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December 16, 2005Granholm signs winery law in TC
Gov. Jennifer Granholm listens to Tellurex president Charles Cauchy, left, alongside Traverse City West Junior High students Thursday afternoon in Traverse City, where she signed a bill allowing Michigan wineries to ship directly to consumers. Granholm signed the wine-shipping bill Wednesday while in Traverse City and hailed it as a long-sought compromise between Michigan wineries and the beer and wine wholesale industry. "This bill is a product of a lot of negotiation by those around this desk," Granholm said as she signed the measure in front of some area vintners and distributors at a local manufacturing plant. "This bill brings together the best of all possible worlds." The new law allows up to 1,500 cases of wine to be shipped annually by wineries both in and out of the state, and licenses direct wine shippers through the state Department of Treasury. The Treasury will collect taxes on wine sales. State lawmakers worked on new wine shipping rules since the U.S. Supreme Court in May struck down a state law that prohibited direct wine shipments to consumers from out-of-state wineries but permitted wine shipments from Michigan wineries. Some wine experts don't expect the new law to stand up under the legal framework. Under the new law, Michigan wineries can ship directly to retailers and restaurants, but that practice is still prohibited for out-of-state wineries. They must use wholesalers - seen by some as a major flaw that could derail the new shipping rules. "They wrote a bill that absolutely defies what the Supreme Court said," said Ed O'Keefe of the Chateau Grand Traverse winery on Old Mission Peninsula. O'Keefe called the new shipping law "a pig in a poke" and criticized lawmakers for hailing it as a "compromise" between the beer and wine wholesalers and Michigan wineries. State Attorney General Mike Cox also said the new law is "very vulnerable" to a legal challenge in a letter to lawmakers last week. "It's an illegal bill, and they know it's going to be contested," O'Keefe said. "If (Granholm) thinks she's doing something nice up here, she's nuts." One of the two wine bills signed by Granholm includes a "poison pill" provision that would prohibit direct shipments by wineries to state licensees like restaurants and retailers if a state appellate court or federal court finds that portion of the law illegal. But other wine makers said they expect the law will hold up. Donald Coe, managing partner of Black Star Farms winery in Suttons Bay who worked closely with lawmakers on the shipping bill, said the Michigan Beer and Wine Wholesalers Association pledged not to challenge the new law. "The negotiations with the beer and wine wholesalers have been in good faith," Coe said. He added even if the direct shipping to licensees is struck down in court, it won't prohibit direct shipments by wineries to consumers. Coe said the law creates two major advantages for Michigan wineries - they can grow their direct shipping business to consumers and gain national acclaim for Michigan wines by exporting wines to other states. He said Michigan wines don't gain much attention from national wine publications because wineries haven't been allowed to ship outside the state. "It opens us up to becoming a national wine industry," Coe said. Granholm signed the wine bills during a tour with a student group at a new Tellurex Corp. plant in East Bay Township to promote a new $2 billion job creation package signed into law last month. [an error occurred while processing this directive] |