Is Pennsylvania finally taking aim at the PLCB?
Blend $4 billion in deficits with a new Tea Party governor. Squeeze in a full Republican legislature. Shake and garnish with consumer bitters.
Will this stiff drink, now on the table in Harrisburg, lead to the end of the PLCB? The state-run system that bestows such snappy names on its wine stores as #5801 is in a rough patch. As seen in the picture at right (and the accompanying Times story details), the opening hours of this store are limited and the prices, selection and knowledge of the staff may not be all that great either at some state-owned stores. The new kiosks have bombed. Consumer dissatisfaction may be growing as is chatter about privatization. Even though previous governors have floated the idea only to meet with failure, the stars seem to be aligning for reform. While this is something most Pennsylvania wine consumer would likely raise a glass of hard-to-find wine to, the logic that will carry the day for public officials is about money.
The libertarian think-tank, Reason, published a 2007 white paper on PLCB privatization that brings up many good points. (Ah, the PLCB, it’s enough to turn liberal wine drinkers into libertarians.) The report suggest that over half of the PLCB revenues come from taxes, which would continue to flow regardless of state or private ownership of stores and distributorships. Further, the state’s costs would decline with the reduced workforce and pension obligations while the state’s revenues could increase from taxes on the new businesses, which include over 600 locations that are state-owned (thus not generating real estate tax for municipalities).
As we discussed last year, privatization can be botched. Indeed, Iowa and West Virginia got less than the early estimates in their privatizations. From a public policy perspective, it’s crucial to rein in the windfall estimates and not to give away decades of future profits. So state officials should temper their hopes for a one-time profit buy auctioning licenses for shorter terms rather than longer given the weak state of the economy now. (If Pennsylvania authorities do decide to auction off liquor licenses, they should consider doing so in Hong Kong to get four times the going rate stateside.) Also, they could consider scaling license fees as a percentage of revenue to make it more accessible for small business owners. And on a related note, adding a bottle deposit would add hundreds of millions to the state’s coffers, as I estimated a reform could add $200 million to New York’s treasury.
And, please, for the love of Epoisses, allow food to be sold in wine stores!
Distributors are likely to want access to the sixth largest state and use their clout. Since the governor-elect does not appear to have distributors as major donors, he should use this independence to simultaneously push for a liberalization of shipping wine directly to Pennsylvania residents while collecting taxes.
Consumers also need to recognize that while a slothful public monopolist can fail to deliver the goods, private sector isn’t always a panacea: even if a 7-Eleven offered better hours than #5801, would they offer better wine? And even in New York, I’ve encountered wine store clerks who don’t know Chardonnay from Chenin Blanc.
If you are a Pennsylvania resident, what’s your take?
On January 5th, 2011 at 3:59 pm ,DG wrote:
Please, please, please make this happen. PA wine stores are a joke (at least in my area) and I couldn’t care less about the Chairmen’s Selections…Just give me a wine store with WiFi so I can look up reviews from sources I trust!
On January 5th, 2011 at 4:02 pm ,Adam wrote:
I am no longer a resident of the Common Wealth of Pennsylvania, but let me just say they are the only state I have bought alcohol in that is run by a Liquor Control board, and it turned me incredibly sour to the whole idea.
For one thing I was completely amazed at prices when I would look at alcohol outside of the State, not to mention even stores with small selections outside of PA seem to have wonderful selections compared to the store closest to me in PA.
While my stores hours were not as bad as the posted picture, I will say it was frustrating to try and explain to people outside of PA certain alcohol laws in the state that make basically no sense, such as you can only buy up to a certain number of ounces of beer at a time from a grocery store ( yet they have no problem with you purchasing that beer, taking it to your car, and walking back to the store to purchase more).
On January 5th, 2011 at 5:20 pm ,Albert Brooks wrote:
The system is bloated, poorly run and staffed with people who get their position by seniority and not by knowledge. Where else would you have a guy who ran a restaurant be the CEO of a $1.9 BILLION enterprise? The 400 or so people in Harrisburg that just do administration cause the overhead to be far above any real business. If it wasn’t for the current bottle fee (really a secret tax) they wouldn’t turn over any profit at all to the state.
Disband the entire system and rebuild it with a new mission and certainly new people.
On January 5th, 2011 at 5:41 pm ,JJ wrote:
As a former resident of PA, I found the liquor laws there backwards and ill-reflecting on the state. Please fo away with the PLCB and allow direct wine shipments into PA! Let independent wine stores operate and watch the quality and prices go down. The residents of PA are not being served well by their state government.
On January 5th, 2011 at 7:58 pm ,Warren Davidson wrote:
I imagine that for a “serious” wine-buyer, Pennsylvania would be very frustrating. But since I am only a bargain-hunter, I love the current system. The Chairman’s Selection program, in which the state buys up what amount to unsold lots and retails them at wonderful discounts, has allowed me to drink far above my income level. I do a lot of price comparison; PA prices are great — on certain specific things.
On January 5th, 2011 at 8:20 pm ,phillywinefinder wrote:
Thank you for your last paragraph. We have been shopping and drinking the PLCB for the last 6 months and have found the prices and selection in the Philly area to be just as good and often better than neighboring NJ. Agree completely with Warren Davidson. We like being able to buy the Chairman’s Selection wines and privatization is not all it’s cracked up to be.
http://www.phillywinefinder.com
On January 6th, 2011 at 8:03 am ,Terroirist » Blog Archive » News Roundup: Industrial Wine wrote:
[…] the PLCB, it’s enough to turn liberal wine drinkers into libertarians.” Dr. Vino takes a look at the push to privatize Pennsylvania’s state-owned liquor […]
On January 6th, 2011 at 8:10 am ,JG wrote:
I am a “serious” wine buyer living in southeastern PA. I buy all of my wine out of state (i.e. the internet, occasionally across the river in New Jersey)due to the State Store’s limited selection of anything that isn’t made on an industrial scale. I know it’s hard to predict the financial impact of such a change, but PA could be collecting many tax dollars from my wine purchases if only I could find what I’m looking for in PA. My hope is that privatization would keep me closer to home.
On January 6th, 2011 at 9:49 am ,1WineDude wrote:
I probably don’t need to say anymore than has already been said by me on 1WD, PalatePress, WineCrushBlog.com, letters to my Congressional reps., etc., etc., etc.
BUT… you are leaving out one huge piece of this puzzle and likely the one that will be the real stumbling block to privitization in my home Commonwealth: Unions. The unions lose big-time under this new idea (an idea I support, btw) and while the proposals soften the blows a bit, the unions will still be fighting it tooth & nail.
On January 6th, 2011 at 11:03 am ,Dr. Vino wrote:
Thanks for sharing views from within PA.
Joe (1winedude) – I did mention the labor cost savings to the state’s coffers if privatization occurs. But yes, organized labor seems to be leading the cause for preserving the status quo and they appear to share that position with MADD and other groups trotting out the old line about underage drinking.
Meanwhile, the new governor and members of the legislature and some (many?) consumers appear to be for reform–and presumably private wholesalers are as well. We will have to wait and see.
Btw, what is the specific “new idea” that you mention?
On January 6th, 2011 at 2:31 pm ,James McCann wrote:
Is Winedude finally admitting the unions are going to be the biggest opponents, and NOT the wholesalers? That’s a nice change.
A couple comments on the post:
1. General Corbett is far from a tea party candidate, he was the mainstream Republican candidate.
2. Many of the 600+ physical locations are leased from private owners that pay taxes.
3. Who would buy at auction a license that has an expiration date, as suggested? Build a business and then have someone outbid you for the license later on?
4. Profits outside of taxes are very meager and could be easily made up by keeping the PA shopper in state.
5. The wholesalers are squarely behind Corbett, but need to keep their powder dry, as they still need to deal with the PLCB until this happens.
On January 6th, 2011 at 2:54 pm ,Dr. Vino wrote:
James – I stand corrected about Corbett’s Tea Partiness, even if it does blow my lede. I must have gotten the info from one of those twitter accounts critical of him that he subpoenaed.
On January 6th, 2011 at 3:28 pm ,James McCann wrote:
Considering they were written by a corrupt politician that Corbett put in prison, I would agree with the source being untrustworthy.
I was not trying to make this about politics, interesting that you chose to respond to that part of my reply.
On January 6th, 2011 at 3:52 pm ,Chris S. wrote:
1. While I despise the PLCB system, my main fear is that privatization will give me even less choice than I have now.
2. Privatization might still not let me actually bring wine from out of state, nor have it shipped to me. Those two aspects still drastically reduce my choices.
3. My biggest fear regarding privatization is that the PA good ole boy network will sell to a large interest, reap a one time benefit, and we’ll get a network of higher priced yet reduced selection stores, yet lose the store income tot he state’s bottom line.
4. I think, ultimately, a liberalization of the laws, such as allowing private stores to compete on a level playing field with public stores, might make everyone happy.
On January 6th, 2011 at 10:42 pm ,Albert Brooks wrote:
What some of you people need to do it actually read the bill. No entity can own more than 10% of stores in a county that has more then 10 stores. No entity can own more than 1 store in a county that has less then 10 stores. So while Walmart could get a number of stores they couldn’t get a majority or even a large percentage of them.
The system is so bloated that they need to raise the bottle fee to just pay anything back to the state. Pretty much a rip-off of every person in the state.
On January 6th, 2011 at 11:21 pm ,chris wrote:
The PLCB is a complex flawed organization, but if a consumer chooses to educate oneself in the multitude of ordering processes, they have perhaps the greatest selection of wines at some of the best prices in the country.
If privatization occurs under the current proposal, consumers in PA will likely have fewer choices in wine selections.
Large wholesalers will control this state and we will be confined to Yellow Tail and the likes.
Small importers and distributors who personally develop relationships with producers and export brokers for small independent wineries will lose out, and those of you who think you will be better off without the PLCB will be paying more money for the same boring wines found in the grocery stores nationwide. Long live ubiquity!
On January 7th, 2011 at 7:29 am ,1winedude wrote:
Whoops – Sorry, Tyler, what I meant by new idea was the legislation that was proposed recently (mid-2010, I think?) that our new gov. says that he supports. It’s not actually a new idea to privitize the PA State Stores, but the way in which it would be done in the proposal is different than in past proposals and hence the “new” of the idea. In that legislation, the PLCB doesn’t actually go away I believe (could be wrong here, going from memory and would need to dig up the text to confirm) but has to morph into something much smaller.
Cheers!
On January 7th, 2011 at 9:45 am ,Dr. Vino wrote:
Joe 1winedude – You mean House Bill 2350 that incoming House Majority Leader Mike Turzai (R., Allegheny) proposed last May? Here’s a link that I found with one search:
http://www.post-gazette.com/pg/10173/1067279-454.stm
Here’s a summary of the bill itself:
http://www.repturzai.com/Display/SiteFiles/21/OtherDocuments/HB2350_Summary.pdf
It doesn’t mention slimming down the PLCB into anything but an enforcement role.
I’m curious what exactly you’ve written on the three sites you mentioned above since the specifics of the proposal don’t seem all that important to you?
On January 7th, 2011 at 10:32 am ,phillywinefinder wrote:
“The PLCB is a complex flawed organization, but if a consumer chooses to educate oneself in the multitude of ordering processes, they have perhaps the greatest selection of wines at some of the best prices in the country.”
Agreed. And it’s not that difficult for many of us to go out of state or get around the bans on shipping.
Therefore, privatization would actually result in less choice for the individual wine buyer, not more.
On January 7th, 2011 at 11:38 am ,Dave Erickson wrote:
I read the bill summary, and it says it will create 850 new tax-paying businesses: 750 retail stores and 100 private wholesale businesses. I find it hard to believe that the state will auction off stores to 750 different “highest bidders.” On the other hand, I can easily imagine Total Wine being the highest bidder for, say, 100 different stores. As for the prohibition against any single corporate entity owning more than 10% of stores in a county–golly, that’s what shell companies are for. Excuse my cynicism, but there it is.
On January 7th, 2011 at 1:57 pm ,Jeff wrote:
While I agree that sometimes there are good ‘deals’ to be found via Chairman’s Selections, etc, they tend to be no more exciting than the bland stacks found in large corporate stores found in other states. I appreciate phillywinefinder (and others) attempts to help find the gems in a poorly tended garden, but let’s not go overboard.
For a real enthusiast/wine geek/any other descriptor you feel fits best, the selection can be frustrating. Yes, AS frustrating as a lot of boring stores in other states. But here’s my personal beef with the PA system:
Go to New York, San Francisco, even Memphis Tennesse(!!) and you can find a specialty store chock full of small-producer, hard-to-find, interesting, exotic, dare I even say ‘authentic’ wines. If PA privatizes only to the deepest pockets, the consumer will continue to lose. But with the system in place as it is, some of the largest markets in the country (Philly and Pittsburgh) will still lack in this area, and that is just an embarrassment!
On January 7th, 2011 at 2:55 pm ,Chris wrote:
I am from Philly but living in California now. My eyes have been opened to the glory of a private system.
A lot of the fun of wine comes from trying new things. Yes there are some nice stores in the PLCB system, but there is zero incentive for them to stock a rare, hard-to-find wine or spirit.
In a privatized system we would benefit from entrepreneurs who are passionate about good drink–they would introduce us to new and interesting things.
Chairman’s Selection seems great–and I loved it when I was in PA too. But there is a reason those wines are UNSOLD.
That is all for now.
On January 7th, 2011 at 6:35 pm ,phillywinefinder wrote:
I can see the glory of the private system from my house…ok not quite, but I can get there via the Ben Franklin bridge. Moore Bros is 10 minutes away as well as Total Wine, Joe Canals, etc. Also have access to Garagiste, Wine Library and so on.
I think it’s unfair to say the CS wines are big market brands. Judge for yourself, the list is at PAWineTalk. The CS wines change frequently, so its not boring. What about finding something like Testarossa Syrah, 950 cases made, priced at $35 by the winery and $6.99 by PLCB? Exciting enough for me.
On January 7th, 2011 at 11:35 pm ,Chris wrote:
Saw this guy posting on twitter about working at the PLCB…
He is exactly the type of guy we have to buy wine from in PA.
http://twitter.com/#!/BigFrank18411
On January 8th, 2011 at 6:50 am ,Alex A wrote:
Remember James Carville’s famous quote about Pennsylvania from the 1992 election? “Pennsylvania is Philadelphia and Pittsburgh with Alabama in between.” That same profile applies for the most part to where the wine drinkers in the state live, which by coincidence happens to be near the borders of nearby “free” states. Go to the parking lot of any wine store in the parts of Delaware, New Jersey, Maryland, and even New York and 95% of the car license plates are PA tags. Delaware is the only border state to not have a sales tax, so these consumers are not shopping across the border to avoid a paying a sales tax. They are going to avoid delaing with the PA LCB. Every bottle bought out-of-state is a 6% PA sales tax loss, in addition to the other taxes on alcohol a private sytem would pay. That is a lot of lost revenue.
Right now most savvy wine buyers in PA can pick and choose between the occasional great deal with the PA LCB and driving over the border to buy wine (though technically performing an illegal act, out-of-state wine buyers are rarely caught and prosecuted). It would be interesting to see a study estimating just how much tax revenue is lost by having wine buyers buy across state lines.
On January 8th, 2011 at 10:19 am ,James McCann wrote:
1. The previous proposal is no longer on the table, as the Governor will be leading the reform effort, NOT the legislature.
2. The idea that privatization would lead to less choice is so riduculus it is not worth commenting on.
3. Phillywinefinder – I know that you are an apologist for the system, but how does the fact that you can access wine by driving to NJ support your argument for keeping the current system? And if you travel to NJ to purchase, you certainly see plenty of deals and closeouts at those stores also.
On January 8th, 2011 at 2:47 pm ,phillywinefinder wrote:
James McCann: I was responding to Chris who said: “I am from Philly but living in California now. My eyes have been opened to the glory of a private system.”
If you live in Philly, you don’t have to go to Calif. to experience the so-called glory of a private system. As has been said, people in PA routinely buy wine in different states. But here’s the key: once you figure out that there are in fact good deals for the consumer available in the PA state monopoly system (and these deals are available by virtue of the state monopoly and its position as largest purchaser), why would any wine enthusiast want to scrap that system for a private system, when they already have access to the private systems of other states?
As Dr Vino says in the original post, the private system is not a panacea. People tend to exaggerate both how bad the PA system is and how good the private system is. And, as he also points out, privatization can be botched.
On January 8th, 2011 at 2:59 pm ,Albert Brooks wrote:
PWF, every where you post you advocate breaking the law to give credence to to your theory that people in PA have it so good. You don’t seem to care about the other 10 million residents who don’t live on the eastern side of the state, only for yourself. The sooner you realize that the state should not be in the business AT ALL the better it will be for those of us who have to read the same thing over and over again from you.
On January 8th, 2011 at 5:07 pm ,James McCann wrote:
Albert,
Exactly, +1
On January 9th, 2011 at 8:12 pm ,Alex A wrote:
What do you think would happen to the PA LCB if suddenly people buying out-of-state were to be arrested, prosecuted, and fined by the PA authorities? Not just here and there, but on a widespread basis? It would disappear quickly. The authorites turn a blind eye (for the most part) in order to keep the system alive.
On January 9th, 2011 at 9:37 pm ,brian l wrote:
Seems the concept of a free market is lost on the author.
On January 13th, 2011 at 10:57 pm ,Richard Miller wrote:
If you dig deeper than a superficial ideology that says private enterprise is good and government run ones are bad, I think the Pa. system will reveal itself as one of the best run retail systems in the country.
First, the picture in your article shows a store with limited hours without stating the location of that store. There are remote areas of the state where only a government run store would even exit. Private enterprise will not create stores or offer hours where the economies do not support them. Second, as a former resident of Pennsylvania, and a current resident of Ohio, I can say without qualification that the Pennsylvania system is vastly superior in offerings, locations, and hours. The luxury store in Erie, while one of the weakest luxury stores in the state, is superior to anything I have seen in Ohio. A reasonably run state system with huge purchasing power combined with the ability to hire many (I think Pa has eight) specialized buyers can overwhelm any private retailer. In Ohio, for example, most wine is sold in grocery stores with very limited shelf space, uninformed buyers, and limited purchasing power.
I would put the Pa. luxury stores in the Philadelphia, Pittsburgh, and Harrisburg areas against any of the large private stores in New York City. Check the inventory of these stores online http://www.lcb.state.pa.us. and compare the selection of Savennièrs, French Rieslings, Château-neuf-du-Papes, Burgundy, and so on against what is offered by the large New York city retailers, who’s inventories can also be checked on line. The Pa. Stores will hold their own against the best private stores. As a wine lovers, we must support those systems— private or state run –that provide us with access to the wines we want.
On January 18th, 2011 at 7:33 pm ,tew wrote:
Richard Miller writes “There are remote areas of the state where only a government run store would even exit [sic].” Oh really? I’ve always found a liquor store in even the smallest towns across the country anywhere the government does not prohibit private enterprise from selling (e.g. liberal markets). Drive around California and tell me you can’t find a decent selection of beers just about anywhere, wine too, as well as spirits.
On January 19th, 2011 at 6:21 pm ,mike wrote:
How will laying off 4,500 employees and losing a yearly profit of half a billion dollars be a good thing? Maybe for a few of Corbetts political donors and big companies like walmart who want a license.
On May 28th, 2011 at 11:18 am ,Jon wrote:
As a Pennsylvanian I would not like to see taxes increase due to privitization failing to bring in the funds. Turzai’s bill states sales tax would increase to 9% and a gallonage tax would be put in place. Well there is a gallonage tax on beer and beer out sells wine and liquor by a long shot. But yet, the state stores still bring in more money(taxes included). Also, what will the cost be for a private store owner on purchasing wine/spirits? Will they get the same deal/pricing? My only concern is, in a slow economy and unemployment rising, if $$ is decreasing due to failed studies on privitization, will they increase sales tax & start to tax food & clothing? I buy more food & clothing! If our deficit is increasing then make government smaller!
On May 28th, 2011 at 6:17 pm ,Albert Brooks wrote:
@Jon: Since the PLCB is so poorly run (they will lose money this year) the point about how good their buying power is seems to be moot to me. There is NOTHING in the previous HB2350 about the sales tax going to 9%.
If you care to read it, look here: http://www.legis.state.pa.us/CFDOCS/Legis/PN/Public/btCheck.cfm?txtType=PDF&sessYr=2009&sessInd=0&billBody=H&billTyp=B&billNbr=2350&pn=4192
Beer does not have the 18% Johnstown flood tax (from what…1936?) on it so looking at it from just sales tax collections beer does contribute more then booze. It seems that your only concern is keeping your job since none of your facts are correct.
On May 31st, 2011 at 1:02 pm ,Richard Miller wrote:
In response to several comments about the financial efficiency of the State run system, I suggest that people read the actual, published financial statements of the PLCB, and not offer comments based on simplistic ideology. Year after year, the financial statements show a system that provides a high rate of return on assets (in the +20% range), a high gross margin (+30% range) and a high operating profit (+7% range). It returns money to the State in the form of collected taxes, but it also transfers its considerable profits to the General Fund year after year. The real test of a well run business is in the financial data. Based on the facts presented in the financial reports, the PLCB is well run as a business. This is not the same as to state that is serves its customers well, but I think it also does that.
On May 31st, 2011 at 2:31 pm ,Albert Brooks wrote:
Yes, let us look at the actual financial statements.
According to the PLCB itself (http://www.portal.state.pa.us/portal/server.pt?open=18&objID=913963&mode=2) they had $55,604,362 in net assets at the end of FY 2009. At the end of FY 2010 they had net assets of NEGATIVE $8,273,405 while contributing less money to the state. $125M in 2009 and only $105M in 2010. This year they will contribute only $80M and will probably be in the hole again.
This is for a monopoly business where sales have grown. If it isn’t poor management why are they losing money?
Central administrative support went up over 30% in just those 2 years and will go up again. Failed wine kiosks that supposedly cost the state nothing are costing for driver, trucks, supervisors, helpers to stand around and make sure the machines are running. You have a guy that ran a restaurant CEO Joe Conti) in charge of a $1.9B business
who at one time co-sponsored a bill to abolish the PLCB.
Oh, and those “considerable profits”….they had to borrow against themselves to pay the $125M and the $105M over the last years. The surplus fund no longer exists.
So tell me again how well they are being run and lets see some numbers to back it up.
On June 1st, 2011 at 10:39 am ,Richard Miller wrote:
Assets at the end of 2010 were not negative. The numbers show a decrease in assets. Since inventory is the largest asset category, I assume this reflects a reduction in inventory, not unusual as inventories are adjusted to business conditions Maintaining or increasing sales with less inventory is a sign of good management, doing more with less indicates increased efficiencies. The LCB does not operate “in the hole†or lose money. If one reads the audited financial reports applying standard accounting practices, the LCB is a profitable entity. The LCB returned $80 million of its profits to the General Fund in 2008. Each year it not only turns sales taxes back to the state, but its profits are transferred to the General Fund as well. It has done this every year. It returned more in 2009 and 2010, around $100 million, but will continue to send sizable amounts to the General Fund. The problem for those who want to privatize liquor sales is to explain how the state will make up the loss of these revenues it receives from the LCB.
On June 1st, 2011 at 10:59 am ,Jon wrote:
Don’t forget the difference of cost of goods increased by 44 Million from the same period a year ago. Also, my point was exactly what you said: “The problem for those who want to privatize liquor sales is to explain how the state will make up the loss of these revenues it receives from the LCB.”
I would not want food/clothing to be taxed along w/ sales tax increased! If NJ NY have higher sales tax, that will be the states justification along with we need more $$ But you never hear anyone talk about why PA has so many workers in the Capital. This Privitization does not fix anything with the budget…..so being this is not a soviet style blog, my comments warrant me as a PLCB Employee by the MOD……how pathetic is that!!
If privitization should take place, IMO, it should be when the economy is more robust and less people unemployed.
On June 1st, 2011 at 11:53 am ,Albert Brooks wrote:
Richard – If you bothered to look at the link I posted, which is from the PLCB itself, you will see it says “Net Assets Ending” is a negative number. Also if you look you’ll see where income is down over 30% across the two years.
Since taxes collected will increase (based on the last proposal) the “where” is easily answered. 850 stores and wholesalers will still collect sales tax and whatever replaces the Flood tax, PLUS they will pay business tax which the PLCB doesn’t do. PLUS they will need more workers total in stores, in warehouses, drivers etc. PLUS with competitive prices there will be less border bleed. (Border bleed must be a problem or why else do they put those outlet stores near the border and screw the rest of the citizens of the state?) PLUS with more convenience there will be more spur of the moment sales. PLUS the state gets off the hook for billions in civil service retirement since the PLCB does not fully fund that, we the taxpayers do.
Jon- Don’t forget store ops went up 17 Million, admin costs up 16 million and the amount returned to the general fund went down 20 million the biggest percentage drop ever. (until this year when it will drop even more).
Yes, you hear it all the time about why there are so many state workers in Harrisburg and why are so many of them PLCB office workers, kiosk watchers, and political cronies. The state should not be a jobs program. As you said, if the deficit is increasing make the government smaller. Start with getting it out of the liquor business.
On June 1st, 2011 at 7:04 pm ,Tim wrote:
While the PLCB certainly needs to be updated, privatization is not the answer in my opinion.
First, store 5801 is located in Forest City, PA. That location is nowhere. Litterally. Only a governement run store could survive in that location. Also, I’ll bet that if you call them up, they will answer the phone politely, “Good [time of day], thank you for calling Pennsylvania Wine and Spirits Forest City. May I help you?”
Second, the PLCB is working within laws that outlined the business 80ish years ago. Things have changed and the PLCB needs to update (like having more than 25% of stores open on Sunday, mandatory markups, the 18% Johnstown Flood Tax, etc).
Third, the Kiosks. A terrible experiment. Yet, during January and February, while the snow was piling up in the Philadelphia area, they did save me a trip around the corner. They didn’t have the great selection I was hoping for, or find in Premium collection stores, but the wines covered me that night. Make some adjustments to these (do I really need a breathalyzer?), and have a rotating stock, and maybe they’ll get somewhere.
Finally, where do the folks who are asking/pushing for privatization think the 4500 or so clerks, managers, buyers, secretaries, and so forth are going to go for paychecks? Some of them really like their jobs and take them seriously. In every store, you’ve got a few go-getters and a few tag-alongs. I’ve had good sucess asking for help when I needed it.
Take some bureaucrats out of the picture and I’ll bet the citizens of Pennsylvania, including myself, will be even happier with their experiences.
On June 1st, 2011 at 8:47 pm ,Albert Brooks wrote:
Even in Forest City there will be Mom & Pop stores that are open 5,6 7 days a week that would be happy to have the business and make it more convenient for the clientele to purchase the basics. Now will they be able to order everything from that store. Maybe, depending on how good the relationship is with the distributors. If not then people will do what they have to do else where…..either travel or mail order. Since Forest City doesn’t stock much to begin with the order part really won’t change.
Second, the PLCB didn’t care enough to change or want to change or even try to change over the last 80 years what makes you think they will do any better in the future. It is a failed experiment that needs to be redone.
Kiosks have to go. They are a failure that is costing the taxpayer money. Don’t even think about saying that they are paid for by the PLCB. Their failure results in increased costs to the consumer via higher prices, and even less “profit” for the state. Not to mention the extra people who have to run, manage, refill and drive there. Why does CEO Conti say they have to do 300 bottle a week to break even if it doesn’t cost them money to run them? Why did Conti say at the beginning that there was no specific number to decide what success was? I have that in writing BTW. Trying to put liquor into the kiosks is a last gasp of a failed program, they are just trying to save their asses because if it fails, as it will, they fail too.
You want to take the bureaucrats out of the picture? Then you have to privatize or else they will still be there.
The PLCB is a bloated bureaucracy that is full of cronyism. Look at CEO Joe or Tony Smith (Harrisburg Special Projects Manager) and his brother in law the district manager. Look at the people in charge of the Chairman’s Wine selection. Jim Short, no wine certifications, Steve Pollack the head buyer – no wine certifications, and the new woman who came out of HR, also with no wine certifications. Not even the lowest level. All they have is seniority but they control what 12 million residents can or can not buy.
The new stores won’t operate in a vacuum they will need people to run and stock them, to order products to deliver inventory. The state is not a jobs program and private enterprise proves time and time again they do things far more efficiently and at lower costs the the government. Add to that after 80 years of their “control” PA doesn’t do better then average on any DUI/DWI incident or fatality rates. Both New York and New Jersey do better across the board.
You want smaller government, start with less government and get the PLCB out of the sales end of things. There are over 400 people in Harrisburg alone. just pushing paper. The 1100 part time workers will most likely be needed in that capacity too, they just won’t be feeding off the taxpayer for benefits and retirement as they do now..
On June 5th, 2011 at 11:59 pm ,Michael wrote:
Albert Brooks pretty much says it all.
Pwf has posted the same nonsense on other sites-we should keep the stupid state monopoly just for the Chairman’s Selection(old stock dumping ground), and hey, some folks live near the DE/NJ border so just break the law and spend your money there, and screw the rest of us who live hours from the border.
I’m gonna guess that private stores have all sorts of deals too, not chosen by some ignorant state bureaucrat.
The plcb can not be put out of business fast enough, IMHO.
On June 6th, 2011 at 12:35 pm ,phillywinefinder wrote:
The state stores in PA bring money into the state, provide jobs, and provide some great deals on wine through the Chairman’s Selection program. Most of the counter-arguments are really political rants by free market fundamentalists who think privatization is the answer to everything. There is no free-market utopia in wine or anything else.
Here’s some old wine in a new bottle:
“the evidence shows that when alcohol sales are privatized, consumption goes up.”
http://bit.ly/l88lXY
On June 6th, 2011 at 12:52 pm ,Albert Brooks wrote:
First, you advocate breaking the current law to get the best deals from NJ on things that PA doesn’t stock or is overpriced on so private enterprise must be doing something right otherwise you would never have to leave the state. Second, increased consumption is exactly what the PLCB wants to do. Where else does a monopoly have to advertise, have wine kiosks and try to convince the legislature that it needs coupon and loyalty programs? You can’t have it both ways PWF.
On June 8th, 2011 at 4:59 pm ,Tim wrote:
But, wait, when we let the free market handle things themselves, what happens?
deregulate oil? worst oil spill in American history
deregulate mining? Miners trapped in collapsed mines in Virgina
deregulate the mortgage market? world-wide financial collapse
deregulate pennsylvania wine and spirits consumption? who knows?
I’m just saying that leaving things like this to people who only care about bottom lines, and not jobs, families, etc, then we all lose…
On June 8th, 2011 at 6:18 pm ,Albert Brooks wrote:
Be careful your strawman doesn’t catch on fire.
Let’s look at the 49 states and ask yourself why does PA do such a piss poor job given all the control they have? Look at the 32 other states that are non control and tell me why most of them have less DUI/DWI then PA? Why PA is only in the middle for underage alcohol related incidents and fatalities? Why PA is in the upper half for binge drinking? What isn’t PA one of the best rated in all those areas. Why do other states with less control do better then PA? If our current system is so great why aren’t we doing better? Oh, and tell me what happened to those 32 other states that went private? Were there riots in the street? Did the arc-angel Wendell Young come down and smite them? Or did people just enjoy the freedoms of not having some unqualified bureaucrat in Harrisburg decide what they could or could not buy?