New Castle News

February 1, 2013

Local merchants not high on state plan for liquor sales

Nancy Lowry
New Castle News

NEW CASTLE — If Gov. Tom Corbett opens liquor sales as other states have done, similar controls should be imposed, area businessmen believe.

“If he’s making changes, he should take care of existing businesses,” beer salesman Gus Benetas said. “The state must regulate prices as they do in Ohio. That is the only way this can work for all of us.”

Benetas has sold food and six packs as Mr. B since 1989 in Shenango Township. He opened Mr. B’s in Neshannock Township in 2003. He plans to relocate that operation to Shenley Square in the spring.

“Times change,” Benetas said. “But I don’t understand why the governor believes there is a need to privatize. Things are working well as they are, and it is not as if the state is struggling to sell alcohol. It is a monopoly. Why would he want to change that?”

Corbett this week announced plans to get the state out of the business of selling alcohol and open that market to private businesses who would compete for beer and liquor licenses.

Corbett’s proposal includes selling state liquor stores.

Existing businesses — including distributors and bottle shops — would continue, but the governor sees the market opening up as businesses compete through public auction for expanded liquor licenses that would allow the sale of liquor as well as beer.

“The big boys would get bigger at the expense of us little guys,” Benetas said. “Who could go up against a Walmart or Giant Eagle who have unlimited resources?”

Since Pennsylvania allowed beer sales in grocery stores, Benetas campaigned on behalf of the small business owners who he claims are at a disadvantage because of their limited inventories.

“They sell many items, not just beer. “

Benetas noted this is not the first time and Corbett is not the first governor to seek to eliminate the state store system or privatize liquor sales.

“As the governor proposes, grocery stores will get a bigger advantage,” he said. “They will be able to place beer on the shelves not in isolated areas — and start to sell beer by the case.”



Follow Ohio’s lead

If privatization goes through, Benetas said, he hopes the plan follows that in other states.

“In Ohio it seems you can buy beer at every corner store, but they regulate the prices. You’re paying the same for a six pack if you buy it at a Mom and Pop’s or at Sam’s Club. No one can sell it at a huge discount to get the advantage over others.”

Benetas said there is currently no plan similar plan for Pennsylvania.

“You can do anything you want at any price,” he said. “The governor wants to create new jobs, but the existing ones will be gone.”

John Morgan, who with his son, John, operates a Coney Island in Slippery Rock and is about to open a tavern and “beer cave” bottle shop in Ellwood City, said he is not up on the details of Corbett’s proposed privatization plan, “but I’d prefer to see things remain as they are.”

No one knows what will happen with alcohol sales if changes come, Morgan said

“What’s going to happen to the people who work in state stores?” he asked. “In six months to a year they could be out of work. They’re getting good wages now, supporting families.”

“The state is looking for a big payoff, but that will be a one-time thing. In three or four years that will be gone and the state won’t get the income from liquor sales they get now.”



BIG BOX ADVANTAGE

Paul Capitola, manager of Beer4Less, believes privatization will hurt distributor businesses like his.

“Liquor licenses will be bought up by Walmart and Giant Eagle who will have the advantage,” he said. “They will get people in the door by selling things cheap. They draw them with bakery goods, produce and lunch meats all sold at low prices.”

Capitola said the “big stores” already sell soft drinks at less than cost “to get customers in the doors.

“We’re at a disadvantage,” he said. “We are limited to selling pop, beer, cigarettes and snacks.”

Josh Senchak of the state Wine and Spirits store on Wilmington Road said information on the governor’s privatization plan remains vague, especially on the future of current state store employees.

“They say the state budget is their priority now and then they’ll turn their attention to this,” he said of the legislators. “And there is no guarantee that this will pass. Everything is up in the air until the legislators act. That could be tomorrow, it could be in six months.”

However, Senchak said, union reps are against the change, and state store employees have received promises.

“They’ve told us we’ll get additional points if we take civil service tests,” he said. “But what difference will that make if the state is not hiring?”

(Email: nlowry@ncnewsonline.com)