Changes to Boost New York’s Wine, Beer Industries

Written by Jessica Bakeman for pressconnects.com

ALBANY — Gov. Andrew Cuomo announced a number of changes Wednesday to help bolster the craft alcoholic beverage industry, saying the state will boost its advertising fund to as much as $3 million and remove some regulations.

“I think your industry has tremendous potential,” Cuomo said at the end of the Wine, Beer and Spirits Summit held near the Capitol. “First of all, the numbers in your industry are astronomical. The growth has just been staggering.”

At the Yogurt Summit in August, Cuomo announced that the state would relax environmental regulations on dairy farms. He made similar announcements Wednesday at the wine summit.

Cuomo said the Empire State Development Corp. would put $1 million toward advertising for the beverage industry, plus another $2 million if the industry can match it. The state had spent $700,000 for all staff and marketing efforts for the industry.

A regulation would be changed to allow one winery or brewery to develop multiple products under one state license. Currently, they need several licenses. A related change would allow the production of two types of beverages, such as beer and whiskey, under the same roof, as now separate facilities are required.

Another change would allow companies at tastings to sell their products to consumers at the events. A $1,000-a-year permitting fee for tastings will be lowered to $125, Cuomo said.

Industry leaders hailed the changes.

“They’re listening to businesses in the state of New York and really want to help us grow,” said Richard Lozyniak, chief executive officer of North American Breweries, which owns Genesee Brewing Company in Rochester. “The way they reacted was so positive. I think everyone in the room was sort of shocked with how proactive they were.”

During the morning session of the summit, industry professionals sounded off about licensing costs and regulations, legislative red tape and archaic alcohol laws that keep them from growing their businesses. After lunch, Cuomo announced some changes.

We were very happy to see that during his lunchtime, the governor went and worked and came back with quick and decisive action to help us out,” said Ralph Erenzo, a partner at Tuthilltown Spirits, in Gardiner, Ulster County.

Owners of wineries suggested taking the Legislature out of the process of coordinating wine trails for tourism. Brewers advocated establishing centralized grain depots and mobile bottling plants. Distillers and cider makers requested more representation in the state’s tourism campaigns to heighten awareness of their products.

“The summit approach was a little new, a little different, but there is something about getting people together and putting them at a table and challenging them to come up with new ideas and new partnerships and new synergies,” Cuomo said after the event. “It worked with yogurt, and I think it has worked extraordinarily well with this industry.”

Cuomo hosted a tasting and reception at the governor’s mansion later Wednesday for the panelists and summit guests.

Tom Crowell, owner of Chatham Brewing, in Columbia County, said the concerns that he shares with fellow brewers seem “like trivial matters from an industry perspective but make a big difference in the ability for us, as small businesses, to work in New York state.”

John Urlaub, owner of Rohrbach Brewing Company, in Rochester, said the lowered licensing fee for offering beer tastings and the ability to sell products directly to consumers at street fairs and other events are changes he had sought for years.

“And in one day, the governor listened to us and took action. I was amazed,” he said.

Panelists asked the state to help in raising awareness for their products. Responding to their concerns, Cuomo said the state would work to offer and promote New York beverages at the state fair and at racetracks.

Elizabeth Stamp, partner at Lakewood Vineyards, in Watkins Glen, said showcasing the products at official functions enhances citizens’ pride in their state.

“Looking at other states that have done this, their industry has such ownership from the people within the state, and they’re so proud of it,” Stamp said. “It makes a huge difference in their production levels and the success of their businesses.”

Cuomo said the state’s effort to attract tourists to New York’s wineries and other beverage production sites have been lacking.

“In terms of signage and marketing, that’s something we have to work on,” he said. “Tourism efforts in this state really do need serious reform, in my opinion. They’re counterproductive. They haven’t been organized. We haven’t made it a good-faith effort, and it’s a tremendous economic engine with great potential, especially for upstate New York.”

Although attendees were pleased with Cuomo’s immediate action, not all of their requests were satisfied. Some of their concerns could not be addressed in one day. Some wineries have pushed to allow wine to be sold in grocery stores, something Cuomo has opposed.

“A lot of changes in alcohol law are statutory changes,” said Erenzo, of Tuthilltown Spirits. “They take a long time to go into effect.”

Lozyniak, of Genesee Brewery, said the state didn’t confront how the proposed 45 percent state Thruway toll hike on trucks would affect the industry.

“For us, it would be a million-dollar expense if it was fully implemented, annually,” Richard said. “And that’s just outbound freight; our suppliers shipping into us — and they’re New York state-based companies — would have the same issue, too.”

New York has gained critical acclaim for its wineries, particularly in the Finger Lakes, the Hudson Valley and Long Island. New York ranks third in the nation behind California and Washington state in grape production.

Craft breweries and liquor distilleries also have increased production in recent years.

According to the governor’s office, there are a total of 321 wineries, six breweries and 75 micro-breweries statewide, as well as 58 liquor distilleries and 23 cider producers.