ND grape growers seek limited self-distribution

 

The North Dakota Grape Growers Association is trying to get a bill passed that would allow them to market locally-produced wines in a less-restrictive way. These efforts typically are opposed by the liquor retailers. I think the state has some potential in this grape growing area, and it seems unlikely to me that they’ll be posing any great competition for the standard liquor stores. It seems that local grape growers and wine makers should be allowed some consideration, as a way to help develop a rural tourism industry that could use some developing.

Here are the grape growers’ talking points. (The map he’s referring to shows North DAkota as “white” while Minnesota, Iowa, South Dakota and Nebraska are “green” and allow intrastate self-distributon; Montana and Wyoming are among the “blue” states, where limited self-distribution has been expanded to out-of-state wineries.)

HB 1340

Facts: Introduced by Senators Fischer, J. Lee, and Warner

- North Dakota is the only Midwest state that does not allow it’s wine industry to sell direct to retailers. 39 states are direct to retail now. Our bill will makeus a blue state. Intrastate and interstate distribution (see map)

- Constitutionality – Best state model! Now according to the Attorney General’s memo March 22, 2011; as such, although the Attorney General can never guarantee that a statue is free from successful constitutional challenge, the attached endorsement (proposed amendments) if adopted would satisfy concerns previously expressed in testimony.

- Tax accountability – tax collection for the increased revenue due to self distribution will not be an issue and has not been a problem in the other 39 states.

- Three Tier System – This is not a breakdown of the three tier system. It allows the wineries the option of self distribution or using a wholesaler as their business model permits. The wineries will turn more to wholesaling as their production grows

- Jobs – HB1340 will create new jobs as vineyard and wineries flourish statewide. New wineries may not open and current wineries may decline with jobs being lost without the free market of self distribution in HB 1340.

- Out of state wineries/big box (Walmart and etc.) – There is no evidence that big out of state wineries or big retailers will ship directly into ND. It is just too inefficient for them and this has not happened in other states.

- Wineries will bring together North Dakota’s two biggest industries, Agriculture & Tourism. The agritourism momentum that this industry has generated thus far will falter without HB1340.

- Over 75 acres of vineyards currently planted in ND will not have a market for their grapes when their vineyards mature. (it takes 4 years) – breeding new cultivars that are true cold climate grapes for our area.

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HB1340 compliments the grape research program at NDSU in breeding new cultivars that are true cold climate grapes for our area.

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