Governor Cuomo Hosts Third Wine, Beer, Spirits and Cider Summit

Governor Announces More Than $16 Million Investment and Support to Grow New York’s Craft Beverage Industry

AUDIO PHOTOS

Lieutenant Governor Kathy Hochul said: “Having traveled to numerous wineries, breweries, and cideries since taking office, I have a strong appreciation for the role they play in New York’s economic recovery. Everywhere I go, members of the farm beverage industry are excited about the explosive growth in these new markets. Universally they are so grateful for the Governor's commitment to improving the business climate for the entrepreneurs and farmers who support this industry.”

Governor Cuomo kicked off today’s Summit by hearing from State officials, research and agriculture experts, and beverage industry leaders on how the State can continue to help the craft beverage industry expand and diversify. More information on the 2015 Wine, Beer, Spirits and Cider Summit is available here.

Senate Majority Leader John Flanagan said: “The third New York State Wine, Beer, Spirits and Cider Summit was a success, and I commend Governor Cuomo for again convening a forum to discuss the future of the craft beverage industry. New York State has made tremendous investments in this industry over the past few years and this support is helping small businesses thrive, create jobs, generate new economic growth, and drive tourism into New York.”

Assembly Speaker Carl Heastie said: “I am happy that we are investing in New York’s booming beverage industry. During my recent Upstate tour, I visited several agricultural sites which contribute to the production of craft beverages. These local farms are important to our state’s economy and deserve this much needed support and attention, and I thank Governor Cuomo for his continued focus on this expanding industry.”

Since Governor Cuomo took office in 2011, State actions that support manufacturers and producers have contributed to a 67 percent increase in the number of winery licenses; 436 percent increase in the number of new brewery licenses; 200 percent increase in the number of micro-distillers, micro-rectifiers and fruit brandy licenses; and 600 percent increase in the number of cidery licenses. Governor Cuomo hosted the first Wine, Beer, Spirits and Cider Summit in 2012.

Today the Governor announced a variety of innovative directives and actions designed to support growth of the craft beverage industry. These announcements are outlined below.

Investing in Marketing and Promotion

An investment of $5 million will be made to renew the marketing and promotional commitment first launched in 2014. The State will commit $2 million in direct spending to support the industry’s growth via $1 million in tourism promotion and a $1 million targeted advertising campaign.

Additionally, Empire State Development will launch a $3 million grant program that matches 20 percent of the industry’s contributions for the marketing and promotion of wine, beer, spirits and cider produced in New York State. Entities deemed eligible for this grant funding will include private entities serving as grant recipients in partnership with not-for-profit organizations, new this year, or not-for-profit organizations whose primary purpose and mission is the promotion and marketing of New York State produced wine, beer, spirits and cider.

Finally, $400,000 will be committed from the above totals to the Global Marketing Initiative for Long Island Wines and expanded shuttle service to support growing wine-related tourism in the region.

Boosting Industry Growth and Employment

Governor Cuomo today announced the creation of a working group of industry leaders, led by State Liquor Authority Chairman Vincent Bradley. The group will consider revisions to the current alcoholic beverage control laws of New York State. State Liquor Authority Chairman Bradley and industry leaders will look for possible reorganization or replacement of the current alcohol beverage control law, including, but not limited to:

• Improvements to licensing provisions
• Clarification of types of licenses available
• A reduction in mandatory paperwork
• Elimination of restrictions imposed on manufacturers

The Governor’s Global NY Development Fund will also reserve $5 million for zero percent interest loans of up to $50,000 to help the wine and beer industry develop export capacity. This includes developing export marketing plans, website translation, product adaptation and market certification. The Fund was created by the Governor earlier this year to help small- and medium-sized businesses based in New York tap into global markets, grow their exports and create jobs in the state.

Finally, the State will expand the beer production credit to include other types of alcohol, starting with the tax year that begins on January 1, 2016. This will be done using existing credit benefit amounts of 14 cents/gallon for the first 500,000 gallons and 4.5 cents/gallon thereafter. Limits on the volume of product eligible for the credit will be 20 million gallons for wine and cider (at a maximum credit of $745,000 per taxpayer) and 800,000 gallons for liquor (at a maximum credit of $83,500 per taxpayer). These thresholds are similar to those employed for the beer production credit, and will ensure that small- and medium-sized businesses and recently established companies benefit.

Cutting Bureaucracy

As a result of hearing some of the challenges faced by craft beverage manufacturers at today’s Summit, the State Liquor Authority will issue the following 10 advisories to clarify laws and regulations that have previously caused confusion within the beverage industry and accelerate additional growth:

• Allow salespeople to work for multiple craft beverage manufacturers. This will provide more distribution avenues for craft producers and enable salespeople looking for employment opportunities to join the growing beverage industry.
• Change its interpretation of the branch offices laws to allow multiple craft manufacturers to have branch offices at the same location. This will allow manufacturers to work together and/or reduce operating expenses.
• Provide guidance on the practice of contract brewing, where a large brewer produces for a small brewer, which will assist both small and large craft beverage manufacturers, allowing small brewers to have small on-site operations until it is financially feasible to invest in more production capacity.
• Permit the sales of off-premise beer in growlers. This will benefit the beer licensees that do home deliveries from a warehouse and grocery stores with large home delivery businesses.
• Update the marketing permit to allow brewers to buy beer used in tasting from retailers. Brewers will be able to conduct more tastings by not having to bring beer with them.
• Allow for a permit to be issued to entities holding craft beverage tasting events to eliminate confusion over whether attendees are charges admission.
• Clarify to licensed retailers the raffles and games allowed at their locations when conducted by not-for-profits. This will support retailers wishing to help not-for-profits with their fundraising activities.
• Support retailers and law enforcement by upholding the Governor’s announcement for enhanced IDs. The State Liquor Authority will explain which IDs are acceptable, and which IDs are not.
• Assist Club licensees, (not-for-profit organizations serving members only), by providing all operating requirements in one location to build awareness of the ABC Law.
• Issue permits for businesses that operate as home wine-making or home beer-making centers – venues where customers can go and produce their own wine or beer using the business’ equipment and advice.

Agency heads and authorities will review their purchase of wine, beer, spirits and cider and increase the presentation of New York craft beverage products consistent with the State Procurement Law. The Department of Agriculture and Markets will assist agencies and authorities in Taste NY branding.

Expanding Taste NY and Tourism Opportunities

A $25,000 investment by Taste NY will make sponsorship opportunities available for distillers to attend the Star Chefs International Chefs’ Congress, an annual culinary symposium that gathers more than 100 of the world's most innovative chefs, pastry chefs, mixologists, and sommeliers to present the latest techniques and culinary concepts.

In addition, the following tourism opportunities were unveiled during today’s Summit:

• I LOVE NY and Pride of NY logos may be used on brand labels to identify products produced in New York State, allowing craft manufacturers to market locally produced goods.
• Establish Taste NY programming at the Barclay's Center in Brooklyn and develop a program that mirrors the partnership with the Times Union Center and Tri-City Valley Cats.

Strengthening Support through One Stop Shop

In 2013, Governor Cuomo launched a One Stop Shop designed to provide New York’s wine, beer, and spirits producers with a single point of government contact for assistance regarding regulations, licensing, state incentives, and any other questions or issues facing the industry. To date, the One Stop Shop has fielded direct requests from over 600 business owners and entrepreneurs.

As a result of today’s Summit, an internal State Liquor Authority unit will be created to coordinate with the One Stop Shop to respond to all inquiries from craft manufacturers. This will improve the experience of the business owner or entrepreneur, expedite the permit granting process, and provide craft manufacturers with information on licensing, compliance, brand label, and other regulatory needs.

In addition, the State Liquor Authority will conduct semi-annual round table meetings with craft beverage industry members to discuss issues of concern and provide legislative and regulatory updates. The round table meetings will act as a soundboard for industry members to voice challenges and concerns, which will allow the State Liquor Authority to continue to improve industry guidelines for the benefit of all industry stakeholders.

Improving Education and Research

The State Liquor Authority will permit wine schools to provide tastings as part of the course curriculum. This will relieve wine educators of the consequences of allowing tastings and fuel growth of the important research taking place in New York’s educational institutions.

The State will also renovate the NYS Food Venture Center at Geneva. The Center houses the Winery and Enology Lab and the NYS Brewery & Analytics Lab, both of which do extensive consulting, technical service and sampling for the farm based beverage industry. Revitalizing the Food Venture Center means that these farm based beverage labs will have more space and ability to meet ever expanding industry needs in both the growing sectors of farm based beverages and value-added food production. Also, the Center receives more than 3,000 requests for testing and food product commercialization services annually. As the only FDA certified food authority in the Northeast, it is vitally important to food innovators but also food safety for consumers. The State will be adding $3.5 million in addition to the $3.4 million that was committed in the previous budget.

Finally, to support hard cider development, the State will commit $200,000 to establish a research plot at the Agricultural Experiment Station in Geneva to breed and field test varieties of cider apples for size, disease and virus susceptibility and desired consumer traits.

State Agriculture Commissioner Richard A. Ball said: “The craft beverage industry is stronger than ever in New York State thanks to Governor Cuomo’s initiatives that have provided unprecedented support and promotion of our state’s agri-businesses. By working together with our partners in the industry, today we’re able to expand on those efforts and do even more to help our craft beverage producers create and market their innovative products, growing jobs and New York’s agricultural economy.”

Empire State Development President, CEO and Commissioner Howard Zemsky said: “Under Governor Cuomo’s leadership and through the collaboration of State agencies, we continue to make strong commitments to New York’s craft beverage industry. Today’s Summit reinforced New York's position as a leader of craft beverage production by highlighting investments that continue to pay off in big ways. With over 800 beer, wine, spirits, and cider establishments, a growing workforce, and a $27 billion economic impact, we are truly feeling the effects of New York’s booming craft beverage industry.”

State Liquor Authority Chairman Vincent Bradley said: “From the outset, Governor Cuomo recognized the growth potential for New York’s beverage manufacturers. Over the past five years, overhaul of legislative and regulatory policies coupled with substantial improvements to the state’s business climate have stimulated record growth in craft producers in addition to encouraging large manufacturers to open and expand in New York. Today, we heard firsthand the concerns and ideas from industry leaders on how we can further assist, tomorrow we get to work putting these ideas into action.”

For more information about New York’s growing beer, wine, spirits and cider industries, please visit www.taste.ny.gov.