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Week in Review: Privatization efforts in spotlight

By   /   February 15, 2013  /   No Comments

By PA Independent Staff

HARRISBURG – A majority of Pennsylvania residents favor privatizing the state liquor stores, but this week it was another privatization effort that stole the headlines.

Newly minted Attorney General Kathleen Kane blocked a contract that would have handed off the managerial duties for the state lottery to a private firm. The move is seen as a political one by the state’s first Democratic attorney general against the Republican administration of Gov. Tom Corbett, who has promised to privatize some state services.

Attorney general blocks lottery privatization

KANE IS ABLE: Attorney General Kathleen Kane was able to block the state’s lottery privatization effort, which she said runs afoul of the Pennsylvania Constitution.

Kathleen Kane’s first major move as Pennsylvania’s new attorney general was to block a contract the state signed last month with Camelot Global Services to manage the operation of the Pennsylvania lottery.

The attorney general is charged with reviewing all state contracts for legality. Kane said the Camelot contract failed to meet constitutional standards.

“The PMA is an unlawful extension of executive authority that infringes on the General Assembly’s powers to make basic policy choices regarding the management and operation of the lottery,” as described in the state constitution, Kane said.

Corbett administration officials said the privatization of the lottery would bring in an estimated $23 billion in guaranteed profits to be used for programs benefitting seniors, including $50 million that would be immediately available for next year’s budget. After Kane rejected the contract Thursday, the state will no longer have access to those funds.

Corbett said in a statement that he was “deeply disappointed.”

“I don’t agree with the attorney general’s analysis and decision, and we will review our legal options,” he said. “My job is to protect Pennsylvania’s seniors, and we will continue to do that.”

Top senator on transportation committee wants higher vehicle, license fees

State Sen. John Rafferty, R-Montgomery, chair of the Senate Transportation Committee, wants to increase fees for drivers’ licenses and vehicle registrations to increase Gov. Tom Corbett’s $1.7 billion transportation plan by an additional $1 billion.

TAKE IT HIGHER: A top senator says higher fees should be used to pay for transportation projects

Corbett’s proposal would uncap a portion of the state’s gasoline tax as the primary source of new revenue. The oil franchise tax, as it is technically known, would gradually rise over five years from the current limit — applied only to the first $1.25 of the wholesale price of gasoline. The governor’s plan would also decrease another portion of the gasoline tax by about 20 percent.

Rafferty said Tuesday he supports those proposals but also wants to increase the cost of vehicle registration and drivers’ license fees, which have not been raised since 1997. Rafferty said those increases are “under serious consideration” because they would move the final revenue figure closer to his $2.7 billion total.

There appears to be bipartisan support in the state Senate for a higher level than what the governor proposed.

Senate Minority Leader Jay Costa described Corbett’s $1.7 billion spending plan Monday morning as “not enough,” a view, he said, several of his caucus members share.

Asked Tuesday if he would approve a plan that went above his $1.7 billion baseline by raising vehicle fees, Corbett said he was trying to keep the taxpayers in mind, “first and foremost.”

Majority favors private liquor sales

About two weeks after Gov. Tom Corbett announced plans to privatize the state wine and liquor stores, a new poll shows a majority of voters favor the idea.

MAKING HIS CASE: Gov. Tom Corbett wants to use $1 billion from selling off the state liquor stores to fund block grants for public schools.

Overall, 61 percent of voters favor closing state-run liquor stores, compared to 35 percent who oppose, according to the poll.

Harrisburg’s free-market think tank, the Commonwealth Foundation, commissioned Fairbank, Maslin, Maullin, Metz and Associates to conduct the poll.

Corbett’s plan would close state stores, add up to 600 more retail locations, and allow for wine and beer sales in supermarkets and other locations. It would also expand what beer distributors can sell.

The poll surveyed 800 voters, with a margin of error of plus or minus 3.5 percent and a confidence level of 95 percent. 

Corrupt traffic court could be abolished soon

The state Senate approved legislation to abolish the scandal-ridden Philadelphia Traffic Court, one day after two former judges pleaded guilty to charges stemming from a wide-ranging investigation into corruption and ticket-fixing.

One bill approved by the state Senate would transfer the responsibilities of the traffic court to the Philadelphia Municipal Court and would move two of the traffic court’s seven current judges into new roles within the municipal court, effectively shuttering the traffic court as an independent judicial body. A second bill would amend the state constitution to remove the traffic court permanently.

“There is no good reason for taxpayers to continue footing the bill for a court that is unnecessary and has become an embarrassment to the state’s judicial system,” said Senate Majority Leader Dominic Pileggi, R-Chesterwho sponsored the bills.

Both bills passed unanimously and now move to the state House.

On Tuesday, former Traffic Court judges Kenneth Miller and Warren Hogeland pleaded guilty to charges of conspiracy and mail fraud for agreeing to drop traffic tickets against politically connected individuals. They were two of nine current and former judges and employees of the court who were indicted last month after a federal investigation into ticket-fixing and corruption at the court.

“The betrayal of public trust at the Traffic Court in Philadelphia is a travesty,” state Sen. Michael Stack, D-Philadelphia, said Wednesday. “It’s an issue that demands incredible amount of reform.”

Sell marijuana in state-run liquor stores, senator says

LIGHT EM UP: State Sen. Daylin Leach wants to legalize marijuana in Pennsylvania, but Gov. Tom Corbett isn’t ready to let people light up.

State Sen. Daylin Leach, D-Montgomery, one of the state’s most progressive lawmakers, introduced legislation to legalize marijuana use for adults age 21 and older. Leach’s legislation envisions marijuana sold alongside alcohol in state liquor stores and beer distributors, with production, distribution and sale regulated in a similar way as alcohol.

Leach made the social and economic case for marijuana legalization at a Monday afternoon news conference, where he said that keeping marijuana illegal makes criminals out of people who “smoke a plant.”

Leach said keeping marijuana illegal is irrational on several levels, comparing it to alcohol and tobacco that can be deadly but are legal. Marijuana, conversely, is prescribed medically in 18 states.

“Like the original prohibition, the prohibition of marijuana has resulted in damages far in excess of what the actual substance we’re controlling could ever do,” he said. “This is a cruel, irrational policy that we’ve had for 75 years without revisiting.”

But in Pennsylvania – especially this session – Leach’s idea is little more than a pipe dream.

Janet Kelley, deputy director of communications for Gov. Tom Corbett, said he would not sign a bill legalizing marijuana.

“Governor Corbett has personally witnessed the devastation of illegal drugs on Pennsylvania communities throughout his career,” Kelley said in an email to PA Independent. “He does not believe that loosening restrictions on illegal drugs is in the interest of public safety.”