Some business express concern with privatization of liquor sales
Area beer distributors say a Republican plan to privatize the sale of wine and liquor could put them out of business.
In Pennsylvania, customers now can only buy cases of beer at distributors. They can buy a six-pack or two at bars and certain grocery stores and restaurants. House Bill 790 would change that.
The bill, which passed the House on Thursday and was sent to the Senate, would allow beer distributors to sell 6-packs and 12-packs of beer with a special permit. Beer distributors also would get first crack at buying 1,200 licenses to sell wine and spirits.
If the bill passes the Senate, however, small beer distributors said they would be forced to compete with grocery stores and other retailers that also could buy licenses to sell wine and up to a case of beer.
Joe Ellis, owner of Ellis Beer Distributors in Wilkes-Barre, calls Gov. Tom Corbett's plan to sell the state liquor stores a "bad idea" which would close 600 state stores and could close about 1,200 small family-owned distributors throughout the state.
"There will be too many outlets with too many options. All we can sell is alcohol," said Bob Maley, owner of Dundee Beverage in Hanover Township. "The pie is getting split with grocery stores and convenience stores."
The Malt Beverage Distributors Association of Pennsylvania is pushing for a negative vote on the bill.
"If you have beer, wine and liquor in a grocery store and you go the store every week, that eventually will push us out of the market. There won't be a need to go to the beer distributor. That's our concern," said Mark Tanczos, president of the association and a second-generation beer distributor in Bethlehem. "We don't believe it is in the best interest to have alcohol sold anywhere except alcohol specialty outlets like a beer distributor or a specialized alcohol store."
State Sen. John Yudichak also is concerned that small family-owned beer distributors will not be able to compete with big retailers and their budgets.
As Corbett pushes for privatization, Yudichak pointed out there already is a healthy private sector that sells liquor in taverns, delis and pizza shops. Yudichak, D-Plymouth Township, is concerned about opening up the market to big retailers and that it will lead to beer distributors closing. Beer distributors throughout Pennsylvania employ more than 36,000 workers, according to the Malt Beverage Distributors Association.
"If privatization is a job killer, I'm going to have a hard time even considering it," Yudichak said.
Anheuser-Busch and MillerCoors, the two giants of the American beer market, have also put their names on a letter objecting to the bill.
Under the bill, which passed the House on Thursday by a 105-90 vote after seven hours of debate, beer distributors would pay fees up to $37,500 to sell wine and up to $60,000 for spirits. Public fees for wines would range from $97,500 to $187,500, and $142,500 to $262,500 for spirits. Licenses must be renewed every two years at a cost of $1,000.
Licenses to sell wine and spirits can sell between 9 a.m. and 11 p.m. every day except Sunday. A Sunday sales permit would cost $1,000 annually to sell that day from 9 a.m. to 9 p.m.
Restaurants, hotels and other eating establishments could obtain permits to sell up to 24 bottles of beer sold in packages of no more than a 12-pack. Restaurants also could purchase permits to sell up to six bottles of wine for diners to take home.
As beer distributors opposed the bill, the Pennsylvania Chamber of Business and Industry applauded state House lawmakers for advancing a plan to gradually get state government out of the retail and wholesale liquor business.
"The Pennsylvania Chamber believes, as do many Pennsylvanians, that the sale of alcohol is not a core function of state government and would be better handled by the private sector," Pennsylvania Chamber President Gene Barr said.