Happy new year! As 2010 comes to a close, we have much to look forward to in 2011. We are very thankful for our donors who help sustain our efforts, for many of our elected officials who continue to make us think wine shipping will finally become legal this year and for our friends in the press who help keep everyone engaged.
In This Report
— Comptroller’s 257 Page Report
— Why Can’t Retailers Ship?
— Corkage Update
— Worcester County Dispensary
— Other States’ Laws (or You Think MD is Weird?)
As you probably already heard, the Comptroller’s report on wine shipping was released two weeks ago. Unless you were living under a rock (or too busy making your list of who will get wine-of-the-month club gifts next year), you couldn’t have missed the coverage in the newspapers like the Baltimore Sun (“Wine-by-mail coming to Maryland?” and Richard Gorelick’s “Comptroller’s direct wine shipping report gets a 9.5 from Maryland wineries”), the Frederick News-Post (“Frederick County retailers, wineries weigh in on shipping debate”), the Daily Record (“Maryland comptroller wants to allow direct shipments of wine”), the Baltimore Business Journal (“Marylanders may finally get wine in the mail”), Annapolis’ The Capital (“Wine home delivery would help Md. vineyards”) and Maryland Gazette, the Washington Examiner (“Lift of Md. wine shipment ban would not increase underage drinking”), the Salisbury Daily Times News (“Md. report on wine by mail called ‘starting point’”) and the Harrisburg Patriot-News (“Maryland wine community generally pleased with Comptroller’s report”).
Even if you don’t read the paper, you might have seen or heard coverage on WBAL (“Md. Report On Wine By Mail Called ‘Starting Point'”), ABC2 (“Report opens door to direct wine shipments in Maryland”), WBFF (“Comptroller Releases Wine By Mail Report”), WJZ (“Md. Report On Wine By Mail Called ‘Starting Point’”), WTOP (“Md. may be close to allowing wine shipments”), WBOC (“Maryland Close To Allowing Wine to be Mailed”) or WCBC AM1270 (“Franchot Releases Report on Alcohol Direct Shipment”). The Salisbury Daily Times also came out with an editorial “From the winery straight to you: Time for Maryland to repeal its ban on direct shipping” that encouraged legalizing wine shipping “to the delight of wine lovers and the benefits of economic growth and job creation at a time when both are sorely needed.”
In case the Comptroller’s report did not offer enough numbers, the Baltimore Sun decided to start a poll asking Marylanders whether they wanted to see wine shipping legalized. As of last count, 633 of the 648 respondents (98%) were in support of shipping. If only our elected officials were as unanimous …
Although the Comptroller’s report did offer some good news, primarily in dispelling the notion that out-of-state interests want to sell to kids or evade taxes, it did have its shortcomings. The Capital and the Maryland Gazette in “Franchot’s report dispels myths of shipping wine” complain that “[w]hile we are appreciative of Franchot’s initiative, we are angry that it has taken this long to sort out the well-known truth in this battle between consumers and legislators who have been bullied for years by the liquor industry. Legislators … have swallowed the improbable predictions of liquor lobbyists who put the selfish business interests of their clients over the needs of consumers.”
The major controversy from the Comptroller’s report, however, was that it somehow miraculously determined that retailer shipping would be a bad thing despite the fact that retailers claimed they actually would prefer it (“the majority of Maryland retailers (65.6%) believe that if out-of-state wineries are allowed to direct ship wine, out-of-state retailers should be able to do so as well.” – Page 62). The Baltimore Sun opined that the “Comptroller’s report reveals absurdity of past objections to direct shipment of wine to consumers but still draws some wrong conclusions” in an editorial published 12/25. “While the report is fact-based, some of its conclusions are not. The most glaring is an observation that legalizing direct shipment from out-of-state retailers would do damage to Maryland-based retailers and wholesalers. That’s absurd. If the ban on out-of-state retail shipment is maintained, that means a Maryland resident who wants to order a gift wine basket or join a wine-of-the-month club or order an imported wine could well be out of luck.” Our friend, Tom Wark, who heads the Specialty Wine Retailers Association, weighed in as well in an editorial entitled “Md. should allow wine shipment from retailers: Comptroller’s recommendation on the practice at odds with facts of his report.” He articulately states that prohibiting retailer shipping “guarantees that Maryland wine lovers will remain without access to a huge swath of the wine market, including small production domestic wines, imported wines, collectible wines, wines available only from auction houses and the large number of wine-of-the-month clubs … Marylanders deserve the same access to the American wine market without having to suffer from arbitrary bans that serve no purpose other than protecting a small number of businesses from having to compete in a well-regulated but open marketplace.”
Corkage continues to gather steam around Maryland. A number of counties have already drafted legislation that would legalize the practice within their jurisdictions. A high-profile group of restaurant owners (Prime Rib, Volt, Mussel Bar, Woodberry Kitchen, etc.) recently sent a letter to the Restaurant Association of Maryland asking for their support in this effort. “We are at a disadvantage to both restaurants without a liquor license and those in other jurisdictions like Washington, DC and Pennsylvania where corkage is legal,” they wrote. “Our best customers are forced out of state on their most special occasions if they want to drink a particular bottle of wine because we cannot lawfully allow them to bring it onto our premises … Given that unlicensed Maryland restaurant proprietors can already determine on their own whether they want to allow patrons to bring wine to them, we feel it only fair that we too should be afforded the same right.” Makes sense, no?
Well, here is the argument against: “… at a time when restaurants are struggling, it makes little sense for the government to exacerbate the problem by taking the sale of a bottle of wine away from the restaurant. Furthermore, questions arise as to the restaurant’s ability to monitor the amount of wine the person consumes when they’ve brought their own bottle(s) onto the premises.” We are not sure how one gets from offering the same rights to licensed restaurants as those that do not already have a liquor license to the government stealing sales. Also, does a belligerent restaurant patron feel any less entitled to drink to excess from a bottle of wine he brought with him compared to one he bought from the restaurant?
Worcester County Dispensary
Many people know that Montgomery County has an unusual liquor situation because the county sells the alcohol, but most people do not realize that government-run liquor sales occur in other counties as well (Worcester, Wicomico, Somerset). The Worcester County liquor control board has apparently gotten into a little hot water (“Comptroller says Worcester County’s liquor board broke laws” and “Worcester County liquor board faulted”) by selling alcohol for less than it paid and for buying 200 cases of rum from a DC retailer that it then resold, all of which is illegal under Maryland law. As much as restaurants and liquor stores would like to see the county exit the liquor business, probably the biggest beneficiaries will be the wholesalers who could legally sell in the county. In what other industry does the government sell the goods and be proscribed from selling them for less than it paid?
Other States’ Laws (or You Think MD is Weird?)
Both Pennsylvania (“A Push to Privatize Pennsylvania Liquor Stores”) and Virginia (“McDonnell unveils plan to privatize Va. liquor sales, but skeptics question taxes”) are control jurisdictions like Worcester County but are contemplating selling off their state-run franchise to the private sector. Pennsylvania, which is known for having quirky (to be polite) alcohol laws, has devised wine kiosks designed to accommodate Pennsylvanians’ desire to purchase wine in grocery stores albeit with a peculiar security feature: “Each machine is connected to a state employee in Harrisburg, via video-camera. A customer chooses their wine, swipes their ID, puffs into a breathalyzer and faces the camera. The state employee checks that the ID matches the person and, if they’re not already intoxicated, the person is allowed to buy the wine.” Lastly, the Nebraska Liquor Control Commission is seeking a ban on bar games that encourage “chugging and intoxication,” as part of a larger proposal restricting bar promotions. Thanks to OpenMarket.org for this reporting.
Marylanders for Better Beer & Wine Laws
4315 Underwood Road
Baltimore, MD 21218
Tel: (202) 904-4297