Sunday, January 08, 2006

Illinois wine producers v beer distributors

Lobbyists are sure in the news these days. The latest story and one of interest to southern Illinois has to do with new legislation promoted by the beer distributor industry and their efforts to put controls on how Illinois wine producers sell their product.

Prompted by the Associated Beer Distributors of Illinois and sponsored by State Reps. Lou Lang and Jay Hoffman, as well as Republican State Sen. Timothy Schmitz, House Bill 4350 seeks to amend the Liquor Control Act of 1934 to limit the number of cases small wineries can ship to customers per year and stop the winemakers from directly selling their products to local retail stores. Instead, the bill asks that small wineries use distribution companies to keep state regulation procedures in place.

In its simplest form this bill would force wine makers to use distributors to get their wine out as opposed to letting them continue shipping their product to customers or retailers on their own. The distributors want to be the middle man and have all business go through them.

Beer distributors and the beer industry have a lot of clout, a case in point being their ability to keep the state of Missouri from enacting an open container law. But the wine makers argue that they do not produce nearly enough wine to make the use of distributors viable.

George Majka, owner of Pomona Winery in Jackson County said this: "If I could find a distributor that would carry my product and would be diligent about selling it, it might cost me several thousand dollars a year; but they provide a service," Majka said. "The problem is my volume is so small it would be difficult to get distributors to sell it."

Governor Blagojevich is on record as being squarely behind the wine growers, "If we continue that growth and provide our grape growers and wine makers with the knowledge and resources they need to produce a quality product, we will all benefit from the results as more jobs are created and tourism dollars brought into the local economy."

But the beer distributors have lots of clout including the governor's main ally in Springfield and also co-sponsor of the current bill, Jay Hoffman. Couple Hoffman with other state officials with distributor ties like Judy Baar Topinka, Senate President Emil Jones and Senate Republican leader, Frank Watson and there seems little hope of the small wine companies winning this fight. The battle at the present time seems mainly one of power. The distributors want to be the only shipper of wine, but the wineries don't produce enough to make it worth the distributors effort. If the wine can't get to the customer, what will happen to an industry on the rise? Cross posted at Respublica

5 comments:

Bill Baar 4:08 PM  

What was the legislation Ryan signed for Bill Wirtz? I remember the guy at the liquor store telling me it would add a buck to every bottle of wine bought.

From the Encyclopedia of Chicago under the entry for Liquor Distribution.

In 1989, the Chicago Beer Wholesalers Association included some 30 wholesalers, each typically with a few dozen employees, each contracting with brewers to distribute exclusively in specified territories. Wine and liquor distribution became extremely concentrated in the 1980s and 1990s. The largest distributor, owned by William Wirtz, had some 1,500 employees in Illinois by 1999, and its operations extended into other states.

Great post Diane.

Anonymous,  10:02 PM  

RGod will simply follow the money as he always does and the wine industry will be the latest to get thrown under the bus. Follow the money!

Anonymous,  10:03 PM  

RGod will simply follow the money as he always does and the wine industry will be the latest to get thrown under the bus. Follow the money!

Anonymous,  11:11 AM  

Americans are consuming more wine than beer according to published reports. The beer distributors are trying to protect their market share.

fedup dem 4:28 PM  

Of course, that clout certain individuals have in the liquor industry doesn't mean that they can't be complete idiots in a sideline business. Just look at Bill Wirtz, the pathetic joke of an owner of the Chicago Blackhawks National Hockey League team (currently on its longest losing strak in my lifetime), who refuses to televise his team's home games.

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