TFWA Board Opposes Tennessee Legislation HB 742/SB 705 on Wine Direct Shipment

We, the Board of Directors of the Tennessee Farm Winegrowers Alliance are deeply concerned about the negative impact House Bill 742 / Senate Bill 705 will have on the industry.

The bill, as drafted, will negatively affect the viability of wineries, vineyards, and farm wineries across Tennessee by limiting their ability to sell wine.

This bill provides that wineries may only ship wine produced by the shipping winery.  Our wineries utilize wine from other wineries to supplement their production and to blend their product.  Not being able to ship that product that is sold at the winery would hamstring their ability to market their wine in this and other states.

For instance, this past season vineyard harvests were down 80%, and to survive Tennessee wineries bought juice and wine from out of state to boost their inventories.  In this instance, this bill would preclude wineries from shipping in or out of state because wineries could not meet the bill’s requirements. 

Furthermore, many of our Farm Wineries do not actually produce the wine themselves.  Instead, the vineyards or the farms outsource the production to a local Tennessee winery who does the processing and returns the finished product to them to sell.  This is hugely beneficial to the farmer as this has become one of the highest value-added agricultural commodities in the State.

This legislation would also stop wineries from using companies, including other wineries, that provide compliance assistance with different tax law provisions and regulations in forty states. It would prevent wineries from utilizing the services of companies that have direct shipping licenses in these other states.  Passage of this bill would disrupt current business practices for some of the State’s smallest businesses and ones hardest hit by the pandemic.  Because of the steep decline of tourism and the resultant effect on sales, the wineries have relied even more heavily on shipping their product to customers in Tennessee and in other states.

To be clear, there was no move attempted to include the Tennessee Wineries in this latest legislative effort and as producers and shippers, the Alliance feels it unfair to be denied a seat at the table in this discussion.  Furthermore, the legislation decimates a fledgling industry in our State and one in which the Tennessee Department of Agriculture has shown great interest and support by helping establish the recently formed Governor’s Wine and Grape Board. 

Tennessee producers and farmers deserve to be able to compete fairly to sell their products and not be further restricted by false barriers designed to cripple the industry to the benefit of a select few.

No mention has been made of the consumer in this letter, but our consumers are loyal followers of our wines. If shipping were curtailed in the manner put forth by this bill consumers will feel as if the government has limited their own personal choices as well as increased the price and availability of their favorite products.

On behalf of Tennessee wineries all across the three Grand Divisions of the State and the consumers of Tennessee agricultural products, we ask that our Representatives withdraw this legislation.

Tennessee Farm Winegrowers Alliance Board of Directors

Rhonda Moody, President – Highland Manor Winery, Jamestown, TN 

Cary Cox, Vice President – Tasli Notch Vineyards, Madisonville, TN

Jonathan Ball, Treasurer – Rocky Top Wine Trail, Pigeon Forge, TN

David Powell, Middle TN Rep. – Trazo Meadery, Clarksville, TN

Bart Horton, West TN Rep. – Century Farms Winery, Jackson, TN

Chuck Compton, East TN Rep. – Chapman Hill Winery, LaFollette, TN