Thursday, March 12, 2009

PLCB Playing Favorites in Philly

Philadelphia Magazine has a "Web Original Article" up about a simply amazing new PLCB initiative -- that's right, another one -- that has jaws dropping all over Philly. Restaurateurs' jaws, that is, at the stunning favoritism and clueless unfairness it demonstrates. Check this:

José Garces' ... new something involves the Pennsylvania Liquor Control Board. That’s right — as part of a wider effort to rebrand its image, the PLCB will be pairing up with notable chefs and restaurateurs to open a handful of boutique wine stores, aiming to give oenophiles a more personal experience. (The Philadelphia location will be the first.) The specialty stores, whose inventories will include a few hundred bottles of wines not available in traditional Wine & Spirits stores, will hold tasting events and have a highly trained staff to help you find that perfect Pinot.
Let's leave aside the easy joke -- that the "highly trained staff" must be the ones who already know how to say "Hello!" and "Thank you!" -- and take a look at this. Suppose you're a Center City restaurant owner, a similar cafe-type joint known for their wine selection: Tria, for instance, since that's the only wine bar kind of place I've ever been to in Philly (disclosure: I have taught three classes at Tria's Fermentation School). How do you feel about the PLCB opening a take-out store inside a competitor's restaurant -- bad enough already, when wine take-out is illegal for you -- that sells wines "not available in traditional Wine & Spirits stores," and the PLCB staff is going to hold tasting events for those take-out wines right there in that other restaurant? I'd feel pretty damned hard done by.

This is a government agency. If Pennsylvania was not a control state, and it was a private business doing this -- Moore Brothers, for instance, and wouldn't it be a happy freakin' day if the PLCB were to go away and Moore Brothers could come to Center City? (disclosure: I have done no business whatsoever with Moore Brothers, they don't know me from Adam) -- hey, no problem! Actually, given the arcane and pointless circumlocutions of liquor law across the country, it would probably be a huge problem getting it licensed, but ethically there's no problem. It's two businesses reaching an agreement, and Garces would either be paying Moore Brothers for the exclusivity or they'd be paying him for the floor space, depending on who got the jump on who. And if Jon Myerow at Tria wanted to cut a similar deal with Canal's, he could.

But the PLCB is a government agency with monopoly retail power. Myerow can't just find another company to make a deal with, or do it himself, because that's illegal. Illegal! He's got to go to the PLCB, hat in hand, and beg to be part of this new program. As would the folks at Chick's, or Southwark, or DiBruno Brothers, or any number of wine-friendly cafes and restaurants.

And the PLCB will either grant them the boon or not, according to their own agenda. A government agency that has an ironclad monopoly on retail sales has no right deciding to essentially grant that right to retail to one business and refuse it to another. The PLCB is totally out of touch with reality. They are "acting like a business" when they aren't a business. They are a 'business' with whom it is illegal to compete, a 'business' with the full force of government enforcement and coercion behind them, a 'business' that can interpret the law to suit themselves without fear of contradiction.

I'm going to have to quote Buddy "I married a PLCB manager" Hobart to express what I feel about this new initiative. "What I say to the skeptical," said Buddy Hobart, president of Solutions 21, "to those of us in the world who believe we've arrived and don't need to improve: Look up the word arrogant in the dictionary." When you find that page, I believe you'll find the PLCB logo next to that definition.

Two notes at the end. First, I'm not pissed at José Garces, not in the least. I don't blame him for doing this, it's a sweet deal, and he would have been a fool not to take the PLCB up on it. And I do look forward to the opening of his new Village Whiskey, which is, yes, a whiskey bar, coming soon, probably May, at 20th and Sansom.

And of course, I'm shocked -- shocked, I tell you! -- that PhillyMag would run this story without a word about how this might unfairly impact other city businesses. What's that you say? Why yes, that's the same PhillyMag that co-sponsors the Philadelphia Whiskey Festival with the PLCB (which also runs one of these mini-stores right at the festival, while not allowing brewers to sell at beer festivals), and not a word of disclosure in the story. Good separation of advertorial and editising departments there.


Anonymous said...

Did you mention the license issue involved here? Tria et al PAID FOR A PLCB LICENSE TO SELL WINE. It seems that Jose Garces will not have to lay out the quarter million or so dollars it takes to snag one of those babies. Tria et al have already invested themselves with the PLCB, and Jose has not, yet Jose's arrangement will allow customers to buy wines TO TAKE HOME that aren't even available to other licensed establishments.

What the hell is this stupidity, and who's in charge of it?? Oh, right.....Joe Conti. Keep up the good work, Joe! You'll eventually run yourself and the rest of the LCB out of business...I hope!

Now, about that lousy bourbon selection...

Lew Bryson said...

Hold on, Sam. I think Garces's place has a liquor license. And licenses in Philadelphia County, last time I checked -- which was a couple years ago, admittedly -- are quite a bit less than a quarter mill; Philadelphia's still losing population, which has an effect on the price. I'll try to check on that, just for my curiosity.

But you're absolutely right on the unfairness of being able to offer wines customers can't get anywhere else. That's one of the most egregious mis-uses of the PLCB's retail monopoly power I've seen.

BTW, I'll say it again: I'm not pissed at Garces, I don't blame him, and he would have been a fool not to take the PLCB up on this idea.

And about that lousy bourbon selection...

Anonymous said...

Well, my exposure to the license situation focuses on State College, where that's the going rate. Sorry for the geographic oversight.

And you're right, if Garces has a license, it's less a problem, though still patently unfair to others.

We'll see what shakes out of all this hoo-hah, now, won't we!

TC said...

I cannot help but wonder if this is legal--and I don't mean with the liquor code, either.

Currently, state stores, at least in theory, only charge you for the cost of the bottle, plus taxes. There is no "profit" to speak of. If this Garces store has any sort of markup on any of those take out bottles--thus producing illegal profit for the state--I wonder if somebody couldn't file a suit accusing the PLCB of an illegal monopoly.

Maybe someone with better legal sense can correct me on this, but it sounds fishy on just too many levels.

Lew Bryson said...

TC --
That's not the case, actually: the State does add a markup of 30%, besides all the taxes. I've got it laid out here:

And Garces will not be taking profit from the store, at least, not as I understand it. The store is just operating in his restaurant, which, given the limited scope of wine retail in PA, is advantage enough for him.

As for "illegal monopoly," the 21st Amendment gives the states a huge amount of leeway on alcohol sales, and pretty much trumps any legal objections to the state's monopoly booze-selling power.

Lew Bryson said...

I was wrong: Garces's cafe will not have a license. So yeah, your point's a valid one. The Almighty Liquor Code says you can't open liquor or wine bottles on the premises of a State Store (except for authorized tastings), but it's easy to see a way around that: the "store" is only part of the cafe. So this gives them an unfair advantage over restaurants with licenses and BYOB's, sounds like.