01 July 2011

So CAN We Have Beer Shipped To Maryland Buyers, Or Not?

The partial trade-off for the 50% sales tax spike on alcoholic beverages was supposed to be the granting of permission for wineries to ship their products directly to Maryland addresses.

Was it worth it?  And what about beer--can we finally order some Lost Abbey Angel's Share, Russian River Pliny the Elder, or New Glarus Belgian Red?  Or a "Beer-Case-of-the-Month" club?

The first hurdle is the law itself.  I have asked many, many officials in the Maryland government if the wine shipment legislation could apply to, say, a "beer-of-the-month" club.  The few answers I got were collective shrugs of the shoulders.  No one I have contacted has been willing to say "yes" or "no" outright.

So I've gone over the same bureaucratic paperwork that a potential seller would go through in researching the issue online.  The application for a wine shipper's permit refers you to Administrative Release AB-42, which so far is buried away in an obscure corner of the state's website along with all the other Alcoholic Beverages Administrative Releases (which themselves make fascinating reading if you're interested in the ridiculously obscure, utterly arcane, and detailed fine-print bureaucracy that government control of a "sin" product entails).

So what does AB-42 tell us with regards to whether you can ship beer or not?  Read it for yourself (PDF document).  Or I can spare you the trouble:  It says nothing.  It says only "wine," but bizarrely includes the following (emphasis added):
Under the new Direct Wine Shipper’s Permit, an in-state and out-of-state wine manufacturer may ship wine, including pomace brandy, directly to a Maryland consumer through a common carrier, such as Federal Express or UPS.
Pardon me, but where the hell did THAT come from?  Did some legislator have a personal interest in that matter in Greektown or Little Italy?  (Never heard of it?  Me, neither.  Look it up.)

However, playing "devil's advocate," let's look further:
A Direct Wine Shipper Permit may be issued to a:
(1) Holder of a Maryland Class 3 manufacturer’s license or a Class 4 manufacturer’s license; or
(2) Person licensed outside of Maryland to engage in the manufacture of wine.
Okay, you need a winery license, right?  But:
A Direct Wine Shipper’s Permit Application:
(1) Must be filed with the Comptroller of Maryland with payment of a $200 permit fee.
(2) Must have attached a copy of the current alcoholic beverages license issued by the state in which the wine manufacturer is located.
Emphasis added, again.  Note that it doesn't say "winery" license, only "alcoholic beverages license."  Heck, you could, in theory, just be a liquor store or bar, except for that "manufacture" word above.  So could brewpubs ship growlers?

But now let's look at the actual Direct Wine Shipper's Permit Application itself, which basically repeats a lot of the information from the AB-42, and there we find the biggest surprise we can imagine on page 3 (again, emphasis added):
6. “Wine” means any fermented beverage, including light
wines, and wines the alcohol content of which has
been fortified by the addition of alcohol, spirits, or other
There's a loophole big enough to run a UPS truck full of beer through!   (The tequila, bourbon and single-malt whisky fanatics, however, are obviously out of luck, unless they really want to push their luck.  Other laws distinguish between distilled and fermented drinks, with different tax rates.)

At this stage in the game, a potential brewery that wants to initiate direct sales comes into the classic argument that bedevils every last alcohol law in existence, and in theory most of the laws passed by American government since 1787:: If the state or commonwealth or Federal government has not specifically prohibited or regulated the specific act you intend to carry out, are you thus permitted to do so?  Or must we all assume that all economic activity must seek the blessings, sanction, and regulation of the government?

But this is even better!  In theory, if a brewery wants to set a precedent in order to tweak laws nationally or regionally (or, more likely, attempt to garner boatloads of free publicity with potential controversy, press releases, and court cases if they're prosecuted), all they would have to do is go ahead and fill out those forms and pay those fees and start shipping cases of beer (Dogfish Head 750's, anyone?) to Maryland addressees.

All of this is pretty much a Gedanken exercise, anyway.  As reported by the Baltimore Sun, only 30 wineries so far--ten in Maryland and twenty out-of-state, with only one in an adjacent state--have taken the trouble to apply and pay for the permit, at a time when Maryland alone boasts fifty or so wineries.  That number is expected to jump as the process clarifies, of course.  The biggest potential beneficiary of this legislation are "wine of the month" clubs, but I've yet to find one whose website doesn't still say something to the effect of "Sorry, but wine cannot be shipped to Maryland" (including the Virginia Wine of the Month Club).  Very, very few breweries make a product with a sale price and profit worth the extraordinary trouble of such a sales permit process, and those that do typically have retail representation in the state already or are already struggling to keep up with demand as it is.  (Would DuClaw, for example, ship bottles of Colossus?)  And unless you're in the remotest corners of the state--Oakland, Chaptico, Scotland, Crisfield, or the like--going to one of the many, many good retailers is probably still easier than having stuff sent UPS or FedEx, as well as being just generally more fun (even with that damned sales tax hike).

So, could we yet see "Beer of the Month" clubs in Maryland, or better yet, a retailer offering to ship 24 different bottles of holiday ales come Christmas-time?  Stay tuned.

(Please note: This rabble-rousing libertarian is NOT an attorney, and the above should not, in any way, be construed as legal advice.  The bag is not a toy.  Close cover before striking.  Typed in a facility that houses soy, wheat, dairy, and peanut products.)

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