Wednesday, August 08, 2007

Illinois Wineries Have Mixed Reaction on Shipping Legislation

For the past couple of years the Illinois wine industry has been trying to pass legislation that will allow the industry to continue self distribution of their products. This is in response to an US Supreme Court ruling that states must treat in-state and out of state wineries equal in regards to distribution laws.

The Illinois Grape Growers and Vintners Association (IGGVA) is the industry association that has been pushing for a change in law. They have often been at odds with the Illinois Beer Distributors Association who saw the wineries ability to self distribute as infringing on their turf. Both groups have been trying to find a compromise that will sustain the growth of the Illinois wine industry and satisfy the distribution industry.

It appears that they have reached an agreement with legislation being passed in the Illinois General Assembly, but not all wineries are happy:

Some supporters said Illinois could ultimately see more wine business if out-of-state wine retailers decide to set up shop in Illinois to avoid the proposed law’s restrictions.

But some lawmakers said successful Illinois wineries would suffer as well and the new regulations would punish them for growing. As proposed, the largest Illinois wine producers would lose the ability to sell directly to restaurants and retailers and instead would have to enter into agreements with distributors.

Local wineries such as Galena Cellars in Geneva and Lynfred Winery in Roselle have said signing agreements with distributors could make their wines too expensive for the common connoisseur.

Distributors want a piece of the profit in exchange for carrying the relatively few bottles of wine small wineries create. That could ratchet wine prices up to $30 a bottle for companies like Galena Cellars and Lynfred Winery.