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News 05/07/2002

Updates on the RMAVV web page:
  - Doug Caskey from the CWIDB has provided us with a Colorado List of Local Liquor Licensing Authority Contacts. The information is linked from the RMAVV 'Useful links' page under both the Colorado Information Resources and Government/Legal sections. Thanks very much to Doug for providing us with that information.
   - MaryAnn Graff and Harold Larsen's presentations from the spring meeting are now available in the archives.  Horst is adding some new data to the 2001 Grower's Survey, so it will not be there for another week or so.

Brown Bag Lunch subject announcement for Wednesday, May 8, 12:00 at the Rodger's Mesa Research station:
  Dr. Horst Caspari will be discussing winter damage.

Winefest News
  Amy Nuernberg has informed me that the Colorado Mountain Winefest site is now completely updated for our 2002 event.  Check it out at http://www.coloradowinefest.com/

Winery Fax from Doug Caskey at the CWIDB
Date: 6 May 2002
From: Doug Caskey, executive director
Colorado Wine Industry Development Board
Phone: 720.304.3406
TO: all Colorado Wineries
INFORMATION
Attached (see attachments below - nmj) are some informative e-mails and files that you should all be aware of. First is a message from Laura Harris of Liquor Enforcement reminding all of you that wine used for sampling is not exempt from the Colorado excise tax. Please read and follow Laura’s instructions regarding excise tax payment and filings.
Secondly, I am passing along the resume of a winemaker currently working in Oregon, who is interested in consulting for wineries here in Colorado, with the intention of moving to our state eventually. The presence of Mr. Musgnung’s resume in this fax should not be construed as an endorsement of his services by the CWIDB. I merely want to make you aware of the availability of his services.
While Richard Bruno was unable to commit to consulting for our entire industry this year, I am sure he would be amenable to working for Colorado wineries individually. His phone number is (415) 664-2692 and e-mail is richard@vinumcellars.com.
Thirdly, for those of you who don’t get information from the American Vintners Association, I am including some significant news about shipping to Pennsylvania.
Also, big thanks to Kevin Sweeney of Grande River who called me last week with a solution to our UPS intrastate shipping problems. UPS has been inconsistent at best about enforcing the ban on shipping wine intrastate within Colorado which they announced last fall, but, apparently, has begun confiscating and destroying shipments to some reciprocal states as well as to destinations within Colorado.
Kevin has read the fine print on the FedEx Ground customer agreement. If you file the correct paperwork with FedEx Ground, a winery can ship wine within Colorado and to all of the reciprocal states despite the company’s insistence that you can only ship Express to other licensed destinations. My experience with FedEx has always been much more positive than using UPS. Even if you use FedEx Express Saver in their airborne division, the rate is about the same to ship a case of wine as UPS if you are a regular, registered FedEx customer. Contact your FedEx representative immediately (or go to http://www.fedex.com/us/) and inquire about shipping your wine with them. I don’t believe that FedEx has the same minimum charges that UPS does. This gives us a reasonable and competitive alternative to UPS, until such time as UPS reconsiders its ban on intrastate shipping in Colorado.

Also, some notes about UPCOMING EVENTS:
- Beginning on June 21, the elegant Oxford Hotel, across from Union Station in Denver, will be hosting a “Colorado tasting” every Friday afternoon from 4-6 PM through September featuring one Colorado wine and a Colorado food product. The Oxford is requesting one donated case of wine in return for purchasing at least one case to sell through room service.

As we will have 12 weeks of this promotion, I hope that at least 12 different wineries are interested in participating. If less than 12 wineries sign up, those who do participate can have more than one wine poured in these events. You do not need to be present when your wine is poured, although you may be if you want. You will be responsible for delivering and invoicing the wine to the Oxford, along with any promotional materials and a fact sheet on your wine. Please let me know if you are interested in participating in this series of tastings. The Oxford will select wines from a list of interested wineries.

- Change in times for Applejack parking lot tasting: Friday, June 7, 4-7 PM and Saturday, June 8, 10-5 PM.

New PARKING LOT TASTING OPPORTUNITIES:
- July 4-6, The Wine Experience in Broomfield (this is an outstanding wine shop next to the new Flatirons Crossing Mall). Two Rivers has tentatively agreed to license this tasting, so call them (970.255.1471) if you are interested in participating.
- July 11-12, Lukas Liquors, Littleton. Stoney Mesa will be licensing this event (970.856.7572).
- Aug 16-17, Evergreen Discount Liquors. Wine manager, Greg Thomas, is an active member of the Wine Board, so this should be one of the best events we do! Call me if you want to participate.

PROMOTIONAL WINE PURCHASES
Finally, as I announced at the April RMAVV meeting, the Colorado Wine Industry Development Board has voted to phase out paying for promotional wine over the coming fiscal year beginning July 1, 2002. The CWIDB will buy one case of wine from each licensed and producing winery up to three times during the coming fiscal year at the standard rate of 50% off your retail sales price. Beyond the 1-3 cases the CWIDB will purchase, depending upon budget and demand, wineries can donate product to participate for any event in which they choose to participate. I am attaching a copy of the policy that the board approved at its April 19 meeting. Please call me if you have any questions or concerns about the new policy.
I will be out of town May 9-16 and then heading to the Estes Park Wine Festival May 17-18. Please leave me a message and I will try to respond on Monday, May 20.
 

Subject: Tax Information for Wineries
Date:       Fri, 5 Apr 2002 16:26:47 -0600
From:       "Harris, Laura" <lharris@spike.dor.state.co.us>
To:       <dcaskey@coloradowine.com>

Doug - If it wouldn't be too much trouble, could you include the following
information in your next newletter?  There seems to be some misinformation
floating around.  THANKS!

1.  Wine used as "tasters" (for consumer sampling) whether in the winery, at
festivals, or at other off-site tastings, is subject to the Colorado liquor
excise tax, and both surcharges.  Although wine used as samples may be
exempt from federal tax, Section 12-47-503(1)(a), C.R.S. states that the tax
is due on all alcohol beverages "sold, offered for sale, or USED in this
state." The deduction described on the state excise tax return as "sales
exempt by federal law," is for sales to the military only.

2.  The Colorado use tax is due on all wine used in this state for sampling.
There is a line, or separate section, on the sales tax return for the
remittance of the use tax.  It is the same rate as the state sales tax.  The
use tax is computed on the cost of the wine, not the retail price.

3.  Jan Glazner, of the Business Tax Accounting Section at the Dept of
Revenue ( the liquor tax specialist), continues to find significant errors
in the computation of the Colorado Winery Surcharge.  She will contact each
winery by letter if she finds a problem.  You may reach Jan at (303)
205-8211 Ext. 6860 (press #); and fax number (303) 866-3211. Please give Jan
your full coopertion, she is a valuable resource.

4. Please contact Jan if you receive a "Notice Due."  The Liquor Enforcement
Section does not handle these types of tax matters.

5. Please do not send liquor excise tax returns to the Liquor Enforcement
Division in Lakewood.  All tax returns for the state of Colorado should be
mailed to Colorado Dept of Revenue, 1375 Sherman, Denver, CO 80261..
 

Letter from Bill Musgnung
April 4,2002
To those in the Colorado wine industry,
I am a fine wine winemaker working for the past 16 years in smaller wineries perfecting the art of red wine making. I plan to continue to develop my skills and deepen my appreciation for wine by doing consultation in the next year or two while my children finish high school.

In the year 2004, my family is considering a move back to Colorado, (my wife’s home state). It is my hope to find a small winery that will have need of a permanent winemaker. I am sending this letter to help introduce myself, and let the Colorado industry know of my intentions.

Enclosed is further information explaining what I may have to offer you.
Thanks and keep up the good work,
Bill Musgnung
2927 Raymond St.
Forest Grove, Oregon 97116
503-359-0712
musgnung@juno.com
(nmj - Doug Caskey's info included a consulting letter and resume here, but please contact Doug or Bill directly if you want that additional info...)
 

Pennsylvania Direct Shipping News
 
American Vintners Association
1200 G Street, NW, Suite 360
Washington, D.C. 20005
www.americanwineries.org
Phone: (800) 879-4637
Fax: (202)347-6341

May 1, 2002

TO: AVA Members
FR: Bill Nelson
RE:  This Week at AVA

DIRECT SHIPPING
Pennsylvania “Internet Order-Direct Shipping Law” Now in Effect
A new Pennsylvania shipping law has gone into effect that will allow wineries to accept, on the Internet, direct orders for consumers and then ship those orders to any one of 627 Pennsylvania PLCB (state) stores in the state. All wine sold in Pennsylvania is sold through the state monopoly. There are no private wine stores. A consumer may only receive 9 liters of wine per month through the direct shipment process.  Information is available from the PLCB web site: http://www.lcb.state.pa.us/Licensing/Direct_shippers_info.asp
In order to participate you must first obtain a free two-year license from the state. Download from: http://www.lcb.state.pa.us/licensing/ or phone 717-783-8250 to obtain a full packet including application, terms & conditions, tax clearance forms and detailed instructions.
After receiving your license and getting a 7-digit I.D. #, you may accept orders and ship directly to your customers c/o a designated PLCB store. An order (invoice) must be electronically transmitted to PLCB central headquarters (more about this later). The order must also be sent to the customer to facilitate the pickup. The PLCB will transmit its copy of the order to the liquor store. The wine must be shipped directly to the designated liquor store using an approved shipper. While there is a long list of approved shippers, only DHL and FedEx, but NOT UPS are on the list. All orders/invoices must include: (a) cost of product (b) shipping cost, (c) a PA handling charge of $4.50, (d) an 18% “PA emergency tax on the sub-total of  (a) + (b) + (c) and, finally, (e) PA sales tax of either 6% or 7% on the sub-total of items (a-e). PA stores with numbers beginning with first 2 digits of “02, 51, 91 or 92” are subject to the 7% tax. All other stores are taxed at the 6% rate. [A test order must be developed and sent to PLCB before regular orders are accepted.]
CONDITIONS: (1) Only wines not included in the PA product catalogue (updated weekly) may be shipped through this process. (2) Taxes, fees and list of transaction must be sent to PLCB by the 10th day of each month. An annual report must be filed by January 15th. (3) All packages must be clearly identified as containing alcoholic beverages and must include two copies of the Wine Order. (4) Consumers must be twenty-one (21) years of age or older on the date of order and residents of Pennsylvania. All wine purchased must be for personal consumption and not for resale. (5) The store will open the order and inspect for damage which if presented will be noted on the order. Direct Shipper Licensee is responsible for errors and damage. (6) PLCB will notify the customer who must then pick up the product within 30 days. (7) Direct Shipper’s website must require Consumer to indicate that he/she has read the Board’s disclaimer and agrees to its terms and conditions before Consumer may complete his/her order. Direct Shipper must maintain a copy of the Consumer’s acceptance of the Disclaimer for a period of two years.
Details of the Order process. (1) Order # must be the 7 digit licensee designation # followed by a 5 digit order number to identify the specific order. (2) At this time the only way to transmit to PLCB is by FTP “tilde” (~) separated values. FTP requires additional software. AVA is trying to get PLCB to offer an Internet based process as a more convenient substitute. (3) 23,861 products are on the current PLCB list (available from their web site in ~ separated format or from AVA in Excel format). This list is updated weekly. None of these products can be direct shipped.
Wineries obtaining direct shipper licenses may be linked to PLCB web site by contacting PLCB.
A typical order can be viewed at:  http://www.lcb.state.pa.us/Licensing/Direct_shipper_inv_sample.asp
Is this process too complicated to be useful? Good question. Experience will tell.
(nmj - removed sample invoice - look at the above address to view the sample)
 

CWIDB Promotional Wine Purchasing Policy
Marketing Committee Recommendation:
- The CWIDB will purchase one case or equivalent volume from each licensed and producing winery up to three times over the fiscal year to be used for small events, gifts, public relations, government or trade receptions, etc. This inventory will continue the support the CWIDB gives to tourism industry partners, governmental agencies, and others looking for free wine.
- This wine will be invoiced at no cost to the winery currently hosting the CWIDB’s promotional inventory. The CWIDB will be invoiced for “promotional activities” at 50% of the retail tasting room price.
- Beyond that quantity, the wineries can choose which events to participate in by donating product
- The executive director will still coordinate Colorado wine industry participation in some events, as a central contact or clearing house, and then notify the wineries of upcoming events
- Wineries can also request the executive director pour their wine at events not on the CWIDB list of events
- Wineries will be responsible for making arrangements to get their product, whether purchased or donated, to the executive director, to the CWIDB’s promotional inventory, or to the location of an event. Arrangements may include having the executive director pick up wine when close to the winery. The CWIDB will not pay shipping costs or wholesaler charge-backs.
- This policy represents the CWIDB’s intention to completely phase out paying for promotional wine completely within one year.