►
Description
House Department of Agencies Subcommittee House Hearing Room 3
A
B
A
C
C
All
right,
hb557
was
brought
to
me
by
the
ABC
alcohol
beverages.
Commission.
This
bill
will
allow
a
closing
business,
the
ability
to
transfer
leftover,
alcohol
inventory
to
the
new
owner
or
another
business.
The
seller
owns
of
the
same
license
type
upon
the
closure
of
the
sale
of
an
existing
business.
It
would
require
a
10-day
notice
to
the
Tennessee
ABC
and
the
Department
of
Revenue,
which
includes
a
detailed
inventory
list
and
the
date
of
the
transfer.
This
will
help
streamline
the
closing
process
for
buyers
and
sellers
while
ensuring
left
or
alcohol
inventory
is
safely
monitored.
C
I
didn't
know
this,
but
now
where
it
presently
is,
if
you
sell
a
restaurant
or
you
sell
a
liquor
store
liquor
store
to
someone
else,
then
you've
got
to
send
the
liquor
by
inventory
back
and
start
over
again
with
the
new
new
business.
So
this
will
just
allow
you
to
transfer
your
inventory
over
to
the
new
owner
or
to
our
new
business
that
you
personally
have
with
that
I'll
answer
your
questions.
A
D
C
Yes,
sir,
what
what
will
happen
if
we
pass
this
now
it'll
just
remain
in
the
business
to
the
new
owner
will
take
possession
of
it?
Of
course,
they'll
be
paying
the
former
owner
for
the
inventory.
What
happened
before,
if
the
distributor
or
the
wholesale
didn't
want
it
back,
then
you
had
to
just
take
it
home
with
you,
or
they
said
you
could
give
it
to
a
charity
things
like
that,
so
it
was
a
real
mess.
A
A
B
Thank
you
Mr
chairman
now
members.
Many
of
you
will
recognize
this
piece
of
legislation
as
it
passed
out
of
this
subcommittee
and
the
full
committee
last
year.
This
is
a
issue
speaker,
Sexton
is
passionate
about
so
I
appreciate
him
championing
championing
this
issue.
This
simply
requires
that
no
bid
non-competitive
contracts
be
submitted
to
fiscal
review.
For
our
review.
We
don't
vote
on
those
there's
a
mechanism
that
gives
us
the
opportunity
for
additional
review
and
additional
information
to
provide.
B
A
B
A
E
Lambert
Mr
chairman,
before
we
get
a
motion
a
second
on
this
one
I
noticed
that
chairman
Vaughn
is
here
and
given
the
importance
and
gravity
of
his
piece
of
legislation,
and
hopefully
the
fact
that
it
is
non-controversial
I
only
learned
about
this
bill
today,
but
I
fully
support
it
would
Mr
chairman.
Would
you
take
him
up
ahead
of
mine?
I
know
it
has
some
testimony
and
I
hate
to
keep
the
chairman.
E
A
F
F
Imagine
your
33
year
old
wife,
your
husband
passes
away
wrecks
your
world
you're,
trying
to
do
what's
right,
you're,
making
funeral
arrangements
and
then
it
Frey's
a
33
year
old
you're,
taking
into
account
his
buddies
on
base
family
members
from
across
the
country,
as
well
as
former
schoolmates
and
colleagues
you're
ready
to
make
your
funeral
arrangements-
and
you
say
wow
the
optimum
time
to
do.
This
is
obviously
on
a
Saturday
afternoon,
so
people
won't
have
to
take
leave
and
people
will
not
have
to
be
able
to
travel
a
little
better.
F
Imagine
you
make
arrangements
with
the
state
of
Tennessee
veterans
cemeteries
and
they
say
well
we'll
be
happy
to
enter
your
loved
one
as
long
as
it's
Monday
through
Friday
eight
to
five
at
that
point
in
time
they
said
due
to
extraordinary
costs
and
the
fact
that
our
processes
are
placed
into
into
the
books
for
reasons,
because
we
don't
want
to
be
doing
this
for
everyone.
This
is
the
most
efficient
way
to
do
it.
F
Well,
being
a
person
who
wants
to
be
a
man
of
action
for
my
constituents,
I
had
Community
leaders.
That
said,
we
would
love
to
Bear
the
extra
costs
for
this
family.
This
is
very
important.
We
were
denied,
even
though
at
that
point
in
time
the
commissioner
in
play,
had
it
within
the
statutes
to
make
that
decision.
So
what
we
decided
to
do
was
we
think
some
things
are
important
enough,
that
we
don't
leave
it
to
people's
Discretions.
We
put
it
in
the
code,
that's
what
this
bill
does.
A
G
F
G
F
He
was
he
passed
away
when
he
was
83.,
it's
far
more
for
having
an
aging
family
member
when
they
pass
away
it's
a
little
bit
easier
to
structure
the
times
and
dates
and
and
their
peers
can
deal
with
it
a
little
bit
easier
than
we
can
folks
are
in
active
duty
and
that's
what
this
does
we're,
not
throwing
the
whole
system.
What
we're
doing
is
we're
we're
codifying
the
fact
that
sometimes
we
need
to
do
the
right
thing
as
opposed
to
the
cheap
thing.
B
A
E
A
E
Chairman
at
the
Crux
of
this
bill
and
I
know
we'll
have
testimony
today
and
and
I
appreciate,
y'all's
patience
with
the
folks
that
are
testifying.
This
is
a
big
issue,
and
several
years
ago
we
allowed
in
law
for
wineries
to
be
able
to
ship
their
wine
to
customers
anywhere
and
for
wineries
outside
of
this
state
to
be
able
to
ship
their
wine
to
tennesseans.
Here,
that's
an
important
part
of
just
kind
of
as
retail
kind
of
changes.
Over
time.
We
felt
it
was
important
for
wineries
to
be
able
to
do
that
now.
E
When
that
bill
passed
and
I
was
strong
in
favor
of
it,
we
envisioned
that
wineries
would
be
sending
their
product
their
product
directly
to
customers
that
have
requested
that.
Unfortunately,
there
have
been
some
third
parties
that
have
stepped
in
the
breach
that
are
called
fulfillment
centers
and
some
of
those
are
very
good
actors.
Some
of
those
are
not,
and
they
are
completely
unlicensed.
They
are
completely
unregulated
and
this
bill
says
that
you
cannot
utilize
a
fulfillment
center
of
that
nature.
E
It
is
a
very
straightforward
bill
and
what
that
will
do
and
I
know,
we
will
hear
testimony
kind
of
on
both
sides
of
this.
But
the
reason
I'm
carrying
this
bill
is
that
I
am
concerned
as
a
small
business
owner.
My
whole
family's
always
been
small
business
owners
that,
when
you
have
a
large
fulfillment
center,
that
has
someone's
complete
customer
list
handles
their
marketing
and
handles
their
distribution.
E
They
have
the
complete
ability
to
destroy
that
small
business
at
any
second
that
they
want
to
by
cutting
them
off.
They've
got
their
entire
customer
list,
they're
shipping
their
product,
they
can
ship
what
was
requested
or
not
I
mean
they
can
leave
it,
laying
in
the
warehouse
or
out
in
the
sun
for
a
few
months
and
then
ship,
something
that
completely
ruins
your
product.
It
is
literally
turning
over
your
entire
business
to
these
fulfillment
centers
and
again
completely
unregulated,
completely
unlicensed.
E
Now,
if
done
properly,
they
can
handle
some
of
the
logistics
and
everything
else
and
just
handle
basically
kind
of
the
online
orders.
They
do
way
more
than
that
and
some
of
these
fulfillment
centers
we
even
take
just
large
bladders
of
wine
from
Wineries
and
fill
the
bottles
and
put
the
labels
on
themselves.
I
mean
they're
literally
getting
into
the
manufacturing
of
this.
This
is
not
what
we
envisioned
when
we
permitted
and
encouraged
our
wineries
here
to
be
able
to
ship
their
own
product.
That's
what
I
want
to
preserve.
E
A
Thank
you
for
your
explanation
and
I.
Like
you
said,
we
have
presenters
on
both
sides.
I
think
at
this
time,
we'll
go
out
of
session
I'm
going
to
allow
each
speaker
to
have
five
minutes
to
State
their
case,
so
the
first
one
to
come
up,
let's
go
out
of
session,
be
Russell.
Thomas
and
you'll
have
five
minutes
to
State
your
case
and
what
you'd
like
to
say.
H
I'm,
the
executive
director
beverage
commission
I
appreciate
you
allowing
me
the
opportunity
to
speak
today.
I
wanted
to
spend
just
a
few
minutes,
sharing
an
overview
with
the
committee
of
some
of
the
facts
involves
surrounding
this
bill
that
can
hopefully
help
put
things
in
context
and
help
you
look
at
this
bill,
as,
as
other
speakers
come
forward,
so
just
to
pick
up
and
give
a
little
bit
of
a
general
overview
of
the
laws
that
we're
talking
about
in
Tennessee.
H
As
leader
Lambeth
mentioned
a
number
of
years
ago,
Tennessee
created
a
license
called
the
winery
now
called
the
winery
direct
shipper's
license.
That
is
a
license
that
gives
a
business
a
winery,
the
ability
to
sell
wine
and
ship
that
wine
directly
to
a
consumer
in
Tennessee.
This
can
be
a
Tennessee
Winery.
This
can
be
a
California
Winery,
any
winery
in
the
United
States.
H
It
is
a
special
exception
from
the
three-tier
system
that
allow
will
say
Winery
to
to
skip
the
wholesale
tier
and
sell
directly
to
a
consumer
in
Tennessee.
So,
a
few
years
ago,
this
body
passed
a
statute
that
required
common
carriers,
FedEx
and
UPS
those
businesses
that
are
actually
delivering
that
alcohol
in
these
cells
to
begin
submitting
reports
to
to
the
Department
of
Revenue,
who
shares
that
with
us
and
those
reports
list
all
the
shipments
of
alcohol
that
FedEx
and
UPS
ship
into
the
state
of
Tennessee.
H
H
We
have
seen
over
those
two
years
an
average
of
about
300
000
shipments
of
alcohol
into
the
state
a
year,
those
report
the
weight
of
each
shipment.
We
see
an
average
over
those
first,
two
years
right
around
about
6.8
million
pounds
of
alcohol
being
shipped
into
the
state,
and
those
reports
show
addresses
where
those
shipments
originate
from
and
in
the
the
first
year
of
that
reporting,
there
were
about
3
700
separate
addresses
from
which
alcohol
was
shipped
into
the
state.
H
That
number
shrunk
down
a
little
bit
in
the
second
year,
but
but
well
over
2500
still,
so
it
can
be
difficult,
analyzing
that
data.
You
look
at
those
reports
and
sometimes
you
see
addresses
that
don't
make
very
much
sense.
It
says
something
like
it
was
shipped
from
nw9
Reserve
with
a
street
address
and
City
doesn't
necessarily
match
up
with
a
known
company
name
or
Winery
name.
H
H
You
notice
that
only
about
I
say
only
still
a
lot
only
about
450
had
more
than
50
shipments,
so
we
analyzed
the
numbers
played
with
it
a
little
bit
and
ultimately,
we
determined
that
really
by
looking
at
volume,
combining
addresses
that
clearly
came
from
the
same
business
that
there
are
really
about
200,
distinct
entities,
businesses,
wineries
that
account
for
over
90
percent
of
the
alcohol
shipment
in
Tennessee.
We
measured
that
a
couple
of
different
ways.
A
H
You
look
at
that.
What
do
you
see
in
those
numbers?
Well,
you
do
see
a
chunk
of
what
you
would
expect.
You
see
shipments
that
come
from
wineries.
You
see
recognizable
Winery
name
or
a
dress
that
matches
up
with
a
winery
license.
I
know
those
top
200.
You
know
over
a
hundred
of
those
are
wineries,
but
that's
not
all
you
see.
H
You
also
see
about
40
entities
that
some
people
refer
to
as
fulfillment
houses
or
third-party
logistics
companies,
other
companies
that
are
providing
services
to
wineries
that
may
be
packaging
Etc
and
those
are
the
addresses
where
FedEx
and
UPS
are
picking
up
alcohol.
That's
showing
up
on
those
reports
that
go
to
consumers
in
Tennessee
and
of
those
about
40.
When
you
look
at
the
volume,
they're
really
processing
well
over
half
of
the
shipments
of
alcohol
into
Tennessee,
so
I
think
that's
important
for
the.
A
I
I
H
H
H
I
H
Honestly,
the
first
time
I
read
this
bill.
I
didn't
didn't
note
anything
that
I
thought
would
affect
the
Tennessee
wineries.
I
would
say
that
I
had
a
conversation
with
some
Tennessee
Winery
people
yesterday
that
raised
some
concerns
that
that
our
commission
has
now
taken
a
second
look
at
to
delve
into
a
little
more
but
I'm
not
aware,
and
this
I
would
defer
to
our
Tennessee
wineries
to
answer
this,
but
I
am
not
aware
of
any
of
them
using
fulfillment
houses.
H
I
think
their
concerns
is
is
more
in
the
first
part
of
the
bill,
which
doesn't
necessarily
address
fulfillment
houses.
But
what
winds
a
license
holder
can
ship
I
think
their
concerns
are
related
to
that
part
of
the
bill
and
not
necessarily
the
Fulfillment
bill,
but
I
would
defer
to
them
to
answer
that.
Okay,.
B
J
H
A
big
chunk,
however,
are
these
third-party
logistics
companies
and
they
are
doing
a
huge
volume,
so
Nationwide
studies
show
that
they
they
handle
about
60
percent
or
more
of
the
total
volume
of
shipments
and
a
shipment
that
comes
from
that
fulfillment
House
address.
It
could
very
well
come
on
behalf
of
a
direct
shipper
licensed
Winery.
It
may
not
the
comment.
The
reports
that
we
get
alone,
don't
answer
that
question.
J
I
was
trying
to
relate
to
6.8,
I,
guess
million
pounds
of
I.
Guess
it's
wine,
salt
wine
right
into
cases
I'll,
let
I
don't
know
if
anybody's
done
the
math
I'm
just
curious
to
know
the
actual
volume
that's
coming
into
Tennessee,
because
obviously
it's
bypassing
the
retail
and
the
wholesalers,
and
if
that
volume
grows.
Obviously
that's
the
issue
that
we're
addressing
here
and
I
mean.
Are
these
wine
shipments
now
be
just
becoming
online?
Retail
outlets
and
I
mean
I.
J
Think
that's
a
Crux
of
what
we're
dealing
with
here,
and
these
are
certainly
a
real
concern,
because
where
does
it
stop?
How
does
it
just
continue
to
keep
mushrooming
mushrooming
and
how
do
we
put
the
and
we're
not
going
to
put
the
genie
back
in
the
bottle,
but
no
pun
intended,
but
we
we
need
to
do
something
here.
H
G
G
H
H
Logistics
shipper-
and
it
is
currently
it
is
not
illegal
for
a
licensed
Winery
to
use
the
services
of
one
of
those
businesses.
So
when
we
see
that
type
of
address
in
the
common
care
reports,
we
we
don't
know
by
looking
that
alone,
it
could
be,
it
could
be
a
shipment
on
behalf
of
a
legal
licensed
Winery.
It
may
not
be
okay.
G
So
I
guess
getting
back
to
my
representative
from
Coffee
County
down
here
with
all
this
that's
coming
in.
We
don't
really
know
what
the
volume
well
we
do
know
what
the
big
volume
is,
but
the
volume
may
continue
to
rise.
But
what
we're
trying
to
do
right
now
is
for
the
local
shipper,
the
local
wineries
and
they
have
their
own.
They
have
their
own
license
to
ship
in.
Is
that
correct,
if
they,
if
they're
so
licensed,.
H
A
H
Yes,
sir,
thank
you
chairman.
That's
a
good
question.
The
current
direct
shipper
statute
does
have
some
requirements.
As
far
as
that
goes,
57
3217
requires
that
the
wineries
only
contract
with
common
carriers
that
commit
in
that
contractual
language
to
only
make
delivery
face
to
face,
confirm
age
and
obtain
a
signature.
So
the
law
does
currently
require
that
when
a
delivery
is
made,
it
should
be
made
face
to
face
the
age
of
that
person
receiving
the
shipment
should
be
verified
and
that
person
should
sign
for
receipt
of
that
delivery.
H
Sometimes
it
comes
from
a
fulfillment
center,
so
we
we
run
operations
where
we
try
to
purchase
wine.
These
are
all
internet
sales,
and
then
we
check
various
things
and
that
delivery
we
check
you
know
are
they:
are
they
complying
with
those
requirements?
Face-To-Face
delivery
confirm
age,
get
a
signature.
We
also
have.
We
also
run
some
operations
to
make
sure
they're
complying
with
the
non-leaders
a
month.
27
liters
a
year
volume
requirements.
J
J
One
question
I
forgot
to
ask
earlier
was
the
concern
of
and
I
asked
you
if
you've
had
complaints
from
citizens
receiving
one
products
that
they
didn't
want,
or
products
that
were
falsified
and
not
what
they
thought
they
were
going
to
get
so
I
just
like
to
get
that
on
the
record.
If
y'all
have
gotten
complaints
along
those
lines.
H
I
Thank
you,
Mr
chairman
I
I
got
a
little
confused
here
director,
which
is
easy
to
do.
For
me,
the
3600
addresses
that
you
said
you
were
the
approximate
number
that
were
shipped
from,
but
you
only
have
900
licensed
shippers
is
that
is
that
what
you
testified
to
I'm
conf
where's,
the
3600
shouldn't
there
be
a
license
for
each
one
of
those
I
mean
that's
where
my
confusion
is
so.
H
It's
36
3600.
This
is
within
that
a
distinct
address
could
be,
could
be
a
name
spelled
differently.
Sometimes
it
may
have.
An
extra
space
between
two
words
are
put
together
as
the
computer
identifies
as
not
the
exact
same
alphanumeric
data
points,
3700
different
ones,
so
there's
quite
a
bit
of
manual
labor
involved
to
go
in
and
analyze
those
addresses
and
group
them
together.
So
with
some
computer
and
manual
labor.
H
I
H
I
H
I
H
Similar
to
how
we
handle
enforcement
at
bars
and
restaurants,
we
look
at
it
as
a
full
circle
of
responsibility.
The
business
that
profits
off
that
transaction,
the
individual
that
that
is
on
the
scene
that
hands
that
over
to
a
minor
all
bears
some
responsibility.
So
in
an
example
of
a
of
a
something
like
that,
but
maybe
one
of
our
operations
with
a
with
a
with
a
minor,
we
would
issue
a
citation
to
that
direct
shipper
license
holder
and
we
would
charge
the
individual
Who
provided
that
alcohol
to
a
minor
with
criminal
offense.
I
I
H
So
if
the
way
this
is
is
written,
it
says
it
would
it
would
what
I
would
describe
as
limit
the
brands
that
may
be
sold
by
a
license
holder
to
brands
that
you
make,
and
it
says
that
it
has
to
be
wands
that
they
produce
when
I've
they've
raised
some
concerns
that
they
feel
that
that
might
cause
a
problem
there.
That's
something
that
just
recently
came
to
my
attention.
H
H
I
I
H
A
A
H
A
H
H
K
Group
in
Sevier
County
and
we're
the
largest
producer
of
Tennessee
Wine
in
the
state,
and
we
have
48
Farmers
under
contract
from
Jackson
Tennessee
to
the
Tri-Cities
that
provide
product
to
us
and
we
buy
54
percent
of
all
the
grapes
grown
in
Tennessee
for
our
wine
production
I'm.
Also,
here
representing
the
Tennessee
Farm
wine
growers,
association
I've
been
a
member
for
31
years,
and
this
bill
is.
K
The
issue
is
that
last
year
there
was
a
crop
failure
in
Tennessee
because
of
a
late
Frost,
62
percent
of
the
great
production
in
Tennessee
was
was
frozen
out.
The
Tennessee
wineries
were
faced
with
two-thirds
of
loss
of
their
crop.
We
were
forced
to
go
out
of
state
to
get
product
now.
If
you
know
this
is
going
to
happen
ahead
of
time,
you
can
go
on
the
spot
market
and
get
grapes.
K
But
if
you
don't
know
it,
then
you're
forced
to
go
into
the
bulk
wine
market
to
make
up
for
the
shortfalls,
and
so,
if
you
can't
get
grapes,
then
you're
forced
into
the
bulk
Market.
You
get
the
bulk
wine
and,
as
this
bill
is
currently
written,
we
can't
ship
our
products
to
Tennessee
because
it
doesn't
meet
the
content
requirement
and
we
can't
control
the
weather
and
we
just
can't
shut
our
business
down
because
there's
a
frost.
K
If
we're
trying
to
grow
an
industry
in
Tennessee
and
provide
a
livelihood
to
the
farmers
and
another
cash
crop
for
the
farmers,
then
we've
got
to
have
the
ability
to
stay
in
business,
otherwise
you're
going
to
lose
all
the
wineries,
so
we're
opposed
to
that
and
that
this
bill
is
overly
broad,
that
it
appears
that
they
have
tried
to
plug
every
hole
possible
regardless
of
what
it
does
to
the
Tennessee
farm
and
wine
Growers,
and
we're
throwing
the
baby
out
with
the
bath
water.
This
bill
will
hurt
our
industry.
K
There
are
69
wineries
in
Tennessee,
348
farmers
who
grow
grapes
for
the
industry,
and
this
bill
is
going
to
hurt
them.
There
are
12
percent
of
the
wineries
in
the
state
are
large
enough
to
work
around
these
rules
and
regulations
being
added
to
us,
the
rest
of
them.
Don't
55
percent
of
the
wineries
in
the
state
are
less
than
ten
thousand
gallons,
and
the
definition
of
that
is
ten
thousand
gallons
is
break
even
and
so
these
people
are
at
break
even
if
they
got
paid
minimum
wage
they'd
get
a
wage
increase.
K
You
know
they're
100
hours
a
week
at
the
mom-and-pop
operation,
and
but
that's
what
bootstraps,
your
industry,
the
little
guys
start
out,
they're
small
they
grow
up,
they
get
big
and
then
they
Prosper.
But
if
you,
if
you
damage
them
in
the
growth
stage,
If,
you
deny
them
a
dollar
and
and
we're
talking
not
a
lot
but
I'm.
A
K
What
we
try
to
do
to
keep
consistency
in
a
product
is,
if
you're
short,
10,
000
gallons,
then
you
try
and
buy
ten
thousand
gallons
and
blend
it
with
what
you
have.
So
you
can
get
a
product,
that's
fairly
approximate
to
what
you
have
it's,
not
just
that
you're
going
to
substitute
something
for
it,
because
that
damages
your
product
line
and
your
customers
saying
hey
what
happened.
You
know
I'm
used
to
this
flavor
from
you
guys,
I'm,
not
getting
it.
K
So
you
try
to
blend
and
work
it
out
and
stretch
it
to
where
you
can
get
a
fairly
consistent
product
of
what
you
normally
produce.
So
your
consumer
is
not
upset
about
the
change
in
the
product.
So
that's
basically
it
I
mean
it's
not
a
complete
replacement
of
the
product,
we're
just
trying
to
stretch
what
we
have,
but
because
the
content
law
is
what
it
is
in
this,
then
we
can't
stretch
it.
It's
got
to
be
all
or
nothing.
J
K
I
mean
we
pay
our
taxes
and
we
want
everyone
to
pay
their
taxes
because
they're
our
competitors
so
to
hear
that
people
are
shipping
wine
into
tendency
and
not
paying
the
taxes.
Well,
that's
a
slap
in
the
face
to
us,
but
it
sounds
like
it's
an
Enforcement
issue,
because
the
current
laws
outlawed
you
don't
need
a
new
law,
it's
already
illegal.
To
do
that.
K
So
it
may
be
a
Manpower
issue
for
the
ABC
or
a
lawyer
issue,
but
I
have
gone
to
in
my
31
years
to
seven
ttb
conferences
on
regulations
and
rules
in
the
industry
and
at
every
one
of
those
conferences.
Someone
is
always
complaining
about
state
laws
that
are
squarely
and
it's
a
Commerce
Clause
violation
and
all
this
stuff
and
they
want
TTV
to
do
something
about
it
and
ttb
has
every
time
this
is
through
five
separate
Presidents.
K
So
if
you've
got
a
list
of
people
who
are
doing
this,
then
you
can
contact
ttb
and
ask
that
their
license
be
revoked.
There
are
over
12
000
licensed
wineries
in
the
United
States.
Today
and
the
ttb
will
take
action
against
anyone
that
violates
state
law,
especially
if
you
can
prove
it
as
an
ongoing
issue.
K
J
K
K
And
so
this
issue
these
are
out
of
state.
But
now
when
we
say
that
Nashville
is
our
number
three
market
up
there
and
the
Tri-Cities
is
our
number
eight
market.
So
we
get
a
lot
of
Tennessee
people
come
up
there
and
we
have
a
lot
of
Tennessee
people
sign
up
for
our
wine
clubs
and
we
ship
to
those
people.
But
we
ship
under
we
have
a
direct
shipper's
license
like
like
everyone
else
is
supposed
to
have
and
we
pay
our
taxes.
K
A
K
Then
you
are
prohibited
from
including
that
in
your
business
model,
now
it's
not
just
the
shipping
law,
because
this
also
includes
opens
chapter
57,
which
is
your
Winery
license.
So
in
effect
this
bill
says:
if
you
ship
to
Ohio-
and
you
use
a
fulfillment
house
in
Ohio
to
handle
your
wine
club,
then
you
can't
have
a
Tennessee
License.
A
Okay,
as
you've
been,
you
know
your
Tennessee
License
that
and
then
you
get
back
to
using
FedEx
and
I'm
trying
to
figure
out
something
here.
Is
there
any
validation
of
when
they
deliver
that
that?
Do
you
all
have
something
in
process
that
checks
that
process?
It
validates
how
you
I
got
a
signature
and
I
was
over
21.
when.
K
They
come
to
our
website
and
they
place
an
order.
Okay,
of
course.
Obviously,
if
they're
in
our
wine
club,
then
they've
been
out,
they've
been
to
our
premise:
we've
ided
them
when
we
sold
them
the
products
there,
and
so
when
they
join
the
wine
club.
We
know
they're
21.
If
they
order
it,
then
it's
on
there
you've
gotta.
You
got
to
be
21
to
order
okay,
but
that
can
State
anything
I
mean
yeah.
We
also
pay
FedEx
an
additional
fee
to
get
an
adult
signature.
Okay,.
K
K
Fedex
does
not
respond
back
to
us
for
that
now.
Also
on
the
Fulfillment
house
issue.
We
don't
have
to
do
that
to
use
the
Fulfillment
house,
because
we
are
sufficiently
of
sufficient
size
to
higher
compliance
people
on
site.
To
do
these
things.
As
I
said,
75
percent
of
the
Tennessee
wineries
do
not
have
the
the
ability
to
do
that
because
they
are
so
they're
tight
on
their
money.
So
basically
it's
them
doing
the
compliance
homework.
So
any
regulatory
burden
you
put
on
that.
Then
you
put
it
on
them.
K
K
If
you
want
to
be
in
compliance
with
the
law
and-
and
the
Tennessee
wonders
want
to
do
that,
then
you
hire
a
fulfillment
house
to
do
the
the
compliance
part,
not
necessarily
the
shipping
part,
but
the
compliance
part.
But
there
is
no
distinction
in
this
law
from
what,
if
they
do
compliance
work
for
you,
then,
even
though
they
don't
handle
the
shipping
of
your
product,
you're
hit
with
it,
because
they're
you're
not
allowed
to
use
a
compliance
work
by
a
third
party.
D
K
You
tell
them
who
you're
shipping
it
to,
and
then
they
tell
you.
Okay,
we'll
take
care
of
getting
the
license
for
this
group.
This
state.
We
will
take
care
of
paying
all
the
taxes
in
this
state.
You
will
pay
us
that
amount
of
money,
and
then
you
will
pay
us
a
fee
for
doing
this.
Now
you
ship
it
to
them,
and
we
do
the
shipping.
There
are
different
kinds
of
compliance,
houses
and
fulfillment
houses
all
over
the
board.
K
K
K
They're
telling
me
that
we
can
look
up
our
FedEx
files.
This
is
a
Rhonda
Moody
she's,
the
president
of
the
tfwa,
the
Highland
Manor
Winery,
and
she
said
you
can
look
up
the
signatures
from
FedEx,
where
you
require
signature,
I,
believe
that
was
your
question.
We
could
confirm
that
we
got
a
signature.
A
K
It
does
happen
if
we
can.
If
we
have
a
package
that
goes
out
it's
requiring
a
signature,
then
we
can
go
online
and
look
at
that
and
say:
okay
FedEx
said
Nancy
Johnson
signed
for
this
package.
We
can
look
and
see
is
Nancy
Johnson,
our
wine
club
member,
our
credit
card
customer
and
yeah,
but
the
signature
looks
different,
was
Nancy
in
a
hurry
or
what.
A
K
A
K
It
does
not
it
all,
it
prevents
you
doing.
If
you
can't
segregate
your
wine,
then
it
could
prevent
you
from
Shipping
in
in
Tennessee
if
you've
got
20
tanks
and
you
bring
in
product
and
you've
got
10
products,
and
some
of
it
is
Tennessee
product
and
some
of
it's
out
of
state
product.
If
you
can't
segregate
it,
if
you
don't
have
enough
tax
to
segregate
it,
then
you
would
be.
It
would
be
dangerous
for
you
to
ship
to
Tennessee.
K
I
K
We
ship
it
straight,
but
under
this
legislation,
Vino
slipper
is
considered
a
fulfillment
house
and
we
could
not
use
them.
We
would
have
to
do
it
ourselves,
even
though
they're
not
touching
our
product,
we're
talking
about
adulterated
products
coming
in
and
out.
This
is
bottle
products
that
we're
shipping,
and
this
is
because
you're
not
allowed
under
this
bill,
you're
not
allowed
to
use
a
fulfillment
house
for
compliance
work.
K
I
K
This
bill
opens
up
title,
57
and
wineries.
There's
a
lot
of
licenses
under
57..
The
bill
doesn't
say:
57
I
forget
what
it
is:
57
203
or
something
which
is
a
shipping
law.
If
it.
If
it
exclusively
only
stated
throughout
the
entirety
the
shipping
law,
then
it
would
solve
some
of
the
problems.
But
when
you
open
title
57,
that
is
the
winery
license,
the
shipping
license
the
distribution
license.
We
have
got
several
licenses.
We
can
get
in
Tennessee
but
they're
all
under
57..
A
B
Right,
like
I
I,
have
two
things:
I'm
gonna
play
deal
with
Advocate.
First,
if
I'm
a
Tennessean
that
owns
a
winery
in
another
state,
we're
Banning
the
Fulfillment
houses.
How
would
it
affect?
Excuse
me,
sir
I
didn't
hear
you
if
I'm
a
Tennessean
that
owns
a
winery
in
another
state,
how
would
Banning
the
Fulfillment
houses
affect
affect
them
if.
K
B
K
E
J
E
You
Mr
chairman
and
in
fact
this
bill
already
resolved
some
of
those
and
I
appreciate
the
testimony
today,
but
I'm
not
sure
why
it
was
in
previous
testimony.
Just
the
code
was
referenced
because
this
bill
does
more
than
just
open
up
the
code.
I
mean
it
specifies
what
a
fulfillment
house
is.
It
doesn't
deal
with
companies
that
just
handle
compliance.
I
mean
it
says.
E
Specifically,
fulfillment
house
means
an
in
or
out
of
state
entity
other
than
a
winery
that
handles
Logistics,
including
warehousing
packaging
order,
fulfillment
or
shipping
services,
and
it
goes
on
from
there,
but
I
mean
it
defines
what
a
fulfillment
house
is
pretty.
Clearly
I
was
a
little
surprised.
That's
the
first
that
I
had
heard
that
we
had
Tennessee
Wine
that's
been
sold
as
Tennessee
Wine.
That
is
not
from
Tennessee
grapes.
I,
don't
know
how
to
solve
that,
because,
quite
frankly,
I'm
a
little
disturbed
by
that
I
get
that.
E
That
may
be
something
that
happens
within
the
industry,
but
if
it's
being
stamped
as
Tennessee
Wine,
if
it's
Georgia
grapes
and
North
Carolina
grapes,
I
I'm
a
little
concerned
by
that
so
I,
that's
the
first
time
I've
heard
of
that
today.
That
may
be
a
conversation.
That's
a
larger
conversation.
We've
had
that
conversation
on
other
products
that
are
stamped
as
Tennessee
Products,
but
I
was
a
little
concerned
about
that.
I
didn't
know
that
was
an
industry
standard
to
intermix
other
types
of
grapes
into
a
wine
that
is
sold
as
Tennessee
Wine
I
will
say.
E
The
ABC
numbers
are
very.
Concerning
I
mean
it
shows
that
there
are
a
large
number
of
shippers
that
we
cannot
identify
as
a
winery
that
are
shipping
wine
into
this
state.
We
have
no
idea
if
they're
paying
the
taxes.
We
have
no
idea
if
they're
actually
going
through
the
proper
protocols
and
we
can't
hold
them
accountable,
I
mean
they.
They
can't
find
these
folks.
They
don't
know
who
they
are.
If
a
winery,
which
is
exactly
what
this
body
passed
a
couple
of
years
ago,
is
shipping
to
a
customer,
which
is
what
we
want.
E
We
want
those
wineries
to
be
able
to
do
that.
That
customer
knows
who
to
hold
accountable,
and
we
know
who
hold
accountable
if
they're
not
getting
the
product
that
they
ordered
or,
if,
quite
frankly,
that
that
Winery
is,
is
playing
fast
and
loose
with
our
laws.
So
these
fulfillment
house
that
are
in
between
I
am
always
open
to
work
with
anybody.
E
I'm
merely
asking
for
your
support
today
on
this
bill,
but,
like
all
of
you,
when
you're
carrying
bills,
I
I
will
absolutely
keep
the
conversation
open
and
we'll
meet
with
anybody
on
ways
to
improve
this
I
will
state
clearly
and
concisely.
There
is
no
intent
on
my
part
and
and
no
intent
on
the
language
of
this
bill
to
keep
a
winery
from
Shipping
their
wine.
None
zip
zero.
E
So
if
there's
some
sort
of
clerical
technical
change
that
we
need
to
make
to
make
sure
they
can
ship
their
wine
even
the
issue
with
kind
of
intermingling
other
grapes,
if
there's
a
way,
we
can
address
that
nobody's
comfortable
with
it.
I
don't
mind,
but
I
would
deeply
appreciate
your
support
and
yes
vote
today.
For
this.
I
Thank
you.
Mr
chairman
leader,
I,
was
very
confused
when
I
read
the
physical
note
in
I've,
never
seen
a
physical
note
exactly
like
this,
due
to
multiple
unknown
factors
regarding
cannibalization
of
sales
and
current
capabilities
of
companies
to
adapt
to
their
logistical
chain
and
other
unknown
numbers
of
potential
licensees
affected
by
the
proposed
legislation,
any
physical
impact
would
be
to
undetermined
at
this
time.
So
we
did
what
this
is
stating
we
don't
know
if
this
is
going
to
affect
the
bottom
line,
for
the
state
is
that
it
am
I
interpreting
that
correct.
E
I
think
you
were
exactly
interpreting
this
properly
and
we've
been
here
for
many
years
together
and
that's
the
whole
issue
we're
trying
to
resolve
with
this
bill.
It's
the
wild
west
with
these
fulfillment
houses,
I
mean
nobody's
watching
the
story
here,
nobody's
keeping
an
eye
on
exactly
what
they're
doing
they're
completely
unlicensed
and
unregulated.
I
Second,
question
is:
if,
if
we
do
pass
this
out
today,
are
you
committed
to
working
with
our
local
wineries,
our
Tennessee
Wineries
and
getting
this
acceptable
to
them?
And
what
about
this
Vino
shippers
that
they
were
talking
about
where
their
product
isn't
actually
touched,
like
in
a
fulfillment
house,
but
it
helps
them
comply
with
other
states.
Would
you
be
willing
to
work
with
that
you're.
E
Right,
absolutely
and
representative
I
see
that
as
more
of
a
technical
change
than
this,
it
was
no
intention
to
actually
get
in
between
anyone
in
their
compliance
officers
compliance
folks,
it's
again
the
Fulfillment
centers
that
are
acting
as
a
warehouse,
a
distributor,
a
retailer
in
certain
instances.
That's
what
this
bill
bars
absolutely
and
dedicated
continued
work
with
our
Tennessee
wineries
to
make
sure
there's
no
negative
impact
on
them
so
long
as
anything
that
would
change
after
this
committee
and
I'm
very
dedicated
to
the
committee
process
and
respect
for
the
chairman.
Anything
would
change.
E
I
I
B
A
E
E
A
Chairman,
thank
you
leader,
the
no
other
questions
we
are
prepared
to
vote,
those
on
House,
Bill,
0742
in
favor
of,
say,
aye
opposed
the
eyes.
Have
it,
however,
before
I
hammered
this
out,
I
want
all
parties
to
get
together
and
come
to
some
kind
of
common
common
ground,
just
like
car
and
the
rest
of
them
said,
and
then
my
biggest
concern
is
the
signatures
and
validation
that
we
just
don't
just
start
dropping
this
off
at
houses.
Okay,.
A
L
L
Straightforwardly
what
this
bill
does
is
remove
a
restriction
that
is
currently
in
place
for
veteran
services
officers
to
be
combat
veterans-
okay,
right
now
that
limits
the
number
of
people,
and
we
have
places
that
need
veteran
service
officers
in
our
state
that
can't
comply
with
this.
There
are
veterans
available,
they're,
not
combat
veterans,
so
this
bill
simply
removes
that
requirement.
It's
still
a
requirement
that
they
be
a
veteran.
With
that
explanation,
questions.
A
A
A
A
M
M
Would
can
they
not
talk
behind
me?
Thank
you
which,
for
us,
the
the
restaurant
during
any
year
when
gross
revenue
from
the
previous
year
derived
from
food
sales
is
50
less
than
the
gross
revenue
of
alcohol
sales.
It's
very
technical
I
can
go
into
a
detailed
explanation
of
the
amendment,
but
that's
an
overall
view
of
the
amendment.
A
M
So
what
this
will
do
is
typically
the
ABC
can
issue
a
liquor
license
to
the
property
owner
or
the
or
someone
who's
leasing,
the
property.
This
will
add
managing
the
property
to
that
as
well.
So
they
can
request
the
permit
on
behalf
of
the
owner
and
last
it
does
have
the
General
Jackson
Showboat.
The
bill
will
allow
Marriott
International
to
serve
alcoholic
beverages
in
the
dock
area
inside
the
gates
before
they
go
on
the
boat.
So
I'm
happy
to
answer
any
questions.
Questions.
A
A
A
G
G
At
that
time
there
were
two
people
that
had
applied
and
they
were
threatening
to
sue
the
state.
So
there's
been
a
long
string
of
court
cases
since
then
to
declare
that,
and
finally,
this
last
year
it
was
in
the
U.S
Supreme
Court
and
they
declared
it
unconstitutional
to
have
that
residency
requirement.
So
the
ABC
has
not
been
acting
upon.
That
requirement.