Direct Shipment of Wine Could Become Legal in Kentucky
Direct shipment of wine to consumers would become legal under a bill that advanced in the state Senate Tuesday.
“This is something we have been talking about a long time,” said Sen. John Schickel (R-Union), chairman of the Senate Licensing, Occupations and Administrative Regulations Committee, the legislative panel that advanced the measure, known as Senate Bill 99.
He said he has received more phone calls from Kentucky citizens in favor of direct shipment of wine than any other issue that has come before the committee in the eight years he has chaired it.
Sen. Max Wise (R-Campbellsville), a sponsor of the bill, testified that 45 states allow direct shipment of wine to consumers. He said it has been reported that a record $3 billion of wine was shipped directly to consumers last year.
Senate Majority Floor Leader Damon Thayer (R-Georgetown) said he supported SB 99. He said Kentuckians visiting California want the ability to ship wine back home that isn’t sold at their local retail establishments.
Sen. Jimmy Higdon (R-Lebanon) asked for clarification on how much wine could be shipped to an individual. Hunter Limbaugh of the Wine Institute testified that a winery in another state could ship up to 24 cases per year to an individual.
Charles George of Wine & Spirits Wholesalers of Kentucky asked that tighter oversight and accountability measures be written into SB 99.
“This bill is kind of like spilling red wine on white carpet,” he said. “It is going to take a lot of scrubbing to clean it up.”
George said his association would like, among other things, for SB 99 to include what’s known in shipping circles as “common carrier reporting.” That’s when shippers, such as UPS and FedEx, are required to report the amount of alcohol being shipped through their systems into Kentucky by out-of-state suppliers. George added that it is required in 15 states, including four neighboring states.
He also objected to language in SB 99 that would reduce the penalty for illegally shipping wine into the state to a misdemeanor from a felony.
George said there was a lot of money at stake. He said when Oklahoma, a state with a similar population to Kentucky, opened up direct shipment of wine to consumers last year that $4.3 million worth of wine flowed into that state in just the first three months.
George said he would like SB 99 to include enforcement provisions to ensure Kentucky collects the taxes it is owed and that wineries are not given an economic advantage by not having to pay Kentucky taxes.
Higden voted for it but said he would like SB 99 to be amended to include common-carrier reporting requirements when it is considered by the full Senate.
From the Legislative Research Commission