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Governor Corbett says funding highways and privatizing liquor stores top his to-do list

Written by The Associated Press | Nov 19, 2012 3:21 PM
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(Harrisburg) -- Governor Corbett is focusing on unfinished business, such as transportation funding, pension reform and the privatization of liquor and wine sales, in the second half of his term.

The Republican governor also said he does not plan to change his inner circle of advisers, even though his hand-picked 2012 candidates for U.S. Senate and state attorney general were both defeated.

Corbett says he's concerned about action in Washington that could worsen Pennsylvania's budget problems.

He says the state cannot absorb the cost of any expansion of the Medicaid program because it would quickly spiral out of control.

The governor adds he worries that failure by Congress to resolve the ``fiscal cliff'' issue could disrupt the nation's economy or cause another recession.

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Comments: 1

  • mrbirkos img 2012-11-21 23:31

    Nothing has changed since 1933.

    PA is still divided in two parts: Pittsburgh/Philadelphia, and everywhere else.

    Of the 620 liquor stores, over 300 are within 50 miles of Pittsburgh/Philadelphia. The other half are everywhere else.

    80% of the revenue comes from Pittsburgh/Philadelphia. The remaining 20% comes from everywhere else.

    The privateer's plan called for liquor licenses to be allocated per county by population. Obviously, licenses in rural counties would be worth much less than urban counties. BUT - the rural counties licenses cannot be sold for less, as those new rural stores could sell their product at greatly reduced prices compared to the new city stores.

    If they hold to the price of a license - the big cities would have the mega stores and the rural areas would have --- what? No one will pay serious money for a license in a rural county.

    This is all moot. The state of Washington set the price for a new liquor license - $166. So our existing liquor stores are essentially worthless to the private sector. They would want to start with their own new and cheap licence and build their own inventory, as many people who bought existing stores in Washington lost their shirts. In fact, 11 of those store owners are suing the state of Washington today.

    In the process of privatizing, Washington auctioned their existing stores this past year - only raised $30 million and only received $150 million for wholesale rights, far from the multi billion windfall trumpeted by the privateers. For a one-time payment of $180 million, Washington wrecked a system that returned $461 million to their treasury in 2011. By comparison, our LCB returned just under $500 million to our treasury in fiscal 2012, a 5% gain over the previous year.

    Given the similarity of the revenue streams, there can be no reasonable expectation that PA would raise any more money than Washington. Probably much less expectation.

    To be fair, Washington is collecting as much sales tax as before. They went from 300 stores to over 1,500. Prices jumped 27-95%, to accommodate new taxes and all attendant business acquisition costs. Selection dropped dramatically in most new locations, with retailers concentrating on the quick- selling jugs. While in every LCB store, customers have access to close to 6,000 stock items and over 32,000 items in special liquor orders. Washington consumers are the big loser.

    In light of the debacle in Washington - selling the LCB would only create problems, not solve any. I think we need to start thinking about raising taxes. How else can we pay escalating debts without increasing revenues?

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