Craft distillers push for tasting rooms
FRED GROTH, maker of Hooker’s House whiskies and HelloCello, would like to offer tastings in his Sonoma distillery, but cannot.
Visitors to Wine County accustomed to waltzing in and out of tasting rooms might be surprised to learn that the same experience is not offered at local distilleries. And some will be surprised to learn that there are some local distilleries.
But a group of 30 California distillers, including one in Sonoma, have banded together to lobby the state to allow limited tastings at direct-to-consumer sales at their distilleries.
So far, their “Taste California” petition has amassed more than 1,000 signatures, and they’ve hired a lobbying firm that has gained the campaign some traction in Sacramento.
“Basically we want to be able to operate just like the wineries and breweries in our state do, but due to current California law we are unable to showcase our own products in our facilities,” said Arthur Hartunian, president of the group, California Artisanal Distillers Guild (CADG).
Like all the members of the guild, Hartunian is a distiller himself, running Napa Valley Distillery, makers of high-end vodka.
CADG’s proposal, being promoted in Sacramento by the lobbying firm Di Mare, Can Vleck and Brown (which also represents Safeway, Best Buy, Mattel and the City of Napa, among many others), seeks to create a special craft distiller license that allows for tastings and limited direct-to-consumer sales on-premise only at the distillery, with production capped at a modest number of cases.
When Fred and Amy Groth launched HelloCello, their local brand of lemoncello, almost four years ago, they had originally hoped to have tastings at their facility on Eighth Street East in Sonoma, where they got a distillers license last summer and began production of Hooker’s House whiskies. “Part of the reason we chose Sonoma is because there’s this whole culture of eat local, drink local, a whole cottage industry of farm-to-table, farm-to-glass – not just with wine, but everything else. So, it seems odd that this piece is missing,” said Fred Groth. “I guess we didn’t totally understand that at the time. We thought, oh, you can probably do that, and then found out, oh you can’t do that.”
California, in specifically not allowing tasting rooms and direct sales for distillers, stands with a very small minority of states: only Nevada, Alaska and Mississippi have similar prohibitions. Of the remaining 46 states, nine have not addressed the issue at all, seven allow only tastings and not sales, and 34 allow both tastings and sales.
“We probably get three or four calls a week from people who want to come and tour and taste, and we have to say, well you can come here and look at things but you can’t taste,” said Groth.
Attorney John Trinidad, who deals with ABC (Department of Alcoholic Beverage Control) and TTB (Alcohol and Tobacco Tax and Trade Bureau) licensing issues for the firm Dickenson, Peatman and Fogerty, is often asked to explain California’s laws relating to alcoholic beverages to the uninitiated. “You try to explain to someone what the law is and they say, ‘That makes no sense. Why does that exist?’” he said. His answer is usually the same: “Let me take you back to the Prohibition Era.”
And in explaining California’s “tied-house” laws – which create regulations for a three-tiered system separating alcoholic beverage manufacturing, production and distribution – this is part of the answer. And it’s also part of the answer for why you can walk into almost any winery in the Valley and get a taste of wine, but Fred Groth has to keep the cork in his bottles of Hooker House bourbon.
“In the pre-Prohibition-era in the U.S., while there was some wine production, wine wasn’t as big a business, but distillers and brewers actually had some clout. When Prohibition actually began, a lot of the social ills associated with the saloons were more directly linked with the influence of beer and spirits,” said Trinidad. “Once the 18th Amendment was repealed, a lot of the states were trying to figure out ways to adopt laws that would avoid the social ills that had taken place prior to prohibition. That’s why you see a lot of different treatment.”
There have been a great many exceptions in the tied-house laws made for winemakers. “Think about where the California wine industry would be without this. Thirty years ago there were no tastings or sales,” said Groth. “Would anybody come to Sonoma now if there still wasn’t?”
“Wine is obviously a big part of the California economy,” Trinidad said. “And there’s been a recognition that those exceptions are beneficial to the economy.”
Part of CADG’s strategy is to make clear its own industry’s benefits to local economies. “For the state, it means increased employment and tax revenues, as well as a new prestige category for California products,” said Hartunian. “It helps build awareness and can even increase tourism as part of the wine experience that people come to California for.”
Many legislators are hesitant to attach their names to a bill that would allow for tastings and sales for distillers. Craig Reynolds, chief of staff for state Sen. Lois Wolk, D-Davis, would say only that the senator (whose district includes Napa and Sonoma) “supports direct marketing for wineries,” but could not say if she’d support the same for local distilleries. Assemblymember Nancy Skinner, D-Berkeley, who, according to a source was said to be considering introducing a bill addressing the matter this legislative session, would also not go on the record about the issue, although a representative from her office confirmed a bill was being considered.
Tasting rooms for wine can be touchy issues in communities, as any Sonoman who’s ever been to a city council meeting likely knows, so politicos are being understandably cautious in adding spirits to the mix, but the issue is not a new one in California. Although the CADG formed only in August, the serious push for legislative action by distillers has been ongoing, with bills dying on the floor at least as far back as eight years ago.
According to some, two of the major alcoholic beverage distributors in California, Young’s Market and Southern Wine and Spirits, have considerable political clout, which they may be using to stymy potential bills.
Asked about the distributor’s role, Hartunian said, “We’ve reached out to them. Invited them to the negotiating table. Asked them to help us write a bill that would work for them as well. And they just flat-out don’t want any changes to their three-tier system and are not supporting us.”
Hartunian makes the case that tasting rooms in other states have not adversely affected distributors in any way, and, to the contrary, might be beneficial, because people then go to their local retailer or bar after being introduced to a brand in the distiller’s tasting room. But, distributors in California, says Hartunian, “want to hold onto the flow of spirits in California.”
Right now CADG is talking every approach it can to getting its proposal adopted, and trying to make the public aware of its efforts.
“We’re going to make as much noise as possible,” said Hartunian.