Budget uncorks trouble for winery
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By The Associated Press and The Chippewa Herald
Thursday, October 25, 2007 9:27 AM CDT
An item in the new state budget has uncorked opposition from Wisconsin winemakers, including one in the town of LaFayette.
Marykay McIlquham, an owner of the Autumn Harvest Winery in LaFayette, said the new legislation would prevent her from selling wine in retail stores.
The proposed change is favored by politically connected beverage distributors. Gov. Jim Doyle is expected to sign the budget and issue vetoes within days.
“We’ve had some grumbling that the governor is potentially looking at a line-item veto,” McIlquham said.
The wine rules bring Wisconsin into compliance with a 2005 U.S. Supreme Court ruling that requires states to treat wine shipments the same whether they are from in-state or out-of-state.
The rules require wineries to go through distributors when selling their products to retail stores. Representatives of Wisconsin’s growing wine industry say the mandate backed by Democratic Sen. Russ Decker, D-Weston, will hurt their business because wholesalers won’t pick up products from small wineries.
“It will only be detrimental to our off-season sale,” McIlquham said.
Her family relies on retail sales to sustain them through the winter.
Julie Coquard of Wollersheim Winery in Prairie du Sac also predicted the rules would reduce consumers’ access to local wines.
“It looks like this will be pretty destructive to the industry,’’ she said.
But Decker’s spokeswoman Carrie Lynch said the plan reduces permit fees and the number of filings required with the state to respond to concerns raised by wineries after the Senate adopted a similar provision this summer. She said the law was needed after the Supreme Court ruling.
“There’s plenty of room in there for wineries to be able to market their product and do it all legally,’’ she said.
The wine rules would give customers the option of ordering products from more wineries by phone or the Internet but potentially make it harder to find Wisconsin-made wines at the grocery store.
All U.S. wineries will be able to apply for a permit to ship to Wisconsin consumers, who could buy directly up to 108 liters, or about 144 bottles, per year. Previously, only wineries in California and Oregon were supposed to have that ability under agreements with Wisconsin, although the rules weren’t always enforced.
Meanwhile, other rules pushed by Senate President Fred Risser, D-Madison, allow brewpubs that make less than 10,000 barrels of beer per year to have up to six retail locations. Previously, brewers that made more than 4,000 barrels were limited to two retail locations under a Depression-era law designed to prevent monopolies.
The rules were written to benefit the Great Dane Pub, which opened a third location on Madison’s west side but has been unable to serve its own beer there because of the old law. Now, that location should be selling its Crop Circle Wheat and other beers within weeks and the company is considering adding other outlets in Wisconsin.
“It’s great for The Great Dane and it’s going to help other pub brewers grow their businesses way beyond what they could currently,’’ said Eliot Butler, president of the Great Dane.
Many brewpubs opposed the idea when Risser proposed it this summer. But Risser aide Terry Tuschen said the Wisconsin Brewers Guild supported the legislation after several changes were made, including dropping a requirement that brewpubs serve a certain amount of food to qualify.
“The laws in place were capping the growth of small brewers and brew pubs and the state has responded by lifting the ceiling of production,’’ said Carl Nolen, vice president of the Wisconsin Brewers Guild. “That’s important for the overall growth of our craft category.’’
But the new rules will force breweries to choose between being brewpubs and having stand-alone breweries that sell beer, said Jim McCabe, owner of the Milwaukee Ale House brewpub and the Milwaukee Brewing Co. He’s preparing to open a new brewery in Milwaukee and said the provision means he’ll have to choose between running brewpubs or breweries.
He said he and others are asking Doyle to strike out the measure.
“We’re left with some pretty tough choices and if we do the brewpub route, we’re capped at what we can produce,’’ McCabe said.
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