Out Of Control

I've been at this for years, since 2008, although I did pretty much drop the ball during the pandemic (which I regret, deeply, because a LOT of things needed to be said, but that's virus over the dam now). One of the consistent themes through all of those years was the way the Liquor Control Board was actually out of control. 

I've brought up numerous examples of this. The famous wine kiosks, the Rise of Conti (and the essential abolishment of his CEO position after he fell from grace), numerous clashes with Governor Rendell (told you I'd been at this for years), the lying about 'variable pricing,' and the disastrous allocated whiskey lottery that they never could get right, and finally just gave up on.

Whoops, not THAT Frank Burns!

But one of the most egregious, amazing examples was one I missed during my COVID hiatus, when Representative Frank Burns (D-Johnstown) tried to find out how many "zombie" licenses the PCLB had for future auction (these are seized or unused licenses; after a year, under relatively new law, they revert to the PLCB, where they can be auctioned to the highest bidder). 

The PLCB said no! That's right: a government agency refused to give regulatory information to a duly-elected legislator. So Burns went to the Office of Open Records. They said the PLCB had to give him the information...and The Lords Of Liquor Control refused again, appealing to the Commonwealth Court. The court ruled in Burns's favor, so of course, the PLCB (which has an unending supply of crap lawyers) appealed the ruling to the state Supreme Court. The PA Supremes fairly quickly denied the PLCB's appeal, upholding the Commonwealth Court ruling, giving the agency 30 days to present the information.

Yeah, I'm Frank Burns. Arrest the PLCB.
(And the snozzberries taste like snozzberries!)

Aside from the truly interesting fact that Rep. Burns is a Democrat, and the state Supreme Court has a solid Democratic majority (so they clearly do get what the PLCB is, but consistently refuse to privatize it), what do we learn here? 

The PLCB directly denied a legal request for information from a state legislator. This wasn't a frivolous request, like 'Hey, how many bottles of Maker's Mark do you guys have right now?' It was information that concerned constituent requests and a valid issue, namely, how is a purchaser supposed to know what the value of a license is when the PLCB won't tell them how many are going to be available? 

The PLCB gave its stock answer, which had always worked for it in the past: 'That's proprietary information, my good man.' But this time, they ran into someone who was just as willing to go to court as they were, and they lost. (Burns paid the legal costs out of his own pocket, by the way; the PLCB...yeah, they paid out of our pockets.)

Commonwealth Court Justice Cannon

They not only lost, the judge "bought none -- not one iota -- of what the Liquor Control Board was trying to sell. [Wow, the PLCB sucking at selling something; shocker.] The Right-to-Know Law is clear -- the information here is public record,” said Burns's lawyer, Terry Mutchler, the first director of the state's Office of Open Records. “It is a very strong decision that advances the law by giving deeper guidance on the components of records that agencies consider pre-deliberative. And also, because it points out that although the LCB may be ‘business-like,’ it is not a business.” (Yes, that's why I included the entire quote.) 

This is classic PLCB style. Don't just be wrong; deny you're wrong, waste thousands of taxpayer dollars denying you're wrong, and then when you're proven wrong, be assholes about it. Assholes? Yeah, the PLCB's main comment on the Supremes' decision was along the lines of, 'Wow, we were really looking forward to proving our case, but we've been denied justice.' Typical. 

This is all by way of proving the point I've been making for years, the one I simply cannot believe the General Assembly does not get: the PLCB is a rogue agency. Burns gets it. He believes that the Board wields too much power and has become arrogant and unresponsive to the public’s wishes. “The LCB has their own little kingdom with a moat around them for protection,” said Burns. “They’re not accountable to anyone, and that has to change. If they can treat a legislator like this you can only wonder how they treat other people out there.”

Bang on, Rep. Burns. The Liquor Control Board is literally out of control, and the reason is that it is answerable only to itself. It is a government agency with its own plentiful source of revenue. It has its own enforcement arm, its own courts and judges; it regularly thumbs its nose at the legislature, the governor, and the Pennsylvania courts; and it arbitrarily changes state-written regulations by 'interpreting' them as they wish.

It does not need to be reformed, or 'brought to heel,' or be regulated. It needs to be done away with. It serves no purpose that is not either anti-consumer or superfluous. Everything the PLCB does can be done more efficiently by existing state agencies. Except the actual wholesale and retail sale of booze: thanks, we can do that better on our own, no state agency required. 

Here's how I laid it out almost exactly 14 years ago in this blog: "...privatize booze sales, put licensing and inspection in the hands of the Dept. of Agriculture, tax collection in the purview of the Dept. of Revenue (they've got some experience with that), put the anti-alcoholism and underage drinking prevention programs under the Dept. of Health, and fully hand over enforcement to the State Police. [Then] give a re-write of the [Liquor] Code over to a commission that includes interested consumers for a change, and charge them with writing a simpler, more understandable Code."

The PLCB shut down for six weeks during the pandemic, and Wolf himself said  (link goes to a PDF) we didn't need them, because now we could buy booze at the Acme store. The PLCB is corrupt, the PLCB is outdated, the PLCB has only 600 stores for the entire state. The PLCB won't let you buy booze in Jersey or Delaware, they force us to buy from them. 

Why the hell aren't we done with this? Why does the Legislature put up with it? 

Privatize. End this out of control agency. 

Let's talk New Jersey just a bit

This is a blog about Pennsylvania's drinking problem -- the PLCB. But sometimes we look at how other states do it, either to see how it's done right, or how it's done wrong. Today, "done wrong" is the New Jersey Division of Alcoholic Beverage Control, and their recent "crackdown" on limited brewery licenses...which was followed by an amusing 180 when they were brought to heel.

Let me explain. A limited brewery license is a relatively new thing, an adjustment to the NJ Booze Code that was just passed in the Garden State in 2012. I'll save you the trouble of looking at it: it's a license for breweries that produce under 300,000 barrels a year, and allows them to sell to wholesalers or direct to retailers, sell directly to consumers on their premises (by the drink, or in quantities up to a half-keg at a time for off-premise), and give limited amounts of free samples. The license is an annual fee, between $1,250 and $7,500, depending on the size of the brewery.

There are two restrictions in the law. On-premise sales must be "in connection with a tour of the brewery" (which has been interpreted to be as simple as signs on the brewing equipment or a three-minute instructional video). And "The holder of this license shall not sell food or operate a restaurant on the licensed premises." And that's it. 

And yet...last month, David Rible, the director of the NJ Division of Alcoholic Beverage Control (ABC, and why does it say "control" if they don't have state-run stores?) took it upon himself to arbitrarily issue a restrictive ruling that suddenly limited that "limited license" with a load of restrictions that seem to go way beyond the NJ legislature's original intent of "in connection with a tour" and "shall not sell food." 

Rible's ruling on consumer freedom

According to Rible's ruling, the limited license holder was now restricted to 25 "events" per year; "Trivia night" is given as an example of an "event," but so are "live" television display of sporting events, and each event must be approved by the ABC. The license holder may only do 12 off-premise events in a year; beer festivals are not included, but events in the brewery parking lot are. They are allowed to host up to 52 "private events," but only in a walled-off area. These "rulings" make things a lot less fun, but then Rible just got stupid. Yeah: David Rible got stupid. PLCB-level arbitrarily stupid.

The food thing got crazy. No food trucks are allowed, which...how? Why can't a food truck park in the lot? Then this one is just a killer: "No restaurant menus of any kind shall be placed or maintained on the licensed premises of a Limited Brewery." Which, one, in the era of GrubHub and Yelp is just stupid and pointless, and two, would seem to violate all kinds of commercial free speech.

Then there's this one, which is just weird: "A Limited Brewery licensee shall not allow, permit or suffer other mercantile business, such as "pop up' shops, bazaars or craft shows, to occur on the licensed premises." Sounds like Rible doesn't like hippies.

Upshot: there was a huge uproar from consumers, breweries (and I suspect the legislature), and within about a week, Rible was back-pedaling like mad. The whole thing was suspended, and now the Legislature is going to revisit the limited license. (And some brewers are pleased with this! Be careful what you wish for...)

Sigh. This is exactly the kind of crazed arbitrary rulings the PLCB loves to make, regardless of consequences. Rible is not a judge, he's not a legislator, he's certainly not the governor. But he took a law, and simply rewrote it. He presumed to know what the legislators really meant when they said "in connection with a tour" and "shall not sell food," and that was "don't take business away from complacent tavern owners." 

Rible's Library of Arbitrary Decisions and Policy Mistakes

Whoops. Did I say that out loud? Yeah, it sure looks like he did this to please tavern owners, who felt they were being gored by this limited brewery license. After all, because New Jersey has the same stupid limits on licenses that Pennsylvania does -- only worse! -- they had to pay a LOT more for their license, often over a million dollars. And that doesn't seem fair. 

Well, it isn't. But it's not the brewers' fault, and they shouldn't be punished for simply following the law. There wasn't any news of breweries selling food, and every New Jersey brewery I've ever been to (a lot of them), has offered some kind of "tour". 

No, the real problem here is that the licensing system is broken, and no one who currently has a license wants it fixed. Sound familiar? 

I'll spell it out for you. The arbitrary decision by the PLCB to allow grocery stores to sell beer because they have purchased a restaurant license (and maintain a "cafe" area separated from the rest of the store) is a bad idea, and it is only making the broken licensing system worse. And in the future, if the Legislature wants to fix that by creating a new, reasonably-fee'd store license, guess who's going to be spending a lot of money to convince them that's a bad idea? The grocery chains who spent millions buying restaurant licenses, that's who. 

Leave it to the Legislature. They answer to us. Bureaucrats like Rible, and the PLCB, rarely answer to anyone. Though I do have to admire the brewers of New Jersey for standing up to this bullshit. Well done! Hold onto those menus!

New Jersey's example is clear. As long as the PLCB has this kind of arbitrary regulatory power...mistakes will be made. The solution? It's at the top of the screen, as always: Abolish the PLCB. Rewrite the Code.