Why Wine Drinkers Should Care About the HR 5034 Bill

"By ordering wine direct, we are essentially doing an end-run around the three-tier system. And HR 5034 seeks to clamp that down, once and for all."


[Flickr: Jesse757]

I have nothing against wine and liquor stores. In fact, I've squandered many a happy afternoon browsing the shelves and peering at notes scribbled by earnest staffers about their favorite picks, and exited with a great bottle to enjoy.

But the cold hard truth is that many great wines never make it to my favorite wine shop. In some cases, small wineries produce only a limited run, or have limited distribution resources, and the best way to get my hands on them is to sign up to receive mailings (and hopefully score a case) direct from the winery.

However, the HR 5034 bill could put an end to accessing wines directly from the source. Congress introduced the bill back in April, and it's currently going through the House of Representatives. It's also called the "Comprehensive Alcohol Regulatory Effectiveness Act of 2010," or CARE bill.

Here's why you should care about the CARE bill: It bans interstate shipping of wine, which could range anywhere from mildly annoying (for consumers) to downright catastrophic (for small wineries and other related businesses). Tom Wark argues on his Fermentation blog that "it will put out of business an entire swath of America's artisan wineries." Ouch. And the bill might impact beer and spirits makers too.

In order to understand how we got here, a brief overview of the three-tier system:

In the aftermath of Prohibition (1919) and Repeal (1933), temperance advocates sought to influence state law and policy. Among the 50 states, some were happy to go back to "wet" status, while others preferred to remain "dry."

You know how politics works: compromise, compromise, compromise. And the necessary compromise to get Repeal passed at the federal level was to make it optional—not federally mandated—at the state and local levels. Individual states retained the authority to decide whether, how, and where alcoholic beverages could be distributed.

The end result: a patchwork of state-level controls on distribution and final sale, and a complicated structure of laws controlling alcohol retailing in the United States.

This also led to the birth of the three-tier system still in place today, separating the business of alcohol production (winemakers), distribution, and final sale (wine shops, wine bars, etc.).

This is a long way of answering "What's the big deal?" By ordering wine direct, we are essentially doing an end-run around the three-tier system. And HR 5034 seeks to clamp that down, once and for all.

As you might expect, the distributors and wholesalers are in support of the bill. And smaller/family wineries and merchants are opposed to HR 5034, as are groups in favor of direct interstate shipping of wine, such as Free the Grapes! (I love that grumpy grape logo.)

Am I oversimplifying the issue here? Of course. But it's a start at explaining a complex and important issue that might impact what's in your glass—and soon.

Read more on the resolution on the Fermentation blog, or in this article from writer Jane Staley Boaz.

Where do you come down on this bill?