsylvania, but it's available in surrounding states.

Karen Fenstermacher of Fairview Township said some table wines she sees selling for $3 and $4 in her home state of Massachusetts are priced at $7 or $8 in Pennsylvania. She said the selection is better in Massachusetts, too.

"We bought wine and beer any day of the week. It was just convenient," she said.

Those in favor of ending the state-run monopoly argue it would create more competition and ultimately lower prices and better selection. It would also recapture some of the revenue lost to border bleed as residents stop visits to neighboring states.

"The fundamental answer is competition. The private retailer in a regulated market would be competing against each other to serve customers. Really, it's the same logic that makes grocery stores or large retail stores work," said Leonard Gilroy, director of government reform for the libertarian Reason Foundation.

However, opponents say shoppers would lose an advantage because Pennsylvania bulk buying power works in favor of consumers. As one of the largest purchasers of wines and spirits in the nation, the Pennsylvania Liquor Control Board is able to pass discounts on to consumers.

"The people making sweeping claims about prices going down are just spouting ideology," said Stephen Herzenberg, an economist with the Keystone Research Center, a liberal-leaning group. "When you look at the economics of the situation, there is more reason to think prices will go up with privatization if tax rates and tax collections stay the same."

It is anticipated that the issue of privatization will heat up this summer.

Gov. Corbett, who has said he wants the state to get out of the business of selling liquor, has asked consultant Philadelphia-based company Public Financial Management to analyze the state's 625 liquor stores. The results are expected to be released in July.

Both sides are awaiting one aspect of the study that will reveal how much money the state could get from auctioning liquor store licenses to private operators.

State House Majority Leader Mike Turzai (R., Allegheny) has said he will propose a privatization plan soon that would eliminate state liquor stores entirely. He has repeatedly said ending the state-run monopoly system would benefit consumers through better pricing and selection.

Critics want proof.

"If what the other side of privatization says is true, they would be loaded with volumes of paperwork backing up their claims. They have not shown that price and selection are better," said Wendell W. Young IV, president of Local 1776 of the United Food and Commercial Workers Union.

Joe Conti, chief executive officer of the PLCB, acknowledges a perception problem.

"People enjoy going to different types of stores, and historically our stores are all the same. There is a perception vs. reality. You may go into a lot of stores in other states and they appear they have more selection and their pricing is different," Conti said.

The board has hired a marketing research company to conduct a six-month evaluation of prices on Pennsylvania's top 50 wines and spirits against those same products sold in neighboring states.

The results are expected to be available by midsummer. A snapshot of the study's results from January and February reveals Pennsylvania prices are competitive with neighboring states, Conti said.

A Captain Morgan Spiced Rum was cheaper in Pennsylvania, and a Grey Goose vodka was more reasonably priced in every state but Delaware, where it sold for $2.09 less, he said.