Anyone living and/or drinking in Pennsylvania is familiar with the stricter-than-average alcohol laws within the commonwealth. Beer doesn’t have quite as restrictive laws surrounding it compared to other alcoholic beverages. Wine and spirits are sold exclusively by the state, whereas beer can be purchased from a restaurant, bar, licensed beer store or distributor. Unlike many other states, grocery and convenience stores are not allowed to sell beer. However, that may change soon.
Pennsylvania House Bill 790, introduced on March 4th, is proposing changes to the current liquor laws, moving towards privatizing the industry. If passed, this bill would allow grocery stores and pharmacies to sell six-packs of beer and bottles of wine, convenience stores to sell six-packs of beer, and larger retail stores like Wal-Mart to sell bottles of wine and cases of beer. Additionally, 1,200 licenses would be auctioned off for the sale of hard liquor in privately owned stores. Beer distributors would be allowed to bid for these licenses, creating a type of store not available in Pennsylvania currently: one-stop booze shops.
Although these new rules would greatly increase the range of store types involved in beer distribution, there would still be laws in place dictating the amount of beer these stores are allowed to sell to individuals. Grocery stores and pharmacies could sell up to two six-packs of beer or six bottles of wine to a customer. Convenience stores would only be allowed to sell one six-pack of beer per customer. Conversely, larger retail stores could sell beer by the case and six bottles of wine. Beer distributors could also break down their cases and sell as little as 42-ounce quantities, and unlimited wine.
Governor Tom Corbett is in favor of the bill, saying that the sale of licenses would generate $1 billion, which would contribute to an education block grant. According to 2007-2008 figures, around $353 million could be made from sale and liquor taxes. Customers crossing state borders to buy alcohol also might be more inclined to buy within Pennsylvania. The other lawmakers in support of this bill are overwhelmingly republican, including House Majority Leader Mike Turzai.
There is resistance to privatization, though. There is some question of how much revenue the selling of liquor licenses to private entities would actually generate, especially considering that the liquor licenses will be up for auction, not sold at a guaranteed price. It could also take years for the transition from public to private to be worked out, meaning that we could be waiting that long to see any money from the purchasing of licenses. Additionally, many opponents argue that figures calculated for revenue from sale and liquor taxes is over-exaggerated, and doesn’t take many issues into account, including fraud.
According to the Pennsylvania Liquor Control Board (PLCB), $1.9 billion in sales was generated by the state-run Wine & Spirits stores in 2010-2011, around $80 million of which is returned to the state. The state-owned stores also pay for Liquor Code enforcement and also contribute to the Pennsylvania Department of Health’s drug and alcohol programs. Another issue to consider is the job loss associated with the closing of state-run stores, and how much that might cost in compensation.
There have been some suggested amendments to the bill, including changes that would keep state-owned liquor stores up and running, and give beer distributors first shot at licenses. Many supporters of the bill agree that some amendments will have to be made before the bill is voted on, but that the general idea behind the bill should stay the same.
Compared to other states’ alcohol laws, the laws proposed in this bill are still on the more restrictive side of average. In many states, not only is beer available in grocery stores, gas stations and convenience stores, but these stores also offer hard liquor and some states have no limit on the amount of alcohol that can be sold to an individual. Pennsylvania is considered an alcoholic beverage control state, a title that entails the state having a monopoly on some or all categories of alcoholic beverages. There are eighteen states within this category, including Utah, Oregon, and Virginia. Some of these states have state-contracted liquor stores, or only allow privately owned businesses to sell beverages under a certain alcohol content. Utah and Pennsylvania are the most restrictive out of all these states.
It is expected that the House will vote on this bill later this month.