PROPOSAL TO ALLOW DISTILLED SPIRITS TASTING/SALES BY CALIFORNIA DISTILLERIES ON THEIR OWN LICENSED PREMISES
I am writing to ask for your much needed help and support for a proposal to amend current outdated California ABC laws. This amendment would give Distilleries, who manufacture in the state of California and who operate under a Federal Distilled Spirits Plant (DSP) license, the ability to showcase their own American-made artisanal spirits which were produced by/for or bottled by/for their own facility. The following privileges would apply:
1) The ability to conduct public tastings of their products, with or without a fee, and within their own state and federally licensed and bonded facility much like all California wineries, breweries, liquor stores and supermarkets are currently allowed to do.
2) The ability to sell their own products directly to consumers on their own state and federally licensed and bonded facility, much like all California wineries and breweries, liquor stores and supermarkets are currently allowed to do.
This proposed amendment would apply to only those facilities that hold one or more of the following California Non-Retail Type Licenses.
1) TYPE 3 – BRANDY MANUFACTUER
2) TYPE 4 – DISTILLED SPIRITS MANUFACTUER
3) TYPE 7 – RECTIFIER
Aside from California wineries having tasting/sales privileges for years, in 2011, three separate laws were enacted which are relative to this proposal and distilled spirits tasting/sales in general.
1) In January, 2011, AD 605 was signed into law. Known as the California Instructional Tastings Bill, this new law allows liquor stores and supermarkets, who already sell spirits, the ability to conduct tastings of any distilled spirit on its premises.
2) In August, 2011, AB1040 was signed into law amending California Brewery tasting/sales laws, and no longer requiring a California Brewery to serve food and operate as a restaurant in order to operate a tasting/sales room within its facility.
3) In September, 2011, Governor Brown signed into law Senate Bill 32. The legislation, authored by Senator Leno (D-San Francisco), updates state law to recognize the widespread artisanal practice of infusing alcohol with fruits, vegetables, herbs, spices or other ingredients and allows bars and restaurants the ability to infuse their own spirits for use in cocktails or tastings without having to go through the strict TTB distilled spirits formulation approval process that all California DSP’s must adhere to.
In support of our proposal, I bring up the following questions all of which bring into question whether current California law provides for a fair and level playing field for California Distilled Spirits Manufacturers all of which all small Californian-owned businesses.
1) If a Liquor Store or Supermarket in the state of California is allowed to taste and sell spirits in its store, why can’t a Distillery taste/sell the distilled spirits they manufactured in its own licensed facility?
2) If a Winery in the state of California can taste and sell its own wine from within its own facility, why can’t a Distillery taste/sell its own distilled spirits within its own facility?
3) If a Brewery in the state of California can taste and sell its own beer from within its own facility, why can’t a Distillery taste/sell its own distilled spirits within its own facility?
4) If a Bar or Restaurant in California can infuse its own spirits (without any state or federal regulation) and then sell or taste it or include it in a cocktail they make, then why can’t a licensed infuser California DSP, who has gone through all the state and federal regulatory procedures and requirements to get licensed and approved to make spirit infusions, be able to taste/sell its own products within its own facility?
Your support for this proposal would greatly level the playing field for the over 20 licensed DSP’s in the state of California, and more importantly, has the potential to do so much more good for the state of California, including substantially increasing additional excise, sales, income and payroll tax revenue for the state, create dozens of jobs in California and increase the benefits of tourism for the state of California all at practically no cost to the state.
The American Craft-Distilling movement has increased in popularity in recent years due primarily to public awareness and interest in American-made craft distilled spirits. This has spawned some 300 Craft-Distilleries around the country.
In fact, American-made artisanal spirits represents the fastest growing segment in the beverage alcohol industry and is expected to remain that way until 2016.
While most other states already allow Distilleries located with its state boundaries to conduct tasting/sales, certain archaic laws in the State of California are preventing this very important industry the ability to grow, flourish and contribute to the state of California.
In California there are currently over 20 licensed Craft-Distilleries producing premium distilled spirits sold all over the country and abroad. These products are made primarily using ingredients purchased, sourced or grown by California farmers or industries. Your support of this tasting/sales proposal will allow these local businesses the ability to conduct tasting/sales on their already licensed and bonded premises and in-turn create a substantial amount of benefits for the state including but not limited to, substantially increasing additional excise, sales, income and payroll tax revenue for the state, create dozens of jobs in California and increase the benefits of tourism for California all at practically no cost to the state.
This proposal is important and vital to our already fragile state and local economies. The enactment of a law allowing California distilleries tasting/sales privilege will generate new jobs and in-turn will generate new and meaningful streams of tax revenue not previously realized by the State of California.
Your support of this proposal means supporting Californian-made products, Californian small business, Californian farming and Californian manufacturing. Your support will allow these small Californian-owned companies to compete with the much larger foreign-owned brands who make up a much larger share of distilled spirits sold in California
Supporting this proposal will bring California ABC law on-par with other states.
Many other states like Oregon, New York, Hawaii, Tennessee, Vermont, West Virginia, Michigan, Illinois, Wisconsin and others have recently enacted Distillery tasting/sales laws which are helping to increase jobs and add consumer value as well as generate substantial increases in the amount of excise, sales and income taxes for those states.
Taking into consideration that California is the biggest tourism state in the country as well as the biggest consumer of distilled spirits in the US, California would immediately realize a substantially larger percentage increase of the same tax revenues over those states that do allow distilled spirits tasting/sales privileges to Distilleries.
Historically, large national liquor distributors who mostly distribute much larger foreign-made brands in California have been against tasting/sales because of their fear that it would hurt their business; however, by supporting this proposal, neither liquor distributors nor retailers will be adversely affected. This is because most of the products that they currently sell or distribute are not produced by any of the licensed California Craft-Distilleries asking for your support.
California spirits distributors market and distribute very little product that is actually made in California by the California DSP’s asking for your support. Since they are more supportive of foreign-made brands they should not be negatively affected by this proposal and thereby should not be against this proposal.
Even for those few California liquor distributors who do carry Californian-made spirits or for those distributors who may in the future, want to carry Californian-made distilled spirits, there would be no negative impact on their businesses. On the contrary, this proposal can only positively affect those businesses.
As an example and in support of this claim, California wineries have for years offered tastings and direct sales to consumers and yet there has been no adverse affect to wine distributors. On the contrary, tastings and direct sales at Wineries only helped to increase public awareness of the wines tasted at the Winery, and in-turn increased sales and distribution as consumers continued to seek out those brands after visiting the winery.
Also, given the much smaller scale of distilled spirits manufactured relative to the wine industry in California, most of the distilled spirits tasted and offered for taste/sale at the Distillery would most likely represent products available in small quantity and only at the distillery and not necessarily products that would be offered into distribution in the first place.
A law allowing California Distilleries the ability to do tastings and direct sales of their own manufactured products on their own state and federally licensed and bonded premises not only greatly levels the playing field, but will greatly help to restore and build the already suffering local and state economies by creating more jobs and generating a substantial amount of tax revenue for the state of California almost immediately.