Bill dies allowing direct sales, shipments of wine for state residents

By MEGAN PHILLIPS,

House Bill 98, which would allow direct sales and shipments of wine to state residents, died in committee on January 30.

But, author of the bill, District 111 Rep. Charles Busby, says he’s fighting to bring the bill back for the 2019 legislative session.

The idea came to Busby after he and his wife travelled out of town. They found a wine they loved and couldn’t ship it to their home in Gulfport.

“We were on vacation in Sonoma Valley, and we found a wine there that she liked. But we couldn’t ship it to Mississippi, so we had to ship it to Louisiana at a friend’s house and drive to go get it,” Busby said. “I thought, ‘That’s ridiculous.’ ”

Busby said he believes HB 98 didn’t pass because of a liquor store lobby, which is against wine and liquor sales bypassing local shops.

“(Store owners) don’t want it passed, because they’re concerned it’s going to hurt their business. I don’t think it’s something the (ways and means) chairman (Jeffrey Smith) had an appetite for.”

Last year, many local wine and spirits store owners were concerned about big box grocery stores having a license to sell wine and liquor on their shelves.

Currently stores like these already have wine on their shelves, but with restrictions. In stores like SAM’s, Whole Foods,  and even in a Winn-Dixie on the coast, wine and spirits are sold to shoppers. However, each store must have a separate entrance to that portion of the market.

In 2016, big box stores began backing a lobby called Looking for Wine?.

Wine would be placed on shelves next to everyday produce, potentially killing local wine and spirits shop owners across the state.

Besides the negative affect on the local economy, wine aficionados would suffer as well.

“The consumer stands to lose the availability of nice products,” Nathan McHardy, owner of Briarwood Mart Wines and Spirits, said. According to Tasho Katsaboulas of Kats Wine and Spirits, the wine that chains would put on their shelves comprises 91 percent of wine sales at local shops, because that percent of sales comes from bottles costing $15 or less.

Wine sales for bottles $15 or less normally generate the revenue necessary to carry hard-to-find products in local wine stores, according to McHardy. Taking away nice selections will push wine consumers to leave the state to find better selections elsewhere.

“If they take that revenue away from local stores, they’re not going to be able to buy the nice products. The consumer will be forced to go out of state to seek out those products, taking tax revenue with them because they want nicer wine. The erosion of the local economy is kind of the biggest issue,” McHardy said.

 

Consumers might be under the impression that buying wine from grocery stores would be less expensive than buying alcohol from locally-owned shops.

However, chains will have to buy wine at the same price as local shop owners, according to Katsaboulas.

“Because the state distributes wine, the state requires that Kroger and WalMart pay equal prices as local businesses,” he said. “The state is simply moving the revenue,” he said.

Mississippi’s system is an open system, meaning a store owner can order anything available, and the state sets the price and sends it to the store.

“The only limitation with this is that hard-to-find wine makers send their wine to stores they’re familiar with,” said Katsaboulas, making each store and even each state unique in selection.  “No two state’s wine selections are the same, because each hard-to-obtain winery has different relationships with different states.”

According to Katsaboulas, grocers would leave this system of purchasing hard-to-obtain wine unutilized and sell bulk, co-op, and tank wines.

“In short, because there’s not a price advantage, consumers who want nice wines will be punished for consumers who want mass-produced wines” Katsaboulas said.

Busby said the majority of the state legislative body supports HB 98, and a different alcoholic sales bill, Senate Bill 2278, did pass during the recent legislative session.

“There was a companion bill that would allow direct shipment to permit owners not through ABC (Alcoholic Beverage Control), and that did pass. That’s a baby step in the right direction. Normally, everything has to go through ABC (before it goes to stores and restaurants).”

Now, instead of wines and liquors going from wineries to the ABC warehouse to the store or restaurant, the alcohol can travel straight from the winery or distillery to retailers.

Busby said he’s going to work to push the bill again during next year’s legislative session.

“I’m going to try to get the executive director of the Department of Revenue (Herb Frierson) to talk in favor of it to the chairman and what it means,” he said.

Three other passed bills include HB 192, which would allow people to drive through dry counties in Mississippi with unopened containers without facing charges of alcohol possession in a dry county; and HB 534, which adds Meridian to the state’s list of ‘go-cup’ areas. Ridgeland and the town of Livingston are trying to be included as well.

Lastly, HB 415 allows several areas of Hinds County, and Brookhaven Country Club, to become ‘qualified resort areas,’ which exempts them from local and liquor-dry restrictions.

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