A Plea to the PLCB

Okay, that's six posts here in four days. I've got to ask the PLCB: would you please stop making bad decisions so I can get some paying work done?

Thanks. And get the Legislature to vote you out of existence, too. Make my life a lot easier, I tellya...

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.

"If the LCB were to find a cure for cancer..."

Either Governor Rendell or his press secretary, Chuck Ardo, apparently thinks people like me -- and maybe you -- are just anti-PLCB cranks. Check this out from that Pittsburgh Post-Gazette piece on the courtesy contract controversy:

Such criticism was to be expected from longtime critics of the PLCB, countered Chuck Ardo, a spokesman for Mr. Rendell. "The LCB decided their retail staff needed some training to ensure courteous service," he said. "If the LCB were to find a cure for cancer they would find a reason to criticize it."

"Cure for cancer"? In light of what's been going on lately, it seems more likely that someone at the LCB's brother-in-law would be peddling Laetrile, Chuck, and yeah, I'd criticize that.

In fact, even your own boss criticized the courtesy contract controversy...at least, until someone got to him and, er, pointed out the facts. Check it out, and how Chuck spun it right around (emphasis added, cuz I wouldn't want you to miss the important stuff...):

Mr. Rendell, when asked about the customer service training contract at a news conference, said it was the first he'd heard of it -- and of the relationship between the consulting firm's president and an PLCB manager. "If it's true, it's something that should be corrected," Mr. Rendell said.

But the governor made that comment before he had all the information about the contract, Mr. Ardo said. "He is not calling for the contract to be rebid," said Mr. Ardo. "He answered instinctively [because] the way the question was asked it seemed there might be a problem, but once the details unfolded it was clear there is no problem."

Clear? You bet! It's clear to me that Rendell's "instinctive" response to hearing about a fairly large state contract being let to the husband of a high-ranking agency manager was that it was "something that should be corrected." How much more information do you need? That it's "in compliance" with the state's Adverse Interest Act, according to LCB spokesman Nick Hays? Yeah, that's a tough standard. Check out the Post-Gazette's careful, damning parsing of that:

Hays said the contract was "in compliance" with the state's Adverse Interest Act, which among other things prohibits state employees from influencing contracts in which they have an interest.
The act also prohibits state employees from having an "adverse interest" in any contract with the state agency that employs them. The act defines that interest as being "a stockholder, partner, member, agent, representative or employee" of a company seeking such a contract. Hays said Susanne Hobart does not do any work for her husband's firm.

Let me get this straight. Is this coming from the same state agency that recently required an investor in Philadelphia brewpub Earth Bread + Brewery to sell his investment to his wife (because he was also an investor in another small Pennsylvania brewery, which might influence the managers of EB+B to buy beer from that brewery), and then further required his wife to sign an affadavit that her husband would never profit from her investment? Really?

Did they require Mrs. Hobart to sign a similar affadavit? They're married. The state's "Adverse Interest Act" doesn't cover that? I guess that's one of the "details" Chuck was talking about.

The Gov should follow his instincts more often.

A Shot Across the Bow

Time to step things up. I just sent the following to Governor Rendell, Senators Wonderling, Tomlinson (my local senator), Greenleaf, and Rafferty, and Representative Farry (my local rep), cc;'d to the three PLCB Board members. If you feel like it, send them something similar, but don't use my letter; they'll just write it off as kook action. You can get their e-mail addresses (and those of your legislators) easily: here's a list of senators, representatives, and the governor. Have at it.


Gentlemen,

As a Pennsylvania citizen, taxpayer, and native, I strongly believe that the time has come to end the Commonwealth's monopoly on the sale of wine and spirits. This week's reports of a $173,820 consulting contract with Solutions 21 to train State Store clerks and managers "how to greet someone, where to stand, and how to read a customer's cues", and the ensuing concerns over a possible conflict of interest when it was revealed that the head of Solutions 21 is married to one of three PLCB regional managers, put a cap on a building series of questionable decisions by the Board. The people of Pennsylvania deserve better from their state agencies.

But this is almost beside the point. There is no good reason why the State is in the booze business. Approximately 75% of the monies transferred to the general fund from the PLCB are taxes that could just as easily be collected by private businesses, as is done in other states, as is done in Pennsylvania by beer distributors now. The "profits" from the PLCB stores are not insignificant, but it is very likely that any revenue loss from privatization would be more than made up by greater in-state sales when Pennsylvanians ceased going across the borders to buy spirits and wine in other states. There is, after all, a very good reason that there are huge booze superstores right across our borders; people can get the service and selection there that they simply cannot get in the State Stores. Privatization would bring those stores into Pennsylvania, keep those sales and taxes in Pennsylvania, and bring those jobs to Pennsylvania.

It has been argued since Repeal of Prohibition that the Commonwealth's 'control' of liquor and wine sales is in the interests of the citizens, that control serves, in the words of the Pennsylvania Liquor Code, "for the protection of the public welfare, health, peace and morals of the people of the Commonwealth and to prohibit forever the open saloon, and all of the provisions of this act shall be liberally construed for the accomplishment of this purpose." But all control has proven to be is an inconvenience and annoyance to the citizens. Pennsylvania's record with underage drinking, alcoholism, and drunk driving is not significantly better or worse than neighboring states that have fully privatized wine and spirits sales. The State doesn't sell gasoline, guns, or prescription drugs: why does it sell wine and spirits?

If there is no benefit to the citizens in tax revenue, convenience, satisfaction, or safety, there is no compelling reason to continue with the State-controlled retail (or wholesale) of wine and spirits. Indeed, the State's image suffers from the accusations of favoritism and patronage that dog actions like the Solutions 21 contract and the non-competitive appointment of PLCB CEO Joe Conti.

It has been estimated that privatization would bring the State a windfall of over $1 billion from sale of product stocks and other assets, and the sale of new store licenses (and I would urge the Legislature to set up any new licensing structure to benefit the State rather than the holders of licenses; it angers me, as a taxpayer, every time I hear of a restaurant license sold for hundreds of thousands of dollars that the State should be getting). Even if that's generous, and the windfall is only $500 million, that would go a long way towards plugging the current budget deficit, and tax revenues should increase dramatically. It's a win for almost everyone, excepting current PLCB employees. Some of the windfall could perhaps go for early retirement packages and re-training for the clerks and managers, they could be given preference on other state jobs, and perhaps even low-interest loans to open their own, private stores.

There may never be a better time for privatization to succeed; times such as these favor bold solutions. Pennsylvania could find new jobs and new tax revenues while pleasing the majority of the citizenry. Please consider this in the coming session.

Sincerely,

Lewis Bryson

More People Upset by the PLCB's Latest Off-Pitch Idiocy

It's not just me that thinks the PLCB is crazy, stupid, and wasteful spending $173,000 of Pennsylvania taxpayers' money (in a budget crisis...) on teaching PLCB clerks to say 'hello' and 'thank you' (I hope they're not training them to say "Have a nice day!"). Check out this from the Chambersburg Public Opinion:

But let us take our own stab at it.
Pennsylvania liquor store employees: When conducting transactions and serving customers during your work hours, be solicitous and respectful, smile, and always say please and thank you.
There! We just fulfilled the fundamental intent of this insane PLCB endeavor, and it cost you less than a buck.

Much obliged.

NBC affiliate WCAU/Channel 10 in Philadelphia had a proper response, and pointed out that Philadelphia's Department of Licenses & Inspections, another agency with a bad customer service reputation, was getting free customer service training, courtesy of the Ritz-Carlton Hotel in town.

Shameful.
Not only are you (the taxpayer) footing the $175,000 bill for a better experience at your local liquor store in Pennsylvania. Guess who gets that money? Turns out you're padding the pockets of a man who is married to one of the Liquor Control Board's top-level employees, according to the Inky. How convenient.
But there's no conflict.

Suuuuure there isn't!

The Lehigh Valley Express-Times was quite a bit more blunt about the whole thing:

Pennsylvania's antiquated system for selling booze and wine has been out of date for decades. But don't look for the state to give up the cash-cow system and its cache of patronage jobs anytime soon.
Maybe the powerful bureaucrats can teach their brothers-in-law how to say hello and thank you before they get the job.
It would save us all a few bucks.

Ouch!

But the PLCB -- and the lucky Buddy Hobart of Solutions 21 -- knew people might be skeptical (at least, skeptical of the program; looks like the whole nepotism thing caught them off-guard). From the initial story:

"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."
Added the LCB's Conti: "This is a vast adventure, and it's one we have to take. We know some people will critique us, but we like that. It only makes us better."

Hello? What I say to the Buddy is that it's all about the money his firm is getting paid for these truly questionable services. Because no one on earth believes that the PLCB has "arrived" or doesn't need to improve. Actually, that's not quite true; as I've said before, I don't want the PLCB to improve, I want them to go away.

And Conti? "A vast adventure"? "We like that. It only makes us better"? Please! Spare me the happy talk. Learning to say "Please" and "Thank you" is not a vast adventure.

What you should be doing is creating a divestiture plan, a plan to make the most possible money for the State by dismantling the State Store System, selling off its assets, setting up a new licensing system for private liquor stores that will actually benefit the State instead of the store owners, and minimizing the impact on the PLCB clerks and the costs of privatization.

That would be a vast adventure worth taking.

Where the pig bought her lipstick

An interesting story surfaced today on the PLCB's 'charm school' efforts. Here's the nut, from today's Inquirer:

The president of the Pittsburgh-based company hired to train state liquor-store clerks and managers in the basics of being nice is married to one of the Liquor Control Board's top-level employees.
Buddy Hobart, president of the Solutions 21 consulting firm hired to conduct the training, is the husband of Susanne Hobart, the Liquor Control Board's regional manager in Pittsburgh. Hobart, who is paid $85,000 a year, is one of only three regional managers for the agency.
Liquor Control Board officials said yesterday that Susanne Hobart has no sway over contract matters in general and had no say over the $174,000 contract recently awarded to Solutions 21.

The contract, according to the PLCB, is "in compliance" with the state's Adverse Interest Act. Which is good, I'd hate to have it not be. Hobart's firm was one of five that bid, and submitted "the lowest and best" offer, according to the PLCB spokesperson. But my kids used to listen to John Flynn's The Duck Song when they were little, and I think it's instructive at this juncture:

If it looks like a duck and it quacks like a duck
And there's duck-do on your pick-up truck
Buddy you can bet your bottom buck
It ain't no armadillo

This contract looks like a duck, at this point. Haven't heard it quack yet. But...the husband of one of the PLCB's top managers (who will be getting the training, by the way) gets a juicy contract for services that, realistically, the PLCB doesn't even need -- monopoly, you gotta get your booze here cuz the law says you got no choice, remember? -- and they're telling us it's an armadillo. Maybe it is.

But maybe we should check the pick-up truck.

There's a better, more complete story at the Pittsburgh Post-Gazette, too.

More lipstick for the pig, and Joe Conti surfaces

From an AP story I saw in the Inquirer:

The PLCB is going to spend more of Pennsylvania taxpayers' money (that's money taken out of their 'contribution' to the general fund; more 'operating expenses') to pay a Pittsburgh company $173,820 this year to train State Store System managers "how to coach their staffers in the fundamentals of being good sales reps." This coaching will consist of teaching them "how to greet someone, where to stand, and how to read a customer's cues." Really, that's what they apparently believe the SSS clerks need to learn. I suppose we should be grateful that they're at least paying a Pennsylvania company to do the training.

Folks, this is more lipstick for the pig; it is, as I said here, about as natural as my dog walking on hind legs, wearing a dress, and smoking a cigar. This is not a business. It is a state-owned and mandated monopoly. The reason the PLCB is spending money on this is defensive. They want to keep you just satisfied enough to distract you from the reality of this unnatural situation.

It's pretty telling that the clerks will not receive any product training on wines and spirits under this program. No, they don't get that until they've learned courtesy. Amazing that the SSS has gone this long without realizing there might be a need for this stuff.

There are big ads in the Inquirer every week for the giant liquor/wine/beer superstores located just over the border in New Jersey and Delaware. Why are the ads in the Inky, why are the stores just across the border? Because Pennsylvanians shop there in droves, every week, because the State Store System either doesn't have what they want, doesn't have as good a price, or can't be bothered to give them good service and assistance.

The reason why is simple: the SSS has no incentive to deliver that. They're just doing their job, selling the bottles, and if you want them, okay, they'll sell them. But -- with a few, dedicated, interested exceptions -- the employees are not interested in helping you. They don't have to. All they have to do is keep the shelves stocked and ring up your purchase and bag it (don't try to bag it yourself, a lesson I learned; that's the one thing that will bring out passion in these folks as they quickly tell you you're not supposed to do that).

Now they're going to get training to be nice to people. To say 'Thank you.' Oh, boy. It changes nothing. The State Store System has to go. It is unresponsive, it is ridiculously, unnecessarily state-owned, and it is robbing Pennsylvanians of jobs.

Side bits of interest. PLCB "CEO" Joe Conti was quoted in the article, the first mention of him from the board in months. Has he been behind the scenes, working away? Maybe, though it's hard to believe a long-time legislator wouldn't have made sure he got his due. Has he been resting his ass in a job that most people assumed, from the way it was handed to him without any job search or serious interview process, was a total sinecure? Maybe, though I'd rather not think so. Hard to say.

The story also quoted Eric Epstein, identified as "a Harrisburg activist and founder of RockTheCapital.org." Epstein "politely called the idea 'a demented interpretation of happy hour.
It's a sad state of affairs when you have to train people to be kind and courteous,' he said, 'but I guess things are so bad that even booze peddlers have to pretend to be nice.'"

"Even booze peddlers." Thanks, Eric, you schmuck. It's not like they're pushing crack on street corners.