Monday, March 7, 2011

WineAmerica Opposes New Jersey Assembly Bill Restricting Winery Privileges in New Jersey

March 7, 2011

Assemblyman M. Gordon Johnson, Chair
Law and Public Safety Committee
Assembly of the State of New Jersey
545 Cedar Lane
Teaneck, NJ 07666

Dear Chairman Johnson and Members of the Committee:

WineAmerica, the National Association of American Wineries, on behalf of our member wineries in New Jersey and across the nation, encourage you to oppose A. 3831 that would restrict winery privileges in New Jersey.  WineAmerica is the only national winery trade association.

We oppose this bill because it reduces the range of privileges currently available to New Jersey wineries, undermines the agricultural character of New Jersey’s wine industry, and imposes extraterritorial restrictions on the operation of wineries in states other than New Jersey that are likely unconstitutional.

A. 3831 would be a step back for New Jersey winery law which currently promotes local agriculture, New Jersey’s agricultural potential and heritage, and the preservation of rural landscapes.  In developing its winery laws, New Jersey was right to try to keep its rural areas vital and flourishing.  It should not undercut this legitimate local purpose, but should instead defend its right to promote an agricultural form—winemaking—that reliably makes rural living on wide open spaces more economically feasible.
At the same time, imposing a requirement that out-of-state New Jersey small winery licensees grow and cultivate “at least three acres” of “grapes or fruit used in the production of wine,” and produce no more than 250,000 gallons per year, likely imposes an extraterritorial restriction that violates the Constitution.  E.g., Healy v. Beer Institute, Inc., 491 U.S. 324 (1989).  A state may not establish regulations that have the “effect of controlling commercial activity occurring wholly outside the boundary of the State.”  By subjecting out-of-state wineries to qualification standards that may conflict with local lawi.e., imposing production and cultivation standards that differ from those imposed by other states—New Jersey is contemplating limiting the policy choices of those states whose wineries may wish to do business in New Jersey.  

WineAmerica continues to support the sales and distribution privileges currently afforded to New Jersey wineries, and believes that these and similar privileges, including direct-to-consumer shipping, may be responsibly and thoughtfully extended to wineries without compromising New Jersey’s ability to regulate alcohol beverage markets.

Wineries add to the character of New Jersey agricultural and should be afforded the opportunity to operate efficiently and profitably.  We do not believe that A. 3831 promotes this aim, and respectfully request you reject this hastily drafted bill.

Cary M. Greene
Chief Operating Officer & General Counsel

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