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Bill could threaten wineries, microbreweries

August 10, 2010 12:00:00 AM PDT
Many California wine producers are worried about a bill in Congress right now that could limit interstate wine sales and make it more difficult for small wineries to sell directly to consumers.The bill, called the Comprehensive Alcohol Regulatory Effectiveness Act, would give states control over alcohol laws.

Some of California's wine producers and microbreweries worry this could lead to the prohibition of shipping wine and beer to out-of-state consumers. This would force them to use wholesalers if they wanted to sell their products to consumers beyond state borders, an especially problematic proposal for small-scale businesses which often don't produce enough to make it onto bargain wholesalers' shelves.

"You have these small mom and pop producers across the United States, these artisan wineries like ourselves, making fine wine in small batches and we would be cut out of that," argued Tom Davies, president of V. Sattui Winery.

Shipping out of state is huge business in the California wine industry. According to the marketing research firm Wines and Vines, California accounted for 75 percent of all wines shipped directly to consumers in the last year.

But alcohol wholesalers support the new legislation, claiming it is important in preserving state's rights.

The National Beer Wholesalers Association, which backs the bill, released a statement to Eyewitness News denying that the intention was to encroach on shipping and prop up their own business:

"The CARE Act is not about direct shipping ? it reiterates that the 21st Amendment puts alcohol regulation in the hands of state legislatures like Sacramento - and not in federal courthouses."

Currently, court rulings in 37 states, including California, have upheld the right of producers to sell directly to consumers. If state law should preempt that right, it could mean higher prices and less availability for consumers.

"In order to get it we have to have it shipped directly to us," said tourist Ginger Schwartz. "It'd be very disappointing if congress passed this bill."

Consumer groups and various wine industry associations have been making a push to influence politicians before the elections this November.


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