Corbett backs privatizing state stores; Onorato is opposed

HARRISBURG - Republican gubernatorial candidate Tom Corbett is hoping that if he wins, he can accomplish what two previous GOP governors were unable to do during the course of two decades: privatize the state's liquor stores.

Corbett made his case this week for unloading Pennsylvania's oft-criticized system for selling liquor and wine, arguing that the state's recession-ravaged coffers could get a significant boost from selling it off.

"We need to move our state out of the 19th century and refocus state government on its core functions and services," he said in a news release Tuesday.

After a campaign appearance in Philadelphia Wednesday, Corbett said the struggling economy and the state's annual scramble to shore up a massive budget hole might spur the idea.

"I think that the problem with the economy of Pennsylvania today, and the budget of Pennsylvania today, is certainly going to be a stimulus to giving the legislature a great deal of reason to strongly consider what I'm proposing," Corbett said after the forum.

In the past, opposition has come from unions representing store workers and an overall unease about relinquishing the system to the private sector.

Corbett campaign spokesman Kevin Harley said Wednesday that studies had shown that auctioning off licenses for retail stores as well as wholesale distributors could bring in $2 billion in revenue.

Harley said that estimate came from research done during the summer by State Rep. Mike Turzai (R., Allegheny), who is pushing a bill to privatize the state system.

Turzai has said that the onetime auctioning of the licenses could bring in $2 billion but that other estimates put that total as high as $6 billion.

Also in Philadelphia, Democratic candidate Dan Onorato said selling the system was a bad idea.

"The state stores make $500 million a year to the general net revenues," Onorato said. Supporters of selling the system "project you'll get $2 billion at the high end, a billion dollars on the low end, if you sell them. That's four years of operating revenues that come into the state coffers," he said.

"What I would do is make the store systems more consumer-friendly, put the State Store systems right in the grocery stores, and still keep the profits that we have," Onorato said. "It doesn't do anything to help the budget and it probably just promotes minimum-wage jobs," he said of Corbett's plan.

Liquor Control Board officials said Wednesday that the agency contributed just over $481 million to the general fund in the 2009-10 fiscal year. In the 2008-09 fiscal year, the board sent over just over $496 million.

In recent decades, few issues have generated the level of animosity and even street-brawling protest as privatization of the State Stores.

In the mid-1980s, Gov. Dick Thornburgh - the originator of the idea - staged a much-publicized photo-op where he slapped a "For Sale" sign onto a State Store.

In the mid-1990s, pickets carried signs attacking Gov. Tom Ridge's front man on the privatization plan, LCB Chairman John Jones, that read "Death to Jones."

"It's a very, very contentious issue," Jones, now a federal judge, said Wednesday.

Thornburgh's proposal was defeated in the General Assembly. Ridge, in 1996, could not even get a vote on his plan, Jones said.

Harley said Wednesday that times are different. With the state facing at least a $4 billion deficit next year, he said, "we think there is the public will to do it."