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- 2013 - April - 1st -

Self-distribution for wineries drained from House plans

by Jim Turner, The News Service of Florida

Gov. Rick Scott's spring training funding proposal remains in play in the House, as is a back-to-school sales tax holiday. 

But an effort to expand the number of Florida-based wineries that also could directly sell their products may need to be watered down a bit before it's ready to be served up to state lawmakers this session.

Lobbyists for alcohol distributors and small-farm wineries this week fought against allowing all wineries, regardless of size, that use Florida grown produce for their beverages to avoid the middle part of the state's sales chain. 

House Finance and Tax Subcommittee Chairman Ritch Workman (R-Melbourne) has agreed to withdraw that portion of a wide-ranging economic development package he is compiling.

"That doesn't mean the issue is dead, I like the issue, but it needs to be further explored," Workman said.  "I don't want to kill the whole economic development issue, or slow it down, but when you look at the rest of the bill, that (wineries) had all the conversation."

Currently, Florida law allows only certified Florida farm wineries, which are open for tours and tastings, and produce or annually sell less than 250,000 gallons of wine, to make and sell their own wine.

The measure Workman pulled back from the proposed economic development bill would have opened the distribution field to all manufacturers of Florida wines and wine products, which opponents say could include out-of-state wineries as long as they're using Florida produce.

Distribution industry lobbyists also say the proposal would break the state's three-tiered alcoholic beverage distribution system that maintains a chain for the sale of any product from manufacturers to distributors to retailers.

"It's preferential treatment to companies inside the state. The company I represent is not able to operate in anything other than the middle tier," said Brecht Heuchan, representing Southern Wine & Spirits of America Inc. "At least for our company, it's certainly couldn't be considered economic development."

Another concern is whether out-of-state wineries might claim the proposal would be unfair to them. 

"There is a possibility, a real possibility, that a federal court could look at the issue and say, 'to make it fair for all states nobody could self-distribute,'" said Jason Unger, representing Lakeridge Winery in Clermont and San Sebastian Winery in St. Augustine.

The winery proposal comes as other alcohol-loaded measures have flowed forth in this legislative session. One measure, SB 1344, would make 64-ounce beer growlers legal, while another, HB 347, lets small craft liquor distillers sell up to two bottles directly to customers.

Otherwise, Workman's bill would:

• Maintain the ability for a county or municipality to receive up to $666,660 a year in sales tax incentives to maintain and build Major League Baseball spring training stadiums. New provisions would cap the break at $20 million over 20 years. Communities with two teams could double the incentive. Scott has proposed also setting aside $5 million a year in the state budget to keep teams training in Florida from fleeing to Arizona.

• Increases by $15 million, to $178.8 million, the available tax credits for the New Markets Development Program, which is for those making investments into designated community development entities.  The credit, against corporate income taxes or the insurance premium tax, is available only after the third year of an investment.

• Create a three-day sales tax holiday starting August 2. There would be no sales tax collected on select clothing and footwear that cost $75 or less, school supplies under $15 per item, and personal computers and electronic accessories – tablets, laptops, monitors, input devices and non-recreational software – valued up to $750. Workman had earlier proposed using new collections of sales tax revenue from online purchases through Amazon, eBay or any other large out-of-state Internet-based retailers to help fund the back-to-school sales tax holiday. 

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