Lawmaker Proposes Constitutional Amendment To Privatize Liquor Stores

HARRISBURG (KDKA) - A local state representative has proposed a constitutional amendment to get the state of Pennsylvania out of the liquor business.

It's the latest version of a very old debate in Pennsylvania.

Remember the old state store system where customers went up to a counter, used a catalog and then asked a clerk to get the bottle of spirits or wine for us, since we weren't allowed to examine bottles ourselves?

A lot has changed since those days, but the debate to privatize continues.

Today's modern wine and spirits stores resemble nothing out of the past. Customers usually have plenty of choices, a variety of pricing and special deals, knowledgeable clerks to answer questions and a much more customer-friendly environment.

But one thing remains the same: the stores are still owned by the state.

"I believe core functions of government include infrastructure, education, the promotion of economic activity, security, law enforcement. I don't think that selling alcohol is a core function of government," Pennsylvania Rep. Natalie Mihalek, an Upper St. Clair Republican, told KDKA political editor Jon Delano on Monday.

Mihalek says no matter the improvements, the state should be out of the liquor business, so she's introduced a constitutional amendment to let voters decide that fundamental question.

"Now is a relevant time to reignite this discussion regarding privatization because it is really a question of what is the appropriate role of government," she said.

WATCH: KDKA's Jon Delano reports

Pennsylvania Rep. Dan Deasy, the senior Democrat on the House Liquor Control Committee, calls Mihalek's amendment "reckless" because it does not spell out what replaces the wine and spirits stores.

Under Mihalek's bill, the legislature would have 18 months if the amendment passes to design a new system.

"The voters should know exactly what they're voting on, and how do we fill in the hole in the budget?" asks Deasy.

"The LCB (Liquor Control Board) transfers $185 million a year to the General Fund. That provides a lot of programs, a lot of services, even to the police budget," says Deasy.

Pennsylvania taxpayers have owned and operated the state liquor system since Prohibition ended in 1933. Attempts to privatize – or turn this business over to private companies – have failed, so Mihalek wants to try the constitutional amendment approach.

"Should our government be engaged in the sale of liquor in Pennsylvania? So that is the fundamental question," she said.

But Deasy and other critics say there is a cost to privatization since state-owned liquor stores return a profit.

"It returns a generous profit after all expenses to the taxpayers. So whether you drink or not, this is a benefit for all Pennsylvanians," says Wendell Young, who heads United Food and Commercial Workers Union which represents employees at the wine and spirits stores.

Young says privatization will raise prices and limit consumer choice, down from 5,000 bottles in many of our state-run stores to a few hundred in private stores.

"Most supermarkets that have come to dominate, supermarkets and big-box stores in other states, carry a few hundred items. The biggest specialist stores, which are rare and few between, might carry 500 to 900 items," he adds.

Mihalek is not worried about either supply or prices.

"The market will determine what's being sold," she says.

The House Liquor Control Committee held hearings on Monday, but no indication yet if and when the legislature will send this amendment to the voters.