Tuesday, February 10, 2009

Maryland wineries await fate of proposed law

The Web site for the Maryland Wine Association identifies the wineries, lists events, contains feature stories on the state’s winery proprietors and winemakers, and has one other important component. It updates readers on any upcoming legislation that will affect the industry in Maryland, and does it with a clarity and perspective that is important for issues that often can be complex.

One of those issues will be debated beginning Feb. 18, when the Maryland Senate Education, Health and Environmental Affairs Committee will hear what’s being referred to as the shipping bill.

According to the Web site, this legislation submitted in the 2009 session is based on the model wine shipping language adopted by the National Conference of State Legislatures' Task Force, which is supported by the Wine Institute, WineAmerica and citizen groups Free The Grapes and Marylanders for Better Beer and Wine Laws.

It would create a direct shipper's license which a winery or retailer can obtain for $100. This license allows the licensee (winery or retailer) to ship up to two cases of wine per month to a Maryland consumer. The licensee must label the box with the phrase “CONTAINS ALCOHOL; SIGNATURE OF PERSON AT LEAST AGE 21 YEARS OLD REQUIRED FOR DELIVERY” and pay sales and excise tax to the state annually.

This is a bill that the association supports but isn’t sponsoring, apparently an important distinction that gives it a chance to pass. Instead, it is being sponsored by a consumer group. The primary opponent to bills like these is called the Maryland State License Beverage Association, which is headquartered in Westminster and, among other roles, initiates and supports laws that preserve and protect the rights of responsible alcohol beverage retailers to operate legitimate and lawful businesses. As one person connected with a Maryland wineries said earlier today, “if it were a winery bill it would be defeated by the MSLBA. They’re extremely strong. We’ve had one significant victory over them and that’s the distribution bill of three years ago. If we put our stamp on it, MSLBA is sure to kill it. So from a strategic point of view we are not taking a formal position.”

Al Copp and several partners founded Woodhall Wine Cellars in Parkton, Md., in 1983 and has been active in supporting this measure and others that have come through the state legislature over the past several decades. This one, he said, will benefit his winery and others by allowing them to ship directly to consumer rather than through a system where the wine would have to be picked up by the customers at a retail outlet. “To [the MSLBA], this [bill] cuts out the middle man, and actually, it does.”

While Kevin Atticks, the executive director for the winery association, wasn’t available for comment, his views and those of wineries around the state were spelled out clearly on the Web site. In says, in part, the “the ability to ship wine to a consumer is one of many methods provided by law in other states to encourage the growth and prosperity of small wineries by giving them an affordable way to reach new markets The Maryland wineries support our state adopting those methods, including the authority proposed by the model shipping bill.
In 2004, the Governor’s Wine & Grape Advisory Committee studied the growth of wine industries in neighboring states, and issued its report,
“Maryland Wine: The Next Vintage.” The report contained 52 recommendations for creating a favorable winery business environment in Maryland. The shipping legislation implements recommendation #23 of that report, which reads:

“RECOMMENDATION 23: Enable wineries to ship wine directly to consumers within the State and remove the obstacles to Maryland becoming a reciprocal state, which would allow Maryland wineries to ship to out-of-state customers.’”

In case you were curious, Pennsylvania wineries currently are permitted to ship to customers who reside within the state. Many of the same stipulations, including a signature by someone at least 21 years of age when the package is received, match what’s proposed in this bill. Wineries also have to use a specific carrier, such as UPS, rather than the Postal Service. This remains intact thanks to an injunction filed several years ago by the state’s wineries preventing the Liquor Control Board from forcing them to deliver through the state store system.