Senate Liquor Plan: "Privatization Lite" Is Being Generous
June 19, 2013:
Senator Chuck McIlhinney (R-Bucks) unveiled his "privatization" plan yesterday and…well it’s better letting the details speak for themselves:
• Does not create any new retail licenses
• Keeps the state stores
• Keeps the state wholesale monopoly (basically, if a store sells wine or spirits they have to buy it from the government)
• Keeps the beer wholesale monopoly (which is unconstitutional according to an analysis from the Competitive Enterprise Institute)
On the bright side, the legislation will require the PLCB and the Legislative Budget and Finance Committee to conduct a two year study to determine if the state should get out of the retail and wholesale business.
According to the legislative summary, a new "specialty spirits" permit will be created that will allow the holder to sell one specific category of spirits. Without being able to evaluate the legislative language, we are unable to determine if those will only be available to current licensees only or if it will allow for the creation of a stand-alone specialty shop. However, it would certainly seem that a wine boutique is out of the question.
At this point you are probably wondering, "Does the proposal actually do anything good?"
• The proposal would eliminate the 18 percent "Johnstown Flood Tax" that was enacted in 1936 and levied on all wine and spirits sales in Pennsylvania.
• Beer distributors can sell six packs.
• Restaurant, hotel and eating place licensees can sell up to 4 six packs or 2 twelve packs but again, no new licenses. They can also buy a permit to sell limited quantities of wine and/or spirits for "off-premise" construction.
• Allows Pennsylvania residents to order wine online, etc. and have it shipped to their home.
• Allows manufactures coupons to be used.
• Authorizes the PLCB to ship to permit holders for a fee. (Did not know your local bar currently picks up the order from a state store?)
• Allows for manufacturer/distributor to ship directly to the licensee, which is admirable because it would cost the PLCB up to $770 million per year to deliver to all the bars, restaurants and hotels.
We have a hard time getting excited about most of these changes. A fair comparison would be going to a store to buy a cell phone, asking for the best they have and being handed a rotary phone with an antenna glued on.
If you are as underwhelmed by this proposal as we are, contact your Senator today and tell them you want real privatization, not privatization lite (or modernization plus if you strive for accuracy).
Citizens Alliance of Pennsylvania (CAP) is a non-profit organization founded to raise the standard of living of all Pennsylvanians by restoring limited government, economic freedom, and personal responsibility. By empowering the Commonwealth’s employers and taxpayers to break state government’s "Iron Triangle" of career politicians, bureaucrats, and Big Government lobbyists, this restoration will occur and Pennsylvania will prosper.