"What's black and white and read all over?"

Monday, January 28, 2008
Posted 8:57 PM by

Boozing and losing

Absolutely.The Post-Gazette series on the state liquor store system continued today with some vinegar-tasting news, the bouquet of stinky politics and and the bitter aftertaste of tax avoidance.

Among today's disclosures:

  • A North Philly state store that was subject to community protests in 2004 is in a strip mall owned by a development company headed by Jay Vederman, son of a top aide to Gov. Ed Rendell when Fast Eddie was the city's mayor. The 10-year lease will eventually will pay out more than $100,000 annually. The more profitable store it replaced was leased for about $30,000 a year.

  • Another store with dwindling profits is in Doylestown, Bucks County, home of Joe Conti, the new liquor board CEO. In the past three years, the store's profits have decreased from $48,708 to $16,255. Yet, the board renewed its lease last fall for another year even though a highly profitable Premium Collection store (seventh-most profitable in the state) is less than a mile away.

    Conti and Pennsylvania Liquor Control Board Chairman Patrick J. Stapleton said the downtown state store is a convenience for diners to purchase wine before they eat bring-your-own-bottle restaurants, but its performance is one reason they limited the lease renewal to one year.

  • Stapleton is a busy man. He is currently paid $68,770 as chairman. He also reported in his 2007 statement of financial interests more than $1 million in salary in 2006 from two law firms - $945,000 as a partner at Weber, Gallagher, Simpson, Stapleton, Fires & Newby in Philadelphia, $105,000 from his law practice in Indiana, Pa. and $2,500 as a director for Enterprise Bank. The year before, he reported a total of $262,000 from the three positions.

  • Despite the monopoly on wine and liquor sales, nearly 10 percent of the state's 623 stores last fiscal year showed a loss. The biggest loser was at Liberty Avenue between Ninth and 10th avenues in Downtown Pittsburgh, where expenses exceeded sales by more than $85,000.

  • An estimated 200 to 300 Pittsburgh restauranteurs and bar owners have found a way out of paying a 1 percent Allegheny County tax on all wine and spirit sales by going to store 6316. Located in the back parking lot of an all-but-abandoned shopping mall in Washington County, the store is one of a few across the state which sells discounted liquor in bulk.

Kudos to the Citizens Voice

Never thought I'd ever write that.

When I worked in Wilkes-Barre for the Times Leader eight years ago I had nary a nice word to say about the Citizens Voice. To me, the strike-spawned newspaper was nothing but a rag, selling its integrity to the county Democratic Party in exchange for a monopoly on classified ads.

Despite the many scandals I uncovered on the county politics beat, the CV did its best to defend the administration by being its mouthpiece.

My, how things have changed in eight years with new ownership.

I was nearly floored today when I read on the AP wire that the Voice actually established a legal precedent by getting the records of debit card charges by county employees using the state's Right to Know law. (I used the same law to sift through every county invoice one day a week when I worked for the T-L.)

The CV found that county prison Deputy Warden Sam Hyder used his county debit card to charge $71 at a Las Vegas strip club. Still unclear is whether the bill came from a lot of drinks or three lap dances.

Hyder explained it away was an honest mistake, noting he has a personal card that looks exactly like the county card and he used the wrong one. He has repaid the county and the commissioners decided today to let him keep his job.

Well, the more things change, the more they stay the same.

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Sunday, January 27, 2008
Posted 9:04 PM by

PLCB a relic whose time is past

We will sell no wine (or liquor stores) before it's time, even though the public may find it as distasteful as piss and vinegar.The Pittsburgh Post-Gazette began a laudable series today whose aim is nothing less than ending the state's monopoly on booze sales by privatizing its stores.

Among the newspaper's disclosures so far:

  • The Pennsylvania Liquor Control Board generated nearly half a billion dollars profit last year for state coffers on $1.69 billion in sales. Much of the revenue, however, went to pay the more than 3,600 full- or part-time state store clerks and managers, plus more than 400 people at its Harrisburg headquarters.

  • The average annual salary of a Pennsylvania state store clerk is $30,000, plus health benefits and a pension. A phone survey of privately owned liquor stores in neighboring Ohio suggests that clerks there typically earn half what Pennsylvania clerks make, with no benefits.

  • It's grossly, maybe even purposely, inefficient. In the state-store distribution system, all wine and spirits must go through one of three warehouses, in Pittsburgh, Scranton and Philadelphia. Although a state store is just a few miles from some Erie County wineries, the winery has to truck its wares all the way to Pittsburgh when the local store needs to be restocked.

  • Despite a 2005 U.S. Supreme Court decision that was supposed to put in-state and out-of-state wineries on equal footing for shipping wines directly to customers, Pennsylvania is still listed as a "no-ship" state on the California Wine Institute's Web page.

  • A $10 bottle of wine costs about $18 after markups, charges and state taxes get tacked on.

The last real attempt to privatize the system came in 1997, when "Gov. Ridge did everything in his power" but found little support from the House Liquor Control Committee, said Rep. Robert Donatucci, D-Philadelphia, a long-time member.

Last summer, Gov. Ed Rendell proved he was adapt at playing politics with the PLCB by forcing out its chairman, Jonathan H. Newman, a year after he re-nominated him to the post by naming ousted state Sen. Joe Conti to the newly created post of CEO.

That's seems to be as far towards "reforming" the system as Rendell is willing to go.

Yet, Fast Eddie can't wait to lease the state turnpike and put new toll booths on Interstate 80, even though state taxpayers have long paid for the construction and maintenance of those state assetts.

Somebody needs to tell Ed he's a lame duck and no longer need listen to his campaign contributors.

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