Monday, November 30, 2015

Coming this week: Liquor privatization's first big test

Coming this week: Liquor privatization's first big test



This coming week will be the first test of whether the legislature can finally reach consensus on a plan to privatize the sale of wine and hard liquor in Pennsylvania.

The House Liquor Control Committee is scheduled to hold a hearing Monday to consider Gov. Corbett’s privatization plan, which calls for auctioning off the state’s 600-plus wine and spirits shops to the private sector. The proceeds from the sale – about $1 billion – would be given to public schools through a new initiative to help them pay for early childhood education and school security, among other things.

If it passes muster in committee, the bill would then be sent to the House floor for debate. Majority Leader Mike Turzai (R., Allegheny), privatization’s most vocal supporter in the legislature, has vowed to bring the measure to a full floor vote by the end of the month. If he achieves that, it would be the furthest a liquor privatization bill has moved through the legislature.

"This is really over the goal line," Turzai told reporters recently. "People recognize that Pennsylvania needs a change."

But as both Turzai and Corbett know well, the road toward privatization is pocked with pitfalls – from both ends of the political spectrum. Democrats and the union representing state store clerks have historically opposed it, arguing that it will cost the state much-needed revenue (the Liquor Control Board kicks in about $80 million in profits annually to the state’s general fund) and thousands of workers good-paying jobs. And a number of conservative Republicans believe the state should continue strict controls over alcohol sales.

But Monday’s hearing will feature no debate. There will be no witnesses to provide testimony, just committee members asking questions and voting on the measure. Republicans who control the House said the reason for that format is because privatization has been exhaustively debated for years - and that there is no reason to do so again.

Still, Corbett’s privatization proposal is different from ones floated in the past. And it is expected to be amended in committee Monday with even more changes.

House Republicans said their amendment would allow for the basics of Corbett’s plan: allowing supermarkets and convenience stores to sell alcohol. But it would also scale back Corbett’s aggressive approach to privatization.

The amendment calls for 1,200 wine and spirits licenses, and would allow the state’s beer retailers first crack at them. After that, other retailers, such as grocery stores, could apply for one.

But the amendment would not immediately shut down the state stores. According to information provided by House Republicans, their plan would try to phase them out over time – and may not achieve that in certain counties: for instance, under their plan, all state stores in a particular county would have to close, but only if there are twice the number of privately-owned wine and spirits stores, plus grocery stores, in that county. 

It is a complicated formula, but House Republicans said they believe they have the votes for it.

"Our goal is to move this," said Turzai. "I can tell you that our caucus is very engaged in the discussion and there is significant support for moving Pennsylvania forward."

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About this blog

Commonwealth Confidential gives you regularly updated coverage of the state legislature, the governor and the workings of the state bureaucracy. It is written by Angela Couloumbis in the Inquirer's Harrisburg bureau, based in the statehouse, and by the newspaper's far-flung campaign reporters.

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