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Thursday, February 23, 2006

Ind. Law - Wineries bill amended in committee

Four reporters from four major papers have stories today on the revisions to the wine shipping bill, HB 1190.

"Panel would allow shipping of wine: Compromise puts limits on wineries" is the headline to a very comprehensive story today by Lesley Stedman Weidenbener in the Louisville Courier Journal. Some quotes from the lengthy report:

INDIANAPOLIS — Wineries inside and outside Indiana could ship directly to Hoosier customers under compromise legislation approved by a Senate committee yesterday.

But House Bill 1190 would restrict the amount that wineries could ship to an individual and the total they could ship to all Hoosiers in one year.

Some operators said yesterday that the overall limit was too low and should be increased. Also, wineries could ship only to those individuals already on their customer lists or whose identification they first check in person. * * *

The Commerce Committee amended the bill before approving it unanimously and sending it to the full Senate for consideration. It is now a dramatically different bill than when it was approved earlier this month by the House, which voted to essentially ban direct shipments of wine. * * *

The bill approved yesterday would require wineries -- both in Indiana and in other states -- to obtain a direct wine seller's permit for $100 to ship directly to customers. Only wineries that sell less than 500,000 gallons of wine in the state per year would be eligible for the permit.

Permitted wineries could then ship up to two cases per month to an individual customer but could not ship more than 1,000 cases of wine overall per year.

Winery operators testified yesterday that they generally support the bill's concept. But they said the 1,000-case limit is too low and would hurt their sales. Sen. Brent Steele, R-Bedford, said the cap would put some wineries out of business.

Oliver Winery in Bloomington is the state's largest and ships about 2,700 cases of wine to Indiana customers per year, just a fraction of the 180,000 cases it sells. The company sells the bulk of its product through wholesalers in nine states.

Owner Bill Oliver said direct shipment, though, is a key to selling specialty wines, which are more expensive and made in much smaller quantities.

Direct shipment "is not a great threat" to wholesalers, he said.

Ted Huber, a co-owner of the Huber Orchard and Winery, told the committee that the 1,000-case cap would also be a problem for its business, which draws about 400,000 tourists to the Clark County location every year.

The winery ships about 1,700 cases to Hoosier customers annually. Those direct shipments are important, Huber said, because customers "may not be back for two or three years" after their initial visit.

Bill Ruthhart of the Indianapolis Star writes:
In a major momentum swing for state wineries, a Senate committee Thursday gutted a bill that would have outlawed the shipment of wine in Indiana.

Instead, senators not only voted to permit continued wine shipments in state, but also to allow wine to be shipped to and from Indiana.

"I'm just tickled to death about this," said Dr. Charles Thomas, owner of the Chateau Thomas Winery in Plainfield. "These are some major changes to the bill, and it's much better than it was." * * *

In Indiana, it is against the law for out-of-state wineries to ship to Hoosiers. As result, the Indiana Alcohol and Tobacco Commission also eliminated state wineries' ability to ship their product directly to Hoosiers.

Nine state wineries then sued in Marion Circuit Court, receiving an injunction in November that allows them to continue shipping wine in-state until March 1 -- the deadline the court gave the General Assembly to resolve the issue. * * *

If lawmakers don't pass legislation by March 1, the court could either outlaw all wine shipments in the state or permit them on an unlimited basis.

Faced with the latter possibility, state wholesalers supported the bill despite opposing the concept of shipping wine directly to Hoosiers.

However, as the Star points out in a side-bar, this is not the end of the matter:
WHAT'S NEXT?
House Bill 1190 now heads to the full Senate, where it can be amended. If the Senate passes the new version of the bill, it would be sent to a conference committee. In that committee, members of the House and Senate will meet to resolve their differences on the bill.
They could, for instance, decide to go back to the restrictive, House version of the bill.

Deanna Martin of the AP has a story in today's Fort Wayne Journal Gazette. A quote:

Customers ordering wine would first have to visit the winery in person and complete a face-to-face transaction, during which the winery would check the ID of a person and verify their address and other details. The customer could then order up to two cases a month of wine to have shipped to them at home. Customers already on the winery’s shipping list would not have to make another visit to the winery, lawmakers said.
Patrick Guiane of the Munster (NW Indiana) Times writes:
The glass is half full again for Indiana wineries that had feared the legislature was about to put them out of business.

A Senate panel approved a compromise Wednesday that satisfies the influential liquor distribution lobby without ending the wineries' abilities to ship directly to Hoosiers.

"I think there are a couple of issues, but I think it's really close," Sen. Karen Tallian, D-Ogden Dunes, said at the end of the Commerce and Transportation Committee's three-hour hearing. * * *

The liquor distributors *** brought a large flat-screen monitor into the hearing room to display a short video called "Point. Click. Drink. It shouldn't be that easy."

Supporter of Indiana's 32 wineries, including the Orchard Anderson Winery in Valparaiso, called the underage drinking argument a ruse.

"There wasn't a teenager that drank more alcohol than I probably did," said Sen. Brent Steele, R-Bedford. "And I didn't pay $35 a bottle for it." * * *

Before a groundswell of opposition, the General Assembly appeared ready to simply outlaw all wine shipments. The compromise plan would allow Hoosiers to receive shipments from other states, but only after they make an initial purchase in person.

Here is the link to HB 1190. But the committee amendments haven't been posted yet (they would appear under "Senate Committee Reports") and, as the committee report has not yet been adopted, the "latest printing" does not reflect yesterday's changes either.

Note: I, for one, would like to check to see whether the revision would really require that I physically visit the winery in another state, such as California, before I may place my first order!

Posted by Marcia Oddi on February 23, 2006 08:00 AM
Posted to Indiana Law