Arizona’s prohibitive restrictions on direct shipping by wineries will be lifted as of Jan. 1, 2017. Gov. Doug Ducey signed Arizona Senate Bill 1381 yesterday, permitting residents to have up to 6 cases of wine a year shipped to their home from any winery that obtains a permit from the state. Forty-two states now permit out-of-state winery direct shipping.
"Arizona is ranked 14th in wine consumption nationally, making this a big win for Arizona wine consumers," said the Wine Institute, a California winery trade group and advocate for the bill, in a statement.
Republican State Sen. Nancy Barto introduced the bill on Feb. 1, and a dozen senators and state representatives from both sides of the aisle signed on as primary sponsors. Crafted with guidance from Free the Grapes, an advocacy group that aims to remove winery and retailer shipping restrictions, and supported by the Arizona Wine Growers Association, the bill passed the Arizona House by a vote of 54 to 3 and the Senate by a margin of 28 to 1. In 2018, consumers will be permitted 9 cases annually; in 2019 and beyond, that number will rise to 12.
Arizona currently operates under two systems of winery direct shipping, which effectively impose severe restrictions on which wineries may ship wine to state residents. An on-site restriction has been in place since 2003, requiring consumers to visit a winery in person before placing an order, and a 20,000-gallon volume cap was established in 2006, prohibiting any winery that produces more than 20,000 gallons of wine a year from shipping wine to Arizona residents.
Volume caps have been a popular loophole for bypassing the Supreme Court’s 2005 Granholm decision barring states from discriminating between in- and out-of-state wineries: By setting its cap at just above the volume of the state’s largest winery, the state was permitting local wineries to ship to consumers while prohibiting direct shipment of virtually all of the wine made in California, Oregon and Washington.
A federal judge ruled in 2008 that Massachusetts’ volume cap was unconstitutional, but Kentucky, New Jersey and Ohio continue to operate under volume cap restrictions of varying sizes.
Lawmakers in Oklahoma are presently considering favorable direct shipping legislation. House Bill 2756 now awaits action by the state Senate after passing the House on March 7.