New York's Grocery Store Wine Battle

A proposal permitting the sale of wine in Empire State supermarkets is pitting wine producers and grocers against traditional distributors and retailers.

***Note:  The proposal detailed below was rejected by Albany lawmakers.***

New York State has been infamous for passing its budget long past deadline. But the latest budget of Governor David Patterson is being rushed through the legislature with an April 1st goal, and a few paragraphs in that cumbersome document have incited a bitter battle pitting wine producers and their suppliers against distributors and retailers.

The Governor of New York, facing a $15 billion deficit, is cutting state services and is desperate for new income sources.  He introduced legislation permitting wine sales in grocery stores, which would yield about $105 million in fees to help plug that gap. Grocers and the big chains have sought that privilege for decades, but have been blocked by a powerful coalition of retailers and distributors. With new revenue desperately needed, fiscal emergency could bring an end to the liquor stores' lock on wine sales.

Retailers threatened by the measure have created a website ominously titled, arguing that many will be forced out of business and that large groceries might not be scrupulous about selling wine to underage consumers. (For proponents, there is a website called, which allows New York residents to send a (pre-composed) message to their elected officials in support of the measure.)  They've also retaliated with boycotts against producer-advocates of the legislation.   

Scott Osborne, proprietor of Fox Run Vineyard on Seneca Lake, is one such supporter. He says his sales have plummeted. "In January," Osborne reports, "we were up 15 % against January of '08, but in February, after we began campaigning for this measure, my distributor volume was down 60% and we're down again by 50% for the first two months of March."

New York is one of only 15 states that prohibit wine sales anywhere but in liquor stores and is desperately short of wine outlets in comparison with other regions. California, with just twice the population of the Empire State, has 10 times the number of retail outlets. Proponents also argue that adding more venues would foster competition and could save consumers as much as $80 million annually.

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