When Common Sense and NY State Politics Collide: The Wine Bag Issue

By Evan Dawson, Finger Lakes Correspondent

I do not intend to make a cabernet out of a concord here, but this is ridiculous. And it's a microcosm of the dysfunction that has rotted this state for years.

The owner of one of western New York's largest wine and liquor stores may be fined $10,000 by the New York State Liquor Authority because he had the audacity to sell wine gift bags to his customers who were buying, you know, wine.

Here's the short version: The law is written to enumerate the various things that a wine or liquor store is permitted to sell. Like most stores, Marketview Liquor in Henrietta, NY sells wine, wine glasses, wine stoppers, and corkscrews. That's all just fine. But because the law does not specifically say that such stores can sell wine gift bags, the sale of such decorative bags must be punished. It does not matter if the law inconveniences customers who had hoped to do their holiday wine shopping in one location -- they can go to the grocery store if they want a gift bag.

What's the reason for this? I spoke to several NY state senators today who told me that the law was written long before stores were selling gift bags. Now, according to Senator Joe Robach (R-Rochester), the SLA is getting too aggressive in going after the vicious offenders of the gift bag rule. Robach would like to see the Authority issue warnings while reconsidering the law's merits or, as the case may be, demerits.

But several state lawmakers asked me not to use their name when they explained that they believe this whole thing is about liquor stores vs. grocery stores. They said that lawmakers knew they had upset grocery stores by preventing wine sales on their premises, so they disallowed the sale of some wine accessories in liquor stores (wine-themed magnets is another. Seriously.)

The bottom line is, well, the bottom line: no one seemed to think the SLA would enforce these rules, but the state needs cash. And here's what burns Mike Palmeri, who owns Marketview Liquor: According to documents he showed me today, the SLA sent inspectors in to his store back in June. Mike had no idea (and also says he had no idea he was not permitted to sell wine gift bags). But instead of informing Mike that he was being investigated, they kept the case quiet, allowing Palmeri to place an order of $25,000 worth of gift bags, most of which he expected to sell around Christmas. The SLA whacked him the first week of December -- so he's out the fine and his inventory costs.

"I guess I should have known the law," he told me. "I guess I should not have assumed I could sell these little gift bags for a buck or two apiece. It's my responsibility to know that. But now I'm going to do everything I can to get this law changed."

I asked Michael Smith of the SLA to help me understand why the law prohibits selling wine gift bags in wine stores, and he replied that it's up to SLA to enforce the laws -- any other questions should go to the legislature.

In other words, it might make not a shred of sense, but the state is coming after your store if you dare to sell pretty little wine gift bags. Just because a law is bad for customers and for business does not mean it's bad for lawmakers.

Comments

[John Witherspoon]

WTF! That is the most ridiculous thing I've heard. I can understand wine magnets but gift bags come on! haha Seriously, I can't understand how the law can seperate out retail items like that, or why people (lawmakers) would take the time to do so. I think Mike needs to set up an Ebay account and unload those bags, I am sure he could get rid of most of them. Doesn't make up for the non-sense but may help his bottom line.
Put me down for a few! :)
thanks Evan, hopefully the post will get some letter going to the NY state legislature to get this shit off the books.
Cheers

not to make light of this asinine situation but here is another dumb law that is on the books in california
"It is a misdemeanor to shoot at any kind of game from a moving vehicle, unless the target is a whale" Thats right up there with not allowing wine retailers to sell wine related RETAIL GOODS! Jesus!!

[RichardA]

Excellent article that points out a blatant absurdity in the law that needs to be changed. Can't believe all the money that was probably wasted on investigating this "violation" when I am sure those same resources could have been devoted to a far more pressing issue.

[Evan Dawson]

John and Richard,

What do you make of the SLA response? They're correct, of course, to say that it's not their job to figure out WHY a law was created, only to enforce it. But at some point, doesn't it make sense to ask if dropping that kind of hammer is equal to the offense?

I've heard from a few people who say that SLA should be applauded for enforcing the law, so perhaps I'm wrong.

[Jason Feulner]

And we wonder why people and businesses leave this state in droves...

This a classic example of government absurdity. The enforcement agency claims that it is only following the law and is not accountable. Fine, but while legislators will tell us that the law is absurd, many don't want to be quoted on record because they want to ensure that they don't tick off this constituency or that lobby or whatever.

I applaud Sen. Joe Rabach for saying something on the record, although the way the legislature works good intentions like his are often destroyed in all the absurd party rules that dominate law making in this state.

In the meantime, the store owner will incur lost sales, fine, and legal fees.

So, what's the end result? The government gains very little in revenue, and a good business is put at risk. How can this encourage entrepreneurism or build our tax base?

In a more enhanced analysis, Albany sucks.

[RichardA]

Evan:
I am sure the SLA has discretion in their use of sanctions and this reaction seems heavyhanded and oppressive. Why didn't they warn the store in June? Why didn't they just warn the store in December? The SLA should be trying to get stores to comply with the law, rather than just handing down sanctions. That can be accomplished with a warning too. If the store had ignored the warning, then a fine would have been in order.

[p m dawson]

It is so nice to know that in a time of heightened job looses, and many people suffering from an overall weak economy, that the ever vigilant SLA is cracking down on the wine bag sale violators. Your tax dollars at work. What a state!! Oh, and to the SLA agent who can't see beyond his nose, I suppose if you were a state trooper you would give speeding tickets to anyone going 61 in a 60. Hey, you don't write the law, you just enforce it.

[RichardA]

I have been reviewing the ABC Laws and found this:

Sec.17 (3) "Any civil penalty so imposed shall not exceed the sum of ten thousand dollars..."

So the SLA imposed the maximum fine on this retailer, when they easily could have imposed a lesser amount.

[Evan Dawson]

Richard,

The owner tells me he was advised that he would be paying the full fine. Today he indicates that SLA might decide to impose a smaller fine. It appears that some pressure is being brought to bear already.

[Evan Dawson]

Also, regarding your previous point, Richard: The SLA does not apparently see much room for selective enforcement. PMD's point is on the money (pardon the pun). SLA seems to treat every case as a severe one.

They most certainly could have chosen to alert Mr. Palmeri back in June. At the very least he would have saved thousands of dollars that he wasted on inventory that he can no longer sell. But such courtesies are not on the radar of the agencies that are soaking up our tax dollars.

[John Witherspoon]

Hey Evan
I think the SLA did their job, but didn't in the wrong way. Shouldn't there have been a warning before the fine, especially since this is such a ridiculous law. I think that would have been a better route to take, by citing them with a warning at the time of the inspectors visit, they would have 1. been doing their jobs and 2. hopefully stopped Mike from purchasing $25K of useless merchandise.

still burns me up reading this! aren't there more important things for the SLA to focus on?

[Evan Dawson]

John,

Here's a detailed update from SLA:

http://www.13wham.com/content/news/political/story/Liquor-Authority-Clarifies-Position-On-Wine-Gift/RehXMS76F0i6S3kWFDEg1g.cspx

Seems that their review could lead to a smaller fine -- not the full $10k. But it's obviously arguable whether there should be a fine at all, and they had no real response for the poor timing of the citation.

[PMiller]

The pertinent NYS Statute that the SLA is apparently using to harass this owner is Subdivision 4 of Section 63 of the Alcoholic Beverage Control Law, which reads as follows:

4. No licensee under this section shall be engaged in any other business on the licensed premises. The sale of lottery tickets, when
duly authorized and lawfully conducted, the sale of corkscrews or the sale of ice or the sale of publications, including prerecorded video and/or audio cassette tapes, designed to help educate consumers in their knowledge and appreciation of wine and wine products, as defined in section three of this chapter, or the sale of non-carbonated, non-flavored mineral waters, spring waters and drinking waters or the sale of glasses designed for the consumption of wine, racks designed for
the storage of wine, and devices designed to minimize oxidation in bottles of wine which have been uncorked, shall not constitute engaging in another business within the meaning of this subdivision.