Kansas Alcohol Tax May Get Consumed by Budget Woes

Kansas is among a number of states trying to figure out how to come to grips with a budget shortfall. In this economy it is a difficult task. One of the proposals now on the table illustrates why it is difficult to trust all of the new bills recently introduced to increase taxes on beer, wine and spirits to fund specific programs.

Leaders in the city of Salina say they have been told the $480,000 the community receive on an annual basis from state alcohol levies may not show up this year. The city uses the money to fund alcohol treatment programs, parks and recreation programs and the general fund.

It is pretty clear that once the state diverts this money the good citizens of Kansas can kiss it goodbye. It will be time for as local tax increase and you can bet that someone will propose going after beer, wine and spirits to close the gap.

Tuesday Tasting: Italian Whites

Tuesday Tasting is a regular feature of Lyke2Drink that explores some of the best beers, wines and spirits on the market. This week we sample some white wines from Italy.

The Beyond Beer column in the current issue of All About Beer magazine focuses on Italian wine. When you pick up a bottle of Italian wine, look for a set of letters or words that will give you an idea of the pedigree of the wine. There are four basic designations you will encounter, but keep in mind that not all wines of a certain designation are equal. When it comes to the designations on Italian wine labels, vineyards not following the accepted norms get penalized and cannot use the “highest” designation levels. These are reserved for wines that follow tradition. If a winemaker displays some individuality that they believe results in a better wine, they do so knowing they will not be able to use the prized DOC or DOCG designations. the four designations include:

Vino da Tavola (VDT), or “table wine.” The wine may be a basic quaffing wine or it may use this designation because it is a blend of grapes that does not comply with standards set for the other designations. While “table wine” can often mean lower grade wines, it is not always the case with Italian VDT wines.

Indicazione Geografica Tipica (IGT), a category of wines from a specific growing region, which do not meet the specific strict, traditional rules. There are about 120 IGT zones for Italian wines. These are quality wines that reflect what locals in the region often typically consume.

Denominazione di Origine Controllata (DOC), 300 wines from regions across Italy qualify for this category. Established in 1963, to meet this grade wines must be made using specific grapes, in specific blends, with a minimum alcohol content, aged for a prescribed period and from vineyards that meet specific production guidelines. These wines meet a defined set of criteria for traditional quality wines of the region.

Denominazione di Origine Controllata e Garanitita (DOCG), a cut above DOC wines in terms of quality. These wines must be made from traditional grapes grown in the region, but they also have undergone a blind taste test that indicates the judges have picked these vineyard areas as the best of the best. There are just over 30 DOCG designated appellations.

Five Italian whites to try:

Conte Priola 2007 Pinot Grigio Veneto: Straw colored wine with a clean aroma. Nice grapefruit base to a palate cleansing wine that would match we with seafood and a number of pasta dishes.

Ecco Domani 2007 Pinot Grigio delle Venezie: Clean, slightly floral aroma. The wine has hints of tropical fruit and pineapple, finishing with some green apple qualities.

Monti Rossi 2007 Pinot Grigio Veneto: This wine offers a slight floral and herbal aroma. Crisp with a nice level of citrus and pear qualities throughout the flavor.

Neirano 2007 Pitule Moscato: This sweet lower alcohol wine (7 percent abv) is lightly sparkling. Good to accompany an after dinner pastry.

The Sopranos 2007 Pinot Grigio: Straw color wine with a crisp, tart flavor profile. Grapefruit and tropical fruits in the finish.

The Government Never Buys a Round

Over the last few weeks Lyke2Drink has made mention of more than a few new tax proposals being introduced around the country that will cause the price of the drinks we enjoy to go up.

It's not that I'm some kind of conservative fanatic that believes all taxes are bad. In fact, I've voted for more Democrats and third party candidates for President than Republicans. Governments need money for programs like public safety, education and the health and welfare of citizens too young, too old or too sick to care for themselves. Unlike some recent appointees in Washington, I actually pay my taxes and I do so on time. However, I believe in most cases I do a better job spending what I earn to stimulate the economy and help social causes than the government.

A major concern is the way governments spend funds meant for one purpose on a variety of other programs, many of which don't have widespread enough support on their own to scrape up the votes for funding. Look at what happened to much of the tobacco settlement money back in the 1990s that was supposed to fund anti-smoking campaigns and health programs.

Now governments from one end of the country to the other are rushing to pass laws that increase taxes on beer, wine and spirits. The standard reason given is to fund alcohol treatment programs, which on the surface sounds like a good thing. The problem is that the statistics do not appear to show a sudden increase in alcohol abuse requiring a massive infusion of funding to pay for new programs. The reality is that most of these new taxes will never go to help a recovering alcoholic or support a family that has felt the impact of the disease.

Instead, when it comes to these new drinks taxes, the government is like one of those bar flies that is happy to accept a drink, but somehow always manages to disappear when it is their turn to buy a round. More importantly, this new wave of taxes will be heaped on what we already pay when we buy a bottle of beer, glass of wine or order a cocktail. Drinkers pay more than their fair share of these so-called sin taxes. (I hate that term by the way, since the Bible says Jesus turned water into wine. I tend to think having a drink is more of a holy experience.)

If you don't believe drinkers are already over taxed, consider these numbers from the Distilled Spirits Council of the United States on the amount of taxes collected on alcohol in 2006, the latest year that figure are available:

Federal Taxes:

Spirits: $4.6 billion
Wine: $877 million
Beer: $3.7 billion

State Taxes:

Spirits: $5.7 billion
Wine: $1.6 billion
Beer: $5.4 billion

Local Taxes:

Spirits: $529 million
Wine: $219 million
Beer: $1.09 billion

The Bourbon Belt

Mediamark Research & Intelligence claims that after 25 years of consumer research it knows more about the habits of Americans than even the Census Bureau. They regularly conduct consumer research and sell that data to some of the nation's leading advertising agencies and brand marketers.

As part of a recent study, they asked consumers nationwide if they had consumed one or more glasses of Bourbon in the last 30 days. The results paint a picture of where America's Bourbon Belt can be found:

Top 10 DMA's reporting they've sipped Bourbon during the last month:

1. Memphis, Tenn.
2. Baltimore
3. Biloxi-Gulfport, Miss.
4. Louisville, Ky.
5. Knoxville, Tenn.
6. Mobile, Ala./ Pensacola (Ft. Walton Beach), Fla.
7. Nashville, Tenn.
8. Chattanooga, Tenn.
9. Huntsville/ Decatur (Florence), Ala.
10. Birmingham (Anniston and Tuscaloosa), Ala.

On the other end of the spectrum are the markets reporting the least amount of Bourbon consuming occasions:

1. Laredo, Texas
2. Yuma, Ariz./ El Centro, Calif.
3. Los Angeles
4. Seattle/ Tacoma
5. Eugene, Ore.
6. Harlingen/ Weslaco/ Brownsville/ McAllen, Texas
7. Philadelphia
8. Baton Rouge, La.
9. Sioux City, Iowa
10. Beaumont/Port Arthur, Texas

Drinks & Taxes 2009 v7: Oregon

In many ways, beer is to Oregon what wine is to California or whiskey is to Kentucky. For that reason, it's amazing to consider that the Oregon Legislature just might boost the tax on beer by more than 1,800 percent.

Lawmakers are now discussing a jump in the excise tax from $2.60 a barrel to $49.61 a barrel. That would add an extra 20 cents a pint to each and every glass of beer produced by Oregon brewers.

Oregon officials say the money would go to fund alcohol and drug treatment programs. The politicians are also responding to polls that show voters are against raising the sales tax.

Currently, Oregon's excise tax on beer -- about a penny a pint -- is one of the lowest in the U.S. Brewers in the state say this has helped build the industry and create jobs. The huge jump in the tax could potentially damage sales and would hinder brewery start ups.

Drinks & Taxes 2009 v6: Arkansas

Arkansas has become the latest state to target alcohol as the cure for budget ills. Instead of taking on additional drinks taxes aimed at consumers, the Arkansas Senate has decided to place a levy on businesses.

The state Senate passed a bill to increase alcohol permit fees for restaurants, liquor stores and wholesalers. The maximum cost for a wholesale beer permit would jump from $1,000 to $5,000, while a restaurant wine permit would go from $50 to $300. The state expects these measures will bring in another $1.2 million.

Keep in mind that these are business that already pay a hefty amount of taxes that go to federal, state and local coffers. One part of the bill would allow on-premise consumption of alcohol to expand to 10 a.m. and midnight, adding four hours to the legal time of operation. The Arkansas House must pass the measure before it goes to the governor.

Drinks & Taxes 2009 v5: Kentucky

The Kentucky legislature is considering a proposal to add a 6 percent tax on all beer, wine and spirits sold in the state.

While industry officials protested the new tax -- several Bourbon distillers dumped whiskey on the steps of the capitol as beer delivery trucks circled the area early this week -- Gov. Steve Beshear urged passage of the bill. Without the new taxes he said the state would have to make cuts to programs.

Kentucky officials face a $456 million revenue shortfall and are considering several new taxes and fees to close the gap.

Drinks & Taxes 2009 v4: Standpoint, Idaho

The city of Standpoint, Idaho, is considering a tax on alcohol sold by the drink to pay for infrastructure improvements to its aging Memorial Field.

Standpoint is considering a 2 percent tax on beer, wine and mixed drink sales in bars and restaurants. Off-premise sales would not be subject to the tax.

A similar proposal failed to pass in 2007. If the city council approves the proposal it would then be placed on the ballot and need the support of 60 percent of the voters to become law.

Standpoint leaders say the stadium needs safety and other improvements. Officials are yet to develop a formal plan or estimate for the project.

It's the End of the Trail for Hop Obama

A small Brooklyn brewery may have a better case for receiving some of the massive stimulus pork than some of the big banks that have been using the funds for corporate jets and lavish Super Bowl parties.

Six Points Craft Ales, located in the Red Hook section of Brooklyn, has been ordered by the U.S. Tax and Trade Bureau to stop producing Hop Obama. The popular beer was first brewed last year during the Presidential primaries and the brewery donated money from each beer sold to Project Vote, a group that works to register low-income and minority voters.

While it appears all was good during the campaign, Six Points did not have permission to use President Obama's likeness on the label. Every opportunistic corporation from magazine publishers to collector coin marketers appears able to ride the wave of Obama popularity, but the feds are drawing the line when it comes to beer.

The interesting thing is that a TTB spokesperson is quoted in news reports as saying that the agency had given approval for the product, which it now says was done in "error." So Six Points followed the rules, but they have had to shutdown production and destroy any inventory they had of the product.

Hop Obama was released on March 12, 2008, by Six Points. It was sold in New York and Massachusetts. The beer was made with five different European malts, three different types of Pacific northwest hops and a Scottish yeast.

Budvar Volume Up 4.5 Percent

Budejovicky Budvar, the state-run Czech brewery, said its annual production surged by 4.5 percent in 2008 in the face of the global economic crunch.

The company said it sold 34.7 million gallons of beer, up 1.6 million gallons from 2007. Exports by the company were down about 1 percent during the same time frame. The company was coming off a record year of foreign sales.

Budvar is exported to 54 countries. In the U.S., because of a long running trademark dispute over the Budweiser brand name, the brand is sold as Czechvar.

Charlotte Beer Club & Stoudt's Brewery to Host Pints for Prostates Event on March 5th

The Charlotte Beer Club and Stoudt's Brewery are hosting an event on March 5th and they have made space available to Pints for Prostates so the group can spread the word to more men about PSA testing.

If you are in the Charlotte area on March 5th, please plan to stop by Jackalope Jacks at 1936 E. 7th St. between 6-8 p.m. This event is open to everyone, you do not need to be a Charlotte Beer Club member to attend -- but you should consider joining. There will be specials on Stoudt's beers and appetizers served. Stoudt's Brewery from Pennsylvania is one of the early craft brewers in the Northeast and they make a number of very nice beers.

Pints for Prostates will have a table set up at the event with information for men and the group will accept donations. All money raised by Pints for Prostates goes to help Us TOO International in its mission to support, educate and advocate for men with prostate cancer and their families.

Tuesday Tasting: Italian Reds

Tuesday Tasting is a regular feature of Lyke2Drink that explores some of the best beers, wines and spirits on the market. This week we sample some red wines from Italy.

The Beyond Beer column in the current issue of All About Beer magazine focuses on Italian wine. During my visit to the country back in the fall it was clear just how important wine is to the overall culture. Even the huge wooden doors to the Duomo in Florence have grapes and vines carved into them.

There are 20 different recognized wine regions in Italy. They pretty much run from the top to the bottom of the boot. Tuscany is the best known. But regions like the Piedmont, Trentino, Umbria, Veneto, Sicily, Lombardy and others produce excellent wines. About 65 percent of all wine produced in Italy is red. Chianti is the best known style in the U.S., but Barolo, Barbaresco, Barbera and Brunello are all great reds that should be tried.

Here are tasting notes for six Italian reds:

Bolla 1995 Amarone della Valpolicella: The grapes that go into this wine dry on straw mats for 90 days before being pressed. The wine appears to be slightly burnt red and cloudy. There is a nice mellow flavor to the wine with hints of purple skin fruit and a slight smokiness to the finish.

Campomaggio 2003 Chianti Classico Riserva: This DOCG wine has some wood notes to the nose. It is light in body but has plenty of flavor. Black cherries and plum come through in the overall dry base of the wine.

Colle Maggio 2005 Montepulciano d'Abruzzo: Deep ruby red color and a nice aroma of figs and cedar. The wine’s flavor is a combination of purple plums and black currants, with a slight hint of leather in the base.

Mazzoni 2006 Toscana Rosso: This Moltalcino wine is made using 72 percent Sangiovese and 28 percent Merlot and is a collaboration of the Franceschi family from Italy and the Terlato family from the U.S. Dark purple color in a rich bodied wine. Nice plum and berry notes. Tannins are plentiful, yet soft.

Gomba Boschetti 2005 Albie Nebbiolo d’ Alba: This DOC Barolo is hearty with dark ripe berry flavors and a good level of tannins in the finish. A great red wine for lovers of red wines.

Sasso Al Poggio 2004 Toscana: This wine is a deep ruby red color. Plenty of ripe black cherry and wild berry flavor. Very smooth with an almost velvet like mouth feel. A great wine to go with a traditional pasta or risotto.

Scottish Stimulus: Cut Whisky Duty

The political wrangling over President Obama's economic stimulus plan shows just how divisive different thinking about how to get out of the economic doldrums can be. Imagine if someone suggested cutting the federal excise tax on alcohol producers might the best way to fuel economic growth?

One group is suggesting just that in Scotland.

Gen, an independent economic consulting group, has issued a report that shows a 2.5 percent cut in the duty on Scotch whisky would generate more than double the amount of benefit to the United Kingdom's economy as a similar cut made in 2008 to the Value Added Tax.

The Scottish government says the VAT cut added $474 million to the country's economy. Gen says a cut to the whisky duty would pump $1.09 billion in to the Scottish economy.

Gen is staying neutral on whether the government should make cuts in the duty on whisky, but says a tax cut for the industry would provide a greater payback to the economy than many other stimulus plans.

According to the Scotch Whisky Association, the industry employs more than 22,000 and an additional 16,000 in distribution and retail industries. The industry also attracts significant tourism dollars to Scotland. More than 90 percent of Scotch whisky is exported.

It is highly unlikely that Scotch makers will see a reduction in taxes. Instead, the Gen report is expected to be used to try to stop new duties from being imposed.

Tuesday Tasting: Irish Cream

Tuesday Tasting is a regular feature of Lyke2Drink that explores some of the best beers, wines and spirits on the market. This week we sample some Irish cream liqueurs.

The current issue of DRAFT magazine has a roundup article I did on different types of cream liqueurs. Doing the tasting notes for the story gave me a chance to taste several Irish cream brands side by side. There were more differences than I expected between the brands.

Baileys Irish Cream: This 34 proof liqueur the original and sets the standard for the category. Baileys is thick and rich. The cream base coats your glass. Nice cocoa notes.

Baileys Coffee: This drink takes the traditional Baileys Irish Cream to your local coffee shop. The coffee is subdued, but clearly present. A nice balance and slightly less sweet. A nice twist.

Brady’s Irish Cream Liqueur: This 34 proof is slightly lighter and has a more nutty flavor than the other Irish creams tasted. Hint of vanilla in the finish.

O’Mara’s Irish Country Cream: At 27.8 proof this Irish cream is smooth and flavorful. Clear vanilla and almond notes, on the light side.

It's Official: We're in a Wine Recession

When the likes of the San Francisco Chronicle and Wine Spectator start writing about "budget" wines you can be certain that the world economic crisis has hit boutique vineyards. These two media outlets made the $100+ bottle of California cabernet sauvignon appear to be a reasonable buy. Now they may be signaling that we are in a wine recession.

In Sunday's San Francisco Chronicle columnist Jon Bonne writes: "The economy has forced nearly everyone to take their drinking budget down a peg or four."

This is especially being felt in the world of California boutique wines. Not long ago, spending above $50 a bottle at a retail shop meant you were buying something very special from Napa or Sonoma. Then it was $100. Then the top blew off. It was as if some winery owners had friendly wagers on just how much they could get for a bottle of wine. The wine press appeared to be in on the fun and restaurants and wine shops scrambled for their piece of the pie. Customers flush with stock market cash did not hesitate to spend freely on hot labels.

One merchant in the Chronicle story that specializes in harder to find California wines says his average bottle price is holding at $170, but he admits to selling fewer bottles. Others report that customers are cutting corners, with those who once spent $50 a bottle cutting back to $30 labels.

The current issue of the Wine Spectator runs the lead story "Savvy Shopper," with the promise of "1,000 Good Values for $20 or Less" on the cover. Inside are hundreds of wines from California, France, Italy, Chile, Spain, Australia and other locations that scored well in tasting panels, but don't break the bank.

As Marvin Shanken, Editor and Publisher, and Thomas Matthews, Executive Editor, write in the introduction to the Jan. 31-Feb. 28 Wine Spectator, "We know many people are adjusting their wine budgets in response to the economic turmoil, but that doesn't have to mean giving up wine quality. It just means buying smarter." The magazine tasted more than 16,000 wines to find it's 1,000 value picks.

All of this points to tumult in wine country. Wineries built on business plans that called for $95 bottles will feel the pinch as customers scale back. Even wineries aimed at value conscious consumers will notice shifts as some of the higher priced wines cut costs and patrons move towards what they see as fire sale wines.

The recession will reduce the number of meals consumed in restaurants and it is already cutting into the number of guests at upscale locations. In some cities the explosion of premium priced steakhouses during the last decade has started rolling back with closures taking place. This trend will reduce the number of higher priced bottles consumed on-premise, forcing more of this product into wine shops and liquor stores. Once consumers get accustomed to seeing these labels, some of which were hard to find, at retail prices without restaurant mark up it may put further downward pressure on wine pricing.

While lower prices for consumers on quality wine sounds like a good thing, the jury is still out until we see which vineyards are claimed as victims of the pricing bubble. The thinning of the herd will claim some of the pretenders, but some great wineries may also get caught in the mess. Not every expensive bottle of wine is overpriced.

Pittsburgh Public Schools Announce Two Hour Hangover Delay for Super Bowl Revelers

Earlier this week Pittsburgh Public Schools Superintendent Mark Roosevelt decided that one way to deal with potential student and staff absenteeism caused by today's Super Bowl game was to install a two hour delay in the start time for classes on Monday.

The Pittsburgh Steelers take on the Arizona Cardinals today, with a 6:28 p.m. kick off slated for the game. Roosevelt predicted a late night for many in Pittsburgh and decided that the delay would help cut down on Monday morning casualties.

The schools operated on a similar two hour delay when the Steelers won the 2006 Super Bowl.