To the Point for 2/16/2006

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THE STATE LEGISLATURE is moving through its “short session” this year, but the proposals going through the legislature are still having a potentially enormous impact on the residents of the state — and here in Switzerland County.

Over the past few weeks we have discussed the possible legalization of high-fence hunting; the leasing of the Indiana toll roads to private companies; and now comes House Bill 1190, which if passed could mean the end of small wineries in Indiana.

The bill prohibits a farm winery from selling wine directly to the holder of a wine permit. Instead, wineries would have to market their products through the use of wine wholesalers, who would purchase the wine from the wineries and then resell it to retailers.

Doesn’t sound too devastating, does it? Well, let’s look deeper.

Basically there are three large distributors who operate in the state, and those distributors produce nothing in Indiana, and they don’t manufacture anything in Indiana, according to the Indiana Winegrowers Guild.

For many small wineries, profits come from directly shipping their product to the buyer. If this bill passes, that practice would end (the buyer would have to order the wine through the distributor, who would no doubt add some profit into the cost).

They also sell directly to restaurants and local stores, avoiding the middle man and markup.

Without a way to directly sell to the consumer, the Winegrowers Guild feels that the passage of House Bill 1190 would lead to that winery closing its doors.

Other wineries, such as The Ridge Winery here in Switzerland County, currently sell to the customer through their tasting rooms. Customers can go in, sample different types of wine, and purchase a quantity of something they like.

Jim Butler, who owns and operates the Butler Winery in Bloomington and an officer in the Winegrowers Guild, said that the legislation may also mean that those tasting rooms would have to close. If that happens, it is estimated that wineries would lose 90 percent of their retail sales — and that reality means that most, if not all, would shut their doors.

The Indiana Winegrowers Guild estimates that in state wineries sell $1.5 million in product to in-state customers.

House Bill 1190 could possibly make all of that go away.

Local winery owners Tom and Mary Jane Demaree are very involved in watching this legislation, because it could have critical effect on their winery and on the tasting room operated by Greg and Traci Pavy.

Is it really necessary to hand a small group of distributors who already hold 98 percent of the market the other two percent, as well?

At a time when the Governor is moving toward privatization of services (the toll road, possibly some prisons); does the legislature really need to be spending its time putting Indiana business people out of business?

Switzerland County was the home of the first commercial winery in the U.S. After finishing his first batch of wine, John James Dufour loaded a keg of his product on the back of a horse and rode it to Washington, D.C. to present it to President Thomas Jefferson.

Moving it through a middle man distributor just wouldn’t have had the same historic significance.

This state, and this community, was founded on the concept of independent, individual workers deciding that they wanted to be their own boss, and then spent long hours of hard work to develop their product or service.

The products and services provided by local, independent business men and women form the core of what this entire state is about: hard work and long hours and conservative values.

For state legislators to look at the small, independent wineries and then pass legislation to severely curtail their profits speaks against everything that this state and this country have been founded on.

Because if the legislation causes nearly all of the state’s wineries to go out of business, the big distributors don’t have any products to wholesale, anyway.