ON THE RECORD/Wine ruling proves sour grapes for states

On May 16, supporters of interstate wine shipments tipped their glasses to the Supreme Court decision overturning state laws that prohibit out-of-state wine deliveries but allow them within the state. Lawsuits had been brought against Michigan and New York by a number of plaintiffs, including residents and a small winery, who claimed that the law did not allow for fair competition. Michigan and New York, along with 22 other states, now must draft new legislation to comply with the court’s ruling. American City & County recently spoke with Angela Bunker, an analyst for Michigan’s Liquor Control Commission, regarding how the state will be affected.

Q: What impact is the ruling going to have on Michigan?

A: Taxation, enforcement issues, regulating a system, potential minor access and Internet regulation are the main concerns. We will get input from industry and private groups and community members, and legislators will gather input from their districts. Then they’ll make a determination as to whether they are going to allow direct shipping to everyone or not allow it to anyone, or something in between, some kind of permitting system. Some other states do that where whoever ships a product into the state pays a tax.

Q: What are some of the pros and cons of those options?

A: Not allowing any shipments may hurt Michigan wineries, which are able to ship to private homes in the state. So we don’t want to hurt our own business, but at the same time, we want to keep all safety features in mind. For example, is the delivery to minors something that might happen? Who’s going to monitor this? Who’s going to enforce the rules? Those are issues that need to be taken into consideration because, as in other states, our staffing levels are down, and we really don’t have the manpower to do that right now.

Q: How long do you have to draft new legislation?

A: There’s a 25-day period where the defendants in the case can appeal to the Supreme Court for a second ruling or hearing. After that 25-day period it’s a little bit gray. It may come back to the state then to decide how they are going to be in compliance with the Supreme Court ruling.

Q: How do residents feel about the court’s decision?

A: We have had a lot of feedback from residents, and most of them would prefer that we open up shipping to everyone. We are getting some that want to protect the state and see that it’s regulated, but most of them want shipping implemented from anywhere. I think the general population would like the freedom to order things from all over and have them shipped to their home.

Q: In the beginning, did you foresee the lawsuit getting this far?

A: I don’t think anyone ever did. They thought that the 21st Amendment, which gave states the right to regulate alcohol within their boundaries, would clinch the deal, and that would be what the courts would find and that would be the end of it. And then it escalated all the way up to the Supreme Court.