LEGISLATIVE UPDATES
TENNESSEE: Winery DTC Shipping under Threat!
Two new bills in Tennessee pose a grave threat to winery DTC. We need your help reaching TN wine lovers to help oppose the bills ASAP.
House Bill 742 and its companion Senate Bill 705 would ban winery shipments to TN residents that move through a fulfillment house. If these bills pass, they would shut off 60% of winery DTC shipments to the state, and set a dangerous precedent.
ACTION: Please email your TN consumers with a link to the FreetheGrapes.org web page specific to Tennessee, here: https://freethegrapes.org/alert/winery-tennessee/
And here is some sample copy to use in emails and social media:
Dear Wine Lovers of Tennessee: Your elected representatives have introduced legislation that will, if passed, ban most winery direct shipping to Tennessee. Two bills (House Bill 742, Senate Bill 705) would prohibit direct shipments from wineries using fulfillment houses. A fulfillment house provides wineries with warehousing, picking, and packing services, and arranges for shipments through common carriers like FedEx. An estimated 60% of direct winery shipments to Tennessee flow through fulfillment houses.
We support the efforts of the national coalition, Free the Grapes!, who is urging Tennessee wine lovers to visit its website, take 2 minutes and personalize a message that will be sent automatically to your state legislators. Help us keep the grapes free in Tennessee! Here is a link: https://freethegrapes.org/alert/winery-tennessee/
NEW JERSEY: Campaign Continues in Year 2 of Legislative Session
As previously reported, Wine Institute and Free the Grapes! -- along with an expanded group of stakeholders from wine companies – are coordinating their campaign to overcome the existing capacity cap statute.
Wine access is particularly important as the pandemic has shed a harsh light on the effects of the capacity cap. In 2020, DTC shipment volume increased 27% nationwide, but only 3.5% in New Jersey, the lowest growth rate of any state. (Source: SOVOS ShipCompliant/Wines Vines Analytics annual report).
Free the Grapes! has been placing news stories on this topic to keep the issue alive and cultivate support for Wine Institute’s favorable bills. Example: https://nj1015.com/wine-group-covid-shines-light-on-frustrating-nj-shipping-limits/
ACTION: We encourage you to continue sharing this link with our consumers, via social media and emails: https://freethegrapes.org/alert/winery-new-jersey/
Additional State Updates
ALABAMA. S146 would create a winery DTC shipping permit allowing for shipments of up to 12 cases annually per consumer, with a $100 permit fee. Another bill, S 138 has been amended to include the language we support as well, and it has moved out of the Senate Tourism Committee and heading to the Senate Floor.
ALASKA. S9, which includes our DTC model bill language, was introduced January 19 and is in the Senate committee on Labor and Finance. The bill would align the state’s statutes with our model direct shipping bill.
ARIZONA: H2688 would amend the winery DTC law to include importers and distillers, and create a capacity cap for distillers under 20k gallons.
FLORIDA: H15, an economic nexus bill, was introduced January 15 and is in the House Committee on Ways & Means. It would trigger sales and use tax for wineries exceeding the 200 transaction or $100k sales thresholds.
HAWAII: There are several new bills in Hawaii. H263/S65 would add beer and spirits to the DTC law, delete the household limit but has unclear reciprocal language. S65 passed the Senate on 2/22/21 and now goes to the House. H824/S1241 would add statewide reporting for the common carriers and is supported by Wine Institute. H824 and S 1241 have each passed out of their first Committees and gone to the floor. S194 would require the liquor commission to revoke a DTC shipper’s license if the shipper commits three or more violations (which could include clerical errors).
INDIANA. We are anticipating a bill to remove the state’s wholesaler exclusion for DTC shipments.
KANSAS: H2252 would create a license for fulfillment houses and require them to file monthly reports. This language has been negotiated with the wholesalers and the ABC and would be workable. S258 would change winery reporting requirements from annual to quarterly.
KENTUCKY: H415 is a fix-it bill to allow shipments from fulfillment houses, which was not allowed under the new law passed in 2020. It will also clarify that wineries operating under an alternating proprietor arrangement may ship as well. The bill has moved out of its first committee and now heads to the floor.
MINNESOTA; S479 will put our model DTC shipping language into statute.
MISSISSIPPI: H577 and S2449 were both DTC shipping bills that died in committee in early February.
MISSOURI: H555, an economic nexus bill, was introduced January 6 and would modify tax collections to include remote sellers exceeding the thresholds of $100k in sales during a 12-month period.
NORTH DAKOTA: S2321 would allow microbreweries to ship DTC, but does not affect winery DTC. The bill passed the Senate on 2/12/21 and now is before the House.
NEBRASKA: L80 would reduce the DTC license fees for both wineries and retailers from $500 to $250 per year.
NEW HAMPSHIRE: S14 would allow the state’s liquor commission to be a DTC shipper of wine and spirits. The bill has passed the Senate and now is before the House.
NEW YORK: A799 and A 895 are retailer DTC bills supported by the National Assoc. of Wine Retailers (and Wine Institute). It includes a $125 permit fee, 36-case annual limit, etc. Introduced January 6, the bill is in the Assembly Committee on Economic Development. A3275 and S4245 would authorize the DTC shipping of up to 36 cases of spirits per consumer by a distiller.
OHIO: A DTC shippers bill to overcome the 250k gallon capacity cap statute is in legislative drafting service. Wine Institute is working on some refinements to the bill’s language.
OKLAHOMA: H1922 would require common carriers to report the quantity of wine within the shipment to the state, which they cannot comply with and, therefore, cannot support.
OREGON: S406 would increase the monthly DTC shippers limit from 3 to 5 cases per month.
RHODE ISLAND: S69 is our model DTC bill including retailers, importers and wholesalers, allowing 24 cases/year. If passed, the bill would replace the current onsite visit requirement – aka the “winery visit penalty.”
SOUTH CAROLINA: H3772 concerns wine and spirits delivery by on and off premise accounts but includes some objectionable 21st Amendment language.
SOUTH DAKOTA: H1208 would allow for the DTC shipping of spirits. The bill has been tabled in the House Commerce and Energy Committee. Wine Institute is watching S109, a spirits special order provision for product not in distribution. This bill has passed the Senate and is now in the House.
UTAH: S59 is intended to replace the flawed special-order bill from 2020, but it’s another special order bill that we believe will not work well for consumers or wineries. The bill passed the Senate on 1/26/21 and is now in the House Rules Committee.
VIRGINIA: VA is considering carryover bills from 2020 that concern intrastate distiller DTC and delivery from state ABC stores to VA consumers.
WYOMING: H13 would increase wine shipment limits from 4 to 12 cases/year, and allow retailer DTC, but includes the existing exclusion for those wines sold through the state’s control system. The bill was passed and signed by the Governor and will become effective on 7/1/21.
