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, limiting consumer access, negatively affecting sales, impacting jobs and reducing much-needed tax revenue for local and state governments.
Gov. Greg Abbott’s executive order closing bars had the seemingly unintended consequence of forcing Texas winery and distillery tasting rooms to close, too.
That’s why industry leaders recently launched two grassroots efforts to educate, advocate and mobilize Texans in support of these key drivers of the state’s economy and small business community.
The Texas Winery PAC and the Texas Craft Spirits PAC are working to share their vision of a Texas with laws that promote rather than inhibit the growth and prosperity of the craft spirits and wine industries, both of which have a significant positive impact on the state’s economy.
“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 has a direct and indirect economic impact of close to $15 billion on 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, Texas. “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. Most have outdoor serving areas, which allows for appropriate physical distancing. Most guests are visiting to learn about products and production, and to purchase Texas crafted wine and spirits.
"We are just hopeful that the government will step in and help us for the short term so that we can be set up for long-term success," said Dennis Rylander, co-founder of GM Whiskey and Ranger Creek Brewing and Distilling in San Antonio. "They are small changes that can make a big impact for our industry."
Most of the gains from an increase in overall alcohol sales are being realized by large wine and distillery brands based outside of Texas. Many Texas wineries and distilleries work directly with customers through an onsite experience and without the ability to provide that, are suffering significant losses.
The reason for the significant drop in revenue among Texas distilleries — estimated at 60 percent to 80 percent in lost revenue since COVID-19 began — is that distillers are prevented by law from selling more than two bottles per-consumer every 30 days.
Current law also forces in-person-only sales by distilleries, prohibiting contactless shipping and delivery to consumers over the age of 21. This practice is already safely permitted 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, Virginia and California — would give Texas distilleries a fighting chance to maintain their businesses while providing much-needed products, such as hand sanitizer, during this pandemic.
Not only are Texas wine and craft spirit businesses hurting. The impact on other segments of the economy is also far-reaching. Closing tasting rooms during COVID-19 also impacts small business owners, employees, farmers, travel and tour bus operators. Tasting room closures and restrictions on sales also limit Texans’ ability to enjoy the locally produced wine and distilled spirits Texans have come to love.
"It has been really difficult," said Susan Johnson, owner of Texas Heritage Vineyards in Fredericksburg. "There was no inkling that we would have to completely shut down not only once but twice. And for us mom-and-pop small businesses, it has been really tough. It has been a lot of doom and gloom since this all started, but I think if we can survive this, it will make us all stronger."
It’s time we stood together and called on state leaders to #SaveTexasWineries and support #StillStrongTX.