Patch Poll: Should Public School Funding Grant Be Linked to State Liquor Store Privatization?
Gov. Tom Corbett's 2013-14 budget ties sale of state liquor system to a $1 billion grant for school safety, early education programs, individualized learning and science/math programs.
Gov. Tom Corbett's proposed 2013-14 budget, which he presented Feb. 5, contains an interesting cocktail that mixes the sale of the state's liquor system with funding of a public schools grant.
Under his proposal, $1 billion obtained by the proposed privatization of the state's liquor sales would be used to create the Passport for Learning Block Grant that would focus on school safety; enhanced early education programs; individualized learning; and science, technology, engineering and mathematics courses and programs.
The $1 billion in revenue to fund that grant will come from the three- to four-year process of selling the Liquor Control Board: $575 million from the wholesale license process, $224 million from the Wine and Spirits retail auction process, $107 million from the wine/beer license application process and $112.5 million in the enhanced beer distributor application process.
Few would argue that they'd like to see the state's public schools made safer after the Sandy Hook shootings in Connecticut. Many realize the importance of early childhood education. Science, math, technology and engineering programs? Of course, children should be able to compete in the global market. And individualized learning programs? After PSSAs and No Child Left Behind, the realization that not all children fit in the same box might be viewed by some as a refreshing thought.
However, there are a few questions about what happens after the privatization process is completed. Will the funding provided by the grant simply disappear because the monies dry up? How effective are programs that might help a handful of children learn better or keep them safe for a few years if those initiatives are going to soon disappear for lack of funding?
Those questions become relevant because Corbett has said he hasn't cut money from public school funding over the past few years—that the federal stimulus money that temporarily funneled an additional $1.7 billion into Pennsylvania’s public education system just came to an end. That left cash-strapped local school districts with the hard choices of laying off teachers; closing schools; cutting music, art, library, languages, tutoring programs and full-day kindergarten while state elected officials chose not to find revenue to help its public schools.
The bigger question is whether Corbett's plan to link the demise of the state liquor system to the public school funding issue is an attempt to help the schools or leverage to get state legislators to vote in favor of the liquor privatization plan.
What do you think? Vote in our poll and tell us your views in the comments section below.
Roger
6:18 am on Sunday, February 10, 2013
Yea!! One more poll! This poll is really inclusive -- brings together two topics that are both divisive in their own. This is the clash of the titans.
Oren Spiegler
6:26 am on Sunday, February 10, 2013
Ideally, there would not be such linkage, but given the battles with past legislatures when privatization efforts were pushed, Governor Corbett felt that he had to present some lure to end the era of Prohibition, something which should have been accomplished long ago just as forty-eight other more enlightened states have done. He has made a good offer to the General Assembly, but knowing its propensity to shoot itself and members' constituents in the foot, it is not at all certain that it will take the governor up on it. This, after all, is a state in which the mantra of, "We will do it this way because we have always done it this way" reigns supreme.
Roger
8:07 pm on Sunday, February 10, 2013
Leverage, leverage, leverage .... the way of politics. It happens at all levels, and the linkage is not surprising. I agree there should be no link, but this is the way politics works, apparently. We see it in Wash DC on a much large stage (e.g. tax rates against spending cuts - today's topic).
It is probably one of the reason why some very good people don't get involved with politics. They cannot stand this leverage, tit-for-tat way of accomplishing things. Most of us like to create ideas, develop a vision, put a plan together, gather the resources, and execute -- not try to make things work under a charade of leverage.
On the flip side, I expect there are many in politics who thrive on finding ways to leverage a position, one issue against another. The negotiations, the meandering, and tit-for-tat tactics are posturing that makes the blood flow. This is standard ways of accomplishments and the higher the stakes, the better they like it -- merits of either side be set aside. Apparently, this is why many bills have many amendments on matters having nothing to do with the bill. The matter does not have to be justified on its own merits, but rides the coattails of something of much higher stakes.
Leverage, leverage, leverage ...
Sue T
11:15 am on Monday, February 11, 2013
I have to agree Oren. I've lived in 5 states and this has to be the most backward state I've ever seen. I was shocked when I moved here and found the liquor stores...the worst is they control the sale of wine. I agree there shouldn't be linkage, but you do what you need to in order to get it done.
Paula Lane
7:48 am on Sunday, February 10, 2013
We need to "get it done" with regards to the privitization of the State Stores. Our purchases within the state (no wine being shipped for gifts to PA residents) is both controlling and self-serviant to the Commonwealth.
Debra Phelan
9:22 pm on Sunday, February 10, 2013
Totally agree, Paula. Let's get this privatization done already! And give the money to the schools if they need it.
Glenn
8:23 am on Sunday, February 10, 2013
Privatize please! We need all schools to have multi million dollar athletic fields and new buildings.
James Dale Barrington
8:39 am on Sunday, February 10, 2013
Zandy, you casts the dilemma we all face in today's politics, well, with this conundrum. More conversations to come, no doubt. Wished every proposal were without a 'catch 22', but they rarely are. 'Hindsight' has given up on us and left us, so, we remain in the 'unfortunate' column until someone is brave enough to say, and mean it that our children are more than an appendage.
Kaitlin
9:23 am on Sunday, February 10, 2013
Governor Corbett is a swine, and is trying to hit two birds with one stone regarding this issue. He didn't have enough support to initially dismember the unions and privatize liquor, so he raped public education (whilst seeking to, in a way, privatize that via vouchers and charter schools), and is now saying, "Hey, look! We need to invest in education, and I know how!" I realize that this is "how it's done" in politics, but that doesn't make it OK for me.
Susan Rose
9:26 am on Sunday, February 10, 2013
I agree with Kaitlin
That's what you get when you elect a conservative.
Bob Howard
8:24 pm on Sunday, February 10, 2013
Katilin --- you marginalize your comments when you misstate the facts. Exactly what do you mean "he raped public education."
Ralph Meyer
9:51 am on Sunday, February 10, 2013
Another of Corbett's dipstick attempts to privatize the State Stores, which do a fine job, and do not need to be sold to his profiteering friends. I'd still like to know what he's getting under the table for his attempts. Selling the stores is a one-time deal. What happens after that? He hasn't solved anything more than covering his bum temporarily instead of decently taking care of schools. He has about as much foresight as a blind mole. Him and the republicans' cant about government being the problem: ...It's interesting. They blather about that, and then all of them want to be elected to the government. Makes one wonder why, doesn't it? Best thing for government is to cut their perks. No pension other than what anyone else gets, and term limits of one or two terms and out. Not to mention getting bribe money (called campaign funds) stringently limited, or, better yet, criminalized so pols can't be bought with it.
cc
10:36 am on Sunday, February 10, 2013
No when Ed Rendell was Governor he was the swine. State Stores should of ben privatized years ago and no Governor would do it. Lot of parents (not all) are for voucher programs for their children, as we should have the choice of where we want to send our children to school, especially when the local school district is being run by a bunch of clowns and the administration is a joke.
Kaitlin
11:15 am on Sunday, February 10, 2013
I believe that we DO have a choice of where we want to send our children...that is a choice you make when you buy a home in a particular school district, borough, or community.
cc
11:33 am on Sunday, February 10, 2013
Kaitlin, What happens when you move into a district that had a great school district when you purchased the home and by the time you have children and they are ready for school that the district is at the bottom of the barrel. Isn't as simple as you say it is. That is why school vouchers are needed so you have a choice of where you want to send your child/children.
Bob Howard
8:27 pm on Sunday, February 10, 2013
Kaitlin: You are correct that wealther people have school choice. Would you deny it to the poor because they cannot afford to move into a particular school district?
Debra Phelan
9:31 pm on Sunday, February 10, 2013
That's ridiculous, Kaitlin. Your average "Joe" does not have the money to buy into the affluent areas with the great schools. I'm with you, "cc." In my opinion, If anyone truly cares about the children & their education first and foremost, then vouchers should be available. Where you live should not determine where your children go to school. With a voucher system, you have true free choice and the kids from the bad neighborhoods and ghettos can attend the school of their choice. They deserve to have the same opportunities that the children have whose parents have means. But again, thanks to politicians and unions, most children will never have true free choice.
TwoFists
11:08 am on Monday, February 11, 2013
You're right Kaitlin and normally I would absolutely agree with you. That's why my family moved to Edgewood in 1980 because of the great school. The only problem is that the liberals destroyed our school a couple of years later with the merger.
KMan
11:20 am on Sunday, February 10, 2013
With comments like Kaitlin, make me want to move out of the state. Question...why haven't our children's test scores improved beyond the third world level while increasing tax dollars expenditures on our teaches and education? You believe the more money we spend on education the better the level of education our kids receive.......hardly not.
cc
12:10 pm on Sunday, February 10, 2013
because they have to cut money from education to pay teachers salaries and pensions. The teachers who aren't good at teaching are still in the schools because they have tenure protecting them. We got teachers who are almost ready to retire and could care less about the education of our children. We do have some teachers who go beyond to help our students learn but there are very few of them. We also have school boards that are to worried about how to spend money making the school look pretty yet take money away from departments like technology.
Debra Phelan
9:31 pm on Sunday, February 10, 2013
Exactly, KMan!
Debra Phelan
9:38 pm on Sunday, February 10, 2013
Well said, KMan.
M. R. Birkos
1:14 pm on Sunday, February 10, 2013
The $1 billion windfall is not guaranteed. Not even Sheetz is keen on the exorbitant license fees.
Iowa privatized retail operations of wine in 1985, liquor in 1987.
West Virginia privatized liquor operations in 1991.
Both states earned less than $20 million.
In 1986, Iowa earned $71.6 million. In 1987 - $43.6 million. Sales tax revenue did not return to pre-privatization levels until 2004.
http://www.pennlive.com/editorials/index.ssf/2010/12/dont_toast_yet_to_pa_liquor_st_1.html:
http://voices.washingtonpost.com/virginiapolitics/2010/09/as_we_reported_this_weekend.html:
In 2004, Maine earned $125 million for a 10 year lease of their wholesale rights, but since, has lost over $100 million due to revenue sharing with the wholesaler.
http://www.mainebiz.biz/article/20110725/CURRENTEDITION/307259998:
In 2011, we know that Washington’s liquor sales contributed $461 million to their general fund, roughly equal to our PLCB. When they privatized in 2012, we know that Washington only earned $150 million for wholesale, $30.8 million for their existing stores, and a new liquor/wine/beer license is only $166.00. They exploded from 300 to over 1,400 outlets, many open until 2:00 AM. Unit sales only increased by 8%.
Since 2011, the governor’s windfall estimate has been $1.6 billion. Today it is $1.0 billion. Ironically, the governor’s billion dollars and the market comparables are both deal killers.
Albert Brooks
3:11 pm on Sunday, February 10, 2013
These polls are pretty worthless once they are posted on the union pages and the leadership tells the drones to vote against them. Just realize that there has never been a scientifically conducted poll in favor of the PLCB. The citizens have wanted it gone for decades.
Roger
5:22 pm on Sunday, February 10, 2013
But, Albert, polls make for divisive stories on Patch, and create page views. Patch desperately needs page views, and these polls help the cause. Putting two hot topics together may help double the cause.
Zandy Dudiak
6:52 pm on Sunday, February 10, 2013
Roger, just to clarify, Patch did not put these two topics together. Gov. Corbett did that with his proposal. I watch the news all week to decide on a topic that might interest our readers. We offer this as a way for people to have a conversation about a variety topics that affect the western Pennsylvania area, directly or indirectly.
Roger
7:58 pm on Sunday, February 10, 2013
Zandy, I am sure you are aware of this story on Saturday,
http://online.wsj.com/article/SB10001424127887323452204578291641794924434.html?mod=WSJ_qtoverview_wsjlatest
Still missing revenue targets. Maybe by the end of 2013, ... it Patch hangs on that long.
Sorry, but no mystery about page views and revenue. I don't blame you, and would probably do the same to help try to make it work.
Mike Jones
9:24 pm on Sunday, February 10, 2013
@Zandy... I'm working on a story right now about how CV officials are happy that state funding is remaining stable (even increasing a bit) but they are "concerned" that the funding is coupled with the sale of the state stores as one-time revenue and does not offer long-term support. Nice poll question on an important issue.
John
3:16 pm on Sunday, February 10, 2013
Not only that but the 200 million is not even in the league the liquor stores bring in for state revenue. Try a half a billion dollars each year. Not million, billion!! What happens when that is gone?? I'll tell ya, higher taxes,higher liquor prices, more underage drinking , NO WAY is this the way to go!!!
Roger
5:17 pm on Sunday, February 10, 2013
John, the argument of $500M in revenue each year, over against the $1B in sale, has been advanced many times. Of course, the argument is intended to say that the payback is only two years.
I have asked those commenters several times in other threads: What is the split on taxes and profit? I've never received an answer.
If the split is $100M/$400M on profit/taxes, that is one case. If the split is $400/$100M on profit/taxes, that is entirely different case. I think we can all agree the taxes are not going to go away under a privatized system, so the only component of concern is the profit.
John, your $500M for two years is true, but only part of the story. It only is a useful argument when we know the splits on profits/taxes. We need to know the rest of the story. Requests in the past have been ignored. John, help us out with this information to reinforce your argument that the tradeoff is a looser for PA government. Thanks.
Albert Brooks
3:23 pm on Sunday, February 10, 2013
Considering that 80% of that is taxes which will still be collected where do you think it will go?
JohnRz
5:09 pm on Sunday, February 10, 2013
Yep, all those taxes will be collected anyway. The twelve hundred private liquor stores and thousands more that will be selling wine and beer will be as about as reliable as the tooth fairy when it comes to leaving their taxes under the commonwealths pillow. There won't be any of that money spent auditing thousands of new outlets to insure compliance. "We'll get the taxes anyway"? That would have the folks at the Dept. of Revenue ROFLTAO!
Sami Augustine
3:39 pm on Sunday, February 10, 2013
Corbett is a Shuster smoke screen for dummies to stupid to see through the smoke.
Sami Augustine
3:41 pm on Sunday, February 10, 2013
State stores bring in 500,000,000 a year and provide decent paying jobs for neighbors Corbett want to throw that always says cronies make a dime.
Roger
5:19 pm on Sunday, February 10, 2013
Sami, since when is it the responsibility of the PA state government to provide decent paying jobs?
In case John does not provide the information to my previous post regarding splits in profit/taxes that make up the $500M, maybe you can help us out with this information.
Concerned Citizen
10:14 pm on Sunday, February 10, 2013
The providing jobs argument shouldn't even be part of this discussion. It's not the responsibility of the state to provide jobs. And the taxes will still be collected, whether its privately run or not. Besides the fact that your points aren't valid, your grammar (and punctuation) is reprehensible. Fairly unintelligible posts.
Albert Brooks
3:43 pm on Sunday, February 10, 2013
What's a "Shuster " ?
cc
4:36 pm on Sunday, February 10, 2013
this is the definition I found for a "Shuster", but it sounds more like obama "
A verb meaning to fail to meet expectations, particularly at a moment critical for success or even slightly respectable results.
Slightly derogatory, indicating the type of disapproval that can only be backed by the weight of a nation's scorn.
"Well we almost won the game, but the kicker missed the extra point so we lost by one."
"Man, he really shustered that!"
"The United States team has a chance to go up by two and almost certainly clinch a victory here in the ninth end."
"Oh no, he pulled a shuster! What a letdown!"
"Apparently he truly enjoys the taste of disappointment."
http://www.urbandictionary.com/define.php?term=Shuster
Albert Brooks
4:39 pm on Sunday, February 10, 2013
Thanks cc.
Bill
5:33 pm on Sunday, February 10, 2013
This is a big reason why we are in the mess we are in; not just the state level but in Washington as well. Give every item it's own vote "NO PACKAGE DEALS". In washington they call them Christmas Tree bills because everyone gets to hang their own ornaments (bills) on the tree. By the time it's passes we get a lot of cost that we don't need and would not have voted for on ot's own.
Albert Brooks
6:22 pm on Sunday, February 10, 2013
What JohnRz fails to mention is that the PLCB already is responsible for over 17000 licensed establishments. So he is really saying that the PLCB can't do it's job. Tax collection is not a privatization problem it is an enforcement problem.
Albert Brooks
6:31 pm on Sunday, February 10, 2013
Also, nothing says that liquor taxes have to be collected at the retail level. They can just as easily be collected at the wholesale level as many states already do. This cuts down the number from thousands to hundreds or less then the number they check now.
Albert Brooks
6:28 pm on Sunday, February 10, 2013
Roger - of the $494 million turned in last year approximately $390 million was collected taxes and $104 million were contributions to the PSP, Alcohol Education and the General Fund.(http://www.lcb.state.pa.us/cons/groups/alcoholeducation/documents/adacct/001821.pdf)
Roger
6:23 am on Monday, February 11, 2013
Thanks. The ratios make the arguments of "two years to return" bogus, and can be discounted.
JohnRz
11:12 pm on Sunday, February 10, 2013
Love the link Albert! But before you use it to mislead people I'll point out that the $104M is AFTER the contribution to the PSP. True profit before this transfer is $125M.It also shows the general fund transfer request was $25M less than the year before. Combine this with a $20M profit increase and you have a $45M positive swing in the change in net assets. Total ending net assets are $23M better! Just the opposite of what the Governors (paid for) report from PFM predicted. Thanks for the assist.
"Tax collection is not a privatization problem it is an enforcement problem." What kind of double talk is that Albert? The problem is putting revenue at risk. Taxation has been a fox and hound game forever. http://www.thedenverchannel.com/news/daveco-liquors-to-give-up-thornton-liquor-store. Think they'll ever get every penny back from Daveco? Including the court costs and the cost of the audit and investigation? I kinda doubt it.
Albert Brooks
8:19 am on Monday, February 11, 2013
Is that like the PLCB manager who stole from the store? Think they'll ever get back all the money it took to investigate, audit and court costs? Didn't think so.
Albert Brooks
8:27 am on Monday, February 11, 2013
So after record sales the true level of sustainable transfers is under $120M but only if the level of stores and employees remains about the same. Since the number of stores has been decreased from 692 in 2000 to 605 now one would expect profit to increase due to lower operating costs. This hasn't been the case.
JohnRz
11:17 pm on Sunday, February 10, 2013
"Also, nothing says that liquor taxes have to be collected at the retail level." BS Albert. The Guvs plan includes both the 18% liquor tax and the 6% sales tax." You need to know the retail price to calculate either. You would have to use a gallonage tax. Before you expound on the beauty of gallonage taxes I'll tell people the problem with them. They never adjust to price increases. For instance Pa beer tax is about the lowest in the country because it was set many years ago and has lost 90% of it's real value. Easy to see why big alcohol and their shills love it so much.
Albert Brooks
8:13 am on Monday, February 11, 2013
You usually do better then this John, the 18% liquor tax can be collected at the wholesale level just like cigarette tax and of course, sales tax is collected at the point of sale. You only need to know the price the wholesaler is charging the store to calculate the liquor tax.if you choose to collect taxes in that way instead of all at the retail level. You could even move it up to the distributor level and deal with even less entities. Works for other states.
JohnRz
9:21 am on Monday, February 11, 2013
Wrong Albert. If one retailer charges $20 and another charges $25 the 18% changes with it.
The Frustrated Pragmatist
9:00 am on Monday, February 11, 2013
It seems, as usual, the thread has been diverted from the original question, whether or not it is a good idea to link the two issues.
I'm not so sure the question is even valid. State funding levels of schools have been fairly consistent over the past few years. You MUST exclude the one-time payment from the Federal Stimulus program if you want to be honest in the evaluation of State funding to local districts. That money was never intended to be repeated year after year.
So, the State is providing funding levels that increase slightly year to year. Unfortunately, the funding does not quite cover the increase in PSERS contributions required of local districts.
If the State Stores are privatized, and State Revenues go up, that could provide addtional funding for schools. The two do not have to be linked in stone, it is just a matter of more money might be available....or might not.
JohnRz
9:26 am on Monday, February 11, 2013
The problem with linking the two is the Governors plan is also a one time stimulus. In four years the education money goes away. He is holding education hostage to his political agenda. Anyone surprised?
Albert Brooks
9:49 am on Monday, February 11, 2013
You need to add "in Pennsylvania" to your statement. Not every state does things the same and only one other does things the way PA does. Us and Utah against the world!
Joseph
10:53 am on Monday, February 11, 2013
"This is just an attempt by the governor to sell the liquor store privatization to state legislators."
That option is awesome because it's worded to be negative. That's how politics works though.
Why is home ownership linked to schools?
Why is the lottery linked to senior citizens?
Why is the Allegheny liquor tax linked to Port Authority?
Why does the PLCB contribute revenue to the General Fund (~45% of which goes to education)?
Why does the cigarette tax fund Children's health insurance and agriculture preservation?
Why does EVERYTHING seem to be linked to job creation?
etc, etc, etc.....
Bob Howard
3:37 pm on Monday, February 11, 2013
It is a symptom of special interests.Each interest needs money so they can do “good things” for society. Want to change it? Get involved.
Joseph
1:47 pm on Tuesday, February 12, 2013
I've been involved. I've seen the beast first hand. The only way to change it is to become a part of the special interest groups or run for office to diffuse the special interest groups (good luck winning an election without the support of special interest groups).
Anna Coen
11:03 am on Monday, February 11, 2013
Zandy, I personally thought this was a good article in that it brought up discussion and dialogue about our schools. I have no children in the school system but believe that "Our Children Are our Future" and I have a problem with cuts of any kind to our schools.
Bob Howard
3:41 pm on Monday, February 11, 2013
What if you money is being wasted by certain public schools? What if your district is building beautiful schools but has below average academic results? Are you OK with your tax dollars going to school districts where less than 50% of the students graduate? PA has been throwing money at the problem becasue too many people believe it is a money problem. It is time to get involved and confirm your money is being spent on the children and not the special interests of adults.
Bob Bob
7:09 am on Tuesday, February 12, 2013
This state is so behind times, privitize alcohol.