Malt Beverage Distributors Association of Pennsylvania http://www.mbdap.org/ Malt Beverage Distributors Association of Pennsylvania Wed, 15 Oct 2008 15:11:00 EDT en-us Wegmans license applications now before Commonwealth Court MBDA’s objections to the PLCB’s issuance of licenses to six (6) Wegmans locations is now before Commonwealth Court and all briefs have been filed. We expect that oral argument will be scheduled for sometime in December, although a date has not yet been assigned.

If you would like to read the brief filed by MBDA counsel, Robert Hoffman, Esq., in response to the various issues raised by Wegmans as to why not only they are entitled to these licenses but also their argument that distributors will actually benefit if Wegmans can sell beer, click here.

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Wed, 15 Oct 2008 15:11:00 EDT http://www.mbdap.org/news/wegmans-license-applications-before-commonwealth-court http://www.mbdap.org/news/wegmans-license-applications-before-commonwealth-court http://www.mbdap.org/news/wegmans-license-applications-before-commonwealth-court
New Licensing Search System The PLCB has announced the launch of a new Licensing Search System. Licenses are categorized by county, and all licenses in each county are listed alphabetically according to the licensee's name as it appears on the license, which may or may not be the same as a trade name. In addition to information such as the name, address and trade name of the licensee, corporate officers, shareholders, and managers are given, in addition to a history of citations issued. Go to www.lcb.state.pa.us, click on "PA Licensing Search" on the right hand side of the screen and follow the instructions.

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Tue, 30 Sep 2008 14:10:00 EDT http://www.mbdap.org/news/new-licensing-search-system http://www.mbdap.org/news/new-licensing-search-system http://www.mbdap.org/news/new-licensing-search-system
Vidalia Marketplace Closes Vidalia Marketplace, Lansdale, Montgomery County, is closing its doors after little more than a year at this location. Vidalia was one of the first supermarkets to obtain an "E" license to sell take-out beer in the same way Sheetz, Wegmans and Weis want to sell beer using "E" and "R" licenses. Vidalia's website gave no explanation for the "going out of business" decision.

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Thu, 24 Jul 2008 15:14:00 EDT http://www.mbdap.org/news/vidalia-marketplace-closes http://www.mbdap.org/news/vidalia-marketplace-closes http://www.mbdap.org/news/vidalia-marketplace-closes
Oral Argument Before Pa. Supreme Court On Wednesday, May 14th, the Pennsylvania Supreme Court heard oral argument in the Sheetz litigation. The PLCB and Sheetz had appealed the Commonwealth Court order issued in February, 2007 which denied Sheetz the "E" retail dispenser license it wanted to sell beer at its Altoona location.

Commonwealth Court recognized that "...a potential consequence of the PLCB's interpretation [of the Liquor Code] is a significant transformation of the character of outlets for the sale of malt or brewed beverages, to include grocery stores, convenience stores and other commercial establishments with some small area for eating."

Some Supreme Court justices, via their questions at oral argument, suggested that they too may view the issue of convenience stores, gas stations, and grocery stores selling beer as one which should be addressed by the legislature, not by an administrative agency such as the PLCB.

MBDA has consistently taken the position that the legislature never intended to allow these outlets to sell beer, in bulk, for take-out, using "E" and "R" licenses and for the PLCB to allow them to do so is a misinterpretation of the Liquor Code. The Supreme Court has no specific time in which it must render an opinion but we remain cautiously optimistic that one will be issued before the end of the year.

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Fri, 23 May 2008 12:05:00 EDT http://www.mbdap.org/news/oral-argument-before-pa-supreme-court http://www.mbdap.org/news/oral-argument-before-pa-supreme-court http://www.mbdap.org/news/oral-argument-before-pa-supreme-court
Keep beer in beer stores Selling it in groceries, convenience stores would send wrong message.

By David Shipula

As a guy who's spent his entire working life running a beer distributorship, I often ask my customers, "What's good about selling beer in convenience stores?"

The answer runs something like this: "It's convenient. You can stop for gas, and get beer and cigarettes at the same time."

Now, I can't be the only person who sees a problem with making it easy to buy beer and gasoline in one convenient location. And even though I live in Luzerne County, I know that people in Philadelphia's neighborhoods already are troubled by "convenience stores" that are more than a little careless about checking IDs for underage drinking and that all too often become nuisances in otherwise peaceful residential neighborhoods.

What I don't understand is why it's not plain to everyone that it's already pretty darn convenient to buy a beer - or six or 12 or 24 - in Pennsylvania if you want to do so.

According to the U.S. Census Bureau, there are 2,400 gas stations in Pennsylvania, about 2,700 supermarkets, and 2,900 drugstores. Compare that with the 1,300 beer distributorships where Pennsylvanians can buy beer by the case and 500 "deli" licenses that allow people to buy up to two six-packs to go. Several thousand of the state's 12,000 bars and restaurants can, and do, sell beer to take out. If there is power in numbers, that's proof that we have convenience of access to beer.

This is the system set up by law, and changing the law requires an act of the General Assembly. That's the point that the Malt Beverage Distributors Association, of which I am the Pennsylvania president, seeks to uphold in the state Supreme Court in its suit against the Sheetz gasoline stores. It's also the point that we're making in our appeal of restaurant licenses granted to Wegmans supermarkets.

If there were a true groundswell of opinion favoring free and easy access to beer, don't you think the legislature would have changed the law by now? In fact, public opinion is split - although polls show that people are slightly more in favor of limiting access to beer than opening the floodgates.

The reasons are simple: Most people think that waving ice-cold six-packs in front of motorists is a bad idea. They also want the supermarket shopping experience to remain something the entire family can enjoy without giving children - from toddlers to teenagers - the idea that beer is as harmless as, say, a calorie-laden, high-fructose corn syrup-laced soft drink.

Why has the Malt Beverage Distributors Association taken up the fight to insist that everyone play by the same rules, the laws enacted by the General Assembly? Because they are the same rules that were applied to us when we bought our state licenses and undertook the privilege of selling beer in Pennsylvania.

It's a question of fair play.

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Mon, 19 May 2008 12:02:00 EDT http://www.mbdap.org/news/keep-beer-in-beer-stores http://www.mbdap.org/news/keep-beer-in-beer-stores http://www.mbdap.org/news/keep-beer-in-beer-stores
6-pack sales appeal to microbrewers, buyers Consumers say they want to try product 1st

BY DANIEL VICTOR AND LARA BRENCKLE
Of The Patriot-News

It took a few sips to persuade Ryan Ulrich to consider buying a case of Flying Dog's Gonzo Imperial Porter.

A case is a lot of beer, and it's not a commitment he would make without tasting a glass of it at a beer festival Sunday at the Appalachian Brewing Company in Harrisburg.

He said he planned to buy cases of his two or three favorite samples.

"I'm not going to lay down $50 without first trying the product," he said.

The beer festival was a convenient way for him to sample different varieties, he said, but six-packs would work, too.

It's consumers such as Ulrich who microbrewers say they're missing out on because of a state law that limits six-pack sales.

Beer distributors must sell by the case, and many times restaurants or bars that can sell up to two six-packs at a time don't have a wide selection.

You can find cases for a lot of local brews -- such as Harrisburg-based Troeg's or ABC -- for about $26. But because specialized varieties are often more expensive than mass-produced brews, beer connoisseurs are more likely to try new brands and varieties if they can spend less on smaller quantities, microbrewers argue.

"If you don't do draft, it's hard to get them to sample your wares," said Matt Allyn, owner of Voodoo Brewing Co. in Meadville. "If they don't sample your wares, it's hard to get them to buy a $75 case."

That problem could be solved, brewers have argued, by allowing six-pack sales in grocery and convenience stores.

It's starting to happen.

A Sheetz in Altoona was granted a license to sell beer last year. In March, Wegmans received restaurant licenses for six of its grocery stores, allowing it to serve beer and wine in the stores and to sell two six-packs to go. The chain is seeking approval for a license for its Silver Spring Twp. store.

The 465-member Pennsylvania Malt Beverage Distributors Association isn't happy. It has sued the Pennsylvania Liquor Control Board to try to block licenses for Wegmans and Sheetz.

Mike Muzic, who works at Breski Beverage in Swatara Twp., said clerks at distributorships are trained in how to sell alcoholic beverages, including how to look for signs of intoxication.

He asked: "Would you trust a high school-age convenience store clerk to not sell to drunk people or those under age?"

And Ashley Lidle, who works with Muzic, said the distributors offer a better bargain at bulk prices.

"[Consumers] are going to gain convenience and lose money," he said.

At its Silver Spring Twp. store, Wegmans is seeking a liquor license for its Market Cafe. If granted, it could sell wine and beer by the glass to be consumed on the premises.

The New York-based chain is waiting for the LCB to schedule a hearing on the matter, said company spokeswoman Jeanne Colleluori.

If the license is granted, she said, Wegmans might seek local brewers to help stock the shelves.

The grocery chain frequently works with local growers to stock produce and other products, she said. "We like to offer local flavor," Colleluori said.

Artie Tafoya, operations manager for the Appalachian Brewing Company, said he'd be open to selling ABC products at Wegmans.

"It's tougher for someone to invest in a case of our beer if they're not sure they'll love it," he said.

There are some pluses to distributorships, Tafoya said.

"At least with distributors, you're guaranteed placement," he said. "In grocery stores, it's more based on shelf space."

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Mon, 28 Apr 2008 15:54:00 EDT http://www.mbdap.org/news/6-pack-sales-appeal-to-microbrewers-buyers http://www.mbdap.org/news/6-pack-sales-appeal-to-microbrewers-buyers http://www.mbdap.org/news/6-pack-sales-appeal-to-microbrewers-buyers
MBDAP President David Shipula's letter to Times-Tribune Editorial writers like those at The Times-Tribune bewail the “monopoly” that beer distributors appear to have over the sale of beer in our communities while others say we need to be able to buy beer almost everywhere and anywhere because consumers have a right to “convenience.”

A March 26 Times-Tribune editorial recently opined that beer distributors have a “near monopoly under state law” on sales of malt beverages.

The definition of “monopoly” is “exclusive ownership through legal privilege, command of supply, or concerted action (or) exclusive possession or control (or) a commodity controlled by one party.”

The reality is that the Pennsylvania Liquor Control Board has issued more than 1,300 beer distributor licenses and requires that no individual or entity can own more than one. So, since no one can control as much as one one-thousandth of the marketplace, there can be no monopoly.

Besides that, there are some 10,000 restaurant licenses and 500 “e-license” holders who also can sell beer for off-premises consumption.

Thus, having control of one one-thousandth of the market to sell beer in case lots is a laughable comparison to a monopoly of any kind.

And, when you consider the number of places where you can buy beer in Pennsylvania — 10,000 restaurants, 500 e-license establishments and 1,300 beer distributorships — a question begins to form about what is a reasonable definition of “convenience.”

According to Merriam-Webster, “convenient” means “near at hand” or “close.”

How close is “close”? Consider that you can buy beer legally in more than 12,000 places in Pennsylvania. By comparison, Pennsylvania has — according to the U.S. Bureau of the Census — about 2,700 drugstores; 2,400 gas stations; 2,800 supermarkets; 3,100 used-car dealers; 650 auto parts stores; and 1,200 florists.

About the only way it could be more convenient to buy beer in Pennsylvania would be if someone would come door-to-door. (By the way, a number of beer distributors still offer home delivery.)

All that beer distributors ask, as small-business owners, is a level playing field and adherence by all to the letter of the law that the Legislature and PLCB require us to live by.

Individual beer distributors can own one and only one license for retail, off-premises consumption — and then only in quantities of one case or more of beer. Already, Wegmans has been granted six licenses by the Liquor Control Board.

Who, indeed, is more likely to be headed for the ability to control the market?

In fact, the buying power of large supermarket chains like Wegmans makes it very difficult for small food and beverage producers to compete profitably. Shelf space is at such a premium in supermarkets that manufacturers and distributors are forced to pay “slotting allowances” to even get their products displayed on supermarket shelves.

Left to “market forces” in the “big box” store environment, it would not be long before the malt beverage aisles would be under the control of two or three major manufacturers just like the soft drink aisles where only Coca-Cola, Pepsi and generic store brands get any display. Craft brewers and micro-breweries — unless they had enough volume to supply every store in a chain — would be locked out and consumers would see less, not more choice.

DAVID SHIPULA

PRESIDENT
MALT BEVERAGE DISTRIBUTORS ASSOCIATION OF PENNSYLVANIA

WILKES-BARRE

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Mon, 28 Apr 2008 14:37:00 EDT http://www.mbdap.org/news/mbdapa-president-david-shapula-letter-to-times-tribune http://www.mbdap.org/news/mbdapa-president-david-shapula-letter-to-times-tribune http://www.mbdap.org/news/mbdapa-president-david-shapula-letter-to-times-tribune
PLCB seeking wine kiosk proposals PITTSBURGH (AP, April 27) - The Pennsylvania Liquor Control Board is seeking proposals for a contractor to operate up to 100 wine kiosks throughout the state.

The kiosks, a sort of a temperature-controlled vending machine capable of holding 500 bottles of wine, would be placed in grocery stores and other places, according to request on the LCB's Web site. They would offer about a dozen different types of wine.

Wendell Young IV, president of the United Food and Commercial Workers Local 1776, whose members include state store clerks, was among those briefed on the proposal. The kiosk has security identification measures such as fingerprints and biometric readings, he said. Users would have to register and purchases would have to be made with credit card, debit card or PLCB gift card.

Young anticipates the kiosks being placed in locations such as grocery stores or malls.

"You're not going to put these up at bus stops, or on a street corner, like a Coke or Pepsi vending machine," Young said.

The five-year contract proposal calls for the kiosks to be operated at no cost to the state or Liquor Control Board.

PLCB spokesman Nick Hays said he could not provide more specifics because of a "quiet period" required while proposals are submitted and evaluated. The request went out in late March and proposals must be submitted by May 8.

Vending machines selling alcoholic beverages have been in use in Japan, Singapore and some European countries, but security issues and restrictive liquor laws have made their development and use elsewhere limited, the Pittsburgh Post-Gazette reported in Sunday's paper.

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Sun, 27 Apr 2008 15:57:00 EDT http://www.mbdap.org/news/plcb-seeking-wine-kiosk-proposals http://www.mbdap.org/news/plcb-seeking-wine-kiosk-proposals http://www.mbdap.org/news/plcb-seeking-wine-kiosk-proposals
Distributors appeal decision to give beer licenses to super markets Noting that state law prohibits the sale of beer at supermarkets,  the Malt Beverage Distributors Association of Pennsylvania (MBDA) today appealed to Commonwealth Court to overturn a recent decision by the Pennsylvania Liquor Control Board (PLCB) to award the transfer of six liquor licenses to Wegman’s Food Markets, Inc. The license transfers would enable the Wegman’s stores to sell beer in their Market Cafés in stores at several  supermarket locations across the Commonwealth.

The PLCB handed down its decisions on the March 19 without comment or explanation,  The licenses involve Wegman’s Food Markets in Williamsport, Wilkes-Barre, Dickson City, State College, Bethlehem, and Lower Nazareth.

In the petition to the Commonwealth Court, MBDA challenged the LCB rulings as clearly in conflict with the state Liquor Control Codes prohibition against beer sales at grocery stores. 
MBDA President David Shipula of Wilkes-Barre noted there “is a clear distinction between the PLCB’s own experiment in selling liquor and wine in several supermarkets around the state and the licensing of direct beer sales by supermarkets.”  In the case of the state liquor store experiments, liquor and wine are sold by employees of the PLCB in space leased directly by the PLCB from the supermarkets. 

“The sworn testimony in the Wegman’s license hearings shows distinctly that Wegman’s, the supermarket, is also the sole owner, employer and seller of beer and groceries in the same location,” Shipula said. “They can talk about building walls, barriers and partitions between the area where beer is sold and groceries are displayed but, in the final analysis, if it walks like a duck and quacks like a duck, it’s a duck – or, in this situation, it’s a clear violation of the intent of state law as adopted by the General Assembly and approved by the state’s chief executive.”  The Market Cafes are and will be important and indistinguishable parts of the Wegmans’ supermarkets and that makes the sale of beer there a violation of state law.

MBDA has in the recent passed, challenged the PLCB’s granting of beer sales licenses to convenience stores, which it believes to also violate state law that forbids convenience stores from selling beer. 
 

 

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Mon, 24 Mar 2008 14:45:00 EDT http://www.mbdap.org/news/distributors-appeal-court-decision http://www.mbdap.org/news/distributors-appeal-court-decision http://www.mbdap.org/news/distributors-appeal-court-decision
A six-pack of controversy to go The Trogner brothers built their dream over a decade, one beer recipe at a time.

It was a gamble, but today their microbrewery teems with towering stainless-steel vessels that churn and hum five days a week to create a select line of craft beers.

"We're not on the world-domination path," said John Trogner, 36, who with his brother, Chris, launched the Harrisburg-area Troegs Brewing Co. in 1997. But they do want to thrive.

Now the Trogners, like many in Pennsylvania's community of 67 beer brewers, believe they could get slammed by what is termed a "beer reform" measure winding through the legislature.

It is intended to give Pennsylvania beer lovers more choice, including the ability finally to buy a six-pack conveniently.

But the proposal has sent waves of anxiety through state beer brewers - many of them family owned microbreweries - who fear it will give an edge to out-of-state brewing giants and cut into their much smaller profits.

In-state brewers, including the Trogners, don't mind the expanded access to six-packs.

The problem for many is the proposal to allow the sale of 12- to 18-packs of beer: Smaller breweries don't have the packaging equipment to produce those sizes. It would give larger breweries an even larger price advantage.

"Who's this bill going to help? It's certainly not going to be the little guy," said Joseph Piccirilli, consultant to the Iron City Brewing Co. near Pittsburgh, one the state's larger brewers.

The beer biggies, like Anheuser-Busch and Miller Brewing Co., are pushing hard for the right to market those bigger packages in Pennsylvania. They've hired lobbyists; last year Anheuser-Busch spent about $200,000 and Miller spent $100,000, according to lobbyist disclosure forms.

Neither company responded to interview requests.

As it stands now, at distributorships, consumers can buy beer only by the case: 24 bottles, or four six-packs.

At bars or taverns, they can buy up to two six-packs at a time, often at marked-up prices.

Under the measure pushed by Sens. John C. Rafferty Jr. (R., Montgomery) and Sean Logan (D., Allegheny), beer distributors would be able to sell six-packs, 12-packs, 18-packs and any other configuration up to a case.

Restaurants and taverns - and convenience stores and supermarkets with liquor licenses - would be able to sell as many as three six-packs at a time, or any other configuration up to 18 beers.

"To me, this is all about the consumer," Rafferty said. "It's about giving people options."

Rafferty and Logan's beer-reform proposal has been floated in the Senate in the past. But the two plan to tuck it into an existing House bill over the next few weeks.

The two senators contend the measure would help in-state brewers by creating more outlets for six-pack sales. Customers now may be reluctant to try a case of their beer because if they don't like the taste, they are stuck with unwanted bottles.

In addition, the bill could earmark several million dollars in economic-development grants to help in-state breweries buy packing equipment for the new configurations.

Still, many Pennsylvania brewers aren't buying it.

The grants, distributed among the brewers, wouldn't be nearly enough to offset the price of new machinery, they say. That cost, depending on the size of the brewery, could exceed $1 million.

"There's not one microbrewer in this state that can make an 18-pack, not one," said Piccirilli, the Iron City consultant, who supports expanded access to six-packs, even 12-packs, but nothing beyond that.

Tom Kehoe, president of Yards Brewing Co. in Philadelphia, agreed that the larger-size beer packs would put a strain on in-state brewers. But he does not believe it will drown the state's craft-beer businesses.

Microbrews, Kehoe said, appeal to a different kind of beer drinker, who usually won't buy from "the big guys."

Patrick Jones, the brewer at Triumph Brewing in Philadelphia, put it this way: "Once you've tasted microbrewed beer, it's hard to go back to the other stuff."

As head of the statewide union for microbrewers, Artie Tafoya, owner of Appalachian Brewing Co. in Harrisburg, knows that many of his brewers are against the bill.

But he says he wants to do "what's best for beer."

"I'm a beer guy through and through, but I don't want anybody to feel like they're going to lose their business," he said.

Tafoya is optimistic a compromise can be reached.

"I still think there's a lot we can do to make the beer rules a lot better - for all of us," he said.

A fair chance is all that the Trogner brothers ask for.

"This is not a get-rich-quick scheme for us," John Trogner said.

"We love beer . . . and we want to continue making a living off what we love," he said.

By Angela Couloumbis

Philadelphia Inquirer


Contact staff writer Angela Couloumbis at 717-787-5934 or acouloumbis@phillynews.com.

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Mon, 03 Mar 2008 09:33:00 EST http://www.mbdap.org/news/a-six-pack-of-controversy-to-go http://www.mbdap.org/news/a-six-pack-of-controversy-to-go http://www.mbdap.org/news/a-six-pack-of-controversy-to-go
Lawmaker adds incentives for state store sale The latest attempt to privatize Pennsylvania's state-owned liquor stores faces the same formidable coalition as earlier tries and the added hurdle that stores now are widely viewed as more customer-friendly.

 

"Most Pennsylvanians seem satisfied with the way the state store system is now. There isn't a hue and cry for privatization," said Al Neri, editor of The Insider, a statewide political newsletter.

Sen. Rob Wonderling, R-Montgomery County, is trying to sell the liquor stores, an undertaking that former GOP Govs. Dick Thornburgh and Tom Ridge couldn't accomplish. Wonderling has added twists to his bill, and he said he's optimistic about its chances.

"I know this isn't going to happen anytime soon," Wonderling said. "It's a marathon, not a sprint."

Democratic Gov. Ed Rendell thinks state stores would be better in private hands -- he also is trying to lease the turnpike to private enterprise -- but he believes it would be "unrealistic" to pursue liquor store divestiture, spokesman Chuck Ardo said.

The combination of unions representing state store workers and conservative Republicans concerned about the state having less control over alcohol sales "will forever defeat any attempt to change the current system," Ardo said.

For the foreseeable future, that political climate is unlikely to change, said Steven Peterson, a professor of politics and public affairs at Penn State University's Harrisburg campus.

"I just don't see anything that's likely to change the dynamic," he said.

"There seems to be more customer orientation" at the stores, which have Sunday sales, more availability of better wines at reasonable prices and friendlier clerks, Peterson said.

Older Pennsylvanians might recall drab stores with rude clerks. Customers once had to submit requests to clerks, who would go behind partitions to get bottles. The public was shielded from seeing most of the bottles in a system designed after Prohibition. Pennsylvania is regarded as one of the tightest "control" states in the nation.

But Wonderling isn't accepting the premise that change is impossible. His proposal would maintain some state control of liquor stores. Four hundred of the state's 600-plus liquor stores would be auctioned off, but 200 would not be sold. They would be placed under contract to private firms, but the state would retain 48 percent control.

In another attempt to rebut criticism of privatization, Wonderling said he told Mothers Against Drunk Driving to find the toughest alcohol-related enforcement measures in the nation and he would include those features in the bill.

The other proposal that distinguishes Wonderling's bill from past efforts: He would put the estimated $800 million from the sale of stores in an interest-bearing account to provide annual revenue for improving health care in Pennsylvania.

The fundamental basis for Wonderling's approach is his belief that running a liquor store monopoly isn't a core function of government.

An added benefit, he said, would be "more competitive prices and more choice in selection."

Supporters of the current system see an ongoing financial benefit to the state. The Liquor Control Board pumps about $500 million yearly into the state's General Fund. It's an argument that has helped defeat proposals to sell the state stores in the past.

"The system we have is working well. It provides money to the general fund and some control of underage drinking," said Gary Tuma, spokesman for Sen. Vincent Fumo, D-Philadelphia. "(Fumo) sees no need to change."

The most recent attempt to sell the stores was by Ridge in 1997, when both chambers of the General Assembly were controlled by Republicans (Democrats now control the House). Ridge proposed increasing the number of licenses and opening 757 private stores. His plan never got rolling in the Legislature.

Thornburgh tried in 1981 but ran into opposition from religious groups, mid-state conservatives and union backers.

Peterson said the system won't change unless there's a public outcry for it.

Brad Bumsted can be reached at bbumsted@tribweb.com or 717-787-1405.

 

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Mon, 25 Feb 2008 13:16:00 EST http://www.mbdap.org/news/lawmaker-adds-incentives-for-state-store-sale http://www.mbdap.org/news/lawmaker-adds-incentives-for-state-store-sale http://www.mbdap.org/news/lawmaker-adds-incentives-for-state-store-sale
Hearings planned on privatizing liquor stores Pennsylvania legislators plan to hold a public hearing this summer about privatizing retail liquor sales, the chairman of the House Liquor Control Committee said yesterday.

"Let's put it out there and see what kind of response we get," said Rep. Robert Donatucci, D-Philadelphia, following a House appropriations hearing for the Pennsylvania Liquor Control Board yesterday.

The bipartisan hearing would be held jointly by the House Liquor Control Committee and the Senate Law and Justice Committee, probably after a state budget is passed.

At present, Mr. Donatucci doesn't think privatization supporters have enough votes for the bill to advance.

"I don't think it's even that close," he said. And he expects legislators first will deal with beer packaging initiatives that would allow consumers to buy six packs instead of whole cases at distributors.

Sen. Rob Wonderling, R-Montgomery, introduced the privatization bill this month, arguing that the state should not be in the liquor business. In the bill's current form, about two-thirds of the 623 state stores would be sold to the highest bidder and the remaining stores would be offered to a private equity firm. Proceeds from the sale would go toward improving health care for the state's residents.

"Even if it was viable, they would have to make some changes," said Mr. Donatucci. "When you put the facts on the table, privatizing the system in Pennsylvania is not as easy as it sounds."

At yesterday's hearing, PLCB Chairman Patrick J. Stapleton said privatization raises issues of possible social costs, including increased underage drinking, and financial implications. The PLCB last year alone returned nearly a half-billion dollars to the state treasury.

"We're not sure the numbers add up to being a plus for the commonwealth" if the system were made private, he said. He added that private retailers likely won't want to operate in remote areas of the state, forcing residents to travel long distances to purchase wine and spirits.

"I think the arguments against it [privatization] are even stronger than they were 10 years ago," when Gov. Tom Ridge tried unsuccessfully to privatize the system, he said.

Following a four-part Pittsburgh Post-Gazette series on Pennsylvania's liquor control system last month, reader responses showed widespread consumer frustration with the state store system.

But the complaint that selection is limited "is just not the case," Mr. Stapleton said yesterday, noting that the agency has 12,000 different wines in the system. "We're fighting a war of perception."

Rep. Ron Raymond, R-Delaware, agreed, saying with improvements in recent years "we have arguably the best liquor stores in the country."

That, plus the millions the system generates for the state, "makes a pretty compelling case for keeping the system the way it is," he said.

The appropriations portion of yesterday's hearing was brief, as the PLCB is one of the few state agencies that gives back money to the state each year.

Mr. Stapleton said sales had increased by "a little over 5 percent," but were below the agency's projected sales by about 1.5 percent. He attributed the missed sales goal to a general slowdown in the retail market. He said the agency is doing well when compared with neighboring states.

By Steve Twedt, Pittsburgh Post-Gazette
Steve Twedt can be reached at stwedt@post-gazette.com or 412-263-1963.

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Wed, 20 Feb 2008 13:06:00 EST http://www.mbdap.org/news/hearings-planned-on-privatizing-liquor-stores http://www.mbdap.org/news/hearings-planned-on-privatizing-liquor-stores http://www.mbdap.org/news/hearings-planned-on-privatizing-liquor-stores
Sheetz before supreme court Oral argument before the Pa. Supreme Court in the Sheetz case is scheduled for 9:30 a.m., April 17, 2008, Courtroom 456, City Hall, Philadelphia, PA.

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Fri, 15 Feb 2008 09:46:00 EST http://www.mbdap.org/news/sheetz-before-supreme-court http://www.mbdap.org/news/sheetz-before-supreme-court http://www.mbdap.org/news/sheetz-before-supreme-court
MBDA Legal brief MBDA is involved in litigation protesting the transfer of liquor licenses to Wegmans. So far there have been 6 hearings covering locations in Williamsport, Wilkes-Barre, Scraonton, State College, Bethlehem and Easton.

Below is a link to the brief MBDA has filed, which explains why distributors will be harmed by these transfers and why, as a matter of law, the transfers are not permissible.

View the legal brief (PDF file)

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Mon, 28 Jan 2008 12:16:00 EST http://www.mbdap.org/news/mbda-legal-brief http://www.mbdap.org/news/mbda-legal-brief http://www.mbdap.org/news/mbda-legal-brief
Wegmans moves closer to beer sales If Wegmans Food Market gets its way, before long its Downingtown store will be selling beer, over the objection of beer distributors.

On Jan. 10, Wegmans applied to the Pennsylvania Liquor Control Board for a restaurant license that would allow it to sell up to two six packs of beer and serve beer by the glass with meals to adults eating in its café.

Francesca Chapman, deputy press secretary of the PLCB, said Wegmans must be inspected by the state before the application can be approved. And there must be a permanent 4-foot high wall separating the licensed and unlicensed parts of the store.

“Nothing is going to happen too quickly,” Chapman said.

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 Edward J. Dymek, a township supervisor, said that legally the municipality must conduct a public hearing regarding the application, which it has done.

“No one came,” Dymek said.

Barbara Kelly, township manager, noted that the few individuals who did show up for the meeting were local beer distributors concerned about competition from Wegmans.

David Shipula of Wilkes-Barre, president of the Malt Beverage Distributors Association of Pennsylvania, said the supermarket is “masquerading as a restaurant.”

The supermarket is using an existing restaurant license, in this case one from Nottingham, and transforming itself into a beverage distributorship, said Shipula, who owns Beer Super in Wilkes-Barre, not far from a Wegmans that has also applied to the PLCB.

As a beer distributor, Shipula said he is limited to what he can sell: beer, soda and snacks but not milk or other groceries. “No inducements,” he said.

Shipula said he has seen Wegmans’ plans for its Wilkes-Barre store that call for eight glass-door refrigerator cases.

“That’s not a restaurant,” Shipula said. “That’s the same as what I have. That puts us at a disadvantage and we’ve fol

lowed the rules for years.”

The township can accept or reject the application but reasons to reject it are extremely restricted, said Dymek, who was the township supervisors’ chairman in 2007. There has to be a grave concern.

Arguments that children will see beer consumption or that beer sales is not something residents want are not valid reasons to reject the application, Dymek said. The township has no recourse but to approve the application unless the applicant is involved in illegal activities, he added.

Dymek promised the township and its police will monitor the beer sales to make sure there is no drinking to excess, no vulgarity and that other shoppers are not being harassed.

Dymek said he does not anticipate a problem, noting that Wegmans is a “big operation and concerned with its image.”

In addition to East Caln and Wilkes-Barre, Wegmans has applied for restaurant licenses for its stores in Easton, Bethlehem, State College, Williamsport, Scranton and Erie, according to the PLCB. No application has been filed for Wegmans’ planned store at Uptown Worthington in East Whiteland.

David DeMascole, Wegmans’ regional beverage director for Pennsylvania, said the application process started in the commonwealth last year. The Rochester, N.Y.-based grocery chain already has beer and some other liquor sales in its stores in New York, New Jersey and Virginia.

Store personnel involved with the beer sales in Pennsylvania will go through Wegmans’ training program developed for the other states with in-store alcohol sales and be certified by the PLCB’s Responsible Alcohol Management Program, or RAMP.

RAMP training teaches employees how to serve alcohol responsibly, how to detect fake identification, to not sell alcohol to minors and visibly intoxicated patrons, and to reduce alcohol-related problems at licensee establishments.

“We’re very confident in our program,” DeMascole said.

DeMascole said there is no set date when beer will go on sale at its Pennsylvania stores.

With the restaurant license, Wegmans could also sell wine by the glass, but will be starting with only beer.

“We’re moving slow, one step at a time,” DeMascole said. “We want to do it right.”

Beer sold by the glass must be consumed in the store with a meal purchased at the store. No one will be allowed to sit in Wegmans cafe and just drink beer, DeMascole said. The case with single and six-pack beer merchandise will be in the café in a well-controlled area.

Wegmans, known for selling in-season produce from local growers, will carry that to its beer sales.

DeMascole said Wegmans is in contact with Victory Brewing in Downingtown to sell that brewer’s beer. It already uses a Victory beer in one of its soups.

The application comes at a time when the decision to issue Sheetz convenience stores a liquor license is under appeal before the Pennsylvania Supreme Court, which has yet to hear oral arguments in the case.

The PLCB conditionally issued a license in 2004 to Ohio Springs Inc., a Sheetz-related company, to sell beer and malt products.

Sheetz began to sell beer Feb. 1 but was stopped twice during the appeals process. The Malt Beverages Distributors Association of Pennsylvania sued to stop the Ohio Springs license from being granted.

Beer sales resumed Aug. 28 after the Supreme Court lifted a stay on the sales while it heard the PLCB’s appeal of a Commonwealth Court ruling.

DeMascole said Wegmans does not think the court decision will affect it.

“We don’t see this the same as Sheetz,” DeMascole said. “We see our process differently than theirs. It’s not the same situation. Our submission is within the guidelines of the law.”

By GRETCHEN METZ, Staff Writer  
DailyLocal.com
 
 

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Mon, 21 Jan 2008 08:50:00 EST http://www.mbdap.org/news/wegmans-moves-closer-to-beer-sales http://www.mbdap.org/news/wegmans-moves-closer-to-beer-sales http://www.mbdap.org/news/wegmans-moves-closer-to-beer-sales
Sheetz cited for underage beer sale A 19-year-old woman working for state police was served beer in November at the Sheetz convenience store and restaurant at 17th Street and Pleasant Valley Boulevard, a state police spokesman said Friday.

A citation for the underage sale was filed last week against Ohio Springs Inc., the Sheetz Inc.-related company that holds the beer license for the business.

“We conducted an age- compliance detail, and Sheetz was one of the places that sold to us,” Sgt. Wayne A. Bush said.

The sale comes at a time when the decision to issue Ohio Springs/Sheetz a license is under appeal before the Pennsylvania Supreme Court, which has yet to hear oral arguments in the case.

The violation isn’t expected to be an issue in the case or the original license transfer, Sheetz vice president and general counsel Mike Cortez said.

Sheetz investigated the reported violation and added remedial training to prevent a reoccurrence. The company also disciplined the employee who sold the beer to the underage buyer, Cortez said.

“This is a very unfortunate situation,” he said. “We take this very seriously and will redouble our efforts to make sure it does not happen again.”

Sheetz employees are trained in the Responsible Alcohol Management Program, a voluntary state program that teaches alcohol licensees and their employees about such subjects as following state liquor laws, identifying visibly intoxicated patrons and fake IDs.

Sheetz began to sell beer Feb. 1 but was stopped twice during the appeals process. The Malt Beverages Distributors Association of Pennsylvania sued to stop the Ohio Springs license from being granted.

Beer sales resumed Aug. 28 after the Supreme Court lifted a stay on the sales while it heard the Pennsylvania Liquor Control Board’s appeal of a Commonwealth Court ruling.

The Ohio Springs citation case hasn’t been heard yet by an administrative law judge, PLCB spokesman Nick Hays said.

From the Altoona Mirror

Mirror Staff Writer Mark Leberfinger is at 946-7462.

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Sat, 19 Jan 2008 13:07:00 EST http://www.mbdap.org/news/sheetz-cited-for-underage-beer-sale http://www.mbdap.org/news/sheetz-cited-for-underage-beer-sale http://www.mbdap.org/news/sheetz-cited-for-underage-beer-sale
Supervisors reject Wegmans liquor license Despite promises from Wegmans representatives that its Valley Square store would maintain its family-friendly atmosphere and its employees would be trained in alcohol sales, the Warrington Township supervisors voted Tuesday to deny the market's liquor license application.

After almost two hours of debate from township residents and officials, the board voted 4 to 1 to reject the market's application. Wegmans had hoped to transfer a liquor license from a Pizza Hut in Richboro to its 225-seat self-serve cafe.

Board members' concerns ranged from fears over open containers in grocery aisles, to increased access to alcohol for minors, to the safety of the market's already crowded parking lot.

“It's bad enough being in that parking lot on its own,” said Supervisor Michael Lamond Jr. “If you add alcohol to the mix, it can only get worse.”

Though one resident spoke out in favor of the idea, most public input was overwhelmingly negative.

Steve Mendenhall, who manages Thirsty's Beer on Easton Road, brought with him a petition of more than 300 signatures of area residents who opposed a Wegmans liquor license.

“If Wegmans gets a license, who's next?” Mendenhall asked. “Is Genuardi's next? Is ShopRite next? Are there going to be taps at Wawa?”

Chairman Paul Plotnik had worried most that Wegmans would one day sell hard liquor. Secretary Glenn McKay proposed limiting the market to selling beer and wine for take-out only.

“I can promise you I'd spend three years in a lawsuit if that happened,” said Mark Kozar, an attorney representing Wegmans. “(The Malt Beverage Distribution Association) would sue us, just like they sued our client Sheetz.”

MBDA of Pennsylvania has challenged each of Wegmans other Pennsylvania liquor license applications, as well as beer sales at a Sheetz convenience store in Altoona. The Sheetz case is now before the state Supreme Court.

By SARAH BAICKER The Intelligencer

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Wed, 09 Jan 2008 21:27:00 EST http://www.mbdap.org/news/supervisors-reject-wegmans-liquor-license http://www.mbdap.org/news/supervisors-reject-wegmans-liquor-license http://www.mbdap.org/news/supervisors-reject-wegmans-liquor-license
Philly Wegmans Misreads Needs of consumers The head of Pennsylvania’s retail beer distributors group says it is apparent that the management of Wegmans super market in suburban Philadelphia is misreading consumers in its drive to offer beer by the bottle and by the six-pack at its Warrington (Bucks County) store.

“It’s apparent from quotes attributed to their Warrington store manager, Blaine Forkell, that they see most Pennsylvanians as morally and socially misguided,” said David Shipula of Wilkes-Barre, president of the Malt Beverage Distributors Association of Pennsylvania.  Local media quoted Forkell as suggesting after a Warminster Township hearing on Thursday that Pennsylvanians were in the “Dark Ages” about beer sales.

Shipula said a recent poll commissioned by MBDA showed that voters statewide were almost evenly split, against and for supermarket and convenience store sales of beer, with 48.9 percent opposed and 47.9 percent supporting.

“When you look at how strongly people feel about either position, though, you see an even wider split with 35 percent strongly opposed to selling beer where groceries and gasoline are sold, only 27 percent strongly in favor and 37 percent somewhere in between,” the Wilkes-Barre beer distributor said.

“What’s also telling is that more than 60 percent think the present system of retail distributors works pretty well and provides a wide array of consumer choices in terms of foreign and domestic beers, micro-brews, craft brews and brand names,” Shipula said.  “If anything popped up as a potentially popular improvement it would be allowing retail distributors to sell in less than case lots.  In the Philadelphia suburbs, 79 percent of those interviewed were in favor of that.”

Shipula said his group was strongly opposed to any legislation that would ease Pennsylvania’s historic ban on beer sales where groceries or gasoline are sold. “This is good public policy that has been in place for 70 years.  Of late, some chains like Wegmans on the grocery side and Sheetz on the gasoline side have been finding loopholes in the law to co-locate beer sales with groceries and gasoline, but that doesn’t make it right or good public policy.”

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Fri, 14 Dec 2007 12:24:00 EST http://www.mbdap.org/news/philly-wegmans-misreads-needs-of-consumers http://www.mbdap.org/news/philly-wegmans-misreads-needs-of-consumers http://www.mbdap.org/news/philly-wegmans-misreads-needs-of-consumers
Laws on Beer Up for Vote in Pennsylvania

A new poll by Terry Madonna Opinion Research shows that most Pennsylvanians view easier access to carryout beer, as in supermarkets, as leading to an "increase in the rates of underage drinking or other alcohol-related problems."

The survey, involving 772 Pennsylvania adults interviewed in September, was conducted for the Malt Beverage Distributors Association of Pennsylvania.

A total of 54.6 percent of those interviewed saw beer in supermarkets leading to more alcohol-related problems while an even larger percentage -- 62.7 percent -- believed that Pennsylvania's more than 1,300 existing retail malt beverage distributors "provide a sufficient selection of imported and domestic beers."

David Shipula, president of the beer distributors' group, said the consumer responses underscored two of the strengths of the current state beer sales system: wide consumer choices and strong restrictions against sales to minors.

Dr. G. Terry Madonna, President of Terry Madonna Opinion Research, noted that an even higher percentage of respondents -- 71.2 percent -- want to allow retail beer distributors to be able to sell beer in smaller quantities than the current legal purchase of a case of 24 bottles or cans.

"Statewide, people were pretty evenly split over suggestions that we expand the retail sale of beer into supermarkets and convenience stores with 48.9 percent opposed versus 47.9 percent favoring," Madonna said.

Shipula said, "The poll underscores what consumers have been telling our members all along, that the state-sanctioned system of beer sales works well with people being able to buy 12 or fewer cans or bottles for off premises consumption from some 11,000 bar and deli licensees and quantities of a case and larger from some 1,300 retail distributors. If anything, they find it strange that they can't buy less than a case from a beer specialty store."

Legislation has been proposed in Harrisburg to change several aspects of the current system ranging from allowing retail distributors to sell in less than case quantities to allowing bars and delicatessens, and by extension, supermarkets and convenience store/gas stations, to sell up to 18 cans or bottles for off premises consumption.

"People who want to change the law say they are acting on behalf of the consumers but this poll shows that the public wants a system with adequate protections -- something that we do have now," Shipula said. "The consumer also realizes that specialty stores -- and that's what beer distributors are -- tend to carry larger variety and selection of the product than general stores like supermarkets and convenience stores where shelf space is at such a premium that companies must pay 'slotting allowances' for the privilege of having the store stock their brands."

NOTE: The above represents some of the findings of a survey of 772 Pennsylvania adults conducted during September 2007. The survey was designed by Terry Madonna Opinion Research on behalf of various sponsors and the interviewing was conducted by Dynamic Marketing Research Associates of Easton, Maryland. The sample error for the total sample is plus or minus 3.5 percent. Telephone numbers for the survey were generated via random digit dialing. Respondents were selected from within each household. The final sample was weighted to correct for differential probabilities of selection and non- response.

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Tue, 30 Oct 2007 11:30:00 EDT http://www.mbdap.org/news/odd-laws-on-beer-up-for-vote-in-pennsylvania http://www.mbdap.org/news/odd-laws-on-beer-up-for-vote-in-pennsylvania http://www.mbdap.org/news/odd-laws-on-beer-up-for-vote-in-pennsylvania