Pa. study begins on privatizing liquor sale
Outside analysis of the State Store system will include what stores could fetch.
HARRISBURG - Gov. Corbett's administration took a preliminary step Tuesday toward privatizing the sale of wine and spirits in Pennsylvania, as an outside consultant began an analysis of the 620 state-owned and -operated liquor stores.
The study by Philadelphia-based Public Financial Management (PFM) could take until July. It is one of several moves aimed at privatizing, or at least modernizing, the liquor system, which dates to the end of Prohibition in 1933.
Corbett has said he wants to get the state out of the liquor-selling business, arguing that it's not a "core function" of government. PFM was on retainer with the state, a contractual relationship begun under Corbett's predecessor, Ed Rendell. It was unclear Tuesday how much PFM would be paid for the study.
One aspect of the study is likely to be a highly disputed point - how much money the state could get from auctioning licenses for liquor stores to private operators. The United Food and Commercial Workers, a union that represents many of the clerks in State Stores, differs sharply on this point with proponents of privatization such as House Majority Leader Mike Turzai (R., Allegheny).
Turzai said Tuesday that by May, he would introduce a bill that would permit an auction of licenses for the 620 existing liquor stores, along with 130 new ones, to private owners. The exact details of his privatization proposal will likely depend on what the governor's study turns up, he added.
"The governor and I are committed to having the private sale of wine and spirits," Turzai said.
Meanwhile, the three-member Liquor Control Board asked a House committee Tuesday for bills that the board said would improve the system's operations and lessen, if not stop, any need for privatization. They include:
Allowing expansion of Sunday store operations. Currently, no more than 25 percent of the 620 stores may be open, and only from noon until 5 p.m. The board would like more stores open and perhaps as late as 8 p.m.
Letting wineries ship directly to buyers' homes, rather than to State Stores for pickup. The board wants to be sure that underage teens cannot, however, order wine via phone or the Internet, and wants to ensure that all state taxes are collected on the wine.
Creating flexibility in pricing by lifting the current flat 30 percent markup imposed on every bottle of wine and spirits sold, in order to give the board power to vary the price markup "between a $7 bottle of wine and a $500 bottle of champagne," as LCB Chairman P.J. Stapleton put it.
Increasing efforts to lessen "border bleed" - a problem that exists mainly in Southeastern Pennsylvania, where Pennsylvanians who work or vacation in Delaware or New Jersey go there to buy liquor because of better prices.