March 2011 Archives

PLCB spirits catalog changes for the week of March 21st:

New in-store and online products:
  • Frapin Cognac VS Premier Cru 750 ML (#003603, Regular, $37.99)
  • Jack Daniels Tennessee Honey 750 ML (#003698, Regular, $21.99)
  • Kajmir Brandy Vanilla 50 ML (#007161, One Time, $0.99)
  • Kru 82 Vodka In Stainless Steel Water Bottle 750 ML (#030599, Online, $17.99)
Jack Daniel's has jumped on the honey-bourbon liqueur bandwagon with their "Tennessee Honey" product, which according to DrinkSpirits is the best of the category so far.

Frapin Cognac is another smaller cognac brand that we're happy to welcome to stores. Frapin is one of the largest cognac producers to use estate-grown grapes, although how much that improves the final product is debatable. I can't say much about the cognac itself, as the only time I've tried it was well into the evening on the last night of Tales of the Cocktail 2009, but the cognac drinkers I know seem to like it.

I tend to avoid discussing vodka here unless it comes in a really cool bottle--and in the case of Kru 82, that bar has been met. Kru 82 is packaged in a reusable metal bottle with a screw-on cap, much like what you'd buy at REI for camping and hiking, except it comes pre-filled with vodka for your convenience. Kru 82 is new and novel enough that Tasting Panel Magazine featured it on their March cover. Licensees: good luck with your legal obligation to destroy the bottle once it's empty.

Delisted SLO products:
  • M P Roux Elisir 1 L (#063240, SLO, $35.39)
  • Marie Duffau Armagnac Hors D Age Aged 12 Years 750 ML (#053703, SLO, $48.69)
  • Marie Duffau Armagnac VS 750 ML (#053649, SLO, $24.59)
  • Veev Acai Liqueur 750 ML (#060693, SLO, $31.59)
Both the Duffau armagnacs and Veev are available in specialty stores now.

Reactivated SLO products:
  • Hangar One Chipotle Chili Vodka 750 ML (#504253, SLO, $38.59)

New SLO products:
  • Averell Damson Gin 750 ML (#510972, SLO, $27.99)
  • Bacardi Rum Solera 750 ML (#510931, SLO, $20.79)
  • Finlandia Vodka Wildberries 1 L (#510938, SLO, $20.79)
  • Franciacorta Gazio Amaretto 750 ML (#511012, SLO, $29.69)
  • Franciacorta Lemonel Liqueur 750 ML (#511014, SLO, $29.69)
  • Franciacorta Orangel Liqueur 750 ML (#511015, SLO, $29.69)
  • Laine VSOP Napolean Brandy 750 ML (#511028, SLO, $17.59)
  • Latinae Sambuca 750 ML (#511013, SLO, $29.69)
  • Schoenauer Apfel Apple Schnapps 1 L (#510982, SLO, $22.99)
Averell Damson Gin is actually a liqueur--think sloe gin--from the guys who make DH Krahn Gin. The gin is infused with Damson plums from the region of upstate New York where Scott Krahn, the founder, earned his economics degree and first started thinking about becoming a distiller. I'm looking forward to trying it.
Not much happened in the spirits catalog this week. No changes were made to the in-store or online selection.

PLCB spirits catalog changes for the week of March 14th:

Delisted SLO products:
  • Appleton 21 Year Rum 750 ML (#503144, SLO, $124.49)
  • Charbay Blood Orange Vodka 750 ML (#058828, SLO, $30.39)
  • John Mcdougalls Bladnoch Malt Scotch 750 ML (#052725, SLO, $142.99)
  • John Mcdougalls Islay Malt Scotch 750 ML (#052968, SLO, $149.99)
  • Liberty Bell Coconut Rum 1 L (#040360, SLO, $11.59)
  • Marie Brizzard Cassis Dijon 750 ML (#500920, SLO, $24.79)
  • Martin Millers Gin West Bourne 750 ML (#057910, SLO, $43.89)
  • Springbank Scotch 18 Year 750 ML (#504928, SLO, $144.99)
  • Wild Scotsman Mortlach Malt Scotch 750 ML (#054435, SLO, $83.99)
  • Wild Scotsman Sngl Cask Sngl Malt Ben Nevis 750 ML (#067933, SLO, $79.99)
Martin Miller's Westbourne-Strength Gin is available in specialty spirits stores now, so no harm in it leaving the SLO catalog.

Reactivated SLO products:
  • Bird Dog Blackberry Whiskey 750 ML (#506501, SLO, $20.79)
  • Jameson Bar Packs Must Purchase 6 1 L (#050209, SLO, $26.39)
  • Korbel Brandy 750 ML (#040051, SLO, $11.89)
  • Kru 82 Vodka 750 ML (#508997, SLO, $18.69)
  • Pisco Barsol Acholado Blue Label 750 ML (#054845, SLO, $20.59)
  • Skyy Vodka Orange 750 ML (#058758, SLO, $19.09)

New SLO products:
  • 42 Below Vodka Kiwi 1 L (#510760, SLO, $18.69)
  • 42 Below Vodka Passion Fruit 1 L (#510761, SLO, $18.69)
  • 42 Below Vodka Pure 1 L (#510759, SLO, $18.69)
  • Benjamin Prichard's Lincoln County Lightning 750 ML (#510773, SLO, $21.89)
  • DeKuyper 03 Orange Liqueur 80pf 750 ML (#510777, SLO, $24.99)
  • Effen Vodka Cucumber 70pf 750 ML (#510776, SLO, $29.19)
  • Gorzka Korzenna Vodka 750 ML (#510830, SLO, $14.09)
  • Jacquins Five Star Brandy 1.75 L (#510934, SLO, $19.39)
  • Tvarscki Light Vodka 1.75 L (#510801, SLO, $13.19)
  • Underberg Herbal Digestive 88 Proof Must Be Ordered In Multiples of 3 20 ML (#510748, SLO, $1.99)
Underberg Bitters is a 150-year-old digestif made in Germany. Unlike other digestifs, it is sold only in 20 ML bottles, which are meant to be pounded in one go. The awkward packaging is probably the biggest reason you never see Underberg show up in a cocktail.
This article is one of a series on privatizing wine and spirits sales in Pennsylvania. The full list of articles may be found on the Privatization Index Page.

As the debate rages over whether to privatize the Pennsylvania Liquor Control Board's wine and spirits retail system, advocates on each side of the argument have quoted wildly different numbers regarding the amount of money that the system earns for the state. Wendell Young, the president of one of the unions representing state store employees, says that "selling the Wine and Spirits stores can't replace the nearly $500 million a year they generate for Pennsylvania taxpayers,"1 but the Commonwealth Foundation, a conservative think-tank, says "the state store's annual 'profit' is only around $90 million."2 The PLCB itself says that they earned a profit of $105 million last year, as well as collecting $376 million in taxes.3

All of these numbers are accurate, more or less, but each is misleading in its own way.

Fortunately, we can clarify the situation using data readily available from the PLCB in their annual financial reports.4 In particular, their income statement (also known as a Profit & Loss statement) spells out the PLCB's revenue and expenses in sufficient detail to answer our questions. But first, we need to understand how the state stores set prices for the products they sell.

The Retail Price Formula5

Like private-sector retailers, the PLCB negotiates prices with its wholesalers and then marks up the wholesale price of each item to cover overhead expenses and profit. This mark-up, dictated by PLCB regulations, contains two components: a variable mark-up equal to 30% of the wholesale price, and a fixed mark-up based on the type and size of the product. (This fixed mark-up is variously called the handling fee, the operational cost, or the logistics, transportation & merchandise factor (LTMF).)

On top of the marked-up price, the state assesses an 18% liquor tax.6 This is sometimes referred to as the "Johnstown Flood Tax" or "Emergency Flood Tax," but the flood is distant history. Now it serves as Pennsylvania's liquor excise tax, similar to the excise tax that nearly all states levy on booze. The 18% liquor tax is imposed by state law and goes directly to the state's General Fund, exactly like sales tax, except that liquor tax is included in the shelf price of wine and spirits instead of being added on at the time of sale.

Finally, the price with liquor tax is rounded up by five to fourteen cents so that the final digit of the price is a nine. This is purely for cosmetic reasons.

Let's see this in action, using Old Crow Reserve Bourbon as an example.

Wholesale price7 5.50
30% wholesale markup + 1.65
Handling fee (LTMF) + 1.20
Price after PLCB markups 8.35
18% Liquor Tax + 1.50
Total price with markup and tax 9.85
Final price after rounding up $9.99

As with any non-essential retail purchase, the state levies a 6% sales tax on the retail price, and Allegheny and Philadelphia counties levy a 1% sales tax. This would bring the total amount charged for Old Crow Reserve to $10.59 or $10.69.

From Sales Revenue to State Revenue

With an understanding of what portion of the retail price is taxes, what portion is retailer markup, and what portion is wholesale cost (known in accounting parlance as "cost of goods sold"), we can look at the financial data from the PLCB retail system. The last three fiscal years8 are summarized below:

FY 09-10 FY 08-09 FY 07-08
State and local sales tax collected 112,085,291 109,490,825 102,215,022
Liquor tax collected 271,015,028 266,332,120 250,995,726
Cost of goods sold 1,058,769,004 1,014,032,177 939,780,873
Operating expenses 381,962,459 367,121,231 343,285,606
Operating income9
70,658,946 110,584,357 130,198,907
Gross sales revenue
(total of all lines above)
1,894,490,728 1,867,560,711 1,766,476,134
Transferred to General Fund 105,000,000 125,000,000 80,000,000

Operating expenses include all day-to-day overhead expenses necessary to run the state stores and the associated warehousing and logistics system, including labor, rent, utilities, office supplies, etc. Operating income is the sales revenue remaining after paying suppliers and overhead expenses.

In the table above, the state's General Fund receives three revenue steams from the PLCB: sales tax collected, liquor tax collected, and the final "Transferred to General Fund" line. The taxes are imposed by state law and the stores simply act as tax collectors, just like private retailers do when collecting sales tax. The "Transferred to General Fund" line represents net profit, but it is the net profit from all PLCB operations, not just the state stores.

This bears repeating: the headline number used by the PLCB as the profit they contribute to the General Fund includes revenue from both the retail system and non-retail sources such as certain licensing fees and investment income, less expenses like licensing administration, legal work, education and enforcement programs, etc. While the bulk of this profit does accrue from the retail system, this number should not be used in analysis of store operations.

The most accurate measure of state store profit is the system's operating income, which ranged from $71 million to $130 million over the last three years. During that time, the stores also collected between $353 million and $383 million in sales tax and liquor tax as required by state law, for total net revenue generation of $454 million to $486 million.


Now we're prepared to ask the big question: how would privatizing liquor sales affect these revenue sources?
  • Sales tax receipts from off-premise sales would remain unchanged, provided Pennsylvanians continued to spend the same amount of money on wine and spirits after privatization. Receipts from on-premise sales would increase or decrease depending on whether poured drinks would be taxed at the final point of sale under a private system. (Currently bars and restaurants pay sales tax on the liquor they purchase from state stores, and no sales tax is assessed on the per-drink price charged to patrons.)
  • Assuming bars and restaurants would be permitted to buy wine and spirits directly from privately-owned wholesalers, the existing 18% liquor tax would need to be replaced with an excise tax applied at the wholesale level. Until the details of this proposed tax change are published, liquor tax revenue from private sales cannot be estimated.
  • Operating income would need to be replaced with a combination of taxes and fees totalling 4% - 8% of the retail value of wine and spirits sold (or 7% - 14% of sales at the wholesale level). Part or all of this revenue might be accounted for through liquor license fees, as yet undetermined, and existing business taxes that the state-owned stores are exempt from but private liquor stores would be required to pay.
  • A portion of the tax and fee revenue from private stores would need to be set aside to pay for additional license administration and liquor code enforcement expenses which are not incurred under the present system.10
Clearly, little can be said about state revenue under a privately-owned system without having a specific privatization proposal in front of us.

We can, however, look to our neighbors who currently have private liquor sales (known as "license" states) to see how their alcohol tax revenues compare to ours, as a guide to how revenue from our 18% liquor tax might be replaced in a privatized system.

Tax Revenues in Other States

License states impose an alcohol excise tax at the wholesale level, assessed as a gallonage tax based on the total volume of beer, wine or spirits sold. While Pennsylvania's wine and spirits sales are taxed under the 18% liquor tax, beer is taxed at a gallonage rate.

Combined alcohol excise tax revenues from beer, wine and spirits for Pennsylvania and several license states in the region are as follows:11

FY 08-09 FY 07-08 FY 06-07
Pennsylvania 292,302,120 277,284,726 264,549,608
New York 206,452,712 205,252,942 194,221,559
New Jersey 105,487,892 104,101,187 103,293,428
Delaware 15,500,000 14,700,000 14,800,000
Maryland 29,874,000 29,168,000 28,966,000
Massachusetts 71,850,000 71,169,000 70,958,000

Pennsylvania easily tops the list in alcohol excise tax revenue collected. Notably, our revenue is significantly greater than New York's, despite New York having a population roughly 50% larger.

To more clearly illustrate the differences between states, we can divide alcohol tax revenue by total ethanol (pure alcohol) consumed, using state-by-state alcohol consumption rates published by the National Institute on Alcohol Abuse and Alcoholism.12 We obtain an estimate of the consumption rate during Fiscal Year 06-07 by averaging the consumption rates for calendar years 2006 and 2007, the most recent years for which data has been published.

FY 06-07
alcohol excise tax revenue
Est. ethanol consumption (gallons) Tax revenue
per gallon of ethanol
Pennsylvania 264,549,608 22,072,000 11.99
New York 194,221,559 32,391,000 6.00
New Jersey 103,293,428 16,481,000 6.27
Delaware 14,800,000 2,287,000 6.47
Maryland 28,966,000 10,087,000 2.87
Massachusetts 70,958,000 13,474,000 5.27

Pennsylvania clearly stands out here. While most of the other states impose an excise tax of approximately $6 per gallon of ethanol consumed, Pennsylvania's tax burden is nearly double that.

Because all states except Utah tax beer at a gallonage rate, we can estimate the portion of revenue attributable to beer by multiplying the NIAAA beer consumption rate by each state's beer tax rate.13 Subtracting beer consumption and the estimated beer tax revenue from the overall totals gives a rough estimate of the tax revenue resulting from wine and spirits:

Tax rev. per
gal. of ethanol
(beer only)14
Tax rev. per
gal. of ethanol
(wine & spirits)
Pennsylvania 1.78 28.42
New York 3.11 8.31
New Jersey 2.67 8.69
Delaware 3.56 8.68
Maryland 2.00 3.62
Massachusetts 2.44 7.31

Pennsylvania has one of the lowest beer tax rates in the nation (behind only Missouri and Wisconsin), but the excise tax burden on wine and spirits is enormous. Per drink, we pay more than three times the state tax of New Jersey or Delaware, and almost eight times the state tax of Maryland.

If excise tax revenues are to remain unchanged post-privatization, potential bidders for wholesale and retail liquor licenses must take into account the unusually large tax burden that would be imposed on their products. This would likely translate into a competitive disadvantage for retailers located near the state border, where customers have the option to shop in neighboring states with lower liquor taxes.

Future Work

A more thorough treatment of excise taxes will be published here in a forthcoming study, including revenue projections of various excise tax models using detailed sales data from the state stores.

Once a complete privatization proposal is published in the legislature, further analysis can be made of its effects on government revenue.

Footnotes and References
  1. Young, Wendell. "State stores won't fix the budget." Opinion. Philadelphia Inquirer, 5 Jan 2011.
  2. Currie, Katrina, and Nathan Benefield. "Liquor Store Union Distorts Facts to Skew Poll." Commonwealth Foundation. 10 Jan 2011.
  3. Guerriero, John. "State discontinuing 400 wine and spirit products amid movement to privatize." Erie Times-News, 23 Feb 2011.
  4. PLCB financial statements can be found on the Facts and Figures section of their website.
  5. Price formula provided by Stacey Witalec, Director of External Affairs, PLCB. Personal correspondence, 18 Feb 2011.
  6. More accurately, the 18% markup is an estimate of the tax liability generated by the sale of the item. The actual liquor tax remitted by the PLCB to the General Fund is calculated by dividing gross liquor sales by six and five-ninths.
  7. The wholesale price of Old Crow Reserve includes $2.30 in federal excise tax.
  8. Pennsylvania's fiscal year runs from July 1st through June 30th.
  9. The recent trend of decreasing operating income is due to higher pension and worker's compensation costs. This trend will be corrected by an LTMF rate increase. ("PLCB again proves need to privatize." Editorial. Scranton Times-Tribune, 28 Sep 2010.)
  10. The Bureau of Liquor Control Enforcement does not currently perform enforcement checks at state stores as they are not considered licensed establishments. (Boehm, Eric. "State Liquor Stores Face No Scrutiny From State Police." Pennsylvania Independent, 4 Mar 2011.)
  11. State tax revenues were collected from the following sources:
  12. "Volume beverage and ethanol consumption for States, census regions, and the United States, 1970-2007." National Institute on Alcohol Abuse and Alcoholism. Oct 2009.
  13. "State Tax Rates on Beer (January 1, 2010)." Federation of Tax Administrators. 7 Apr 2010.
  14. Calculated by dividing gallonage tax rate by NIAAA standard 4.5% ABV for beer.
PLCB spirits catalog changes for the week of March 7th:

New in-store and online products:
  • Camarena Silver Tequila 750 ML (#003581, Regular, $21.99)
  • El Zarco Gold Tequila 750 ML (#003608, Regular, $16.99)
  • Elijah Craig Kentucky Bourbon 12 Year 750 ML (#003455, Regular, $21.99)
  • U'Luvka Vodka Poland 750 ML (#030519, Online, $44.99)
  • Wild Turkey Rare Breed Brbn 750 ML (#005423, Regular, $35.99)
Wild Turkey Rare Breed and Elijah Craig 12yr are nearly the last bourbons to arrive from last fall's listing period. The Elijah Craig was formerly available only in 1.75 L bottles, for some reason, but the PLCB closed those out and replaced them with the standard 750 ML package. Hopefully this move will encourage more people to give this excellent bourbon a try.

New-to-store items (previously online-only):
  • Castello Banfi Grappa Tower Bottle 750 ML (#009704, Limit Dist, $42.99)
  • CM Nero D'Avola Grappa Sicily 750 ML (#010928, Limit Dist, $34.99)
  • Nonino Amaro Bitter Aperitivo Italy 750 ML (#010426, Limit Dist, $44.99)
  • The Yamazaki 12 Year Old Single Malt Whisky Japan 750 ML (#030981, Limit Dist, $44.99)
Banfi Grappa, from the vintner well-known to wine drinkers, is a less-aggressive, easy-going spirit that I consider a great introduction for people who have never tried grappa before. It's about as unoffensive as grappa can get without losing its self-respect.

Amaro Nonino lives up to its name--"Quintessentia"--as, perhaps, the archetypal Italian digestif. Its production method is a bit unusual for an amaro, having grappa as its base and aging five years after being infused, but I consider it to be the standard that all other amari should be compared to. It is complex and herbal without being overpowering, and sweet without being syrupy. If you're going to have one amaro in your liquor cabinet, this should be it.

Our first Japanese whisky, Yamazaki 12-year, landed on store shelves this week. While I prefer Suntory's Hibiki expression, their standard 12-year is a fine whisky and worth trying at least once.

Delisted SLO products:
  • Aberlour Single Malt Scotch 12 Year 750 ML (#502468, SLO, $83.49)
  • Bakon Vodka 750 ML (#502544, SLO, $31.49)
  • Bird Dog Blackberry Whiskey 750 ML (#506501, SLO, $20.79)
  • Bowmore 25yr Single Malt Scotch 750 ML (#055581, SLO, $186.59)
  • Canadian Club 150th Anniversary 750 ML (#058973, SLO, $175.29)
  • Chartreuse Yellow 750 ML (#067770, SLO, $53.99)
  • Constantino Brandy 1 L (#059701, SLO, $8.19)
  • Courvoisier L Esprit Cognac 750 ML (#064328, SLO, $3414.69)
  • DeKuyper Creme de Menthe White 1 L (#051917, SLO, $13.69)
  • Frangolino Blueberry 750 ML (#051989, SLO, $28.29)
  • Jacquin's Five Star Brandy 750 ML (#507842, SLO, $12.49)
  • Kru 82 Vodka 750 ML (#508997, SLO, $18.69)
  • Landy Cognac XO 750 ML (#505823, SLO, $64.39)
  • Leroux Creme de Cacao White 1 L (#503021, SLO, $19.29)
  • Level Vodka 50 ML (#069939, SLO, $3.49)
  • Massenez Creme de Mure 750 ML (#041497, SLO, $27.49)
  • Nonino Grappa Vigneti Chardonnay 750 ML (#067090, SLO, $50.29)
  • Old Granddad Spec Sel Bourbon 750 ML (#063169, SLO, $29.09)
  • Pisco Barsol Quebranta 750 ML (#503570, SLO, $19.09)
  • Roth Vodka 750 ML (#053585, SLO, $35.89)
  • Strozzi Acquavite Grappa Nv 750 ML (#057424, SLO, $34.39)
  • Tres Rios Reposado Tequila 750 ML (#066770, SLO, $38.49)
  • Virginia Lightning Corn Wky 750 ML (#054090, SLO, $17.09)
  • Zapata Triple Sec 1 L (#050113, SLO, $4.29)
A few of these are already on store shelves or, in Barsol Pisco's case, on their way soon. [Update 5/8: Barsol Pisco is not planned for in-store placement; see Don Cesar Puro Pisco instead.] I'm sad to see the Massenez Crème de Mûre disappearing, as it was the only crème de mûre available in PA at all.

New SLO products:
  • Absolut Wild Tea Flavored Vodka 80pf 1 L (#510644, SLO, $30.69)
  • Berkshire Mountain Distillers Berkshire Bourbon Whiskey 750 ML (#510608, SLO, $49.99)
  • Berkshire Mountain Distillers Ethereal Gin 750 ML (#510604, SLO, $39.99)
  • Berkshire Mountain Distillers Greylock Gin 750 ML (#510605, SLO, $35.99)
  • Berkshire Mountain Distillers Ice Glen Vodka 750 ML (#510607, SLO, $35.99)
  • Berkshire Mountain Distillers New England Corn Whiskey 750 ML (#510610, SLO, $49.99)
  • Berkshire Mountain Distillers Ragged Mountain Rum 750 ML (#510606, SLO, $35.99)
  • Blue Ice Organic Vodka 750 ML (#510732, SLO, $25.79)
  • Blue Ice Vodka 750 ML (#510730, SLO, $19.59)
  • Bulleit Bourbon 1 L (#510724, SLO, $27.99)
  • Ch D'Orignac Pineau des Charentes 750 ML (#510713, SLO, $31.39)
  • Domaine Charbay Blood Orange Vodka 750 ML (#510524, SLO, $40.89)
  • Don Roberto Tequila Anejo 80pf 750 ML (#510537, SLO, $72.69)
  • Don Roberto Tequila Reposado 80pf 750 ML (#510536, SLO, $62.49)
  • Don Roberto Tequila Silver 80pf 750 ML (#510535, SLO, $57.69)
  • Double Cross Vodka 80pf 750 ML (#510643, SLO, $41.69)
  • El Olvido Tequila 750 ML (#510731, SLO, $19.59)
  • Glenmorangie Finealta 750 ML (#510460, SLO, $79.99)
  • High West Whiskey Bourye 750 ML (#510611, SLO, $73.99)
  • High West Whiskey Double Rye 750 ML (#510612, SLO, $39.99)
  • High West Whiskey Rendezvous Rye 750 ML (#510614, SLO, $59.99)
  • High West Whiskey Rocky Mt Rye 21year Old 750 ML (#510615, SLO, $137.99)
  • High West Whiskey Western Oat 750 ML (#510616, SLO, $39.99)
  • Highland Mist Scotch Whiskey 1 L (#510544, SLO, $12.29)
  • Mr Boston Light Rum 1 L (#510541, SLO, $9.69)
  • Mr Boston Riva Gin 1 L (#510542, SLO, $8.09)
  • Mr Boston Triple Sec 1 L (#510543, SLO, $4.89)
  • Mr Boston Vodka 1 L (#510540, SLO, $7.49)
  • Nectar Aguardiente 58pf 750 ML (#510580, SLO, $15.69)
  • Nectar Aguardiente Club 48pf 750 ML (#510581, SLO, $15.69)
  • Paramount Blackberry Brandy 65pf 750 ML (#510538, SLO, $10.89)
  • Smirnoff Espresso Vodka 1 L (#510727, SLO, $14.99)
  • Smirnoff Peach Vodka 1 L (#510725, SLO, $14.99)
  • Smirnoff Twist of Citrus Vodka 1 L (#510729, SLO, $14.99)
  • Smirnoff Twist of Melon Vodka 1 L (#510726, SLO, $14.99)
  • Smirnoff Twist of Pineapple Vodka 1 L (#510728, SLO, $14.99)
  • Svedka Blue Series Vodka 80pf 1 L (#510681, SLO, $13.39)
  • Ten High Bourbon 1 L (#510545, SLO, $9.59)
  • Tullamore Dew Irish Whiskey Crock 750 ML (#510567, SLO, $37.59)
  • Ultimat Vodka 80pf 375 ML (#510539, SLO, $22.59)
Two craft distillers were pulled into the SLO catalog this week. Berkshire Mountain Distillers in Sheffield, Massachusetts makes the usual complement of white and lightly-aged spirits, which have received decent reviews. Their Ethereal Gin is produced in limited runs with some fairly uncommon ingredients--batch 1 included spearmint and rose hips. I assume batch 2 is what's available to order here, but I haven't confirmed that with the distributor.

HIgh West styles themselves as "Utah's first distillery since the 1870's, and the only ski-in gastro-distillery in the world." Although distilling operations only started a couple years ago, master distiller David Perkins bought aged bulk whiskey and blended it himself, creating the widely praised Rendezvous Rye and Bourye Whiskey (a blend of rye and bourbon). Silver Oat is their first in-house whiskey, unaged of course, which I'm looking forward to trying. Oh, and apparently their food is pretty good, too, judging by their Yelp reviews.
This article is one of a series on privatizing wine and spirits sales in Pennsylvania. The full list of articles may be found on the Privatization Index Page.

Until now this blog has been silent on public policy. Although many wine and spirits consumers in Pennsylvania hold a low opinion of our government-owned liquor stores for various reasons, I have always left the diatribes to others and accepted the fact that political inertia was firmly against private-sector liquor sales. Instead I've tried to help cocktail and spirits enthusiasts and professionals get the most out of the PLCB retail system, through my blog and in my informal role as a volunteer advisor to the product selection team in Harrisburg.

Now there is a very real possibility that a substantial revision of state liquor code will result in the privatization of the existing government-owned retail system and the licensing of additional private businesses to sell wine and spirits for off-premise consumption. This would likely have a radical effect on the prices, selection and availability of spirits products in Pennsylvania.

To be clear: I have never been nor will I ever be in favor of government-run liquor sales. As with the Pennsylvania Lottery, I am philosophically opposed to the government promoting any vice, be it gambling, drinking, smoking, or whatever. I have no inclination to prohibit private citizens from engaging in these activities at their own risk and expense, but I believe the government's role should be to monitor and regulate, not encourage. (Imagine if tobacco products were only sold in state stores. Would we have government-sponsored billboards suggesting a carton of Camels as a Mother's Day present?)

From a more pragmatic perspective, it is clear that private liquor retailers in other parts of the country offer a wider range of customer experiences than our state stores. Pennsylvania law imposes strict constraints on the PLCB in terms of pricing, product selection, employee hiring and training, etc, which has resulted in 650 clones of a mere three or four different "model" stores. I expect that privatization would open the door for individual stores to differentiate themselves based on these factors to a much greater extent than is possible now.

On the other hand, Pennsylvania's state stores are, perhaps, the best-run government liquor stores in the US. They consistently turn over a profit, and despite public perception, the PLCB makes an effort to respond to the demands of its customers. There is no overriding mandate to privatize at all costs, and indeed, I believe it would be politically infeasible to enact any privatization legislation that would negatively impact Pennsylvania wine and spirits consumers or, more crucially, government revenue. In addition, many common complaints about the state stores might be addressed by relaxing the statutory constraints the PLCB must operate under, thereby improving the customer experience without bearing the risks that privatization might entail.

As a starting point for evaluating the privatization legislation that is expected to be introduced in the House, as well as any competing legislation that seeks to improve the existing stores, I will be publishing several reports and analyses on the PLCB retail system as it stands now, especially in comparison to other states that already have private-sector liquor sales.

Future posts will look at the following questions:
  • How much revenue do the stores generate for the state, and how does it compare to other states' revenues from liquor sales?
  • What tax structure would be necessary to impose on private retailers to replace revenue currently generated by state stores?
  • Do the state stores achieve their goal of competitive pricing, or is public sentiment correct that prices are lower in neighboring states?
  • How does the selection of products in state stores compare to private retailers in other states?
This will not be a comprehensive analysis of public policy, however. My research will steer clear of the following politically- and emotionally-loaded topics about which much has been said already:
  • Public safety and enforcement issues, such as underage drinking, drunk driving, alcohol-related injuries, etc
  • Quality of customer service
  • Public vs. private sector employee wages and benefits
As each new article is posted, it will be added to the Privatization Index Page.

In the interest of stimulating productive public debate, I will attempt to make my writings about policy issues as neutral as possible. I encourage independent interpretation of my results, and will gladly work with any party interested in recreating or extending my analyses. I can be reached privately at

Members of the media who are not already on my mailing list and wish to have early access to my formal reports should email me as well.
[Edit 3:35pm -- I don't think this warrants a new blog post, but I wanted to bring to everyone's attention a chart the PLCB posted which lists suggested alternatives for all 396 products that were delisted. Most of the spirits suggestions I checked were fairly reasonable. (My favorite suggestion was for the Ice Box Manhattan Cocktail RTD: "Bourbon, sweet vermouth") I don't expect most of you will need it, but if your mother-in-law or somebody calls you up complaining that her favorite $6 chardonnay got delisted, you could quickly look up an alternative in the same price range that she might be happy with.]

PLCB spirits catalog changes for the week of February 28th:

New in-store and online products:
  • Camarena Reposado Tequila 750 ML (#003579, Regular, $21.99)
  • Courvoisier 12 Year French Cognac 750 ML (#003272, Regular, $49.99)
  • Cynar Artichoke Liqueur Italy 1 L (#010925, Limit Dist, $22.99)
  • Evan Williams Cherry Reserve Kentucky Liqueur 750 ML (#003466, Regular, $15.99)
  • Illegal Mezcal Joven 750 ML (#003681, Regular, $54.99)
  • Knob Creek Single Barrel Kentucky Bourbon 750 ML (#003276, Regular, $39.99)
  • Michael Collins Single Malt Irish Whiskey 10 Year 750 ML (#003434, Regular, $36.99)
  • Old Grand Dad 114 Kentucky Bourbon 750 ML (#003279, Regular, $24.99)
  • Old Overholt Straight Rye 750 ML (#006242, Limit Dist, $19.99)
  • Pineapple Coconut Jack Rum 1.75 L (#003675, Regular, $19.99)
  • Pinnacle Chocolate Whipped Vodka 750 ML (#003676, Regular, $13.99)
  • Tropical Jack Rum 1.75 L (#003679, Regular, $19.99)
It's a party for American whiskey drinkers this week! Knob Creek Single Barrel, which John Hansell describes as similar to the original but "more sophisticated", made it into the regular selection, as did the venerable Old Grand-dad 114. Evan Williams Cherry Reserve, a well-done knock-off of Beam's Red Stag, is also in stores.

New to the specialty spirits collection is Old Overholt Rye, finally available again after Beam pulled it from PA a few years ago, and Four Roses Single Barrel Bourbon (below) which was available as an online-only item last year until it sold out in just a few days.

The PLCB is testing how well a high-end mezcal will do in stores with Ilegal Joven, an excellent spirit which I discussed when it went on SLO in September. It's expensive, like all good mezcals, but hopefully it will do well.

Last but not least, we have Cynar. Although well-loved and drunk in great quantities by Italians and craft cocktail enthusiasts, the rest of the world would be best served by Stuart Walton's description from his Ultimate Book of Cocktails: "A liqueur for the truly intrepid, Cynar is a soupy, dark brown potion made in Italy, the flavouring of which is artichoke leaves. It contains all of the savoury bitterness of the globe artichoke, which is boldly illustrated on its label. If that sounds like fun, go ahead and try it."

New-to-store items (previously online-only):
  • Amaro Ramazzotti Herbal Liqueur Italy 750 ML (#010635, Limit Dist, $22.99)
  • Four Roses Single Barrel Kentucky Bourbon Whiskey 750 ML (#010880, Limit Dist, $39.99)
  • Junipero Gin 750 ML (#010487, Limit Dist, $33.99)
  • Neisson Agricole Blanc Rum Martinique 1 L (#030986, Limit Dist, $30.99)
  • The Isle of Jura Single Malt Scotch 10 Year Old 750 ML (#010878, Limit Dist, $39.99)
Ramazzotti Amaro is one of the classic so-called "medium" amari. Where Averna is rich and chocolatey, Ramazzotti is rich and rhubarb-orangey, like a heavier version of Montenegro. Ramazzotti is also the base of Amer Boudreau, should you be inclined to make your own Amer Picon substitute.

The other online-only item I've been impatiently waiting to see in stores is Junipero Gin. As the name suggests, it carries its juniper boldly in front like a banner. There's no delicate, floral "new western" subtlety here: like DrinkHacker imagines, it's a gin that seems like it would be perfectly suited for the gritty 1940s. If you're a gin martini drinker, you want to try it.

Neisson Blanc is generally thought to be the best blanc agricole rhum available. It's another rum from Kaiser Penguin's consolidated top-10 list.

Delisted SLO products:
  • Beefeater Wet Gin 1 L (#054687, SLO, $30.89)

New SLO products:
  • Van Gogh Mojito Mint Vodka 750 ML (#510491, SLO, $21.99)

PLCB press release from today:

Pennsylvania Liquor Control Board Alerts Consumers to a Voluntary Recall of Stainless Steel Flasks Sold in E&J® VSOP Gift Packs

Harrisburg - The Pennsylvania Liquor Control Board today alerted consumers to a
voluntary recall of the engraved stainless steel flask sold in E&J® VSOP holiday gift
packs at PA Wine & Spirits stores in 2006, 2007, 2008, 2009 and 2010.

According to information from the manufacturer, lab tests revealed brandy stored in
the flask under certain conditions may show elevated levels of lead, which can pose
a health risk.

"More than 13,000 of these gift packs were sold at our stores over the past five
years," said Patrick J. "PJ" Stapleton, Chairman of the PLCB. "We want to make
sure those customers who purchased them are aware of the recall and stop using
them immediately."

The affected flasks were sold in stores across the state from approximately October
through February from 2006 through 2010. The flasks are silver and rectangular in
shape with "E&J VSOP" etched on the front.

Consumers who may have purchased one of the impacted gift packs should call the
E&J Brandy consumer recall hotline at 1-866-959-8477 for information on how to
return the flask for a refund.

Close-out pricing is a go

Don't forget that today is the day delisted items switch to their close-out pricing, and everything is marked down 30-40%. The Post-Gazette has provided a handy printable list for you to highlight and take to the store with you.

I already bought a half-case of Martell Cordon Bleu, a case of Herbsaint Original, and as many half-gallons of Bulleit as I could carry.

What did you buy?

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