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Jones McKee and co-owner Richard Carey started Tamanend Winery about 10 years ago, beginning at their home before purchasing a warehouse-sized facility and tasting room off of Route 741. They also run Vitis Wine Center, offering “wine repair” services, consulting and bottling.
Jones McKee has seen this privatization movie before — and seen it end the same way.
Under state laws, here’s how the PLCB product selection works: Applicants have two shots a year to get the Pennsylvania Liquor Control Board to review their products for placement – along with a $150 fee. If the product doesn’t make the cut, there goes any shot at distribution. And the PLCB keeps the $150.
Carey, a California-bred vintner and all-around enology expert with about four decades of experience making and selling wine, said he finds the application process more than a little atypical.
“There is not a place in the entire country that I have ever been where we have had to pay the company to sell our product,” Carey said.
Carey once took four “bag-in-a-box” wines to the PLCB for consideration. Carey said Tamanend was the first winery in the state to have the equipment to produce the niche product, a popular party option that holds three liters of wine.
PLCB selected one varietal. By nature, Carey said, bag-in-a-box is a “low-profit” product, and he’d need to sell about 70 cases to the state system to make it worth his while. It ended up being 50.
The product ended up being sold at a store down the street from the Lancaster winery’s home base. But first, Tamanend had to ship the product north to a Scranton warehouse. All efficiency questions aside, that might not be a problem for a large-scale distributor. But Carey said he could “pour the wine down the drain cheaper than I would drive up there.”
Stacy Kriedeman, deputy communications director for PLCB, said there’s about 100 Pennsylvania wines in the state system. When PLCB selects a product, store placement decisions are made based on factors like past sales, demographics, marketing strategy and what store managers believe will sell best, she said.
Price is negotiated on a variety of factors, but Pennsylvania wines can’t be sold at a higher price in the state store than at the winery, Kriedeman said. And the PLCB has a mandatory 30-percent markup that sellers must consider.
Jones McKee said the system, however constraining, is something wineries have “learned to live with.” Putting aside the bureaucracy of the system, PLCB staff is often helpful and understanding, she said. Past administrator Darryl Stackhouse, she said, “absolutely loved” Pennsylvania wineries.
And as the laws presently read, Pennsylvania wineries do have other options to legally sell their products that may not be allowed in other states with a common “three-tiered” retail system.
Wineries like Tamanend—legally considered “limited wineries” due to the amount of wine they produce — can sell directly out of tasting rooms. They also can operate up to five retail locations, either on their own or in conjunction with other wineries.
Tamanend has two retail locations, one in Lancaster and another on Main Street in nearby Strasburg.
Pennsylvania wineries can sell 365 days a year, if they want. Because the state stores operate on a special schedule that involves closing on federal holidays, and many are closed on Sundays, wineries have a leg up on those days.