Pataki Resurrects His Wine-Shipping Proposal

This article is from the archive of The New York Sun before the launch of its new website in 2022. The Sun has neither altered nor updated such articles but will seek to correct any errors, mis-categorizations or other problems introduced during transfer.

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The New York Sun
NEW YORK SUN CONTRIBUTOR

ALBANY – For the second year in a row, Governor Pataki is proposing to allow the direct shipment of wine to residents of New York from California and other states, a move that promises to ignite a major battle between wine wholesalers and independent wineries in the state.


The proposal, which budget analysts say would generate $2.6 million for the state’s coffers next year, has some lawmakers in Albany confused. The U.S. Supreme Court heard arguments in October on whether state laws limiting interstate trade violate the U.S. Constitution. A ruling backing New York’s current law barring such shipments could make the governor’s proposal irrelevant.


The governor proposed a similar change to state law last year, but his plan didn’t make it past the Legislature. A source close to those negotiations said the proposal died in the Senate as a political favor to the leader of the state’s Conservative Party, Michael Long, who owns a liquor store in Bay Ridge.


Much has changed since last year. Last summer, the Senate’s majority leader, Joe Bruno, a Republican, engaged in an open feud with Mr. Long after the Conservative Party refused to support a number of Republican candidates for state office. Some say Mr. Pataki reintroduced the wine item this year in the hope that cool relations between Messrs. Bruno and Long would ensure its passage.


Mr. Long denied influencing last year’s decision on the wine proposal. “I really stay away from issues that are directly related to my business,” Mr. Long said Tuesday in a phone conversation from his store. “I don’t want the public to perceive that I’m using my political position to benefit my business. If there are people in government that are looking to hurt me, I can’t help that. I can’t speculate.”


A spokesman for Mr. Pataki said the governor reintroduced the wine item because of its widespread support among winegrowers. “New York’s wine industry is the fastest growing and most successful segment of the state’s agriculture industry,” Scott Rief said. “The Farm Bureau and virtually all New York State wineries are supporting this measure because it is a common-sense change that will significantly benefit one of our premier and most high-profit industries and open New York’s vineyards to the national markets.”


Vineyard owners in New York have been trying to alter the state’s interstate trade law since 2000. They say it unfairly limits growth by preventing winemakers here from shipping their product to California, which only ships directly to states that permit direct shipments back. A number of states, including Virginia and Georgia, have changed their interstate trade laws to comply with California’s so-called reciprocal agreement law.


Wholesalers in New York say changes to the state’s current law would result in lost tax revenue, with out-of-state vineyards hiding their New York sales revenue from the state’s tax department. “We opposed this because the system of distribution in New York safeguards its regulatory system and its tax collection system,” the executive director and legislative chairman of the Federation of New York Package Store Associations, William McDevitt, said. “Allowing out-of-state entities to avoid those kinds of regulations weakens the system and creates business entities beyond the purview of the state and the tax department who have no jurisdiction across borders.”


The wholesalers may face a losing battle. Legislators last year put a crack in the state’s liquor laws by allowing Sunday liquor sales for the first time since before Prohibition. And Assemblyman Ronald Canestrari, the upstate Democrat who proposed that bill, said momentum is now in the direction of liberalized liquor laws.


“It’s a very controversial issue,” Mr. Canestrari said. “There’s resistance to change in the industry, and this would open up a whole can of worms. But it’s been proven that Sunday sales work and consumers are pleased with it, so I think we’re halfway there already.”

The New York Sun
NEW YORK SUN CONTRIBUTOR

This article is from the archive of The New York Sun before the launch of its new website in 2022. The Sun has neither altered nor updated such articles but will seek to correct any errors, mis-categorizations or other problems introduced during transfer.


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