The New York wine industry has emerged bruised from the Legislature's still unfinished effort to address the state's US$16bn budget deficit.
The industry, America's fourth largest (in terms of wineries), has been wrestling with three issues simultaneously: an attempt to get wine into supermarkets, a tax hike, and a threat to the New York Wine and Grape Foundation's future.
Despite a strong effort to get wine sold in supermarkets and convenience stores, Governor David Paterson and the grocery store lobby was defeated by an opposing group representing wine and liquor shops across the state.
Afraid to alienate retailers who currently carry their wines, many wineries opposed this proposal. Some, however, supported it openly, and may lose customers as a result.
As part of the new budget emerging from negotiations between the governor and the state Assembly and Senate, the excise tax on sales of wine is set to be increased by 58% (from 19 to 30 cents a gallon). Wineries, which would foot the bill, fear that passing it along to consumers might cause a drop in sales.
In another move, the New York Wine and Grape Foundation, a trade association representing the state's 261 producers, has temporarily staved off the governor's attempt to wholly eliminate its funding in the new fiscal year.
Last year, the foundation was awarded US$1m, which the wine industry had to match with another $1m. It also got $1.8m, which it did not have to match, from the state government. Months later some of that money was cut back.
This year, the foundation appears likely to receive about $951,000, which again must be matched by its members. The sum could be reduced, however, during the complex legislative process.
If the $951,000 grant remains, 'we will be able to continue our core research and promotion programs but nothing beyond that,' said foundation president James Trezise.
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The attempt to get wine into New York grocery stores has been shelved temporarily, but it will be back. In fact, it promises to return for another go this summer. Now I happen to be a black-belt cheapskate and I'm all for the consumer, but the peculiarity of New York's current laws strongly suggest that the only fair thing is to maintain the status quo. By law, New York wineshops are restricted as to days and hours of operation (grocery stores, especially supermarkets can run 24/7), restricted as to location (proximity to schools), restricted as to merchandise (wine and liquor only and absolutely nothing else) and, most important, can operate only one outlet per license. Hence almost all wineshops are tiny mom-and-pop-style operations. They haven't the capital to fund expansion even if they are allowed to sell, say, camembert with their chardonnay; can't benefit from the economics of bulk purchases; and couldn't stay open all night if they wanted to. In short they're dinosaurs—but only because the state legislature has made them that way. To face bankruptcy from unfair competition would be obscene: the lawmakers themselves admit that all they want from this deal is more tax revenue. I'd just as soon pay my winemonger an extra buck a bottle, thanks.
Bill Marsano
The patchworks of hypothetical tweaking and tinkering only create more obstacles, playing into the hands of the liquor lobby and wholesalers. What's needed, for the sake of wine and wine-lovers, is a total overhaul, out in the open, not in some back room, as was the case last week. There isn't a single objection to the idea of wine in grocery stores that hasn't been overcome somewhere, proving that it can be done. Where there is a will, there is always a way; in New York, when there is a will, there is always a won't. It works in 35 other states. (And at the same time, an overhaul of the State Liquor Authority is also overdue.) Meanwhile, the incredible shortsightedness of cramping and curtailing the good work of the Grape and Wine Foundation, which would leave the New York wine industry speechless, seems to be nothing but mean-spiritedness—extreme prejudice indeed.
Brian St. Pierre, London, UK
As a consumer in a state where wine is sold in grocery stores, wine specialty stores and wineries, I can say it works…to a degree. The wine specialty stores are apt to get their teeth kicked in this year.
A few grocery chains have got almost the same selection of the middle to upper middle grade wines for about the same or slightly lower prices and stay open 24/7 in some cases. They have the $4 -$9 bottle price segment covered, which is a challenge to a small shop. The specialty shop can usually order almost anything you want, but there are only so many labels they can get their hands on.
As to the location thing, there are elementary schools and pre-schools hard against (right next to) the local grocery selling wine and beer and across the street is a wine/beer specialty shop. A winery is just a few miles away where you can also pick up bottles or cases. The local voting districts can make the call to be wet or dry and most seem to go with availability anytime. The shipping laws are still a crazy patchwork in the US and getting crazier. I can get wines shipped to me from wineries in California, but I can't ship any out to friends legally. Distributors still seem to run the show here when it comes to brand availability, but there's plenty to choose from right now. Maybe not so much next year?
Tom Day – Cincinnati, Ohio
Mr. Day raises another interesting point—the old bugaboo about wine and other alcoholic beverages not being allowed for sales anywhere near schools, as if kindergarteners were going to be led astray by proximity, a concept that should have been buried with Carry Nation. It's another example of the demonization of wine—why do we allow it?
Brian St. Pierre
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The attempt to get wine into New York grocery stores has been shelved temporarily, but it will be back. In fact, it promises to return for another go this summer. Now I happen to be a black-belt cheapskate and I'm all for the consumer, but the peculiarity of New York's current laws strongly suggest that the only fair thing is to maintain the status quo. By law, New York wineshops are restricted as to days and hours of operation (grocery stores, especially supermarkets can run 24/7), restricted as to location (proximity to schools), restricted as to merchandise (wine and liquor only and absolutely nothing else) and, most important, can operate only one outlet per license. Hence almost all wineshops are tiny mom-and-pop-style operations. They haven't the capital to fund expansion even if they are allowed to sell, say, camembert with their chardonnay; can't benefit from the economics of bulk purchases; and couldn't stay open all night if they wanted to. In short they're dinosaurs—but only because the state legislature has made them that way. To face bankruptcy from unfair competition would be obscene: the lawmakers themselves admit that all they want from this deal is more tax revenue. I'd just as soon pay my winemonger an extra buck a bottle, thanks.
