As a follow-up to our July 15, 2020 blog post regarding the State Water Resources Control Board’s (State Water Board) release of proposed General Waste Discharge Requirements for Winery Process Water Treatment Systems (proposed General Order), today the State Water Board issued a public notice regarding the first stakeholder meeting to discuss fees
California Wineries Take Note: State Water Board Releases Draft General Order for Winery Process Water for Public Comment
On July 3, 2020, the State Water Resources Control Board (State Water Board) released proposed General Waste Discharge Requirements for Winery Process Water Treatment Systems (proposed General Order) along with the draft California Environmental Quality Act (CEQA) Initial Study and Mitigated Declaration for public comment. The proposed General Order will apply statewide, and includes requirements to ensure winery operations will not adversely impact water quality. The State Water Board also noticed a July 22, 2020 public workshop and future proposed adoption of the proposed General Order. The July 22, 2020 public workshop will begin at 9:30 a.m. via remote attendance only. Although a quorum of the State Water Board will be present at the public workshop, no final action will be taken at the workshop.
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Ecology Rolls Out Washington’s First Winery General Permit to Regulate Discharges of Wastewater
Beginning in mid-2019, many Washington wineries will need a permit from the state Department of Ecology (“Ecology”) to discharge wastewater. Ecology issued the state’s first five-year Winery General Permit (the “permit”) on May 17, 2018, but delayed its effective date until July 1, 2019. The new permit will regulate discharges of process wastewater from wineries to land, groundwater, and wastewater treatment plants. No surface water discharges will be allowed under the permit. Ecology has not determined how much a permit will cost, but the new rules in the permit will add financial burden to businesses and may hinder the growth of small wineries.
Ecology decided to develop the general permit due to the rapid increase of wine production in Washington. However, according to Ecology’s Fact Sheet, wineries have not been a “major source” of pollution in Washington. Although Ecology stated in one of the agency’s Responses to Public Comments that “it was unable to find documented evidence of a Washington winery polluting groundwater,” it maintained that “a lack of evidence does not mean groundwater is not being impacted.”
The new permit will apply to wineries that discharge at least 53,505 gallons of wastewater or produce at least 7,500 cases (17,835 gallons) of wine or juice per calendar year. More specifically, wineries that meet the above threshold numbers will need the permit if they discharge wastewater according to one or more of the following methods: (1) to a wastewater treatment plant that is not listed; (2) as irrigation to managed vegetation; (3) to a lagoon or other liquid storage structure; (4) as road dust abatement; (5) to a subsurface infiltration system; or (6) to an infiltration basin.
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Agency Extends Relief to Prevent Unintended Tax Burden on Custom-Crush Facilities and Bonded Wine Cellars
As we wrote about earlier this month, the Tax Cuts and Jobs Act (H.R. 1) passed late last year included significant, temporary federal excise tax relief for wine, beer and spirits businesses for 2018 and 2019. Unfortunately, in an apparent oversight of legislative drafting, the wine excise tax relief (provided in the form of…
A Prop. 65 Win for Winemakers: No Separate Warning Required for Inorganic Arsenic
The California Court of Appeal recently handed a victory to winemakers, ruling that a specific Proposition 65 (“Prop. 65”) warning is not required regarding the presence of inorganic arsenic. The lawsuit, Charles et al. v. Sutter Home Winery et al., was originally filed in 2015 and alleged that wines made by over 15 named defendants exposed consumers to inorganic arsenic without the correct Prop. 65 warning.
Inorganic arsenic is a chemical identified by the State of California as a carcinogen and reproductive toxicant, and plaintiffs argued that defendants’ products required a specific warning to inform consumers about exposure to inorganic arsenic. Defendants prevailed on demurrer because the trial court found that the existing “safe harbor” warnings for alcoholic beverages complied with California’s Prop. 65 warning requirement as a matter of law, and that no additional warning for inorganic arsenic was required. In other words, the trial court determined that Prop. 65 does not require both a general warning and specific warning for an alcoholic beverage product. Plaintiffs subsequently appealed.
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No Peace for Piece-Rate Pay in Washington Agriculture
This post was written by Adam Belzberg, Ryan Jones and Tim O’Connell for the Stoel Rives World of Employment blog.
In yet another blow to agricultural employers, grab your stopwatches. In Carranza v. Dovex Fruit Co., the Washington Supreme Court has just held that agricultural employers are required to compensate piece-rate workers on…
Tax Cuts and Jobs Act Includes Tax Relief for Wine, Beer and Spirits Businesses
Included in the Tax Cuts and Jobs Act (H.R. 1) passed in late December were “Craft Beverage Modernization and Tax Reform” provisions that, among other things, reduced federal excise taxes for wine, beer and spirits businesses. These reductions expire at the end of 2019 unless extended by future legislation. While these changes may not have…
Ninth Circuit Rejects Retail Digital Network’s Challenge to the Constitutionality of California Tied House Law
This post was co-authored by Stoel Rives summer associate Chad Punch.
Earlier this summer, the Ninth Circuit Court of Appeals revisited an issue that it had examined thirty years prior: whether a California Prohibition-era tied house law is unconstitutional under the First Amendment because it impermissibly restricts commercial speech. Specifically, in Retail Digital Network, LLC v. Prieto (No. 13-56069), the plaintiff, Retail Digital Network, LLC (“RDN”) sued Ramona Prieto (“Prieto”) in her official capacity as Acting Director of the California Department of Alcoholic Beverage Control (“CABC”) seeking a declaration that California Business and Professions Code § 25503(f)–(h), which prohibits alcohol manufacturers and wholesalers from providing anything of value to retailers in exchange for advertising their alcohol products, violates the First Amendment of the Constitution. Hearkening back to its earlier decision in Actmedia, Inc. v. Stroh (830 F.2d 957 (9th Cir. 1986)), the court here ultimately disagreed with RDN’s arguments and left California’s longstanding tied house laws intact.
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2017 Changes to Washington Liquor Laws Affecting Producers and Distributors
This post was guest authored by Stoel Rives summer associate Alex Pearson.
With the Washington State Legislature’s third special session at a close, now is a good time for alcoholic beverage producers and distributors to take a moment to look at five bills that passed the Legislature and were signed into law by Governor Inslee this past session. All are effective as of July 23, 2017, and create new opportunities for producers and distributors. What follows is a summary of the more notable additions and modifications made by these new laws. Please note that these laws affect a variety of licensees, so we encourage all producers and distributors to evaluate these changes with their attorney.
Legal Definition of Mead
One of the world’s oldest alcoholic beverages—mead—finally has a legal definition in Washington. S.H.B. 1176 amends RCW 66.24.215 and RCW 66.28.360 to define mead as a wine or malt beverage sold as “mead” and which is fermented primarily from honey, but may contain other agricultural products such as fruit, hops, or spices. Those licensed to sell beer or cider in growlers will also be allowed to similarly sell mead to customers, so long as the mead sold has an alcohol content equal to or less than 14 percent alcohol by volume. Additionally, starting January 1, 2018, mead will be exempt from the assessment on wine production that funds the Washington Wine Commission.
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2017 Changes to Oregon Liquor Laws
This post was guest authored by Stoel Rives summer associate Antonija Krizanac.
Since the 2017 Oregon Legislative Session convened on February 1, 2017, the Legislature has introduced a variety of bills that impact the Oregon alcohol and beverage industry. Out of the countless proposed bills, five have already been signed by the Governor and will go into effect this year or early 2018 and may impact your business. Following is a summary of those bills.
House Bill 2150: Relating to electronic administration of alcoholic beverage tax provisions
House Bill 2150 requires the Oregon Liquor Control Commission (“OLCC”) to allow manufacturers or distributors of wine, cider, or malt beverages to file by electronic means:
- A statement of the quantity of wine, cider, or malt beverages produced, purchased, or received, and
- Payment of privilege taxes on such activities.
This alters the current filing and payment system, which is done on paper. The measure will apply to statements or privilege taxes due on or after July 1, 2019.
Effective date: January 1, 2018
Link to enrolled bill: https://olis.leg.state.or.us/liz/2017R1/Downloads/MeasureDocument/HB2150…
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