Watered-down plan emerges in end

05/27/2001

By George Kuempel and Wayne Slater / The Dallas Morning News

AUSTIN – It seemed like a simple idea: allow Texans to buy wine directly over the Internet.

In-state wineries promoted the idea. California vineyards were all for it. And independent surveys found support among many Texas wine drinkers.

But as lawmakers prepare to leave Austin this week, supporters of unfettered on-line wine sales have failed – defeated by a handful of Texas wholesalers whose blueprint to kill the bill was developed long before legislators came to town.

"I'm not surprised at all," said veteran lobbyist Brad Shields, who has been on the opposite side of wholesalers in the past but was not involved in liquor issues this session. "Historically, they have been awesome."

The battle over Internet wine sales, which played out in public hearings and behind the scenes, offers a case study of how a proposal can draw a formidable thicket of obstacles, competing interests and big-money opposition.

Over the last five months, the bill was debated, killed, resurrected, rewritten and finally passed in a form that is a thin shadow of its former self.

It's the story of how a bill does not become law.

For Texas and California vineyards wanting to lift the ban on Internet wine sales, the chief opposition came in the form of "Butch" Sparks, a 57-year-old veteran lobbyist for the influential liquor wholesalers.

Short, round and silver-haired, Mr. Sparks – Robert at birth – has long been a fixture at the Capitol. He has spent nearly three decades as an indefatigable defender of the state's arcane liquor laws, in which his clients control the distribution from producer to retailer of virtually all wine and distilled spirits in Texas.

Mr. Sparks defended his efforts against the bill. "We just got our message out," he said.

He and other critics said that allowing wineries to ship their products directly to Texans threatens a loss of tax revenue and offers no safeguards against minors buying off the Internet.

Backers argued that the change would boost Texas' fledgling wine growers, who say current law protects wholesalers and their profits.

'Booze Brothers'

And the four companies have become among the most generous contributors to Texas candidates.

This session, as in the past, Mr. Sparks joined forces with beer lobbyist Mike McKinney. Often seen together in the Capitol's marbled halls, the pair is widely known as "the Booze Brothers."

"They are constantly on the job," said Rep. Ron Wilson, D-Houston, and chairman of the committee that regulates alcohol. "All they do is work on these issues."

Rep. Debra Danburg, D-Houston, a sometime opponent of the industry, said few other lobbyists have a better grasp of the rules and rhythms of the Legislature.

"They eat, sleep and drink with the committee," she said.

On the other side were the Texas vineyards and California wineries, whose lobby team was smaller and whose executives had little history of making contributions.

"The small wineries I represent don't have that kind of money," said Sharon Hull, working for Texas and California vineyards. "I have been a lobbyist for a long time, and I know that money doesn't buy you votes but it gets you access. I don't have the money to entertain members. I have limited access."

As the industry's emissary in Austin, Mr. Sparks has been lobbying longer than most members have been in office. He has visited them, wined and dined them, helped direct campaign money and provided alcohol for political gatherings.

"The word is always out that they will bring you whatever you need for a fund-raiser," said Rep. Anna Mowery, R-Fort Worth, one of several lawmakers who sponsored Internet wine-sales bills that died in committee.

Long before the Legislature convened in January, the liquor industry began preparing.

Industry executives and political action committees contributed more than $720,000 to Texas politicians over the last year.

The industry boosted its lobbying team to 10 people. And it hired Public Strategies Inc., an Austin-based media consulting firm whose partners have advised presidents, foreign governments and corporate CEOs.

The firm developed a campaign to drum up opposition by warning that children would buy wine over the Internet.

On the other side is Ms. Hull of the Wine Institute, an industry group whose members include California wineries. Texas wine and grape growers signed up former House Speaker Billy Clayton.

Bills introduced

The House Licensing and Administrative Procedures Committee held a hearing Feb. 19, and both sides produced witnesses. Opponents warned of lost taxes and the prospects of minors purchasing alcohol. Supporters promoted convenience and dismissed warnings that children would be buying wine over their computers.

"I don't know about any of you," San Antonio wine salesman Ben Valentino told the committee, "but when I was an underage drinker and my friends and I wanted to drink, we wanted it to be immediately."

The Senate State Affairs Committee met March 12 in the ornate chamber, under wall-sized paintings of the fall of the Alamo and the battle of San Jacinto.

Again, a series of witnesses – small-vineyard owners, some presenting their whole families to the committee – urged passage of the bill.

Mr. Sparks, sitting nearby in a leather Senate chair, declined an invitation to testify. The next witness was a Church of Christ minister from Stephenville, who cautioned against teen drinking. The minister was followed by another foe, Mr. McKinney, the beer lobbyist.

"Now that's what I call politics makes strange bedfellows," said Sen. Carlos Truan, D-Corpus Christi and vice chairman.

The bills remained in committee.

Ad controversy

Public Strategies produced and mailed a full-color postcard to thousands of Texas households to generate public opposition to Internet sales.

The mailer is divided into three panels, the first showing a clean-cut young white boy named Billy at age 5 standing beside a lemonade stand. The next panel shows him at 11, throwing a newspaper in an upscale neighborhood.

In the last panel, an unsmiling Billy at age 14 is pictured with a can of beer in one hand and a cigarette in the other. A notation says he was "selling booze he bought on the Internet to his friends."

In the background, a young black man lounges against a graffiti-covered wall, suggesting Billy has fallen in with bad company.

When he saw the mailing, Mr. Wilson was livid. He called Public Strategies to complain about the ad's racial overtones. The company promised to pull the ad from production but Mr. Wilson was already making sure that other black members on the House floor saw copies of the postcard.

Suddenly, lawmakers were reconsidering the wine proposal.

Rep. David Swinford, R-Dumas, saw an opening to press his bill to allow limited shipments of wine from Texas vineyards. Under his plan, Texans could order wine only from in-state wineries and have it shipped to the closest local retailer, which would hold the bottles for the customers.

Without the advertisement flap, it probably wouldn't have happened, Mr. Swinford said. "It glued the deal."

In the end, the alcohol industry signed off on the Swinford bill and the Legislature sent it to Gov. Rick Perry, who indicated last week he would let it become law.

As lawmakers adjourn Monday, Texans still can't order wine from outside the state. The liquor industry control over in-state sales remains largely unchanged. And backers of Internet wine sales say they'll be back next session.

"Consistency," said Mr. Perry as a kind of epilogue.

Researcher Rob Giacobbe in Austin contributed to this report

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