Cary Greene Writes Column for ShipCompliant CARE Act Blog

Cary Greene has written a blog post for the great new CARE Act blog that our friends from ShipCompliant have put together.  The ShipCompliant CARE Act blog is a great resource to get all the different perspectives on H.R. 1161.


What Scholars Have to Say About the CARE Bill

License to Steal

By Michael Kaiser

Last week I had the pleasure of attending License to Steal, the National Wine Marketing Conference.  The conference was held at the Lodge and Conference Center in Geneva State Park in Geneva-on-the-Lake, Ohio.  Located right on the shores of Lake Erie, Geneva is home to many wineries in OH.  The Grand River Valley appellation is perfect for growing Riesling and other varietals such as Cabernet Franc and Vidal Blanc. 

License to Steal is the brainchild of Donniella Winchell, the Executive Director of the Ohio Wine Producers Association (and long time champion of WineAmerica).  It is the first wine conference completely devoted to marketing.  The marketing directors from several state associations organize the topics and content of the conference.  This year Indiana, Missouri, Ohio, Virginia, Michigan, Illinois, Pennsylvania and New York all had a hand in developing the agenda for the conference.  Wineries from Maryland to Texas were in attendance. 

I was a featured speaker on the second day of the the conference.  My topic of discussion was the CARE Act and other federal issues that will impact the wine industry.  I also discussed the importance of joining WineAmerica.  It was great to see so many members in attendance. 

The License to Steal Conference is an important tool for any winery, no matter the size, to learn how to better market themselves to consumers and retailers.  Social media dominated the discussion, as expected.  Facebook and Twitter have really surged in use by wineries and License to Steal can teach wineries how to really use those programs to reach out to their consumers.  I urge any winery looking to change or improve their marketing practices to attend License to Steal next year.

On my way back to the Cleveland airport I stopped at Ferrante Winery.  Ferrante is a long time WineAmerica Member.  Nick Ferrante, who is a third generation winemaker at the winery, and has become known for his Rieslings.  If you are ever in that area of Ohio I urge to to stop at Ferrante Winery and all of the other great wineries in the region.

This week it is on to the Pennsylvania Wineries Association meeting.  I'll have a report on that later in the week.

Government Shutdown Will Include TTB

With the very real possibility of a government shutdown due to a lapse in appropriations, the TTB has issued guidelines for their shutdown procedure.  The attached link has all of the information.  If you have any questions please contact us.

TTB Government Shutdown Plans

WineAmerica Signs Letter Requesting Continuing Funding of USDA Research

April 1, 2011

The Honorable Harold Rogers The Honorable Norm Dicks
Chairman and Ranking Member
Committee on Appropriations Committee on Appropriations
U.S. House of Representatives U.S. House of Representatives
Washington, D.C. 20515 Washington, D.C. 20515

Dear Chairman Rogers and Ranking Member Dicks:

The undersigned organizations represent a broad coalition that is extremely concerned about the elimination of vital research funding for American agriculture under the most recent Continuing Resolution.

Under House Joint Resolution 48, funding was eliminated for the remainder of the year for all special research grants under the National Institute of Food and Agriculture (NIFA), and all “Congressionally directed” research projects in the ARS budget. The total amount of this account for FY 2011 was $89 million from the NIFA budget and $42 million from the ARS budget, which is a small sum in comparison to the overall federal budget, but a critical amount considering the essential research being conducted in almost every state. Moreover, these research efforts support jobs and future technological advancements that will help our country maintain its ability to address future global food security issues.

Specifically, NIFA and ARS funding supports vital research essential to combat pests and diseases, address food safety and security issues, environmental compliance, and to enhance the nutritional value of certain crops. Additionally, the beneficial impact of the vital funding that effective agricultural research can deliver has been identified as a 30 to 1 return on investment for the American taxpayer. What makes this situation even worse is that NIFA and ARS are allowed no alternatives to achieve savings. Rather, they are directed to target and eliminate “Congressionally-directed” research projects without regard for the importance of, or the need for, the research being conducted.

Though we are respectful of the difficult task that confronts Congress and the important efforts that have been taken to begin to reducing our federal deficit, we believe that the costs of eliminating this funding, and thereby these research functions, far outweigh any immediate benefit in regard to spending reduction. In the future, the funds that the federal government will need to provide to fill this void, particularly in the area of pest and disease eradication will far exceed the small yet vital investment that these competitive
grants currently receive.
We respectfully ask that a funding level equal to that in FY2010 be provided for these essential activities.

Thank you for considering this important issue.

Sincerely,

American Nursery and Landscape Association
Blue Diamond Growers
California Association of Nurseries and Garden Centers
California Grape and Tree Fruit League
California Table Grape Commission
Cal/West Seeds
Cape Cod Cranberry Growers
Columbia-Snake River Irrigators Association
Del Monte Foods
Empire State Potato Growers
Florida Fruit and Vegetable Association
Georgia Fruit and Vegetable Growers Association
Idaho Grower Shippers Association
Idaho Potato Commission
Maine Potato Board
Michigan Carrot Development Program
Michigan Potato Industry Commission
National Alfalfa & Forage Alliance
National Association of Wheat Growers
National Aquaculture Association
National Council of Farmer Cooperatives
National Grape and Wine Initiative
National Grape Cooperative Association/Welch’s
National Milk Producers Federation
National Potato Council
National Watermelon Association
Northern Plains Potato Growers Association
Northwest Agri Products
Northwest Horticultural Council
Ocean Spray Cranberries, Inc.
Oregon Potato Commission
Produce Marketing Association
Seneca Foods Corporation
Society of American Florists
Texas Produce Association
United Fresh Produce Association
U.S. Apple Association
U.S. Dry Bean Council
Washington State Hay Growers Association
Washington State Potato Commission
Washington Association of Wine Grape Growers
Western Pistachio Association
Wild Blueberry Commission of Maine
Wisconsin Cranberry Growers Association
Wisconsin Potato and Vegetable Growers Association
WineAmerica

Wineries Unlimited Wrap-Up

By Michael Kaiser

Last week the 35th Annual Wineries Unlimited Trade Show and Conference, presented by Vineyard and Winery Management Magazine was held at the Greater Richmond Convention Center in Richmond, Virginia.  The 2011 Conference was the first to be held in Virginia and it did not disappoint.   The Virginia wine industry really embraced the Conference and showed why it is one of the most important wine states in the country.

Wineries Unlimited is always a good conference for WineAmerica.  We see a lot of old friends and we get to make some new ones.  This year was no different.  As always, we shared a booth on the trade show floor with the WineAmerica Insurance Administrators who were excited to talk about their new insurance program.  Their new underwriters (Markel) are located in the Richmond area.  The trade show was an excellent way for us to illustrate why wineries should belong to WineAmerica.

From viticulture and enology to marketing, Wineries Unlimited is a very good way for existing and new wineries to learn how to make their business more successful.   Jim Trezise, the president of the New York Wine and Grape Foundation (and WineAmerica Executive Committee and Board Member) gave the keynote address at the conference.  Additionally, at the Best of the East Grand Gala, Governor Bob McDonnell of Virginia was the featured speaker.  The Governor and First Lady of Virginia have been huge supporters of the Virginia Wine Industry since he took office in January 2010.   This March, during Virginia Wine Week, the first lady planted Chambourcin vines at the Virginia Governor's Mansion and they hope to turn that into a wine.  Todd Haymore, the Virginia Secretary of Agriculture, also spoke at the Gala.  His presentation focused on how the Virginia wine industry has grown in recent years.

The slogan for Wineries Unlimited 2011 was: "Virginia is for Wine Lovers" and the program and attendance confirms that.  We look forward to the 36th conference in 2012.

I hope to see some of you at the "License to Steal" wine marketing conference next week in Geneva, Ohio.  I will be a featured speaker.

Update on the CARE Act

By Cary M. Greene

The effort to defeat the newly numbered H.R. 1161, known to many of you as the CARE Act or H.R. 5034 (the bill number given to it last Congressional session) continues as though it never stopped.  Last Congress, the wholesaler effort to pass the harmful H.R. 5034 culminated in a hearing before the House Judiciary Committee.  As we commented at the time, wholesaler trade group witnesses not only failed to justify the necessity of the bill, they “repeatedly and readily acknowledged that courts would be re-litigating and rehearing long settled principles of alcohol law for years to come if H.R. 5034 becomes law.”  WineAmerica, From the Chiefs Desk (October 2010 Newsletter) available at http://wineamerica.org/newsroom/newsletters/October_2010_Newsletter.pdf (containing our complete analysis of the hearing).

In other words, wholesaler witnesses—at a hearing they had sought, relating to a bill they had demanded—admitted that the CARE Act would open up a veritable can of jurisprudential worms.  But despite the failure to offer any good reasons for Congress to spend its time considering H.R. 5034 last session, wholesaler trade groups have seen fit this session to seek the reintroduction of the nearly identical and equally bad H.R. 1161.

As we did last session, WineAmerica continues working together with our coalition colleagues at the Wine Institute, Brewers Association, Beer Institute, Distilled Spirits Council (“DISCUS”), and the National Association of Beverage Importers to defeat this harmful bill.  So far, this producer coalition has sent a number of joint letters to the Hill and visited individually and in coalition with a wide range of Congressional offices.

Throughout this effort, WineAmerica’s message has been simple: the CARE Act is bad for American wineries.

The passage of H.R. 1161 would signal to states that they should be afraid.  It would tell state legislators and regulators that despite the promise of technology to improve and modernize their regulatory structure, and despite the effectiveness of free flowing interstate commerce in building and growing markets for local products, states should make their laws regulating alcohol tighter.  Even though data and evidence show that there are ways to safely regulate wine apart from the existing system, see http://wineamerica.blogspot.com/2011/02/wineamerica-joins-industry-partners-to.html, H.R. 1161 would tell states to ignore these possibilities because they are just too dangerous.

The spillover effect of the CARE Act for American wineries would be a more restrictive wine regulatory system with less accountability to consumers and less adaptation to market needs.

For more than a year now, wholesaler groups have argued that the CARE Act is necessary because they believe courts are undermining the Twenty-first Amendment and forcing the “deregulation” of alcohol beverages.  They want to provide the states virtually unlimited power when it comes to regulating alcohol.  To paraphrase one NBWA supporter’s arguments, at the time it was ratified “everyone knew” the Twenty-first Amendment “trumped” the Commerce Clause (the section of the Constitution that gives Congress the power to ensure the free flow of interstate commerce) and other federal laws.

Unfortunately, this revisionism ignores the forty years of history, case law and federal statute that preceded the Twenty-first Amendment.  As Supreme Court cases from the 1880s and 1890s confirm, states were never permitted to pass protectionist laws that favored local alcohol beverages or alcohol beverage dealers.  During this period, Congress also indicated that states may only regulate out-of-state alcohol “to the same extent and in the same manner as though such [alcohol beverages] had been produced in such State or Territory.”  In other words, court efforts to curb state protectionist tendencies have a long and telling pedigree and—reasonably enough—continue to shape court interpretation of the Twenty-first Amendment.

States wield a variety of judicially supported powers that are not in jeopardy, including: (1) establishing “control” jurisdictions; (2) licensing and investigating license applicants; (3) imposing and monitoring pricing controls; (4) conducting random compliance inspections; (5) establishing restrictions on hours of operation and outlet density; (6) establishing restrictions on exchange and use of marketing and advertising materials; (7) prohibiting consumption by various classes of consumers including those who are underage; (8) mandating ID checks; and (9) imposing excise and other taxes.

As with our other producer trade group colleagues, WineAmerica supports state rights to regulate alcohol, and has no interest in seeing alcohol abused.  At the same time, states should not be encouraged by Congress, as H.R. 1161 proposes to do, to abuse their regulatory power by passing laws that undermine the interstate commercial character of our national markets.  Federal courts have wisely used their powers of judicial review to strike down state alcohol laws that are anti-competitive, protectionist or a violation of vital Constitutional interests.  At the same time, courts have repeatedly affirmed laws that actually enforce “core” Twenty-first Amendment concerns, such as temperance.

WineAmerica will continue to advocate on behalf of American wineries to defeat the CARE Act. We hope our members continue to support our efforts whether through paying dues, or actively becoming involved in contacting your legislators.  Let us know how we can help you.

Congressional Outreach Still Critical

By Jennifer Montgomery

  

As WineAmerica continues its efforts in opposition of the recently re-introduced the CARE Act (HR 1161), we still need help from our grassroots. If you have not yet gotten an opportunity to contact your Member of Congress, we urge you to reach out to him or her at your earliest convenience. With the wholesalers recently canvassing the Hill, Congress, particularly the new members, need to hear the other side of the story and to know that this legislation could have a significant negative impact on the local wine industries in their home states. Your outreach is vital to our overall efforts.

I will be happy to address and questions or concerns you may have.

jmontgomery@wineamerica.org