Beer Distributors Criticize Gov. Corbett’s Privatization Plan

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WILKES-BARRE – Governor Tom Corbett said privatizing the liquor system would bring in $1 billion for education, but one beer distributor in Luzerne County told Newswatch 16 that the proposed changes would make it nearly impossible for his business to compete with national retailers.

A spokesman for the Malt Beverage Distributors Association of Pennsylvania said that the group estimates that an enhanced license for distributors to sell six-packs, wine and liquor would cost $350,000 under Corbett’s proposal.

David Shipula told Newswatch 16 that Beer Super on Scott Street in Wilkes-Barre has been operated by his family for 63 years and he fears that he would not be able to afford bidding against national retailers for an enhanced license.

“(Corbett) is saying ‘okay, here's your chance to bid’ and I'm going to have to bid against Wal-Mart or another giant chain from across the United States that might have 30 or 40 stores,” said Shipula. “They're going to come into the room and write the check, probably. I'm going to have to get financing, the capital, because I've been restricted to this one store."

State Senator John Yudichak criticized Corbett’s proposal, saying privatizing the system instead of modernizing it will put thousands of jobs in jeopardy.

"The distributors have worked in Pennsylvania. They've generated a tremendous amount of economic impact and tax revenue and it's predictable. To end that system, on the promise of a one-time, $1 billion windfall; it simply does not add up,” said Yudichak.

The Malt Beverage Distributors Association of Pennsylvania released the following statement about the proposed changes:

“Our analysis of the Governor’s proposal clearly shows that it will put alcohol sales in thousands of new outlets while increasing prices in many locations, reducing selection at those locations, and creating more “border bleed” by encouraging more buyers to shop in neighboring states. It will make alcohol more accessible to minors. In addition, many studies show that a substantial increase in alcohol outlets will put a greater strain on local law enforcement resources.
The plan is designed for big business, showing favoritism to the large companies like Wal-Mart, Costco and Rite-Aid. Distributors have played by the rules created by the General Assembly since 1933 and not allowed to grow their businesses. This plan removes restrictions on us, but does so in a way that our 1,200 family-owned businesses would be completely destroyed by these large out-of-state corporations. This is like asking a horse that has been stabled and unable to train to successfully run the Kentucky Derby against the best thoroughbreds in the world.
While the plan appears to enhance our business privileges, it does so at a cost that is five times higher than the similar privileges being offered to the national big box stores. This is not fair.
The Malt Beverage Distributors Association of Pennsylvania (MBDA) will continue to work with our state elected officials to ensure that Pennsylvania’s consumers are offered greater convenience and that beer distributors are given a fair chance to compete.”

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