Senate Liquor Legislation Expected Today

State Senator Charles McIlhinney is expected to unveil his legislation today dealing with the liquor business in Pennsylvania. McIlhinney recently chaired a series of hearings on the proposal to privatize the booze business in PA, hearings that sometimes became contentious as union-backed opponents of privatization, including some lawmakers, expressed their outrage at the plan to close more than 600 state stores across the Commonwealth.

What will be included in the Senate bill is still a mystery, but McIlhinney indicated during the third and final hearing that he did not support Governor Tom Corbett’s plan to use the proceeds from the sale of the state stores for education block grants. The governor calls the plan “Passport for Learning.” Opponents dubbed it “Shots for Tots.”

The state House of Representatives passed a plan earlier this year that did not include the block grants. It is possible the Senate could follow suit and propose a privatization plan that does not include specifics on the use of the proceeds. In that case, the money would be set aside and its use would be determined at a later date.

Governor Tom Corbett has been pushing privatization since taking office in 2011. He says the state should not be in the business of selling alcohol, but the elimination of the state store system would mean the loss of thousands of jobs, and despite plans for job assistance, it’s unlikely that all state store and PLCB employees would find immediate work.

Meanwhile, retailers like Pennsylvania-based Sheetz convenience stores are pushing hard for the privatization effort. Sheetz employees wear pins promoting the potential sale of beer and advocates for the various chain retailers have been regulars on Capitol Hill in Harrisburg. It is arguably the most heavily-lobbied issue in a year full of big issues in Harrisburg.

Most agree something has to change, but privatization opponents are pushing for what they call a “modernization” effort. For now, that is likely to be the fallback Plan B should privatization fail to pass before the summer break.


Governor Still Faces Low Numbers, But Senator Toomey Gets Boost in New Poll


Terry Madonna

Terry Madonna

Governor Tom Corbett is facing one fewer potential opponent next year with word that Republican Bruce Castor has decided not to run against him in the primary.  But   he’s still facing challenging approval ratings.

The latest Franklin and Marshall College Poll shows Governor Corbett’s job performance remains around 25% and more than half of those polled do not believe he deserves reelection.

Poll Director Terry Madonna says voters list the economy, jobs and schools among their priorities with privatizing liquor and lottery sales last on the list.  He says this creates a problem for the Governor, who has been talking about privatizing the management of the lottery and privatizing alcohol, he says  it does not resonate with voters as very relevant to them.

Madonna says the economy has also been a factor.  He says it’s often hard when you recommend cuts to popular state programs and the economy doesn’t seem to be moving forward very quickly. He says there’s an important correlation between governors who win reelection and the health of the economy.

Madonna says  Governor Corbett’s numbers lag behind the ratings of two previous governors, Tom Ridge and Ed Rendell,  at this time in their terms.

Madonna adds that the poll also shows some softening in support for liquor privatization. Although a plurality supports selling state stores, a third option is on the table- modernization. The poll shows 26% of voters support modernizing liquor sales.

Meanwhile, another Pennsylvania Republican saw his numbers go up in the poll.  U. S. Senator Pat Toomey  gained 9 points in his favorability ratings since February and now stands at 35%. More than 40% of those polled don’t have an opinion or are undecided.

Madonna says the gun background check debate in Congress did not hurt Toomey with the voters. The Senator was one of the architects of a compromise effort that failed to win final approval.

Madonna says 57% of the voters in Pennsylvania favor creating more laws to regulate gun ownership. 89% favor universal background checks.

Senator Pat Toomey

Senator Pat Toomey

Knowles: Transportation is Smartest Place to Invest Liquor Privatization Dollars

With a public hearing on liquor privatization now scheduled in the state Senate, a group of state House members is calling for the upfront windfall from the sale of private wine and liquor licenses to be invested in transportation infrastructure. 

State Rep. Jerry Knowles (R-Berks/Schuylkill)

State Rep. Jerry Knowles (R-Berks/Schuylkill)

“It takes each and every dollar from privatization of the wine & spirits shops, and those dollars would be spent on roads and bridges,” state Rep. Jerry Knowles (R-Berks/Schuylkill) said of the legislation he sponsored

The governor wants to see liquor privatization revenue used for education block grants, but the bill that passed the House never designated a specific use for the revenue; it simply created a restricted account to hold the money. 

“I would like to see it be a billion, but it doesn’t matter if it’s $750-million, it doesn’t matter if it’s half a billion,” Knowles said at a capitol news conference.  “That’s still big money where I come from.” 

Knowles and his supporters are wary of being blamed for school funding cuts when the four-year block grant program, envisioned by the governor, expires.  “I want to make it perfectly clear,” Knowles said, “the governor has a good idea, it’s just that I have a better idea.”

Rep. Knowles recognizes that his plan would not raise enough revenue to solve PA’s near $3-billion dollar annual transportation funding shortfall, but he suggests that any legislative solution should start with HB 220. 

Meanwhile Senate Transportation Chair John Rafferty is scheduled to unveil a new funding plan on Tuesday, and the as-of-yet unrelated liquor privatization bill faces an uncertain fate in the chamber.

Committee Amends, Advances Liquor Privatization Bill

Like the plan Governor Tom Corbett outlined in January, the amended version of HB 790 would create 1,200 new private sector wine & spirits licenses.  The big change is that existing beer distributors would be given the right of first refusal. 

The amended bill would also allow state-run liquor stores to stay open until the number of privately-owned license equals twice the number of state stores in a particular county.  As soon as the total number of state stores falls below 100, all remaining outlets would be closed. 

A limited number of grocery stores would also be allowed to purchase special wine-only licenses under the amendment that ultimately cleared the House Liquor Control Committee. 

“This committee will deal with HB 790 today, after which it will go to the full House of Representatives for a debate and possible amendments, after which it will go to the Senate, after which it will probably come back to the House,” Chairman John Taylor (R-Philadelphia) said while emphasizing this is just the first step in a long legislative process. 

Democrats on the committee repeatedly called for public hearings and more time to analyze the bill during some two and a half hours of debate.  “I just think this is getting more confusing, instead of making it less confusing for our consumers,” said Minority Chairman Paul Costa (D-Allegheny).

Moments after the debate ended with a party-line vote of 14 – 10, Governor Tom Corbett released a statement calling it a “momentous first step.”  Corbett says he will continue to work with the General Assembly to end the state’s role as the sole wholesaler and retailer of wine & spirits.   

While the original Corbett plan would have potentially generated $1-billion dollars from the upfront sale of the wholesale and retail licenses, the amended bill is only expected to generate about $800-million.

Pennsylvania Liquor Store

Liquor Privatization Bill Introduced

The legislation essentially puts the plan Governor Tom Corbett outlined in January into bill form, and House Majority Leader Mike Turzai (R-Allegheny) is optimistic.  “People recognize Pennsylvania needs to change in a positive direction. We’re now talking about the details of how you structure that change.”  Turzai is the bill’s prime sponsor and perhaps the legislature’s biggest proponent of liquor privatization.    

While Turzai believes the concepts and objectives of liquor privatization will remain the same, he recognizes the details could change through the legislative process.  An amendment already being explored by Liquor Control Committee Chairman John Taylor (R-Philadelphia) would reportedly allow state-run liquor stores to compete with private sector licensees. 

State Rep. Mike Turzai (R-Allegheny)

House Republican Leader Mike Turzai

Turzai suggests that sort of plan merely takes a different route toward the same destination.  “In my mind, once the private sector gets the opportunity to sell wine & spirits, the state stores are – over time – they’re not going to be able to compete.”

The bill (HB 790) appears to be on the fast track.  Turzai tells reporters he’s eying a March 18th committee vote and final House passage in late March or early April. 

The timetable should raise red flags, according to House Democratic Leader Frank Dermody (D-Allegheny).  “Most legislators want to discuss ways to improve service and convenience for customers through the normal committee process, including hearings,” Dermody says in a statement.  “The more complicated his plan becomes, the faster he wants to vote on it with not committee hearings.”

RadioPA Roundtable

Radio PA Roundtable 03.01.13

On this week’s Radio PA Roundtable, Brad Christman and Matt Paul bring you more from the state legislative budget hearings, which included questioning on pensions and liquor privatization this week. Also, Radio PA’s Cathy Clark provides an update on the health of the Susquehanna River.

Radio PA Roundtable is a 30-minute program featuring in-depth reporting on the top news stories of the week.

Click the audio player below to hear the full broadcast:


Liquor Board’s Balancing Act on Display at Budget Hearing

As the battle lines are being drawn on Governor Tom Corbett’s liquor privatization plan, the legislative debate may come down to privatization vs. modernization.  But the issues can be mutually exclusive.  Peppered by repeated questions from the Senate Appropriations Committee, Liquor Control Board Chairman Joseph Brion said he is not personally opposed to privatization.  “I don’t think the state should be in the liquor business.  But – by the same token – we are in the liquor business.  So my attitude is – if we’re going to have a liquor business – make it the most profitable and best that you possibly can.” 

Others have suggested that modernizing the system now, will make it more valuable for possible privatization in the future. 

The Liquor Control Board transferred $530-million dollars to the state’s General Fund in the current fiscal year, but Monday’s testimony in the Senate hearing room indicated that more than 80% of the cash was generated by taxes, which would still be in place under a privatized system. 

Not lost on lawmakers weighing these difficult issues is the cost of enforcing the state’s liquor laws.  “Clearly if you’re going to have more licensees, you’re going to need more feet on the ground, and that’s okay, but we have to take that into contemplation when we review the legislation,” says state Rep. Scott Petri (R-Buck), a member of both the House Appropriations and Liquor Control committees.   

State Police Commissioner Frank Noonan, last week, estimated that his agency would need an additional $5-million dollars under a privatized liquor system.  Liquor Control Board officials have indicated that they’re regulatory costs total $38-million dollars today, but those are currently covered by the revenue they generate. 

Forthcoming legislation would appropriate $5-million more dollars for PSP’s Bureau of Liquor Enforcement and hike fines for liquor law violations.  House Majority Leader Mike Turzai’s latest bill is set to be introduced on March 4th.

Attorney General Rejects Lottery Contract

Like thousands of state contracts every year, the Professional Management Agreement with Camelot Global Services is subject to review for “form and legality.”  But Attorney General Kathleen Kane says it failed that test.  She says it’s in violation of both the law and the state constitution. 

Kane addressed the media for about five minutes this afternoon.  Listen to her entire statement by clicking below:  KaneLottery

Governor Tom Corbett entered into the contract in hopes of generating billions of additional dollars, over the next 20-years, for state programs that benefit senior citizens. 

A recent Franklin & Marshall College Poll found that 64% of Pennsylvanians oppose the move.

Opinions Shift on Same-Sex Marriage

Public opinion is changing when it comes to same-sex marriage in Pennsylvania.  Today’s Franklin & Marshall College Poll finds that 52% of Pennsylvania voters now favor legal marriage for gay and lesbian couples, compared to 41% who oppose it. 

Terry Madonna

Terry Madonna

Poll Director Terry Madonna believes this is the first poll to show majority support for the issue in PA.  “Some polls gave gotten up to 47, 49, even 50% support – depending on how the question was worded – but not a majority support for gay marriage,” Madonna tells Radio PA, “heavily driven by young voters whose attitudes on gay marriage are very different from seniors who oppose gay marriage.” 

Just seven years ago, in May 2006, Madonna’s poll found just 33% support for same-sex marriage in the Keystone State. 

Democratic state Senator Daylin Leach (D-Montgomery) has long been pushing marriage equality legislation, and is already circulating a co-sponsorship memo this session, which would legalize same-sex marriage in Pennsylvania.  However, while public opinion may be changing, Madonna believes the Republican-controlled General Assembly is still many years away from changing state law. 

The F&M Poll provides a number of compelling results aside from the same-sex marriage issue.  Here’s a sampling:

– Governor Tom Corbett’s job performance rating has hit a new low, as just 26% indicate that he’s doing a “good” or “excellent” job. 

– 64% oppose plans to put Pennsylvania Lottery operations in the hands of a private manager

– 82% want more money being spent on transportation infrastructure, but only 47% support the main recommendations of the TFAC report

– 53% support privatizing state-run liquor stores.