New York looks to wine sales to close budget gap

Reporting from New York — 

Quick, which of the following is not allowed in New York: riding the subway without pants, performing a play in public while naked, or buying wine at the grocery store?

If you chose the last option, perhaps you’ve been following one of the liveliest debates to emerge from otherwise dry budget talks in the state capital, Albany, where politicians struggling with a dire fiscal crisis see wine as an antidote.

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FOR THE RECORD:
New York wine sales: An article in Section A on Sunday said a proposal to allow New York grocery stores to sell wine would also allow liquor stores to sell cigarettes and beer. The proposal would permit liquor stores to sell cigars and soda, but not cigarettes and beer. —

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New York remains one of 15 states that limit wine sales to liquor stores. But the proposed 2010-11 budget would open sales to grocery stores to generate an estimated $250 million in revenue from new liquor licenses.

In this bastion of liberalism -- home to the city that never sleeps, a burgeoning local wine industry, and a mainly urban populace that prides itself on sophistication -- it might seem like broadening wine sales would be as welcome as a full-bodied red on a cold winter’s night.

But the state’s powerful liquor store lobby has successfully fended off similar attempts in the past -- most recently during last year’s budget debate -- arguing that the change would drive small liquor stores out of business by making it convenient for shoppers to buy wine at grocery stores.

“What would be left for us?” said Dominic Noel, the manager of Wine Chateau, a Brooklyn shop with pressed ceilings, wooden floors, and racks holding 2,600 labels catering to customers looking for obscure bottles you wouldn’t find near the cereal aisle of Food King: a Petite Sirah from Baja California, Mexico, for example, and a shelf loaded with Greek wines.

“As a wine store, we deliver a particular type of service -- a type of happiness,” Noel said.

Opponents of change, led by a coalition called Last Store on Main Street, say specialized wine stores are a New York staple that offer wine lovers an array of labels from around the world.

The state will become “one big strip mall,” lamented Matthew La Sorsa, the Wine Chateau’s owner and a member of the coalition, which last month held a protest in Albany against the proposed change.

With an April 1 deadline for state lawmakers to approve the next budget, the battle focuses a spotlight on the idiosyncrasies of New York.

Those who support grocery store wine sales point out that not everyone in the state lives in New York City, where it’s common to be just a few minutes’ walk from a liquor store. In fact, 570 towns, with names like Swan Lake and Owls Head, speaking for their rural characters, have no liquor stores, according to the Department of Agriculture and Markets.

“Nobody realizes that there is more to the state of New York than the five boroughs,” said an exasperated Kim Pavnick, the owner of Grandpa’s Grocery in the snowbound hamlet of Bliss, more than 300 miles northwest of New York City. “We’re in the boonies here. If more than three cars a day pass my house, it’s because someone is having a bake sale.”

Life in Bliss would be far more blissful if people didn’t have to drive 12 miles to buy a bottle of wine, said Pavnick, calling the current law “ludicrous” and adding that her store and adjacent restaurant would thrive if she could sell wine.

Were it not for the economy, the Prohibition-era law would not have become such a hot-button issue.

But with a projected deficit of about $8.2 billion threatening cuts in public services, Gov. David Paterson has presented the plan as a quick means of raising money without raising taxes.

In an attempt to assuage liquor store owners’ anger, the proposal would let them sell beer, chips, cigarettes and other complementary items now confined to grocers. It also would let liquor store owners hold more than one license, permitting them to own two stores.

“That, combined with the increased money at stake, gives a very different dynamic to the proposal this year” compared with last, said Michael Rabinowitz of New Yorkers for Economic Growth and Open Markets, which has launched its own public relations blitz to counter Last Store on Main Street’s.

Jon Frederikson, a California-based wine industry expert, said California’s thriving wine-selling business -- for grocers and liquor stores alike -- undercuts the New York liquor stores’ argument.

“There are plenty of wines to go around, and you’ve got a zillion imports that are never going to end up in food stores,” he said.

“For a good wine merchant, you end up treating your customers like a doctor. People rely on you for recommendations. You have your own select wines. It really works.”

tina.susman@latimes.com