HARRISBURG -- Confronted by 75 opponents wearing yellow union shirts, House Majority Leader Mike Turzai fought to make his case Wednesday for a historic change in the way liquor and wine are sold in Pennsylvania.
Members of the United Food and Commercial Workers, led by President Wendell Young, jammed a House committee hearing room as Mr. Turzai addressed the first of several hearings on his House Bill 11. The proposal would end the 78-year-old, state-run liquor system and replace it with as many as 1,250 privately owned wine and liquor stores around the state.
"It's time for Pennsylvania to enter the 21st century," said Mr. Turzai, R-Bradford Woods. "The state Liquor Control Board system is antiquated. It's not consumer friendly. We can do better on price and convenience to customers."
He saId only Utah and Pennsylvania have such complete state control over liquor and wine sales, noting that 32 states sell the products through private stores.
But the UFCW, which represents 3,500 of the 5,000 LCB workers, strongly disagreed. "Why does he want to dismantle a system that makes $500 million a year for the state?" said Ken Stuart, a union member from DuBois, referring to the amount the LCB turned over to the state general fund this year. "What he wants to do is foolish."
Peggy Rhodes, a 20-year store clerk from the Gettysburg area, said LCB clerks are much more vigilant than privately run stores would be in checking IDs so that underage people aren't allowed to buy liquor.
"Mom and pop [liquor] stores want to make money,'' she said. "It's just common sense and human nature that some [underage buyers] are going to slip by."
Mr. Young had a brief confrontation with Mr. Turzai as he entered the Capitol before the hearing started.
Pointing to the crowd of folks in yellow UFCW shirts, Mr. Young said, "Mike, I want you to meet our members -- the ones you want to put out of work during this recession."
Mr. Turzai shook Mr. Young's hand in a noncommittal manner and walked off toward his office, leading Mr. Young to say, "I think he has a hard time dealing face to face with the people whose jobs he wants to take."
In his hourlong address to the House Liquor Committee, Mr. Turzai said his bill has several items to help LCB workers who would lose their jobs under a private system. The new retail store owners could get tax credits for hiring LCB employees, and the employees could receive civil service points to help them find other jobs with the state.
An early retirement program would also help those LCB workers near retirement age.
He said the state still would get at least $400 million a year in taxes under his bill. He would eliminate the current flat 30 percent markup in the price of products bought from wine and liquor makers and would eliminate the 18 percent "Johnstown flood tax" on all products, imposed since the flood of 1936. He would impose a new "gallonage tax'' of $8 to $12 per gallon, depending on the product, and would continue the 6 percent sales tax.
His bill, which hasn't been officially introduced yet and thus isn't available online, does have one significant change from earlier versions: It would authorize 1,250 retail liquor/wine licenses instead of 750, as in previous versions.
The licenses would be auctioned off to the highest bidder. The first 750 would be Class A, meaning with at least 15,000 square feet of retail space, and would likely be in more populated areas. The bill authorizes 60 retail stores for Philadelphia, the state's largest city, which now has 59 LCB stores.
Statewide, there are 621 LCB stores, so the Turzai bill would more than double the number of stores. The state General Services Department would divide the state into regions for the licenses and make sure that no region got too many stores.
The department also would conduct the auctions to the private owners. License holders would be limited on how many stores they could operate so no one could have a monopoly.
Supporters of the Turzai bill said having more liquor stores would make buying liquor and wine more convenient for consumers, while opponents fear it could increase underage drinking, increase the amount of liquor sold and result in more driving-while-intoxicated incidents.
Mr. Turzai estimated that the new retail licenses -- plus an additional 100 wholesale liquor licenses -- would bring in a one-time $2 billion to the state, a figure that critics have claimed is seriously inflated. Mr. Turzai said that money could be used to fix ailing state roads and bridges.
That led Rep. Dante Santoni, D-Berks, an opponent of the bill, to say, "The roads will be better built so that more people can drive drunk on them."
The House liquor panel will hold at least three more hearings on the bill -- in Pittsburgh, Philadelphia and Hershey -- before the Legislature resumes work in mid-September. Mr. Turzai wants the House to vote on his bill this fall.
The House and Senate are controlled by Republicans, who generally favor private ownership of business, but not necessarily in the case of liquor stores. Senate President Pro Tem Joe Scarnati, a Republican, has already said liquor privatization won't be a major issue in the Senate this fall, even if it does pass the House.
Tom Barnes: firstname.lastname@example.org or 717-623-1238.