BILL ANALYSIS �
AB 2488
Page 1
Date of Hearing: April 9, 2014
ASSEMBLY COMMITTEE ON GOVERNMENTAL ORGANIZATION
Isadore Hall, Chair
AB 2488 (Levine) - As Amended: February 21, 2014
SUBJECT : Alcoholic beverages: licenses: suspension and
revocation.
SUMMARY : Authorizes the operator of the certified farmers'
market to allow a licensed winegrower to conduct an
instructional tastings on the subject of wine, subject to
specified conditions. Only "one licensed winegrower" may
conduct an instructional tasting during the operational hours of
the certified farmers' market event. Specifically, this bill :
1) Provides that a licensed winegrower, a member of the
licensee's family, or an employee of the licensee may conduct an
instructional wine tasting for consumers at a certified farmers'
market, subject to the authorization and managerial control of
the operator of the certified farmers' market.
2) Specifies that at all times during an instructional tasting
event, the instructional tasting event area shall be separated
from the remainder of the market by a wall, rope, cable, cord,
chain, fence, or other permanent or temporary barrier. Only one
licensee may conduct an instructional tasting event during the
operational hours of any one certified farmers' market.
3) Provides that the licensee shall not permit any consumer to
leave the instructional tasting area with an open container of
wine.
4) States that the licensee shall not pour more than three
ounces of wine per person per day.
5) States that no premium, gift, free goods, or other thing of
value shall be given away by an authorized licensee or its
designated representative in connection with an instructional
tasting event conducted pursuant to this section that includes
tastings of wine, as specified.
EXISTING LAW :
1) Establishes the Department of Alcoholic Beverage Control
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(ABC) and grants it the exclusive authority to administer the
provisions of the ABC Act in accordance with laws enacted by the
Legislature. This involves licensing individuals and businesses
associated with the manufacture, importation and
sale of alcoholic beverages in this state and the collection of
license fees or occupation taxes for this purpose.
2) Existing law, known as the "tied-house" law, separates the
alcoholic beverage industry into three component parts, or
tiers, of manufacturer (including breweries, wineries and
distilleries), wholesaler, and retailer (both on-sale and
off-sale).
3) Allows ABC to issue a certified farmers' market sales permit
that authorizes a licensee under a winegrower's license, a
member of the licensee's family, or an employee of the licensee
to sell wine produced and bottled by the winegrower at certified
farmers' market locations, under specified conditions. Requires
ABC to notify local enforcement agencies of the permits.
4) Authorizes a winegrower license to sell bottled wine
produced by the winegrower for consumption off the premises
where sold and only at fairs, festivals or cultural events
sponsored by designated tax exempt organizations. The licensee
must notify the city and/or county where the event is being held
and obtain approval from ABC for each event.
5) Authorizes licensed winegrowers to sell wine directly to any
person holding a license authorizing the sale of wine or brandy,
and to consumers for consumption off the premises of the winery.
6) Permits a winegrower or distilled spirits manufacturer, or
its authorized agent, to instruct consumers at an "on-sale"
retail licensed premises authorized to sell its product on the
subject of wine or distilled spirits under the following
conditions: (a) The instruction of consumers may include the
furnishing of not more than three tastings to any individual in
one day; (b) A single tasting of distilled spirits may not
exceed one-fourth of one ounce and a single tasting of wine may
not exceed one ounce; and, (c) An instruction may include the
history, nature, values and characteristics of the product being
offered, and the methods of presenting and serving the product.
FISCAL EFFECT : Unknown.
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COMMENTS :
Purpose of the bill : According to the author, current law
permits a winegrower who grows 100% of the grapes at their
winery to sell the wine to adult consumers who attend a
certified farmers' market, as defined. Certified Farmers'
Markets (CFMs) are governed by California Law, under the
California Department of Food and Agriculture (CDFA). These
rules are enforced by County Agriculture Commissioners in the
counties in which the market operates. The markets also fall
under the jurisdiction of the health departments in each county
in which a market operates.
Under the ABC Act, a winegrower can be issued a "Certified
Farmers' Market Sales Permit" (Type 79 license) which allows
them to sell no more than 5,000 gallons annually. Business and
Professions Code Section �23103 defines a "winegrower" as any
individual producing "grapes, berries, or other fruit into
wine." According to the California Farm Bureau Federation, more
than 800 certified farmers' markets are held in California each
year but only 17 Type 79 licenses were issued by ABC in 2013.
According to the Wine Institute, there are so few wineries
selling wine at certified farmers' markets, in part, because
consumers are accustomed to sampling wine before purchasing a
$15-$25 bottle. Currently, there are 9 states that have adopted
laws approving wine tasting events at certified farmers'
markets.
The author states, this bill would replicate these other states'
laws by permitting a Type 79 license holder to offer samples of
wine to interested shoppers at the markets. AB 2488 would
additionally extend this privilege to cider makers and other
fruit winemakers. The bill mandates safeguards that licensed
winegrowers and cider makers must adhere to while offering
tastings of their product at CFMs. They include: 1) with the
consent of the market manager, one winery or cider maker alone
would be permitted to conduct a tasting at a CFM on any given
day; 2) the tasting event must be corded off from the main
market area; and 3) the winegrower would be limited to pour no
more than 3 ounces of wine or cider per adult consumer.
The author further notes, this bill will grant an important
market access opportunity for small wineries to build their
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brands and be a competitive force in the marketplace. In
addition, consumers will benefit from the direct interaction
with growers and vintners.
In support : According to the sponsor of this bill, the Family
Winemakers of California, "Traditionally wine, like many
products, is sold through sampling. Consumers want to
understand the wine, decide if they like it and decide if it's a
good value. A taste beats the sales pitch every time. AB 2488
provides for tastings at certified farmers' markets under
specific circumstances that limit tasting to one winery on any
one day, and limits the number of tastes to no more than three
total ounces. The decision on whether to allow tasting falls to
the certified farmers' market operator since they know whether
this activity is a good fit for the specific market."
Related legislation : AB 1424 (Assembly Governmental
Organization Committee), 2013-2014 Legislative Session. Permits
winegrowers and beer manufacturers to describe the composition
of their products, in addition to other characteristics already
permitted, when engaging in tastings or instructional events for
their licensees or employees. (Senate Inactive File)
Prior legislation : AB 636 (Hall), Chapter 329, Statutes of
2013. Permits, under specified conditions and until January 1,
2016, the appearance of a person for the purpose of providing
autographs at an instructional event for consumers that a
winegrower, California winegrower's agent, importer, or other
specified parties conduct, or participate in, that is held at a
retailer's premises featuring wines produced by or for the
winegrower or, imported by the wine importer.
AB 933 (Skinner and Hall), Chapter 366, Statutes of 2013.
Grants licensed distilled spirits manufacturers and licensed
brandy manufacturers the privilege to conduct consumer tastings
on their licensed premises and to charge for those tastings,
as defined.
AB 605 (Portantino) Chapter 230, Statutes of 2010. Authorizes
ABC to issue to the holder of an "off-sale" retail license an
"instructional tasting license" for the purpose of furnishing
tastings of alcoholic beverages to consumers, subject to certain
limitations.
AB 2293 (De Leon) Chapter 638, Statutes of 2008. Permits
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distilled spirits manufacturers and winegrowers to provide their
product offerings directly to consumers (free of charge) during
invitation-only events on premises for which a caterer's permit
authorization has been issued.
SB 1548 (Murray) Chapter 670, Statutes of 2006. Authorized beer
manufacturers and wholesalers to offer beer samples (not to
exceed 8 ounces per person, per day) to individuals of legal
drinking age at on-sale retail licensed premises under specified
conditions.
AB 2285 (V. Brown) Chapter 248, Statutes of 1998. Allowed
on-sale retail licensees to offer limited tastings of wine or
distilled spirits at the licensed establishment.
AB2520 (Thomson), Chapter 384, Statutes of 2000. Authorized
licensed winegrowers to obtain certified farmers' market sales
permits authorizing the sale of wine at farmers' markets, as
specified.
REGISTERED SUPPORT / OPPOSITION :
Support
California Association of Winegrape Growers
California Farm Bureau Federation
Family Winemakers of California
Wine Institute
Opposition
None on file
Analysis Prepared by : Eric Johnson / G. O. / (916) 319-2531