Texas wineries and distilleries are facing a crisis. As Texas continues to navigate the COVID-19 pandemic, tasting rooms at hundreds of wineries and distilleries remain closed. This limits consumer access, negatively affects sales, impacts jobs and reduces tax revenue for local and state governments.
Gov. Greg Abbott’s Executive Order closing bars had the consequence of forcing Texas winery and distillery tasting rooms to close.
Industry leaders recently announced the launch of separate grassroots efforts to educate, advocate and mobilize Texans in support of these drivers of the state’s economy and small business community.
Uniting For Common-Sense Regulation
The Texas Winery PAC and the Texas Craft Spirits PAC are working to share their vision of a Texas. They are working for laws that promote, rather than inhibit the growth and prosperity, of the industries.
“Tasting rooms are a significant source of income and marketing opportunities for Texas wineries and many wineries will not be able to survive a prolonged shutdown,” said Patrick Whitehead, president of the Texas Wine and Grape Growers Association. “The wine industry in Texas has a direct and indirect economic impact of close to $15 billion to the state of Texas every year, including over $1 billion paid in state and local taxes.”
“Not only are wineries suffering, but the farmers who grow grapes and everyone else in the supply chain are suffering,” said Roxanne Myers, president of Lost Oak Winery in Burleson. “The shutdown is adversely affecting families across the state of Texas.”
The Texas Craft Spirits PAC, in partnership with the Texas Whiskey Association, the American Craft Spirits Association, and the Texas Distilled Spirits Association recently launched their campaign to raise money to advocate for common-sense regulations that will give Texas distillers the contactless, direct-to-consumer sales options they need to stay in business.
“While I greatly appreciate the Governor’s efforts to keep people safe during this COVID crisis, there is no reason we cannot operate safely under the same capacity rules that apply to restaurants,” said Dee Kelleher, co-owner of Dripping Springs Distilling and chair of the Texas Craft Spirits PAC. “Absent that, without new sales options, many distillers will go out of business.”
Wineries and distilleries generally operate only during the day with most having outdoor serving areas. This allows for appropriate physical distancing. Most guests are visiting to learn about products and production and to purchase Texas crafted wine and spirits.
Working to Open Sales Channels
Despite an increase in overall alcohol sales, most of those gains are by large brands outside of Texas. Many Texas wineries and distilleries work directly with customers through an onsite experience. As a result, they are suffering significant losses.
The significant drop in revenue among Texas distilleries is estimated at 60-80 percent since COVID-19 began. A reason for this is the prevention by law of selling more than two bottles per consumer every 30 days.
The current law also forces in-person only sales by distilleries. It prohibits contactless shipping and delivery to consumers over the age of 21. This practice is already safely in place in other parts of the Texas alcoholic beverage industry.
Opening these sales channels to Texas distillers — as has been done recently in other states, most notably Kentucky, New York, Illinois, and California — will give Texas distilleries a fighting chance to maintain their businesses while providing much-needed products, such as hand sanitizer, during this pandemic.