After wine sales fight, a hangover

Although proposal to expand retail outlets is uncertain, resentment is fermenting  
 
The proposal to allow wine sales in grocery or convenience stores is dead or at least on life support.
  
But the bare-knuckle fight that followed the surprise initiative by Gov. David Paterson, who unveiled the plan in December as part of his budget proposal, brought divisions that are likely to linger.

Many liquor store owners on Tuesday expressed continuing anger at the lobbying campaign waged by the larger grocery store chains that supported the wine proposal. The plan also opened a rift between some wine producers and stores that sell the product.

Scott Osborn, owner of Fox Run Vineyards in the Finger Lakes region, openly backed the plan that would have allowed wine sales in places where beer is now sold, a fact that angered many liquor store owners. That led sales of Fox Run wines to fall by 60 percent, Osborn said.

Will they bounce back? Osborn isn't sure. But he's not about to silence his support for expanded wine sales.

"It's time for New York wine sales to come into the 21st century," Osborn said Tuesday. "It can't continue like this."

Many in the state still expect that the state's limitations on wine sales won't continue, despite the abandonment of the wine-in-grocery-store plan during the budget negotiations that took place over the weekend. Many in the liquor industry expect to see similar proposals soon.

In fact, some legislators, including Long Island Assemblyman Marc Alessi (D-Wading River), are already suggesting they won't wait to push for compromise wine-sale plans.

Grocery chains are also likely to continue their push for expanded wine sales.

"I started supporting this back in 1963, and I've been disappointed every single year for all that time," said Neil Golub, chief executive of the Price Chopper supermarket chain. "The consumers in New York state wanted this."

But liquor store owners say the continued uncertainty leaves them circumspect about investing in upgrades or being able to sell their businesses for a fair-market price. Who, after all, would buy a business that could lose a key component of success?

"I don't know of any other business that has to worry about its fate every year," said Mike DeRossi, owner of Country Square Wine and Liquor in Greenville. "And it's unfortunate that this business has to be this way."

Why the wine measure failed is not clear, a result of the three-men-in-a-room negotiation method that resulted in compromise on the 2009-10 budget but brought complaints over secrecy.

A person in the governor's office, who requested anonymity, said Paterson, as negotiations proceeded, tried to save the measure by proposing a compromise that would have allowed liquor stores to sell food. That effort failed.

Some liquor-store owners would have been angered if it had succeeded.

"Many of our stores aren't built to carry food products," said Stefan Kalogridis, owner of Colvin Wine Merchants in Albany and president of the New York Liquor Store Association.

"I don't want little kids coming into my store looking for potato chips or candy," he added. "I have hard liquor in here."