Passage of SB 688, and with it the ability to sell spirit-based canned cocktails in groceries and convenience stores, was a long time coming in Pennsylvania.
Dating back to the Whiskey Rebellion, the Commonwealth’s relationship with alcohol has been a complex one, marked by a history of teetotaling, bandit distilling, state-controlled liquor sales and gradual — often glacial — liberalization.
Pennsylvania’s current liquor laws have deep roots in the Prohibition era, and the rules governing the sale of alcohol remained largely unchanged for decades after the 21st Amendment was ratified in 1933. Gov. Gifford Pinchot, who oversaw the creation of the Pennsylvania Liquor Control Board, is reputed to have said he created the agency to “discourage the purchase of alcoholic beverages by making it as inconvenient and expensive as possible.” This is likely apocryphal, but in a 1934 editorial, Gov. Pinchot definitely did write that “prohibition at its worst has been infinitely better than booze at its best.”
Regardless of what Pennsylvania’s abstemious 28th governor did or did not say publicly, the practical effect of state-controlled alcohol sales making life inconvenient for businesses and the public remains undeniable to this day.
But progress has been made, albeit slowly.
It is hard to believe, but in fact it wasn’t until the 1970s that the sale of beer from distributors was authorized in Pennsylvania, a major concession at the time and the first real crack in the wall of the control state.
It was then several more decades before further reforms allowed for the sale of beer, and then wine, in grocery stores and other retail outlets. The hard-fought 2016 expansion of wine sales and the concept of a Wine Expanded Permit laid the groundwork for the changes to RTD regulations prescribed in SB 688, which was signed into law as Act 86 of 2024 by Governor Shapiro over the summer.
Now beginning on September 16, for the first time (notwithstanding the temporary and unique ability of certain licensees to sell cocktails to-go during the COVID-19 pandemic) non-state entities can sell spirit-based beverages for off-premises consumption in Pennsylvania.
It’s a big step forward. The new law defines a ready-to-drink cocktail as any premixed drink of 16 ounces or less made with distilled liquor that has an ABV of no more than 12.5%. The big difference between what’s on shelves now and what will be allowed going forward is the kind of alcohol being used. As of September 16, licensed businesses will be able to stock canned cocktails made with spirits like tequila, vodka, and gin. These products will take their place alongside the malt-based hard seltzers and similar beverages that have been on shelves for years because they fall under the same regulatory umbrella as beer.
So for the first time ever, customers will be able to purchase from their local grocer or convenience store beer, wine, and spirit-based products if they choose.
Permit process
For licensees interested in participating in RTD sales, the PLCB permitting process is already underway. Permits are available to retail liquor licensees eligible for wine expanded permits (restaurants, hotels, supermarkets, convenience stores, etc.) and to distributors and importing distributors of malt and brewed beverages, all of which must be certified in the Responsible Alcohol Management Program.
For its part, the PLCB is anticipating thousands of permit applications to be submitted before the go-live date, and board staff have been conducting outreach with PFMA and its membership, along with other interested parties, over the summer.
For most applicants who already have a WEP, the approval process is likely to be straightforward, as long as they are not subject to a pending objection from the board. Licensees interested in applying for a RTDC permit can do so through PLCB+, the PLCB’s online licensing and regulatory platform.
The initial application fee for an RTD permit is $2,500 per establishment, and the annual renewal fee is 2 percent of the cost of RTDs purchased for off-premises consumption, whether purchased from the PLCB or licensed Pennsylvania manufacturers.
For many retailers, especially smaller businesses who operate solely within Pennsylvania, this will be their first time navigating this product channel, and projecting customer interest and sales volume represents a novel challenge. In addition to guidance on the permitting process, PLCB staff are also working with applicants to help ensure there is enough product to go around as an entirely new supply chain is established, providing assistance with product selection and initial supply estimates.
September 16, 2024, will mark a significant milestone in Pennsylvania’s history of alcohol regulation. PFMA was proud to be a part of crafting SB 688 and to help it become law. We are excited to see members embark on this new opportunity to do business in the Commonwealth.
