Relates to licenses for wineries, farm wineries, special wineries, special farm wineries and microwineries; repealer

Summary of provisions

Section 1 amends Alcoholic Beverage Control Law (ABCL) §3 by adding new subdivisions 9-a and 12-aa to establish definitions for "custom crush facility" and "farm."

Section 2 amends ABCL §76 to:

(a) authorize the holder of a winery license to operate a winery; receive and possess wine from other states; sell wine in bulk; sell wine to a licensed wholesaler or retailer, or to a corporation operating railroad cars or aircraft; and operate or use the services of a custom crush facility;

(b) delete references to "farm winery;"

(c) provide for an annual permit authorizing wineries to participate in events sponsored by a charitable organization and providing for notice of such events to be given to the New York State Liquor Authority (Authority) electronically;

(d) make provisions for a licensed winery to obtain a certificate authorizing it to sell wine at retail in sealed containers to religious organizations for sacramental purposes and to a householder for consumption in his home;

(e) authorize a licensed winery to manufacture, bottle and sell various fruit products on and from the licensed premises and to store and sell various gift items in a tax paid room upon the licensed premises;

(f) authorize licensed wineries and farm wineries to charge for use of their premises and wine tastings;

(g) authorize wine grape growers and wine producer organizations and associations incorporated within the State for the purpose of wine grape promotion to hold wine tastings;

(h) authorize licensed wineries to remain open on Sunday between the hours of ten o'clock in the morning and midnight; and

(i) engage in custom wine production allowing individuals to assist in the production of the wine they help produce.

Sections 3, 4, 5, 6 and 7 amend ABCL §76-a to authorize the holder of a farm winery license to:

(a) operate a farm winery for the manufacture of wine or cider;

(b) sell products in bulk to winery licensees, farm winery licensees, distiller licensees, certain permittees and to persons outside the State;

(c) sell to licensed wholesalers or retailers or corporations operating railroad cars or aircraft;

(d) operate, or use, the services of a custom crush facility;

(e) sell cider and wine at retail for consumption off the premises;

(f) sell wine at retail for consumption on the premises of a restaurant, conference center, inn, bed and breakfast or hotel business owned and operated by the licensee in or adjacent to the farm winery;

(g) conduct wine tastings of New York State wines in establishments licensed to sell wine for off-premises consumption and charge for such tastings;

(h) upon issuance of an annual permit, and after giving a written or electronic notice to the Authority, participate in outdoor or indoor gatherings, functions, occasions or events sponsored by a charitable organization;

(i) charge a fee for each wine sample tasted;

(j) operate up to five branch offices located away from the licensed farm winery, after notifying the Authority of the location of such branch office and receiving a permit. Such branch offices shall not be subject to the off premises requirements of ABCL §§79(2)(3)(4) and 105(2)(3)(10)(b)(c); and

(k) engage in custom wine production allowing individuals to assist in the production of the wine they help produce.

Section 8 amends ABCL §76-b to provide for the issuance of a temporary permit to operate a winery, farm winery, special winery, special farm winery or micro-winery.

Section 9 amends ABCL §76-c to provide for a license to operate a special winery on the premises of an existing winery licensee; deletes provisions relating to special winery and farm winery licenses and provides that the provisions of the ABCL relating to the operation of a winery should also apply to the holder of a special winery license.

Section 10 amends ABCL §76-d to provide for a license to operate a special farm winery on the premises of an existing farm winery

licensee; deletes references to microwineries and farm wineries; and provides that the provisions of the ABCL relating to farm winery licenses shall apply to special farm winery licenses.

Section 11 repeals ABCL §76-f relating to micro-winery licenses.

Section 12 repeals ABCL §77 relating to the sale of wine in bulk.

Section 13 amends ABCL §79-c to delete minimum requirements for rules and regulations relating to the collection and annual reporting of information by holders of out-of-state direct shipper's licenses and provides for such licensees to maintain records of shipments and provide copies of such records, upon written request, to the Authority or the Department of Taxation and Finance rather than to report to the Authority semiannually.

Section 14 amends ABCL §79-d to provide for wineries and farm wineries licensed under the ABCL that make direct intrastate wine shipments to maintain records, and keep such records for three years; and provide such records to the Authority or the Department of Taxation and Finance upon written request, rather than report to the Authority annually.

Section 15 amends ABCL §80 to provide for wine tastings, upon the licensed premises, to be conducted by persons possessing a seven day license to sell wine at retail for consumption off the premises and for licensed farm wineries, wineries and wine wholesalers to apply for an annual permit to conduct wine tastings throughout the State.

Section 16 repeals subdivision 1-c of ABCL §83 relating to the fifty dollar annual microwinery license fee and 1-a of ABCL §83 to provide for a fifty dollar annual fee for a farm winery manufacturing no more than fifteen hundred finished gallons of wine annually.

Section 17 amends subdivision 7 of ABCL § 103 to provide that any books and records required by the ABCL to be maintained by a winery, farm winery, special farm winery or micro-winery must be kept either upon the licensed premises or such other location as may be approved by the State Liquor Authority.

Existing law

The ABCL sets forth provisions relating to winery and farm winery licenses in various sections rather than consolidating all of those provisions in the two sections that authorize those licenses.

ABCL §§76 and 76-a require that operators of wineries and farm wineries obtain separate licenses authorizing them to participate in events sponsored by charitable organizations and limits such events to five per year.

ABCL §76 authorizes farm wineries to obtain permits for up to five satellite stores which are subject to the off premises requirements of the ABCL.

ABCL §§76-f and 83 (1-c) authorize micro-winery licenses and fees.

ABCL §77 regulates the sale of wine in bulk.

ABCL §§79-c and 79-d contain minimum requirements for rules and regulations relating to the collection and annual reporting of information by holders of out-of-state direct shippers licenses and requires such shippers to report to the Authority semi-annually.

ABCL §§70-c and 79-d further require wineries and farm wineries licensed under the ABCL that make direct intrastate wine shipments to report to the Authority annually regarding such shipments.

Prior legislative history

Introduced in 2010 legislative session as a Governor's Program Bill S.8305/A.11533. Passed Senate, remained in Assembly Economic Development Committee.

Statement in support

This bill implements several of the recommendations made by the New York State Wine Grape Task Force in its December 2008 report to the Commissioner of Agriculture and Markets. The proposed amendments will help to promote the successful development of New York's wine and grape industry.

The addition of a definition of a "custom crush facility" and the inclusion of express statutory authority for farm wineries to operate or use the services of a custom crush facility will clarify the authority of farm wineries to process grapes, fruits and other plants grown in New York State from or on behalf of other licensed wineries or farm wineries. This will ensure that farm wineries can provide and benefit from this valuable service.

The addition of a definition of "farm" in the ABCL will help to clarify the places and premises that are eligible for licensing as farm wineries.

The consolidation of the various provisions relating to wineries and farm wineries in two sections of the ABCL authorizing the licensing of such businesses will make it easier for applicants and licensees to locate the requirements that apply to each type of license.

The authorization of operators of wineries and farm wineries to obtain annual permits for participation in events sponsored by charitable organizations will encourage participation in such events and benefit both the charitable organizations and the wineries and farm wineries that participate in those events. The elimination of the current cap of five such events per year and the provision for notice of participation to be given to the Authority by written or electronic notice will also encourage participation and increase the opportunities to promote New York's wineries and farm wineries.

The clarification of the authority of licensed farm wineries to operate up to five branch offices located away from the licensed farm wineries; the simplification of the process for obtaining a permit for each branch office; and the exemption of such branch offices from

the off premises restrictions of the ABCL will increase the opportunities for New York State wine to be marketed and sold.

The elimination of a separate micro-winery licenses, while providing for a $50.00 annual fee for farm wineries manufacturing no more than 1,500 finished gallons of wine annually, will help to simplify the licensing process for such establishments. The consolidation of various provisions relating to temporary and special licenses and permits will provide similar benefits.

The revisions made to the requirements governing the collection and reporting of information by holders of out-of-state direct shippers' licenses and by wineries and farm wineries licensed under the ABCL that make direct intrastate wine shipments will simplify recordkeeping and reporting requirements while continuing to make the required information available for review.

The custom winemaking provisions will increase agri-tourism opportunities and interest in New York State wineries.

The above amendments to the provisions of the ABCL governing wineries and farm wineries will facilitate the growth of this important agricultural sector. They will promote the New York wine industry while maintaining appropriate protections relating to the sale of alcoholic beverages. In so doing, this bill will help to promote the economic growth that is so important to the State's future.

Budget implications

It is anticipated that the bill will result in additional sales of wine and in so doing will generate additional tax revenue.

Local impact

This bill would not impose a mandate on a county, city, town, village, school district or special district.

Effective date

The amendments take effect 90 days after enactment.