Maryland Retailers Want In On Wine Shipping Bill
By Alexander Jackson
Baltimore Business Journal, Staff
Friday, March 4, 2011
If Maryland lawmakers pass legislation allowing wineries to ship wine in and out of the state, Maryland’s retailers want in on the act, too.
The House Economic Matters Committee heard three different bills Friday regarding the direct shipment of wine to Maryland. One, House Bill 234, would allow wineries and retailers to do so. Another, House Bill 1079, would allow wineries to ship in and out of state and permit retailers to do so in-state. The third bill, House Bill 1175, would keep a current ban on retailers shipping but allow wineries to mail customers their favorite wine.
Any ban on shipping, whether within or outside of the state of Maryland makes no sense to some shops owners who testified in favor of direct wine shipping Friday.
“I get calls daily from around the country and overseas,” said Rick Ostrand, owner of State Line Liquors in Elkton. Thanks to his store’s online presence and rare wine selection, Ostrand gets calls even though he specifically states on his website he’s not allowed to ship.
“It’s staggering the amount of business I have to turn down,” Ostrand said. “I can’t imagine what would happen if I had a website that said I was allowed to ship. It can only increase revenue, it would increase my business, and I would hire more employees.”
But J. Steven Wise, a lobbyist for the Maryland State Licensed Beverage Association, prefers the bills that restrict retailers from mailing wine. He urged lawmakers to put the brakes on legislation allowing out-of-state shipping.
Wise said House Bill 234 would give out-of-state retailers a privilege with “very few responsibilities.” Wise said only 12 states out of the 36 that allow retailers to ship do so, and it would be in the best interest of the state to not allow it.
“Alcohol should always be in the hands of people who you know who they are,” Wise said.
In written testimony, Maryland Comptroller Peter Franchot levied his support for all three House bills. And it was his report released in January that fueled the proponents’ push for the legalization of direct wine shipping in Maryland.
Franchot’s report stated that allowing wine to be mail from wineries and retailers in and out of Maryland should not contribute to under-age drinking or put small wine retailers out of business. The report, instead, found that consumers in states that allow direct wine shipping are not shopping for the best price, but rather looking for a specific — and often costly — bottle of wine.
Shortly after Franchot’s report was released, Del. Jolene Ivey, a Prince George’s County Democrat, introduced House Bill 234. A companion bill in the Senate also was filed by Sen. Jamie Raskin, a Montgomery County Democrat. That bill, Senate Bill 248, was heard in the Senate Education, Health and Environmental Affairs Committee on Friday.
Bob Douglas, speaking for the Licensed Beverage Distributors of Maryland Inc., told member of the House committee that retailers shouldn’t be allowed to ship at all.
Douglas said out-of-state retailers would benefit at the cost of Maryland retailers if out-of-state shipping were allowed. “Out-of-state retailers who can undercut Maryland prices will poach Maryland customers,” he told lawmakers Friday.
In his written testimony, Douglas stated that there was “significant retail opposition” to the suggestion of allowing retailers to ship wine.
But Arian Jakob, who owns Diwine Spirits in Pikesville, isn’t one of them.
Like several other retailers on hand, Jakob cited thousands of dollars in lost business and lost state tax revenue that could be had if the state were to allow shipping.
Last February, Jakob received an e-mail from the executive director of the Baltimore County Licensed Beverage Association that encouraged retailers to object to the wine shipping legislation.
Jakob asked why then, and asked again Friday, as he said: “It does nothing but benefit the consumer. It has more to do with politics than what’s good for the people.”
Ivey, the delegate who introduced House Bill 234, said 120,000 wineries are available nationwide and just 7,000 are available to the distribution network inside Maryland.
“This is quite a black eye for our state, and something we should rectify,” she said.