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Appleton Creek Winery, Cider, Fireside Winery, Mackinaw Trail Winery, Maryland Wine, Michigan Wine, Old Westminster Winery, Tom Coburn, USDA, Value-Add Block Grant, Virginia Wine, Wine Subsidies
Should the Federal government subsidize wine production? Apparently the junior Senator from Oklahoma and FOX News talking head Greta Van Susteren don’t think so.
I’m not a watcher of Mrs. Van Susteren’s show, called On The Record w/ Greta Van Susteren, but happened to watch last night while chatting with a friend over a post-dinner drink at the hotel lounge. One of the many televisions in the lounge area was tuned to the FOX news channel when the display of a familiar wine bottle caught my attention.
The screenshot that initially caught my attention — wine bottles from Old Westminster Winery in Maryland. Appears as if FOX News may have borrowed several pictures from Old Westminster’s website.
From what I could follow from the on-screen closed caption text, Mrs. Van Susteren was decrying subsidies for wineries as part of a USDA block grant program.
Since I didn’t see the entire segment and wasn’t able to hear, I later found a video clip of the report (in its entirety) on the FOX News site, which confirmed that Mrs. Van Susteren provided supporting commentary regarding a letter that Senator Tom Coburn wrote to U.S. Department of Agriculture Secretary Tom Vilsack, regarding recent spending at the department.
The segment can be viewed in its entirety here.
Senator Coburn, known in some circles as a waste watchdog, wrote to Secretary Vilsack to question the use of USDA grant money to support agricultural enterprises like, gasp!, wineries, while at the same time, threatening to cut food aid funding for 600,000 women and children resulting from the sequester. (I encourage readers to read Senator Coburn’s entire letter to Secretary Vilsack for additional details and context.)
In his letter, Senator Coburn takes direct aim at the USDA Specialty Crop Block Grant Program that provides financial support, for smaller wineries from lesser-known regions;
Last month, the USDA Rural Development also announced it is funding wine related initiatives through the Specialty Crop Block Grant Program, including more than $300,000 to the Mackinaw Trail Winery in Michigan “to facilitate a major expansion of their wine sales and marketing,” $162,500 to the Old Westminster Winery in Maryland (ref. link), $100,000 for the Appleton Creek Winery in New York, $49,900 for marketing and operating costs for processing Nebraska sandhills grapes into wine and selling to local markets, nearly $49,000 for marketing of Fireside Winery in Iowa, and $9,000 to “be used for market and business planning” of another winery in northwest Iowa.
Coburn’s letter continues;
This is not the only USDA program underwriting wine projects. In the last year, more than 20 wine projects were supported by USDA’s Specialty Crop Block Grant Program, including the Hawaii Food and Wine Festival, the development of a Massachusetts wine trail app for iPhones and other smartphones, and a Wine Pavilion at the South Dakota State Fair. Since sequestration went in to effect, the program announced awarding $300,000 to the 3 Horse Ranch Vineyards in Idaho, $30,000 to the Sunnyslope Wine Trail Group “to conduct an advertising campaign” and $40,000 to the Idaho Wine Commission “to raise awareness of the state’s wine industry.
I do not share Senator Coburn or Mrs. Van Susteren’s (apparent) outrage over these wine-related subsidies from the USDA. Admittedly I may be biased. I should point out that I do not support cutting food aid to those in need for the sake of funding wine promotions. Like all government agencies, there is likely no shortage of bloat at the USDA and much room for cost cutting. However, the small grant amounts Senator Coburn referenced in his letter to Secretary Vilsack are not even a rounding error in the USDA’s overall $145 Billion budget (FY 2012).
I am curious to know how these wineries are spending tax dollars granted to them as part of the USDA’s program — vineyard expansion of particular varieties (which ones?), marketing (on what?), staff salaries, new equipment?
I suspect these dollars are being used wisely, in ways that grow not only each individual winery but also in a way that benefits their region.
I did contact several of these wineries for comment but none of them responded.
Of the handful of wineries that received a 2012 Value-Added Producer Grant (awarded on May 1, 2013) or Specialty Crop Block Grant, not one Virginia winery was on the list. However, several Virginia wineries did land sizable USDA grants last year — Michael Shaps’ Virginia Wine Works ($149,125) in Charlottesville, Rosemont Vineyards & Winery ($300,000) in LaCrosse, The Homeplace Vineyard ($208,571) in Chatham, and the Virginia Wineries Association Cooperative ($100,000).
On the upside, Virginia wasn’t completely shut out of the grant monies this year — MeadowCroft Farm in Swoope, VA received a grant for $300,000 for social media and marketing of pickles and their other produce (I’m not making this up) and Showalter Orchard and Greenhouse received a $300,000 grant to process and market hard cider. A complete list of FY 2012 Value-Added Producer Grants can be found on the USDA Rural Development site, here.
In the spirit of fairness, Senator Coburn did not limit his questioning to just wine, he also decries the USDA’s funding support of vodka, bloody mary mix, soy beans, pizza and a number of other related agriculture products.
To those wineries that applied for and were awarded these block grants — I say good on ya!
And, to those Virginia wineries not taking advantage of (or at least applying for) the USDA grants to help fund expansion or upgrade — I say get on with it and don’t let your neighbors to the north reap all the benefits.
Should the government be funding wine, pickle, and cider businesses? What say you?
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Drink What YOU Like 
I don’t have the current numbers in front of me, but it is amazing the jobs that are created by these wineries and the economic impact the respective regions see from their wine industries. I agree with you, if the grants are out there, apply for them; and kudos if you get one!!!
I’m outraged that you’re not outraged. Why should my, or your, tax money be given outright as a grant to wineries in Nebraska, Michigan or Maryland? Or any state for that matter. At best, I could possibly see some Federally backed loans for these entities at favorable rates but block grants?? Absolutely ridiculous!
Richard, thanks for stopping by to comment. I suppose I could say that I am outraged that you are outraged that I’m not outraged. In truth though, I’m not outraged at all. As someone that could fill pages with listing spending that irritate me, I can understand your position. I believe context here is important — much (and I emphasize much) revenue is generated from wine and cider sales. This is one reason for my lack of outrage over such a very small fraction of the USDA’s $145B budget being allocated to support wine-related expansion, thereby potentially increasing tax revenue (which may at some point be allocated to future grants). In exchanging emails with a winery owner here in Virginia, I learned that most (perhaps all) of these grants are ‘matching grants’ that require the recipients to have matching funds to use for the intended purpose of the grant. What’s not clear to me is how much oversight the USDA has over the use of these funds. I suspect little, but I could be wrong about that. As for the money devoted to the pickle social media marketing – i’m on the fence about that one. Cheers!
The Federal goverment collects a lot of taxes from wine and vodka so what is the problem with giving a little back. Would like to see Congress do something that puts them in the same world as the majority of the people when it comes to benefits that they receive for life. I know that will never happen until the majority are shown what members of congress receive, I thought they were civil servants and not put into office to get all they can get for themselves. That might be everyone of them but once you are in, you are in for the ride.
And what has Oklahoma wine industry received over the last years that likely benefitted things in Coburn home state. All this has become a witch hunt that is impacting good things that might result.
Roger, thanks for your comment. Having little, or virtually no, first hand knowledge of the Oklahoma wine industry I’m not sure about what grants/benefits that industry has received. I’m sure the Oklahoma industry has benefited from this and similar programs for sure. Here is a list of recent news items on the USDA Oklahoma page, which provides a few examples: http://www.rurdev.usda.gov/OK_Home.html I tend to agree with you on the impact that may result in positive growth and good things. Best to you!
Farmers and agriculture matter!!! It never ceases to amaze me how quickly people dump on those that grow the food they eat. Whether its corn, soybeans, grapes or apples or even cucumbers for pickles – agriculture matters! Despite what some who have not researched this issue may think the USDA does review all grant applications very closely and as far as I’m concerned each and every one of these small agriculture enterprises deserves every penny of the grants. As you say good for them!!!
As a winery owner and 3rd generation specialty agriculture production grower, I recognize the bias of special interests inherent in agriculture. Our growing problem in America is the cumulative effect of all the special interest groups looking for federal dollars (i.e. tax dollars). All federal grants and hand out programs should be eliminated, each industry must be able to stand on its own without subsidize. Giving grants to one region over another is more unfair than giving nothing at all. Perhaps eliminating excise taxes across the board would be a more equitable approach.
MMM– are not talking about food that we are consuming or are we are talking about wine/alcohol/booze that my taxes are subsidizing?….what is my return on this investment by the government, I don’t drink wine…why is the government even in the investment business anyway, but I digress. Since I live in such an area—California–I often wonder how many politicians(Pelosi-4 wineries, liquor companies) and celebrities are vested in the wine industry to inflate their egos. How many of these are benefiting from tax breaks that their winery provides through these cooperate investment losses. Who is paying for the enormous use of water that these wineries require, or the drying up of wells and aquifers during these drought times. When I am told to stop using water or to reduce my water consumption and I do…why is it that my water rates continue to rise, but never go down when we have a really wet year. Wherever wineries seem to be developing…who pays for the development and use of their water resources….who pays for the massive road improvements….who pays for the losses incurred from illegals driving without car insurance, Actually, I did through my uninsured driver policy after I was hit head on by such a driver—he fled across the border to escape his civil liability…but I’m sure the amnesty program will bring him back. The biggest hit caused by wineries is the school system in California. Wineries require large amount of workers which bring into California, the good as well as the uneducated, the lawless, and illegals. As a parent that had kids in the public school system I see the greatest negative impact on tax dollars spent. Teachers are forced to take additional educational courses ( at tax payer expense) to supposedly assist teaching Spanish speaking students, without any requirement for them to speak English in class. Instead we are paying for fulltime interpreters that go class with them. Lunch and medical programs are overwhelmed by the massive influx of illegals. Gang growth is proportional to winery growth, more wineries equals more illegals and that means more gangs. The law enforcement issues within small towns are huge and the crime rate is unmanageable Mexican gangs are creating major problems within and outside of schools. Prisons are full of lawless illegals–more tax dollars and more growth in government employee numbers that tax payers have to support. Towns are going bankrupt and cannot afford law enforcement to protect the legal residents of California let alone stop the gangs from killing each other. Let’s talk unions—which lends itself to more political corruption. A farm workers union doesn’t create money, it can provide improve working conditions in the field but what they really provide is a controlled voting block for liberals and facilitate millions of dollars for political money sucking candidates. I’m just getting started but I think you get my drift people….you want wine.. grow your own damn grapes and make the wine yourself; and quit sucking the tax payers dry for your special alcohol needs and political correctness.
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