Foes of privatizing State Stores build their campaign

Posted: March 03, 2011

Gov. Corbett has been largely silent on the issue that had been a hallmark of his campaign. But opponents of his desire to privatize Pennsylvania's liquor stores have activated a lobbying machine this year with help from the very workers most in jeopardy: the unionized clerks who stock shelves and operate cash registers.

Only two months into its lobbying bid and a week ahead of Corbett's budget speech to address a projected $4 billion deficit, the union representing a majority of liquor store clerks says its work is gaining traction.

United Food and Commercial Workers Local 1776 president Wendell Young IV said progress had been made despite the political onslaught against public-sector unions in Wisconsin and other states.

This week, the Corbett administration signaled it may be backing off somewhat from its anticipated pursuit of privatization this year, even as fellow GOP backers dangled the option as a way to produce billions for a desperate commonwealth.

If it's true the union has influenced the policy debate, it is all the more notable given that Young's local, which represents 24,000 workers in Eastern Pennsylvania, has simultaneously had to deal with other big threats to its workforce, including the recent bankruptcy and job losses in the A&P supermarket chain and store closings at Acme Markets.

"This has really spread myself, my staff thin, because it's not just the trips to Harrisburg, it's the trips off to different areas, some of these representatives in their home districts, or radio shows late at night or early in the morning in faraway corners of the state," Young said.

"It's been really difficult, and it's why we've brought in extra resources to help."

The union's lobbying began in earnest in January, when a vote of its roughly 2,600 liquor store employees and about 900 in two smaller locals endorsed a dues increase to pay for the effort, Young said. Clerks, earning an average $15 to $18 an hour, fear their jobs and wages would vanish under the plan, he said.

With that, the union, which represents most of the state's 3,500 liquor store clerks, hired a team for its third statewide campaign since the 1970s to defeat proposed privatization.

Young has visited legislative offices across the state and at the Capitol in Harrisburg. At the heart of the union's message is its contention that the estimated $2 billion in revenue from selling the retail liquor network is wildly overstated.

"We've changed the momentum," said Young, whose father in the 1960s unionized the very positions now at risk if state-run wine and spirits stores are dismantled and operations auctioned to private operators such as convenience-store chains.

"That does not mean that I think we're in a winning position just yet," said Young, who led the union's antiprivatization lobby in the 1990s against the administration of Gov. Tom Ridge.

"We hit really strong and hard," Young said, though he declined, for tactical reasons, to name which Appropriations Committee members he had visited. "We're talking to people on both sides of the aisle."

In one of the Corbett administration's only public statements about the issue since the governor took office in January, his budget chief this week seemed to take a softer position.

On Monday, Charles Zogby, Corbett's budget secretary, did not hold up privatization as a solution to the state's budget problems at a press club luncheon in Harrisburg.

"LCB privatization doesn't help the challenge that we're facing as a state, that I'm facing in the general fund," Zogby said.

He maintained that the state should rethink being in the liquor business but in another breath seemed to make the case for maintaining the status quo - for now.

"Certainly, the LCB provides tremendous revenues to the commonwealth, ones that I don't think . . . we as a state can afford to lose or jeopardize."

A Corbett spokeswoman said she would release no budget specifics before the governor's speech to the legislature Tuesday.

Corbett and his chief legislative supporter on the issue, House Majority Leader Mike Turzai (R., Allegheny), made the case last year for overhauling the Liquor Control Board, in part, by claiming it would make financial sense.

Dissolving the state's 614 wine and spirits stores and auctioning the right to sell wine and spirits through licenses would generate the kind of cash up front that would be hard to resist given the state's deficit for the fiscal 2011-12 year, the argument went.

Turzai said the sale of wholesale and retail liquor licenses to private operators would generate $2 billion that could go into state coffers at once, versus the roughly $100 million or so annually in profits that the LCB has given to the general fund in recent years.

The union seeks to debunk those numbers as "myths."

For Turzai's numbers to work, Young and his team contend, the average price at auction for a license would be about $2.3 million. That is more than licenses sell for in New Jersey and West Virginia, the latest state to privatize liquor sales, Young said. In West Virginia, the going rate is $200,000.

Young said his attacks had left Turzai "on the defensive."

"Turzai and others said, 'It will be Bill No. 1, it will be the first thing we take up,' " Young said. "So where is it? How come he hasn't submitted it? Where's the bill? If this is such a sure bet, why wasn't it Bill No. 1?"

Turzai said he was working with Corbett's office on another privatization proposal and added that getting it introduced through legislation in the near future was a priority.

He said he never believed a bill could be implemented in time to raise money for the 2011-12 budget, which must pass by July 1. The earliest the state could capitalize financially would be fiscal year 2012-13, he said.

"I'm 150 percent behind this," Turzai said. "The public is behind this."

Young, he said, does not care what residents want.

"Wendell Young is a hack," Turzai said. "A hired gun who is protecting his own job. He certainly doesn't have the best interest of Pennsylvania residents at heart."

Young has enlisted his father, onetime UFCW patriarch Wendell Young III; former UFCW lobbyist Bob Wolper, who helped the elder Young defeat privatization under GOP Gov. Richard Thornburgh three decades ago; and others to help the drive against privatization.

Wolper and his wife, Karen Ritter, a former state lawmaker, run a consultancy in King of Prussia. Wolper's job, he said, is to craft the opposition message.

During the battle when Ridge was governor, Wolper was not solicited to help. This year, however, with a poor economy and vitriol against unionized public-sector workers in some places, he and others were brought on board.

"Obviously, the state budget deficit and the growing atmosphere of anti-public-sector workers and public-sector bargaining," Wolper said, "it lends a sharper edge to the opposition."

Wolper said Local 1776's deep culture of advocacy - "they don't back off, they don't let off, and that's to their advantage," - had helped Young change minds, particularly among newer lawmakers.

As Wolper put it: "They really can't go head to head with a guy like Wendell because he'll eat their lunch."


Contact staff writer Maria Panaritis at 215-854-2431 or mpanaritis@phillynews.com.

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