So will 2014 — unlike 2013 and all the years before it — be when Pennsylvania moves out of the liquor system?
Depends who you ask.
House Majority Leader Mike Turzai, R-Allegheny, mentioned liquor privatization first among his caucus’ priorities for the new year at a Tuesday briefing. He touted the negotiations he said Lt. Gov. Jim Cawley is leading between members of the state House and Senate.
“It’s a bill to modernize Pennsylvania and show we’re not as antiquated as we are,” Turzai said. “To move us into the 21st Century.”
Turzai has lead the privatization charge, and got a bill passed last spring that would begin selling off the state’s 600 Wine and Spirit Stores.
But that bill never became law, in part because it was not embraced by the Republicans who control the Senate. Instead, the Senate put forward its own bill to start to move the state out of the retail end of the liquor business and set the stage for a lease of its wholesale operations if it proved financially feasible. But that proposal never received a final voted on.
On Tuesday, Senate Majority Leader Dominic Pileggi, R-Delaware County, didn’t mention alcohol sales in the list of priorities he ticked off in the session opening the Senate for 2014. Later, he sounded less optimistic than Tuzai about a significant privatization package.
“There have been some discussions about that over the break,” Pileggi said. “The challenge is still to find something that is acceptable to 26 members here and 102 members in the House. We haven’t lined that up yet. We’ll continue to try to do that.”
“I don’t see the auction idea — auctioning off wholesale and retail licenses — as something we have 26 votes for in this body this year. Knowing the vote count from the last time we went into this in detail, there just wasn’t support for that level of change. There was support for change. The question is can we line up what we have support for here with what they have in the House.”
Turzai acknowledged there has been a gap between the majorities in the two chambers in the past. But, he said the ongoing discussions, could produce a true privatization that would be amenable to lawmakers. The details are still being worked out.
“It’s still a work in progress,” Turzai said.
One potential motivator could be the expected revenue shortfall in the 2014-2015 budget, Turzai said. Previously, Gov. Tom Corbett’s administration has said the shortfall could be $1.4 billion.
If privatization passes in the spring, Turzai said, license sales could contribute money to the general fund right away, though the state stores themselves would be phased out over time according to a formula being developed.
Privatization would also stop Pennsylvanians from traveling to other states for cheaper booze, Turzai said, which would mean more tax revenue would stay here.
Pileggi did not think the Senate would, or should, support a broader privatization effort as part of a plan to fill a projected budget shortfall next year.
“The flaw in looking to selling assets, whether it be the wholesale franchise or retail licenses or anything like that, is those sales are one-time sales and one-time infusions of revenue,” Pileggi said. “What we have now is a system that produces a stream of revenue year-over-year.”
He compared such a sell off of the state stores to former Gov. Ed Rendell’s proposal to lease the Turnpike, which Republicans legislators largely opposed.
“If the liquor issue comes into the budget discussion,” Pileggi asked, “is it a one-time issue or should we be looking to leverage assets forward in a more reliable, consistent way?”
Last year, privatization legislation got tangled up with the effort to pass the transportation funding bill Corbett signed into law in the fall. For a time, the two bills had been linked, and looked like they were going to sink together.
Now, that’s no longer a concern.
“The fact that they were uncoupled and taken in order is helpful to the process,” Turzai said.
Source: Patriot News