ARIZONA STATE SENATE

RESEARCH STAFF

 

GARTH KAMP

LEGISLATIVE  INTERN

SUSAN ANABLE

RESEARCH STAFF DIRECTOR

NATURAL RESOURCES, AGRICULTURE & ENVIRONMENT COMMITTEE

Telephone: (602) 542-3171

Facsimile: (602) 542-7833

 

 

TO:                  MEMBERS OF THE SENATE

                        NATURAL RESOURCES, AGRICULTURE &

                        ENVIRONMENT COMMITTEE                  

DATE:             March 19, 2001

 

SUBJECT:       Bundgaard Strike Everything Amendment to H.B. 2012, dated 3/15/01, 4:33 p.m.

 

                                                                                                                                                           

           

 

Purpose

 

            Allows domestic farm wineries to sell wines produced from other Arizona wineries in addition to their own wines.

 

Background

 

            According to the Department of Agriculture, there are currently 12 domestic farm wineries in Arizona spread throughout Cochise, Graham, Maricopa, Pima and Yavapai counties.  A domestic farm winery is defined as a winery that yields between 200 gallons and 75,000 gallons of wine annually.  To be classified as a domestic farm winery, 75 percent of the grapes used in the production of the wine must have been grown in this state. 

 

            In order to operate a domestic farm winery, a person must apply for a license from the Department of Liquor Licenses and Control.  Currently, this license allows a domestic farm winery to produce and to sell wine only from that winery for consumption on or off the premises.  Wine is defined as a product obtained by fermentation of grapes or other agricultural products that contains less than 24 percent of alcohol by volume.  Port, champagne and sherry are included in this definition (A.R.S. 4-101).

 

            Arizona maintains a three-tiered system for those who produce and sell alcoholic beverages.  The three tiers are made up of producers, wholesalers and retailers.  A person may not hold more than one type of license.  There is an exception to this rule, however, for domestic farm wineries and domestic microbreweries.  Both of those entities are allowed to produce, wholesale and retail their own wine or beer.  Furthermore, under current law, a domestic microbrewery is allowed to sell other spirituous liquors, in addition to the beer it produces if it obtains an on-sale retail license.  Spirituous liquor is defined as any beverage that contains more than one-half of one percent of alcohol by volume.  Hard alcohol, beer and wine are included in this definition (A.R.S. 4-101).

 

            The strike everything amendment to H.B. 2012 proposes to extend a somewhat similar authority to domestic farm wineries to allow them to sell wines produced by other Arizona wineries.

 

There is no anticipated fiscal impact to the state general fund associated with this amendment.

 

Provisions

 

1.      Permits a domestic farm winery that conducts retail operations to sell wines produced by other domestic farm wineries in addition to wine produced on site if the retail sale of the wine is conducted from the same location as the winery.

 

2.      Makes technical and conforming changes.

 

3.      Provides for a general effective date.

 

House Action

 

NRA                2/7/01              DPA   7-1-0-2-0

3rd Read           2/19/01                        54-4-2-0

 

GK/SA/jas