State House Sound Bites

Capitol reporter Mary Wilson covers Pennsylvania politics and issues at the Pennsylvania state capitol.

Corbett's plan for liquor leaves sour taste in mouths of beer distributors

Written by Mary Wilson, Capitol Bureau Chief | Jan 31, 2013 12:05 PM

Gov. Corbett’s plan to sell off state liquor stores and allow consumers to buy wine, liquor, and beer from a wider array of retailers is leaving some businesses a bit rankled. They say the plan would be disruptive to anyone currently doing business alongside the state stores.

Pennsylvania has more than 1,200 beer distributors. Their product is already privatized, but under the governor’s plan, supermarkets and convenience stores would be able to buy licenses to sell it.

That’s a scary prospect for Randy King, spokesman for the Malt Beverage Distributors Association of Pennsylvania, who said Corbett should give more consideration to beer distributors in his quest for more customer convenience.

“The long game on this that if you expand beer and wine sales into every grocery, convenience, and big-box store, it will ultimately have a very negative impact on the business model that beer distributors have used and followed at state direction for 75 years,” said King.

Corbett expects his plan would, over four years, yield $1 billion, which he proposed reserving for a education block grant program for schools.

King’s group wonders if that sum is based on license sales and license renewals that would be higher for distributors than other would-be retailers of wine, beer, and liquor.

“The governor’s windfall revenue projections seem to be based on the backs of distributors, rather than all purveyors of alcohol,” said King. “As proposed, a beer distributor would have to spend $300,000 or more to be able sell beer in all packaging types, as well as sell wine and liquor, while grocery, convenience, big-box, and drug stores would only have to spend $35,000 on a license to sell beer and wine.”

Distributors couldn’t pan the proposal in its entirety – it includes one thing they’ve long fought for: packaging reforms, to allow them to sell beer in six-packs, and not just in cases. King said his group isn’t forming a final position on the privatization plan until legislation to implement it is introduced.

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