New legislative bill threatens the diversity of New York’s wine market
Last week in the NYT, Eric Asimov highlighted the wine program at Nice Matin, a restaurant on the Upper West Side that has remarkable breadth of offerings, depth of vintages and sharp pricing. This apparent wine lover’s idyll was not always this way: only in the past few years have the owners built up the wine program, in part by purchasing the cellars of now-defunct restaurants. Further, the wine director “prowls through a network of collectors and winery owners, seeking mature older vintages to add to the list.”
Across town and upstate, specialty wine shops such as Chambers Street Wines and Crush Wine and Spirits or Grapes the Wine Company, often broker collections of rare older wines that individual collectors are selling. And even though wine auctions have shifted to Hong Kong with astonishing speed over the past couple of years, the gavel still does come down on wine lots at places like Sotheby’s and Christie’s here in New York.
All of these facets of the wine business mean that, with a bit of effort, a wine enthusiast can hunt down an enormous range of rare bottles in New York. It is arguably the best city on earth for wine lovers.
But the status quo is under threat thanks to new proposed legislation in Albany. Representative Robin Schimminger has introduced a bill to the Assembly that would make it possible for restaurants and retail shops to only purchase wine from a “primary source,” that is to say, only from the distributors authorized to sell the wines. So the wine director at a restaurant like Nice Matin who wanted to acquire old vintages of certain wines could only do so through the distributor. And if the distributor did not carry the wines, then the wines could not be purchased from collectors. And such a wine list would likely not exist then in NYC.
Older or rare bottles often find their way into New York via what’s called the “gray market.” It’s a legal yet untraditional channel that brings many exciting back vintages and other hard-too-find wines, wines that may not be of interest large distributors yet are the very wines that quicken the pulse of wine enthusiasts. Not all states offer such a channel for sourcing wine; Connecticut, for example, has a “primary source” bill that prohibits stores and restaurants from buying older collections. And I know plenty of Connecticut wine enthusiasts who do much of their wine shopping in New York.
The new legislative proposal in Albany frames the attempt to shut down the gray market as consumer protection against counterfeits. While counterfeits are certainly an issue in the world of fine and rare wine, I doubt that having a single distributor for many wines would curb counterfeits. Instead, what I fear, is that it would squelch the diversity, sophistication, and excitement out of the New York wine market by reducing selection and raising prices for what’s left. Further, the state’s coffers would suffer from a loss of sales tax revenue on these wine sales.
The bill, known as A06884, has not garnered any attention since it was introduced on April 5. So help shine your light on it by talking about it with your wine friends. And maybe you’ll get so worked up about it, that you will want to contact your legislators in Albany.
Full text of A06884
Find your state representatives in Albany
On May 24th, 2011 at 8:38 am ,Mike wrote:
Not only will this destroy the fine wine market in NY; but the State will lose significant sales tax and excise tax revenues will increasing their payrolls to try and administrate. In the end we lose fine wines and pay higher income taxes to support short fall of this brilliant idea!
On May 24th, 2011 at 9:23 am ,Ron McFarland wrote:
Many states have quirks in wine laws written long ago. I often wonder if a solution is to annoy everyone and allow wine to be sold everywhere, the grocery and drug store, direct to consumers, direct to restaurants, give consumers the choice to bring their own bottles to a restaurant, the channel you highlight plus others.
I think status quo is the weak link, not change.
On May 24th, 2011 at 9:55 am ,Simon wrote:
This just sounds like a horrible idea all around. Hurt the NY consumer and lose money for the State. The same consumers purchasing these wines now are just going to find them elsewhere. This is really what our politicians are spending time on???
On May 24th, 2011 at 10:13 am ,JB wrote:
FYI ; not only is this what the politicians are spending time on, they don’t know what they are talking about. Under the new law, every item you want to register as the primary source must first be sent to NYS Department of Agri. for laboratory analysis! That’s right folks,if the primary source can find an ’82 Mouton and want’s to sell it to a restaurant, they need an extra bottle to send to the state first. Won’t be hard to fill the hundreds of positions that will be required now at the Dept of Agriculture.to administer this law
On May 24th, 2011 at 11:13 am ,Robin C wrote:
I can’t think how that would pass. The distributors can’t be more powerful than the restaurant owners.
On May 24th, 2011 at 12:19 pm ,Chuck Hayward wrote:
To Robin C:
Rule #1 in politics: Follow the money…
On May 24th, 2011 at 12:38 pm ,Mike wrote:
To Robin C: Revert to Chuck Haywards rule #1.Follow the $.
The few distributors with the exclusive rights to products want to have the State insure their exclusivity with a law; it’s called anti trust. Doesn’t seem as if the fine and rare consumer will be able to get a good wine at a FAIR price if this law were to pass.
On May 24th, 2011 at 5:03 pm ,Don wrote:
And how much taxpayer money will it require to staff and enforce and measure and analyze and prosecute? What a pile of doo doo, just to try to give the big wholesalers a big gun to use against the small number of bottles moving in the gray market.
On May 24th, 2011 at 5:09 pm ,Joe Czerwinski wrote:
Thanks for bringing this to people’s attention. There’s an identical bill in the Senate, S4499, sponsored by State Senator Carl Marcellino.
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On May 26th, 2011 at 8:02 am ,Terroirist » Daily Wine News: Italian Whites wrote:
[…] Vino reports that New York State Rep. Robin Schimminger has introduced a bill that would require restaurants and […]
On June 2nd, 2011 at 8:04 am ,Terroirist » Daily Wine News: Amateur Wine Blogger wrote:
[…] week, thanks to Dr. Vino, we reported on the news that New York State Rep. Robin Schimminger has introduced a bill that […]
On July 12th, 2011 at 12:31 pm ,Terroirist » SWRA Releases Eye-Opening Report on Wholesalers’ Political Influence wrote:
[…] Source Laws, which prohibit retailers from purchasing wine from any agent accept a wholesaler. (In practice, these laws prohibit restaurants from purchasing wine from collectors, wine shops, auction houses, […]
On July 19th, 2011 at 9:50 am ,ed wrote:
Ah land of the free right? Get rid of those nobs guys, they are no good for nothing and no one, well maybe their own pocket.