Consuming Concerns
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CONSUMING CONCERNS The 2013 State-by-State Report Card On Consumer Access To Wine Issued By The American Wine Consumer Coalition Washington, DC August 2013 INTRODUCTION The patchwork of state laws concerning wine and consumer access to wine products create a complex and difficult to understand legal quilt. This is due to the passage of the 21st Amendment to the Constitution in 1933 that not only ended the 15-year experiment with national alcohol Prohibition, but also gave primary responsibility to the states for the regulation of alcohol sales and consumption. The states took that responsibility seriously and enacted a variety of laws and regulations concerning how its residents could access and consume wine. Eighty years after passage of the 21st Amendment, many of the alcohol and wine-related laws put in place in the 1930s are still in place in most states, despite a cultural, economic and commercial reality that is starkly different from the 1930’s. In some cases, however, laws concerning how consumers may access wine products and use wine have been updated to match the economic changes that have occurred, to accommodate legal rulings that showed many of the earlier laws to be unconstitutional and to meet the demands of an American consumer base that has become fervently interested in the wines produced now in every state in the country as well as the thousands of imported wines that now reach American shores from Europe, South America, Canada, Eastern Europe, Africa, Australia, New Zealand and other spots on the globe. “Consuming Concerns: The 2013 State-by-State Report Card on Consumer Access to Wine” looks at how friendly the fifty states’ and District of Columbia’s wine laws are to its wine consumers. The premise of this report is a simple one: wine consumers benefit and are well served when the laws of their state allow for easy access to wine products and provides for convenience in using and accessing wine products. Today, more than at any time in America’s history, members of the American Wine Consumer Coalition and wine consumers nationwide have an important interest in the laws governing the access to wine products. The national wine marketplace is today extraordinarily vibrant. Consumption of wine continues on an uptrend that began decades ago, spurred on by the significant interest Baby Boomers showed in domestic wine. The Millennial Generation has demonstrated an equally intense interest in wine and is expected to continue to drive the wine marketplace in coming years. Yet as this report shows, nearly every state imposes restrictions of one sort or another that deprive wine consumers of access to the wines they want or deprive them of simple conveniences where consumption of wine is concerned. Too often today restrictive laws concerning the direct shipment of wine, the ability to purchase wine in grocery stores, Sunday sales of alcohol, bringing a bottle of wine from ones own collection into a restaurant and poor access to products due to state monopolies on wine sales all hamper consumer enjoyment of wine. This report details which states best serve their wine consumers and the degree to which states restrict, often arbitrarily, its consumers’ access to wine. Following, each state is detailed on a single page with its grade, ranking among the other states and with explanations of how it serves, or does not serve, the wine consumer. METHODOLOGY In December 2011, the American Wine Consumer Coalition carried out a survey of wine consumers nationwide. One thousand wine drinkers responded. Within that survey, respondents were asked which issues surrounding consumer access to wine were most important to them. From these 1,000 responses, it became clear that six specific issues were important to wine consumers: 1. Ability to have wine shipped to their home from any winery 2. Ability to have wine shipped to their home from any wine retailer 3. The ability to purchase wine in grocery stores 4. The ability to purchase wine on Sundays 5. The ability to bring their own wine into a restaurant to drink with their meal 6. No State monopoly on the sale of wine Based on the survey responses, it became clear that certain issues and privileges were more important to respondents than others. Respondents ranked these six issues as most important to less important in the following way: 1. Winery Shipping (MORE IMPORTANT) 2. No State Monopoly on Wine Sales 3. Retailer Shipping 4. Sunday Wine Sales 5. Bringing Wine Into Restaurants 6. Wine Sales in Grocery Stores (LESS IMPORTANT) This report grades the fifty states and the District of Columbia based on how closely they adhere to these important consumer access issues. States receive a certain set of points for each way in which they meet consumer needs on these six issues. More points are gained by a state, for example, if they allow direct to consumer shipments of wine to consumers by wineries than by allowing wine sales in grocery stores since respondents in our survey indicated that winery shipping is more important than being able to purchase wine in grocery stores. If a state did not meet consumer expectations on any of these six issues, they received no ranking points for that issue. On the issue of bringing wine into restaurants, states might receive partial point allocation when the conduct was allowed but only under specific, restrictive conditions. In the end, each states’ points were tallied and they received a score up to 100. That score was then translated into a letter grade based on this common formula: A+ = 100 – 97 C = 76.9 – 73 A = 96.9 – 93 C- = 72.9 – 70 A- = 92.9 – 90 D+ = 69.9 – 67 B+ = 89.9 – 87 D = 66.9 – 63 B = 86.9 – 83 D- = 62.9 – 60 B- = 82.9 – 80 F = Below 60 C+ = 79.9 – 77 SOURCES Sources for the rules and laws in various states concering the issues covered in this report primarily included state alcohol regulatory websites, State regulatory codes and laws, as well as direct contact with various state agencies to confirm information where resources were either unclear or contradictory. IN THE CONSUMER’S INTEREST WINERY-TO-CONSUMER SHIPPING Without the legal means to purchase and have wine shipped directly from the winery, consumers simply don’t have access to anything other than a tiny portion of the wines produced in the United States. Most states mandate that all wines arriving in a state from a winery or importer must be brought in only by a state-licensed middleman wholesaler and that a state’s wine stores and grocery stores only purchase their wine inventory from these same wholesalers. However, there are no requirements that these wholesalers represent any winery that desires to see its wines sold in the state. As a result, a state’s retail wine shops have access to only a tiny percentage of the wines available from the 7,000+ wineries in the United States since wholesalers tend only to represent a very small number of wine brands. By allowing consumers to purchase and have shipped directly to them wines from in-state and out-of-state wineries, the state provides wine consumers with access to nearly any domestic wine they desire. Without this privilege, wine consumers are stuck purchasing what wholesalers bring into the state and see their selection severely diminished. RETAILER-TO-CONSUMER SHIPPING Imported wines (French, German, Italian, Australian, etc) are only sold by retailers. As a result, consumers can only obtain imported wines from wine retailers. Yet, in most states, wine retailers are restricted to only purchasing their wines from in-state wholesalers. If those wholesalers do not represent an imported wine brand, then retailers and their consumers may not purchase them. However, the imported wines a consumer might want is highly likely to be available from one or more retailers in other states. It’s for this reason that allowing direct to consumer shipment from out-of- state retailers to consumers is critical to consumer access to wine. Additionally, only a few retailers nationwide specialize in rare and hard-to-find wines, making it doubly important to wine lovers that they have access to the out-of-state wine retail marketplace. GROCERY STORE WINE SALES A number of states still prohibit the sale of wine in grocery and food stores where consumers purchase food. This type of restriction, kept in place primarily to protect liquor stores and wine retail stores from competition, represent considerable inconvenience for consumers who, if they want to purchase a bottle of wine to go with the meal they are preparing, must make another stop, wasting time, energy, and fuel. SUNDAY SALES OF WINE Though rarer than it once was, a selection of states and localities still impose prohibitions on purchasing wine and other forms of alcohol on Sunday. This kind of “Blue Law” serves no legitimate purpose other than local tradition and imposing personal religious values on an entire community. It is an arbitrarily imposed inconvenience to which wine consumers ought not be subjected. BRING-YOUR-OWN-BOTTLE LAWS Many states still make it illegal for a wine lover to bring a bottle from their own collection into a restaurant to enjoy with their meal. While a number of states serve their consumers well by allowing this practice and allowing restaurants to charge a “corkage fee” to patrons with their own wine, too many states still allow restrictions without any reasonable justification. STATE MONOPOLY ON WINE SALES Two states still take responsibility for being the retailer of wine. By doing so, they deprive wine consumers of the benefits of a free market in wine sales that not only tends to reduce the price of wine, but also results in far greater selection and choice for the consumer.