Preproposal statement of inquiry was filed as WSR 99-02-062.
Title of Rule: Chapter 16-575 WAC, Wine Commission, rate of assessment.
Purpose: The proposed rule will increase the maximum assessment rate for vinifera grapes and wine produced in the state to expand promotional programs for Washington state wines in-state, nationally and throughout the world.
Statutory Authority for Adoption: Chapter 15.88 RCW, chapter 303, Laws of 1997.
Statute Being Implemented: Chapter 15.88 RCW.
Summary: The rule change, if approved by a majority of the vinifera grape growers and wine producers will increase the maximum rate of assessments on vinifera grapes from $3 per ton to $6 per ton and the maximum rate on wine from $0.02 per gallon to $0.04 per gallon.
Reasons Supporting Proposal: The assessment rate increase is necessary to maintain and expand markets for wine produced in the state. The Washington Wine Commission has not changed the assessment rate since its inception despite rising administrative and promotional costs and increased competition from other wine producing regions.
Name of Agency Personnel Responsible for Drafting, Implementation and Enforcement: Steve Burns, Wine Commission, 500 Union Street, #945, Seattle, WA, (206) 667-9463.
Name of Proponent: Washington Wine Commission, governmental.
Agency Comments or Recommendations, if any, as to Statutory Language, Implementation, Enforcement, and Fiscal Matters: Adoption of the rule is subject to approval of the wine grape growers and wine producers conducted by the Washington Department of Agriculture.
Rule is not necessitated by federal law, federal or state court decision.
Explanation of Rule, its Purpose, and Anticipated Effects: The Washington State Wine Commission collects assessments on vinifera grapes and wine produced in the state to fund advertising and promotional programs. The cost of conducting the programs for wine has increased substantially since the current assessment rates went into effect on July 1, 1989. Raising the maximum assessment rate will increase potential funding available for programs which may be necessary to maintain and expand markets for wine produced in Washington state.
Proposal Changes the Following Existing Rules: The proposed rule change, if approved by a majority of the vinifera grape growers and wine producers will increase the maximum rate of assessments on vinifera grapes from $3 per ton to $6 per ton and the rate on wine from $0.02 per gallon to $0.04 per gallon. The rate may be adjusted annually by the commission as needed to fund authorized activities. The annual assessment shall not exceed the maximum rate. The proposed assessment increase will not become effective unless the increase is first referred to a referendum of the grape growers and wine producers in accordance with RCW 66.24.215 and chapter 15.88 RCW.
No small business economic impact statement has been prepared under chapter 19.85 RCW. The rule will only affect vinifera grape growers and wine producers in Washington state and will only become effective with the approval of a majority of grape growers and wine producers voting in a referendum. There will be no disproportionate cost to small businesses as defined under chapter 19.85 RCW. The rule will not increase cost in equipment, supplies, labor or administrative expenses. Cost to the vinifera grape growers and wine producers is a per unit fee, established annually by the commission based on anticipated production, condition of the markets and estimated cost of the programs. All cost as well as economic benefit to the producer will be in proportion to the level of production of each producer.
Section 201, chapter 403, Laws of 1995, does not apply to this rule adoption. The Washington State Department of Agriculture is not a listed agency in section 201.
Hearing Location: Doubletree Hotel, Oak/Pine Room, 2525 North 20th Avenue, Pasco, WA 99301, on April 13, 1999, at 10:30 a.m.
Assistance for Persons with Disabilities: Contact Cathy Jensen by April 9, 1999, TDD (360) 902-1996, or (360) 902-1800.
Submit Written Comments to: Steve Burns, Executive Director, Washington Wine Commission, 500 Union Street, #945, Seattle, WA 98101, fax (206) 583-0573, by April 13, 1999.
Date of Intended Adoption: May 19, 1999.
March 2, 1999
(1) Beginning on July 1, 1999 the assessment rate for vinifera grapes grown in this state shall not be less than three dollars per ton nor more than six dollars per ton. The assessment rate for wine producers shall not be less than $0.02 per gallon nor more than $0.04 per gallon. The Washington Wine Commission may adjust the assessment amount levied on wine producers and grape growers as needed to fund necessary commission activities. Provided, that no increase in the assessment on grape growers or wine producers becomes effective unless the increase is first referred by the commission to a referendum by the grape growers and wine producers in accordance with RCW 66.24.215 and chapter 15.88 RCW. In determining whether to adjust the assessment amount the commission shall consider the following factors:
(a) The commission's budgetary needs, including but not limited to a qualitative and quantitative review of programs carried out in the preceding year by the commission. This review should consider whether the program met its goals, benchmarks and objectives and whether the program constitutes the best use of the wine commission's finite resources;
(b) Projected grape production;
(c) Changes in administrative costs;
(d) Changes in the industry outside the control of the wine commission.
(2) The commission shall provide grape growers and wine producers notice of changes in assessment rates in a timely and reasonable manner and in no instance shall the notice be less than thirty days from the date the assessment is due.