Pennsylvania governor Tom Wolf has rejected a bill to privatize the sale of alcohol, which may result in closure of around 500 liquor stores in the state.
The house bill 466 has been vetoed by the governor to reform state liquor system and maximize revenues.
Wolf said: "It makes bad business sense for the Commonwealth and consumers to sell off an asset, especially before maximizing its value.
"During consideration of this legislation, it became abundantly clear that this plan would result in higher prices for consumers.
"In the most recent case of another state that pursued the outright privatization of liquor sales, consumers saw higher prices and less selection."
The modernisation of liquor system will generate additional revenues for the Commonwealth and will also support consumer convenience without selling an asset and risking higher prices and less selection for consumers, said Wolf.
Governor also noted that the state is planning to expand the availability of wine and beer in more locations, including supermarkets, as well as planning for variable pricing, direct shipment of wine and expanding state store hours.