The Rochester Democrat & Chronicle reported on a meeting where Dennis Rosen, the chairman of the state liquor authority, covered the impacts of a 2005 law that increased the ability of in-state and out-of-state wineries to ship in and out of New York. Guess what?
The liquor authority has collected $431,375 in permit fees from wineries in the 15 states [with reciprocal shipping agreements]. Wineries that shipped directly reported $54 million in sales to New York consumers between March 2009 and February 2010, which yielded about $4.5 million in sales taxes.
Interstate shipping was a major fight back in the early 2000s. Then in 2005 Granholm v. Heald went in front of the Supreme Court challenging the constitutionality of laws in Michigan and New York that the court found to discriminate between in-state and out-of-state wineries because it violated the commerce clause.
This opened up new markets, evidenced by the numbers above, but it did not address direct shipping, where a winery can ship directly to a consumer in any state, because, in its silliness to redress the wrong, the court affirmed the right to ship only between states with reciprocal agreements. So a state could choose not to allow shipping at all, whether from an in-state or out-of-state winery, because then it wouldn’t be discriminating. Get it.
The fight continues. Tom Wark, executive director of the Specialty Wine Retailers Association, keeps a close eye on developments. The latest is that in March the Supreme Court declined to hear an appeal in Wine Country Gift Baskets vs. Steen, which upheld Texas’s right to prohibit the shipping of wine from out-of-state retailers. Go figure.