Thursday, May 26, 2016

Wine Grapes: The Most Taxed Ag Product - Well Almost

Depending on what state you live in, tobacco is probably taxed more than wine grapes. But the question is, why should wine grapes  be taxed at such a high rate while HFCS is subsidized by the federal government? In case you don't know what HFCS is, it is high fructose corn sugar. The government pays subsidies to corn farmers to produce a product that is making Americans sick and obese. And don't get me started about glyphosate in wine. (Round Up - glyphosate. All that corn is Round Up ready. There must be tons of glyphosate in sugary soft drinks.) Why don't the neoprobhibs look here for a story? (Because they are fucking dumb!)
How much are wine grapes taxed? Let's start with property taxes of $77 per acre. Assuming 4 ton to the acre, this is $19.17 per ton tax. Assuming 150 gallons per ton, that is $0.17 per gallon.
Then we support the Wine Commission (locally known as the 'Good Ole Boys' Club') to the tune of $.08 per gallon and $12 per ton of grapes harvested for another $0.16 per gallon.
The Washington State Liquor and Cannabis Board wants a cut of $0.87 per gallon.
With a small producer credit of $0.90 the federal tax rate for wine under 14% is $0.17 per gallon, but if it is a big Cabernet Sauvignon (over 14%), the rate is $0.67 per gallon.
And then there is personal property tax on winery equipment. Hard to quantify by the gallon, but on a 20,000 gallon winery with its own bottling line, it would be around $200 or about $0.01 per gallon.
Add this all up and you get $1.84 per gallon in taxes. Multiply by 150 and get $276 per ton. At four tons to the acre this all adds up to $1104 taxes per acre for growing wine grapes! It appears the government doesn't want you to grow those fucking things.
I guess this money goes to corn farmers who received $4,843,815,583 (yes, that is billions) in subsidies in 2013 or about $52 per acre.
So the government pays $52 per acre to grow a crop that is causing obesity and poor health to its citizens, and terrible damage to the environment (Gulf of Mexico, Monarch butterflies, you Google it. 488,000 results), but penalizes a healthy food like wine, which when consumed in a conscientious manor is part of a healthy life-style, to the tune of $1104 per acre.
It's crazy shit like this that makes you want to vote 'NO' for all government.
As the Chad Mitchell Trio sang in 'Rhymes For The Irreverent,'
"Should I write a letter to my congressman?
Each congressman has got two ends
A sitting and a thinking end
And since his whole success depend upon on his seat
Why bother friend?
Like I've always said, we have the best government money can buy. And you ask why I am grumpy.

Saturday, May 7, 2016

$15 Wage and The Wine Industry

I assume you are expecting me to go off about how bad this idea is and how it will put the wine industry out of business. Well, I'm here for surprises. That's why you follow this blog.
So that little girl or young man behind the counter at Micky Dee's thinks their services are worth $15 per hour. They do have a high school education (equivalent to a sixth-grade education in any other country) and they are looking at paying inflated prices for a second-rate college education, majoring in medieval art and minoring in ethnic basket weaving. Give them a two-dollar bill and see if they are worth $15 per hour.
So, what's my point? We just raised the rate we pay our vineyard workers to $12 per hour. Why? Several reasons: First, all those illegal aliens that Trump talks about aren't coming to Washington State. We haven't had an illegal, err excuse me, undocumented worker  apply for work in ten years. They must be going to New York to work for Trump. (Undocumented is an oxymoron. All these people have documents. You can buy them in LA for about $100.)
Second, wages should be governed by supply and demand. The number of brain-dead high school graduates available to work at Micky Dee's is limitless. They have no skills and no work ethic. They think the world owes them a living because all through school they have certificates that say 'Participation.' They think 'participant' is synonymous with 'winner'. They should look in the mirror, there is a big 'L;' on their forehead.
There is high demand for field work right now. Huge crews are being hired by large apple companies to plant trees. Hops need to be trained. Soon the cherry harvest will start. When cherries start, there will be no workers unemployed in the state. (Notice, I said workers. There still will be people on rocking chair 'looking for work.'
Third, it is hard, back breaking, dirty work. Not to sound racist, but no white people ever apply.
There is a parable about Jesus returning to Earth. The first person he meets is a blind man with a tin cup. Jesus touches him and says, "You shall see." The man threw away his cup and responded, "The colors are so bright, the world is beautiful!"
The second person Jesus met was a cripple begging for food. Jesus touched him and declared, "You shall walk." The man jumped up and ran happily away.
The third man was standing on the corner with a sign that said 'homeless. Need money.' As Jesus approached him the man started backing away while muttering, "Hey man, don't touch me. I just got on disability."
We were lucky to get a crew to thin our grapes; but we had to pay $12 per hour. Let the market decide the wage.

Friday, April 15, 2016

PSST! Wanna Buy a Winery Cheap?

Seller orders 30% reduction to $625,000.  Bank-owned winery and vineyard in the lower Yakima Valley. (Technically, it is in the Central Yakima Valley, but most people are geographic idiots.)

Well, here is another sad story from wine country. Everybody wants to get rich in the wine business, but very few do so. The original selling price was around $2 million, but at that time the winery had some inventory as well as a good reputation. I think the bank loaned about a million and the owner carried the rest as a low interest/balloon payment scheme. My accountant told me if you accept these sales terms, be happy with the down payment, because that is all you are going to get. Since the bank has the first lien on the property, they get the property.

Making money in the wine biz is tough. They did the magical thing; they opened up a second tasting room in Woodinville. There was more overhead and apparently the magic that was Woodinville has worn off. They stopped paying suppliers. Word gets around real fast about that. When you can't get grapes, bottles, etc. you go out of business in short order.

There are about 15+ acres of land available, two houses, (one is a B&B), 9726 square feet of production area, plus some equipment like tanks, press, crusher/stemmer, and bottling equipment.

Here is your big chance to own what used to be, you guessed it, Tefft Cellars. Sealed bids due May 26, 2016.

Wednesday, March 23, 2016

Wine Tasting in New Zealand

We just returned from a wine tasting trip to New Zealand. My wife and I were primarily interested in the wine tourism aspect – more than winemaking, although I was interested in why Sauvignon Blanc does so well there and is so bad here. I am happy to report that tourism and wine tourism, in particular, in New Zealand is alive and well.
Wine picnic in Marlborough
 What struck me most was how organized tourism is in New Zealand. Each city of several thousand residents has a tourism office that is prominently identified by the big i. Not only can this office direct you to the nearest wine trail, it can book accommodations for you in nearby B&Bs, hotels, and motels. Never mind that the population of the whole country is only about 4.5 million people. These tourism centers are elaborate with large murals and displays, tons of information racks and are staffed by knowledgeable people.
Tasting room in Waipara
The population of Washington State on the other hand is over 7 million and we don’t even have a tourism office in Olympia. Some cities, through local effort, have big is, but mostly in larger cities like Yakima, Tri Cities, and Seattle. The Washington Wine Commission doesn’t deem tourism to be that important. I have never seen a wine/travel writer in the Rattlesnake Hills AVA, although it is the closest real wine country to Puget Sound, just 2.5 freeway hours away. Judging by the press, they go elsewhere. The New Zealand Wine Growers actively promotes the multiple regions in the country which is a little larger than Oregon. New Zealand has about 700 wineries, on par with Washington and Oregon.
I must say I was quite impressed with the quality of our visit. None of the wineries were snobby like some here in Washington. Most had a $5 NZ tasting fee which I didn’t have topay because I usually bought a bottle of wine. (Hey, after driving on the wrong side of the road all day, I needed a bottle of wine!) At a few, I preferred to pay the fee either because the wine was overpriced or not well made, or both.
The tasting rooms were packed with visitors mid-week and crowed on weekends. Many had full-service restaurants with beautiful indoor or outdoor dining. Those that didn’t usually had a short tapas menu. We at Bonair Winery have a tapas menu on summer weekends. We started out with a chef and about 12 menu items, but serving only about 100 items per weekend made it hard to stock 12 items. Mathematically, you would have nine of each on hand, but that isn’t the way it works. You can never guess which item will be popular on any given weekend. We have since limited the menu to about five items and let the chef go. The few number of visitors to Washington wineries makes operating a full-service restaurant uneconomical. Wine tourism in Washington is pretty much dying out. I’m not sure if it is the lack of promotion or the poor experience many have in tasting rooms. Maybe it is a little of both.
Many of the visitors I talked to in the tasting rooms had visited Napa and Sonoma, but most considered Washington to be too rainy for serious wine production. Yeah, those six inches (16 cm) of annual rainfall keep us ‘evergreen’ in the vineyards.
Wine grapes can be grown all over New Zealand, except in the extreme southern fjord country. We visited five major regions, Hawke’s Bay, Martinborough, Marlborough, Waipara and Central Otago. I will cover each region in a separate post, so stay tuned.

Thursday, January 21, 2016

Wine on a Food Stamp Budget - But No Caviar

Gwyneth Paltrow made headlines by trying to live off food stamps for a week. This is what happens when a washed-up actor tries to get publicity. She got it all wrong. First she claimed that a 'family' was expected to live off $29 a week. Wrongo Buckwheat! The allocation for food stamps is $45.27 per week for a single person. Families get more based on the number of members. You are expected to contribute 30% of your income to make up the $45.27, so the person she emulated was expected to contribute $16.27 from his/her own income - something she failed to take into account.

Second, Ms. Paltrow knew little about shopping and cooking. For example, one does not shop at Whole Paycheck Market on food stamps. Furthermore your grocery basket does not include limes and cilantro. What was she thinking? Scratch that, she wasn't.

I think that food stamps, when wisely spent, can be sufficient. I'm not going shopping, but instead talking in generalities about buying and preparing food. (A head of lettuce, for example, might last well over a week. How do you figure the cost of the one leaf used in a sandwich.)

 What would you eat for $6.47 per day? Well, first there goes your morning latte at Starbucks. Buying in larger quantities and freezing the rest for the future saves money as does checking the 'marked down for quick sale' bins. Most people think hamburger when they think cheap meat, but it turns out the chicken and pork are a less expensive choice. I can get both for under $1.00 per pound. Follow the old rule: "shop around the perimeter of the market."

Here are some ideas for a daily menu:

Breakfast: $1.00
Dry cereal - $.12
1 egg - $.13
Milk $.25
Toast with butter and jam -$.10
Coffee $.15
Juice or fresh fruit  $.25

Lunch: $1.00
Tuna or chicken sandwich  $.45
Bread $.20
Small bag chips $.35 (this is a splurge. You get more mileage from a large bag divvied  up in baggies.)

Dinner: $2.00
Gourmet Salad $.65
Pork or Chicken (6 oz serving) $.40
Rice or Potatoes $.20
Vegetable (broccoli, corn, etc) $.40
Bread $.10
Fruit $.25

Okay, so I have spent $4.00 for food. Remember, $2.32 of our budget of $6.46 was from our own pocket, so it can be spent anyway we like - and we have $2.46 left.

First things first. There are staples that have to be bought like sugar, salt, butter, mayonnaise, flour, catsup, spices, lettuce for that tuna sandwich, etc. Let's allocate $.96 per day for those things. That ought to be more than sufficient.

That leaves $1.50 unspent - and it's my money, not food stamp money. I can find a decent Washington wine for $7.50 on special. There are five, 5- ounce servings in a bottle of wine or $1.50 per serving. I think I'll have a glass of wine with my food stamp meal!  Bon appetite.

Note: Prices have been gathered from multiple sources including Safeway, Wal-Mart, Amazon, Costco, Fiesta Foods,  and Harvest Foods. Serving sizes are based on recommended sizes or greater.