Friday, August 29, 2014
Inquirer Daily News

Beer laws in Pa. a Prohibition hangover

HARRISBURG - The law was born out of fear of the open saloon: that dark, evil place where men drank away paychecks, trafficked in stolen goods, and engaged in unspeakable acts of violence and debauchery.

That was 1933, the end of Prohibition and the birth of Pennsylvania's liquor and beer code. So much is new since then - polyester and podcasts, TV and Twitter. The Phils have won the World Series twice, and man has walked on the moon. Nearly everything has changed since 1933.

But not Pennsylvania's beer laws.

The rules on how and where beer can be sold have remained virtually unchanged - and most major legislative efforts to overhaul them have fallen flat as quickly as the head on a stale lager.

Blame old-time traditions and modern-day politics, say those who have toiled for years to change the laws.

Pennsylvania, they argue, has a system of delivering beer that reflects the societal concerns of 70 years ago. Yet its players remain the same, and they depend on the law remaining intact - and spend millions to keep it that way.

"There is a certain fear of change," Sen. John C. Rafferty Jr. (R., Montgomery) said last week as he unveiled a plan to allow six-packs to be sold in grocery and convenience stores, as well as beer distributors. "And there are a lot of special interests."

It all dates back to 1933, when the liquor code was written with the explicit intention of making it difficult to buy alcohol, said Jay Goldstein, a retired liquor enforcement officer for the state and the former head of a Pennsylvania trade group representing wholesale beer distributors.

The motivating factor was to the protect public welfare and to "prohibit forever the open saloon," which had been a societal bane prior to Prohibition. Those very words were written into the liquor code. They still are there.

Pennsylvania's solution was to create a highly controlled, multi-tier system for beer distribution, which basically goes like this: The brewer (or beer company) sells its product to a middleman, or wholesaler, who then sells it to the beer retailer.

Today, however, the people who work in those tiers have trade groups and lobbyists and political action committees.

So do the people who want to break into Pennsylvania's beer business, such as grocery and convenience stores.

And, not surprisingly, they are at war with each other to protect their turf.

All together, they have spent just over $1.8 million in the last three years to get their voices heard in Harrisburg, state lobbying records show.

"All the different [sides] get into a battle with one another over who can do what," said Rafferty.

Right now, Pennsylvanians can buy their beer at a distributor, where they can pick up a case containing four six-packs; or at a bar or deli, where they can take out up to two six-packs, usually at a steep markup.

There are a few supermarket chains, including Wegmans, that have recently obtained licenses to sell beer. But beer distributors are suing to stop the practice.

Rafferty wants to open the market to allow everyone, including beer distributors and supermarkets, to sell anything from a six-pack to a case. Though the measure has yet to be formally introduced, battle lines are being drawn.

The beer distributors don't like it because they believe big retailers will put them out of business.

Bars and taverns have a problem with it because it could cut into their profitable six-pack sales.

And the big beer companies, which theoretically would benefit from busting the market open, have learned it sometimes is best to just keep quiet. Angering beer distributors could mean their beers get shelved at the back of the store.

"Pennsylvania is a big beer state, and people are passionate about their beer . . . but making any change will require a delicate balance," said Francis X. O'Brien, a former attorney for the Pennsylvania Liquor Control Board who is now a lobbyist for beer wholesalers.

It will also require challenging its past.

Pennsylvania is, at its core, a conservative state, particularly when it comes to alcohol. Even today, 28 municipalities are dry for liquor; 104 for beer; and 550 for both, according to the Liquor Control Board.

"Change doesn't come easily in our state," said Goldstein, now a sculptor who carves birds.

For Daniel Murphy of Haverford, that is an understatement.

The retired partner in the law firm of Stradley, Ronon, Stevens & Young partner tried to get beer into grocery stores - 40 years ago.

At the time, Murphy was hired by a trade group of mostly mom-and-pop grocers to argue their case before a statewide commission examining the issue.

The commission had seven members representing the consumer, seven members representing the beer industry, and one lawmaker: Rep. Matthew J. Ryan of Delaware County, a Republican who later became speaker of the House and a political powerhouse in Harrisburg.

Murphy said the commission was split evenly on whether to recommend changing the law, and Ryan was going to be the tiebreaker.

"He [Ryan] called me and said, 'As you know, I've never taken a penny, but I do ask for favors,' " said Murphy, who now is a judge pro tempore and does arbitration work for the Philadelphia courts.

Murphy said Ryan told him he was "particularly fond" of the nuns at a Bryn Mawr home for children - and asked whether he would arrange for groceries to be sent to them.

Murphy made a call, and a truck full of groceries was promptly delivered to the nuns.

Ryan gave a thumbs-up to allowing beer in grocery stores.

The measure then was sent to the legislature, where it promptly died.

 


Contact staff writer Angela Couloumbis at 717-787-5934 or acouloumbis@phillynews.com.

 

Angela Couloumbis Inquirer Staff Writer
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