Here’s what happened. The new wine direct shipping law in Massachusetts that lets consumers have wines shipped to them from out-of-state was put into the Fiscal Year 2015 budget, which passed. Wine and cider shipping will commence in early 2015.
However, somehow the budget bill that also held the direct shipping bill had a provision snuck in that revoked the right of Massachusetts cideries to self-distribute (go around the wholesaler and sell direct to retailers and restaurants). This was a privilege that the state’s cideries had possessed for a number of years.
According to the Sun Chronicle: “State Rep. Paul Heroux, D-Attleboro, said someone slipped the provision into the budget without most legislators knowing about it. No one seems to be taking credit for it, he said….There is a suspicion that there is a special interest at work, but rank and file lawmakers are not being told who, he said. The whole way the provision was slipped into the budget has been a mystery, he said.”
Let’s ask, who benefits from this bit of legislative chicanery. If a cidery may no longer sell directly to retailers and restaurants, what must they do? Well, they would be required to sell their wines to…..wait for it….a wholesaler, who would then sell to the retailers and restaurants. Being forced to sell to a wholesaler rather than directly to the restaurant or retailer would reduce the margins of cideries by 30%….at least.
But…“No one seems to be taking credit for it, he said….There is a suspicion that there is a special interest at work.”
Who could the special interests have been that worked to screw Massachusetts cideries?
The issue of self distribution was never debated in 2014 in Massachusetts. Whether cideries should be allowed to continued to sell direct to retailers was never at issue. Yet somehow some one or more special interests were able to convince some member of the Massachusetts legislature to slip in this devastating provision under cover of darkness. That’s despicable.
In the end, the problem was fixed as Massachusetts legislators worked in an informal session on December 31st to fix the problem. After some wrangling over language, a bill (H.4571) was sent to the Governor for signing. Cideries will remain able to sell direct to retailers and restaurants in 2015.
However, the fact that this kind of underhanded action could have ever taken place with the consent of a member of the Massachusetts Legislature is exactly what makes people skeptical of government and the kind of thing that makes people despise the wholesale tier.
Massachusetts is a historic cider producing region in the United States and home today for at least 17 cider producers including West County Cider, Homestead Cider, Bantam Cider and Carr’s Cider House.
Kyle Schmitt, owner of Homestead Cider, a new cidermaker in the state, has worked hard to draw the public’s and lawmaker’s attention to the trick that was almost turned on him and his cidermaking peers. In a story published in The Sun Chronicle, Schmidt is quoted as asking, “Who in the House Ways and Means Committee actually snuck this into the FY15 budget, a shady practice from everyone I’ve talked to. Who in the Statehouse authorized this section in the budget? Why did they seek to place this restriction on us?”
These are very good questions that Schmitt says he does not have the answers to. In an interview with The Cider Journal Schmitt indicated he is simply happy to be able to continue to self-distribute his cider, a method of distribution that he says is critical for the success of his business. Schmitt and his partners opened Homestead Cider in January 2014 and began selling directly to just three retailers. That circle has widened over the course of 2014 to include more than 30 retailers and restaurants. With this issue dealt with, Kyle is confident that in 2015 Homestead Cider will continue to expand.