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I have lost count how many times clients have asked me whether a bar, restaurant, or hotel can sell mixed drinks to a customer to go.  The question has come up even more frequently in the last couple of years since beer distributors started selling slushies in a to-go cup, usually with a sticker covering

The federal government has taken significant steps over the past weeks to provide relief to individuals and businesses struggling to manage their finances during the COVID-19 crisis. The first of these, the Families First Coronavirus Response Act (FFCRA), went into effect on April 1.  

Most notable of the provisions in FFCRA were the requirements

I have gotten a number of questions recently related to the PA Skill games that are becoming more and more popular in bars, restaurants, and even convenience stores.  The questions I get are often concerning whether those games are legal and can lawfully be operated by a business owner, particularly if they hold a liquor license.

Recently, the Pennsylvania State Police and the Bureau of Liquor Control Enforcement conducted an investigation and seized a number of games in the Central Pennsylvania area.  In justifying these seizures, they took the position that these machines constitute illegal gambling devices and were subject to seizure by the police. That action by the police led to concerns by restaurateurs and other holders of liquor licenses that they were going to get in trouble or have these machines seized by the police.

After these raids and seizures by the state Police, Pace-O-Matic, one of the manufacturers of these Pennsylvania skill games, challenged the State Police and sought an injunction from the courts to prevent the police from seizing any more of the games they manufacture. They argued that their games do not constitute illegal gambling devices, and base their position on a decision issued in 2014 by a Court of Common Pleas judge in Beaver County. In that decision, the judge concluded that because there is an element of skill involved in the Pace-O-Matic games, they do not constitute illegal gambling. That decision in 2014 led to the wide spread circulation and use of these machines, but has also spurned a lot of copycat machines. Pace-O-Matic was initially granted an injunction by the Court of Common Pleas preventing the state police from seizing any of the machines they manufacture until the issue could further be sorted out in court system.
Continue Reading Pennsylvania Skill Games

Thank you to Chad Umble at LNP for another informative article regarding Pennsylvania liquor laws.  This one is concerning legislation pending in the PA House of Representatives that would impact the way that grocery stores and convenience stores could operate.

More specifically, the article highlights a bill currently being considered in the House’s Liquor Control Committee that would create a “customer convenience permit” which would enable those holding the permit to deny patrons the ability to consume alcohol on their premises, and also allow them more flexibility in terms of where they have to physically locate the beer and wine within their store.  It also proposes to remove some of the restrictions on how many ounces of alcohol can be purchased in any given transaction. As you might imagine, despite this being called a “customer convenience permit”, it is really a permit that was crafted solely by and for the grocery stores and convenience stores. As correctly pointed out in the article, Walmart is a major proponent of this bill and likely provided much, if not all, of the input on the bill as it was drafted.
Continue Reading More about the Proposal for New Liquor Permits

Thank you to Chad Umble for another informative article about the changing landscape for PA liquor licenses.  I’m sure there are many who read the article and wonder why the PLCB doesn’t just increase the number of available licenses or create a different kind of license for grocery stores and convenience stores to alleviate the pressure on the restaurants.  The answer to that question is neither simple nor clear, but I can give you some thoughts on why those options are unlikely to occur.

First, simply issuing more licenses would involve a change to the liquor code in Pennsylvania, which would have to pass through the legislature.  It is not as simple as the PLCB simply saying that the quota should be updated or more licenses should be issued.  Any time a bill is introduced regarding changes to the liquor code, it usually generates a lot of attention from many industry groups.  The Brewer’s Association, Restaurant and Lodging Association, Tavern Owners Association, the Malt Beverage Distributors Association, and more recently the Convenience Store Council and the Food Merchants Association, all are trade groups that are impacted by even small changes to the liquor code.  Each of these organizations represents members in various aspects of alcohol sales in the state and any change to the liquor code often impacts each of these groups very differently.  As a result, when liquor bills are advanced in the house or the senate, enormous pressure is placed on our legislators to recognize the interests of these various groups and not change the landscape to hurt any particular industry.  What often happens as a result of this is little or no change. 
Continue Reading More about the Cost of Lancaster County Liquor Licenses

If you have been paying attention to what is happening in the brewing industry in Pennsylvania, you’ve noticed that there has been much discussion about the imposition of sales tax on beer manufactured in Pennsylvania and how that might affect consumer prices.  There was a lot of uncertainty about how new regulations from the Department of Revenue will be instituted and how sales tax will be charged on beer produced within the state. You may have read my post Sales Tax on Breweries back in the fall when we knew that it was coming but nobody was certain how it would ultimately be implemented. Now we have some guidance. As part of the 2019-2020 budget for Pennsylvania, the General Assembly was able to include some language that clarifies from a legislative standpoint (as opposed to internal regulations that the Department of Revenue was applying) how sales tax will be charged.

The issue that made this particularly difficult was the potential for inconsistencies in the amount of tax imposed, based on how the beer was sold.  For instance, in my previous post, I used the example of a $40 keg of beer that is sold at wholesale.  For a restaurant or other brewery buying that keg at wholesale, sales tax is paid and remitted to the Department of Revenue based on the $40 wholesale price, so $2.40 would be remitted for sales taxes.  Contrast that with the same keg of beer that is sold on site by the brewery that produced it.  If that brewery does not wholesale beer, under the guidelines issued by the Department of Revenue, the brewery would have to impose sales tax on each pint of beer sold from that keg.  Assuming approximately 120 pints of beer are sold from that keg and each pint is sold for $5.00, the brewery would have to charge and remit a total of $36.00 in sales tax.   With this new legislation, there should now be some consistency in terms of how sales tax is charged, regardless of whether a brewery wholesales its beer or whether they sell it entirely at their own property.
Continue Reading Sales Tax on Beer