Sonoma County puts wine tax plan on ice amid industry pushback
A controversial bid to make Sonoma’s wineries pay for promotion has hit a wall, as opponents question its fairness and effectiveness.
From bold proposal to stalled plans
In July, db reported on Sonoma County’s consideration of a Wine Improvement District (WID), a model that would add a small, self-imposed levy on direct-to-consumer sales – including tasting rooms, wine clubs, events and packaged goods – to finance a large-scale marketing drive.
Supporters of the scheme, including vintner Ned Hill and Three Sticks Wines’ co-founder Prema Kerollis, described the WID as “bold, coordinated action” to reconnect with younger consumers and position Sonoma as a “global leader in wine, sustainability and innovation.” Steering committee co-chair Steve Sangiacomo added that the initiative would provide “a sustainable funding model that unites both sides of the wine business” and “secure the future” for the county’s growers and vintners alike.
Rob McMillan of Silicon Valley Bank argued that the additional cost to consumers – “pennies per bottle” – would be negligible, framing the WID as “a flat-out marketing programme,” citing the success of campaigns such as California Raisins, Almonds and the famous “Got Milk?” initiative.
Pause amid leadership changes
However, Wine-Searcher has now revealed that the project has been put on hold by Sonoma County Vintners (SCV). The move follows the announcement of SCV executive director Michael Haney’s resignation, effective in September, and what the publication described as “unexpected” levels of pushback from producers.
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Critics have questioned both the effectiveness of WIDs elsewhere and the fairness of adding extra charges to customers’ bills. Longtime Pinot Noir winemaker Adam Lee, a vocal opponent, told Wine-Searcher: “The two spots that have had winery improvement districts long enough to have some results are Livermore and Temecula. Both have had winery improvement districts since 2021. I have gone through the reports and seen they are not increasing direct-to-consumer sales. They are not increasing the number of visitors to the area. They are increasing the amount of money the organisation has to spend. But they don’t have new ideas. These districts are not having the effects that we want, that all of us want.”
Meanwhile, in Lodi, where a 1.5 percent WID levy is under consideration, M2 Wines’ owner Ted Woodruff told ABC 10 he opposed the plan: “That is not fair to them [customers] to pay for our advertisements, and it’s not fair for us to be forced into doing it.”
A wider industry dilemma
The debate comes against the backdrop of declining US wine sales – down more than 10 percent since 2021 – and increasing concern over generational shifts away from wine. According to Wine-Searcher, one in six red grapes in Sonoma may have gone unharvested last year, while vineyards are being bulldozed in Lodi due to oversupply and weak demand.
Rob McMillan warned that resistance to the WID risked repeating the fate of WineRAMP, a proposed national wine marketing campaign that was shelved in 2022: “The reaction to the WID that is being proposed in Sonoma is another disappointment for me. It’s a repeat of my experience with WineRAMP but this time there is knee-jerk opposition when there should be no doubt that we need to do something to change,” he told Wine-searcher.
For now, Sonoma’s WID plans remain paused – but with the structural challenges facing the Californian wine industry, the debate over how best to fund promotion looks far from over.
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