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LIQUOR PRIVATIZATION: WILL 2015 BE THE YEAR?

If buying liquor, wine and beer in Pennsylvania were more convenient, with widely available selection at competitive prices, most residents probably wouldn’t care if the state stayed in the wine and liquor selling business.

But today’s state store system and the archaic restrictions on private retail beer sales have frustrated Keystone state consumers for long enough.

Pennsylvania has reached the point where it’s time to stop the periodic massaging and tweaking of the state store system and deal with the fundamental cause of all that frustration: state ownership, with all the political machinations and trade-offs that brings.

Leave the alcohol-selling to the private sector, and let state government concentrate on its proper role. Government’s job is not to make profits from selling a product that private business is perfectly capable of handling. Government’s job is to make sure the alcohol business, like other businesses, is run in a fair and responsible way.

Eighty-two years after Prohibition ended, Pennsylvania is closer than ever to reaching that sensible state of affairs. A House committee on Monday approved a privatization bill very similar to what passed the House last session. A vote in the full House is expected Thursday.

Wolf is smart enough to know he needs to make compromises with the heavily Republican Legislature if he is going to get key items on his agenda.

The bill includes a complicated web of provisions to ease the transition, because such a fundamental change on such a broad scale, done abruptly, would cause too much dislocation, most notably for the state stores’ unionized workforce.

Most, if not almost all, jobs in privatized retail operations will be non-union and pay less, and there may be fewer of those jobs, at least in the early stages. The House privatization bill offers transitional aid to current state store workers, along with incentives for businesses to hire the displaced workers. That transitional aid is an essential part of any privatization deal.

As the Legislature shapes the details of a final package that can win the necessary votes, its work should be guided by several key principles:

The privatization arrangement should net a good price for the state-owned assets, without trying to squeeze every last dollar from the sell-off, which would jack up prices on customers.

Privatization should make it possible for customers to do convenient, one-stop shopping, without unleashing a flood of alcohol dispensaries on neighborhoods and communities.

The transition should be done gradually, not abruptly. And it should loosen the rules for buying alcohol from out of state, while preventing wide-scale evasion of the state’s alcohol taxes.

Wine and liquor privatization died last year in the state Senate, even though Republicans were in control. Republicans have a stronger grip on power this time around, although newly-elected Gov. Wolf is opposed to privatization and could well veto it.

However, Wolf is smart enough to know he needs to make compromises with the heavily Republican Legislature if he is going to get key items on his agenda, like a severance tax on natural gas and more money for K-12 education.

Agreeing to liquor privatization is a change that will be popular with voters and can smooth the way for Pennsylvania to make much-needed progress on much more important fronts.

— PennLive.com

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WHAT TESTING CAN’T FIX

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WELFARE, LOTTERY DON’T MIX

There are understandable mixed opinions about whether Pennsylvania welfare recipients should lose benefits if they win a significant lottery prize.

Beyond that, current debate under the Capitol dome centers on what winning figure such a requirement should kick in.

If passed, House Bill 251 as written would require the Department of Human Services to determine if someone who receives welfare benefits should have those benefits cut off or reduced if the recipient’s lottery prize is in excess of $2,500.

Actually, the legislation should have been written to require the determination for any prize of $2,500 or higher — the $2,500 prize being from a 50-cent-straight bet in the commonwealth’s Pick 4 game.

Money withheld from the paychecks of taxpayers fund the welfare system, and lawmakers should act on behalf of those taxpayers’ best interests. If a welfare recipient wins a prize of $2,500 or more, benefits should be adjusted temporarily to reflect that good fortune and spare the taxpayers the burden of providing that financial support.

In response to big prizes above a certain amount, welfare benefits should be terminated.

There are many people with incomes that barely allow them to make ends meet for their own households who are among the people helping to make welfare money available for others.

Then there’s the relevant opinion of Rep. Brad Roae, R-Crawford, who said, “If you can’t provide for your own basic needs, if you can’t provide for your food, clothing, shelter or health care, you shouldn’t be buying a lottery ticket in the first place.”

Some people might counter that a welfare recipient who wins a substantial prize in the lottery could have someone else cash in the ticket, so as not to jeopardize benefits. That’s true.

However, the person cashing in the ticket under his or her name and Social Security number would be responsible for the federal taxes associated with that prize.

And that questionable gesture could have bigger-than-anticipated negative consequences if the prize thrust the “good Samaritan” into a higher federal tax bracket.

Pennsylvania residents who win a prize in this state’s lottery aren’t required to pay state income taxes on those winnings, although a prize won by a Pennsylvania resident in another state would be taxable for state purposes.

Referring to “251” as currently written and what he views as “unintended collateral damage” in the legislation, Rep. Jordan Harris, D-Philadelphia, said, “We’re talking about someone who could win $2,600 and could then have to come up with $1,600 for child care.”

So what? If a hard-pressed welfare recipient is fortunate enough to win a substantial lottery prize, he or she should put that money to good use, not expect the state to use its resources when the money is otherwise available for that care or other needs.

A way around the forfeiture of welfare benefits would be to deposit the winnings into an educational savings account, which would not count as an asset in terms of benefit eligibility.

In the final analysis, the welfare/lottery winnings component of House Bill 251 should be passed, and with the language “prizes of $2,500 or more.”

Fairness is a two-way street.

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