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Kansas legislature

Kansas Legislature

Kansas wineries waiting for vote

Success of vineyards may hinge on ability to directly ship wine

January 22, 2006

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— To Kansas winemakers, the future of their fledgling industry at times may seem as clear as champagne or as cloudy as some basement homebrew.

Over the past three years, the number of wineries has increased from seven to 16, and the amount of grape acreage is expected to double in the next five years, according to Norman Jennings, a vineyard owner and legislative chairman of the Kansas Grape Growers and Winemakers Assn.

"The grape and wine industry in Kansas is one that has the potential to be a major contributor to the state agritourism and value-added agricultural industries," Jennings said.

In addition, a recent U.S. Supreme Court decision on shipping wine was seen by many wineries as the opening to deliver wine from the vineyard to a customer's door, or at least to the retailer down the street where the customer could pick up an order.

But a bill to ostensibly open up wine shipments in reaction to the court ruling has uncorked a bitter fight in the Legislature.


Scott Schmidtberger, a manager for Alvin's Wine and Spirits at 4000 W. 6th St., goes through his wine supply as he dusts off the bottles on Friday. A Kansas Senate bill would allow customers to purchase wine over the Internet or telephone.

Scott Schmidtberger, a manager for Alvin's Wine and Spirits at 4000 W. 6th St., goes through his wine supply as he dusts off the bottles on Friday. A Kansas Senate bill would allow customers to purchase wine over the Internet or telephone.

Senate Bill 370 before the Senate Federal and State Affairs Committee would allow customers to purchase wine over the Internet or on the telephone.

But the bill would require that the wine be shipped from the producer to a licensed wholesaler, who would then take the product to a retail liquor store where it would be picked up by the customer who ordered it.

Greg Shipe, owner of Davenport Vineyard and Winery east of Lawrence, said the legislation was no good.

"The current bill would make it so cumbersome, unwieldy and expensive for an individual consumer to ship wine into the state that we would be surprised if a single transaction took place," Shipe said.

But Tuck Duncan, lobbyist for the Kansas Wine and Spirits Wholesalers Assn., said the producer to distributor to retailer transaction was the best way to go.

"This system makes it absolutely as simple as possible," Duncan said.

It ensures the collection of gallonage taxes at the distributor level and makes sure that underage people are not purchasing the wine, he said.

Shipe said he believed safeguards could be put in place, as they have in other states, to allow direct shipment of wine to consumers.

"Our Kansas wineries get literally thousands of requests yearly to ship our wines all over the state and the country," he said. "The current bill makes absolutely no provision to help Kansas wineries by allowing direct shipping."

Comments

jayhawk2000 8 years, 2 months ago

Did you know Kansas used to be the country's leading producer of wine? The potential is there for the wineries to become both a tourist attraction and revenue earner for the state.

Wine clubs by mail are quite popular here in England, with the post office happy to deliver a case to your door. They will leave it with a neighbor or tuck it away in your garage if you're not in, no problem. They assume if you're old enough to have a credit card to order it, you're old enough to drink it (unfortunately this assumption wouldn't work in Kansas).

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moron 8 years, 2 months ago

I am an expert in wine.

Thanks.

Moron.

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Jamesaust 8 years, 2 months ago

The proposal, which may be found here: http://www.kslegislature.org/bills/2006/370.pdf does seem to meet the core hurdle that states foundered on before the recent Supreme Court holding (against New York State as I recall) -- namely, this bill would burden direct purchases from Kansas wineries as it would any other state's wineries (thereby treating all states equally).

That said, it is a stupid policy that seems aimed at instituting a quasi-prohibition regime. In addition to the layers of handling the article notes, there is also a burden of a (minimum?) "handling fee" for the retailer of $5, in addition to all other taxes, for each delivery (really self-pick up by the consumer), as well as a maximum limit of purchases of 24 bottles in a month (want to stock your personal wine cellar? pace yourself).

This policy achieves its quasi-prohibition scheme behind the shield of two purposes, both bogus in my opinion.

  1. The State wants its tax money, and as one reads the Bill, it is clear that the degree of suffocating control helps ensure that not one drop of alcohol is going untaxed. First, this is more control over a category so small as to be irrelevant for revenue purposes than the State exercises anywhere else. Second, it is so onerous that it virtually ensures that real consumers will just import the wine themselves, thereby losing the State ALL tax revenues (how many miles to Missouri?).

  2. The State doesn't want any wine being ordered up by underage drinkers. First, the direct purchase system is being funneled into the existing alcohol distribution system, the same system by which underage drinkers today get their alcohol (where else does all that alcohol come from?). Why the State believes its existing system is efficient at this is beyond me. Second, given the shipping costs for this wine, it seems quite unlikely that this will be the spigot of choice by underage drinkers. Shipping costs of heavy liquid are prohibitive unless the underlying product is quite pricey, which may explain why wine-of-the-month clubs succeed where beer clubs don't. The underage drinkers of course will need a credit card (try explaining that purchase to Dad.) These drinkers would also need to plan in advance, perhaps weeks in advance, to arrange for shipment and delivery (imagine the embarassment of the UPS truck pulling up when Mom's at home). All in all, I think the idea of kids ordering wines for direct delivery is something that exists more in theory than ever could work in practice.

Bottom line - Senate Bill 370 is surprisingly stupid, even for Kansas.

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mcoan 8 years, 2 months ago

"That proposal subjects wineries to MUCH more onerous shipping provisions than guns!"

Well what would you expect in The Born Again State? This is where Carrie Nation destroyed bars, prohibition continued well past its federal removal, liquor can only be sold in highly regulated stores, and we didn't get liquor by the drink until the 80's.

In Kansas, "morality" trumps economic development every time. Just witness the negative effects of Intelligent Design on recruiting science-related industries to the state. Who would want to locate their business in a state that insists on moving backward, not forward.

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jrlii 8 years, 2 months ago

That proposal subjects wineries to MUCH more onerous shipping provisions than guns!

Guns only have to be shipped to licensed dealers who then assures that the customer is not forbidden to receive them.

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