Natives and visitors alike are surprised to learn that there is indeed a wine "industry" in the state, but according to Gertie Campbell, co-owner of the Highland Manor Winery in Jamestown, TN, her winery sees over 20,000 visitors annually and the numbers continue to grow.

"We've definitely seen an increase in wine interest over the past few years," she says, while pouring the first of several samples to a crowded tasting bar.  She estimates 95 percent of those visitors are from out-of-state.

Highland Manor Winery, owned and operated by Mrs. Campbell and her husband Butch, is Tennessee's oldest winery and boasts a wine list of around 15 varieties, many of which are produced from grapes grown on the winery's estate vineyards.  

The winery offers a free tour guided by knowledgeable staff and a complimentary tasting of their full wine list, along with picnic grounds overlooking their vineyard, and plenty of Tennessee-made jams, jellies, cheeses, and other picnic supplies in their gift shop.  Just minutes away from the Big South Fork National River and Recreation Area, Pickett State Park, and the historic settlement of Rugby, TN, the winery is a convenient stop for tourists visiting the area.  

Many of their wines have won regional and international awards.

"Our muscadine wine is by far our biggest seller," says Mrs. Campbell, and she points out there is a one-year waiting list for the wine which has won several competitions as far away as Madrid, Spain.  According to Mrs. Campbell, Highland Manor produces very close to the 40,000 gallon production cap, and would expand production if allowed by law.

Many of the visitors to Highland Manor winery would like to purchase its wine in larger quantities for shipments to their home, Mrs. Campbell says, and notes that she also receives requests from visitors who would like the convenience of on-line purchasing as well.  

"I think the biggest hindrance to our business and the wine industry in the state are the restrictions placed on us by Tennessee law," she says.  Despite the limitations, she sees a bright future for Tennessee wine and definite growth potential.  Mrs. Campbell and her husband are members of the TFWA , and work closely with Dr. David Lockwood, University of Tennessee professor of food science technology, to lobby the legislature for friendlier wine laws.

Highland Manor Winery is just one of 28 or so wineries scattered throughout Tennessee, eight of which are located in the East Tennessee region. The quality and variety of wines offered by Tennessee wineries is evident from the many national and international awards won by several wineries in the state.  

LOCAL WINE & SPIRITS PERSPECTIVE

Mr. Brent Barnett, a Spirits Manager at Knoxville's McScrooge's Wine & Liquor, says his store carries around 30 different varieties of local wine from wineries throughout the state including Stonehaus Winery in Crossville, TN, and Tennessee Valley Winery in Loudon, TN.  He attests to the quality and demand of Tennessee wine.

"There is a definitely a demand for local wines," he says, and adds that they sell very well and are comparable in quality to popular wines from North Carolina and Georgia.

Mr. Thad Cox, Jr., proprietor of Ashe's Wines & Spirits in Knoxville, says his store carries a small amount of Tennessee wines.

"The small demand we receive comes mainly from tourists interested in the fruit wines to take home as a souvenir," he says.

Mr. Cox also points out that the majority of Tennessee wine is made from juice imported from outside sources because the Tennessee climate of alternating drought conditions and humidity make it harder to grow grapes.

He credits North Carolina's wine industry growth to businesses like the Biltmore Estate, who combine the tasting in with their tour of the estate.  

TENNESSEE WINE LAWS

A University of Tennessee professor of food science and technology says unfriendly legislation is the biggest problem facing Tennessee wine growers.

According to Dr. William C. Morris, who sits on the board of the Tennessee Viticulture and Onelogical Society (TVOS) and the Tennessee Farm Winery Association (TFWA), the state has remained static during the past decade with 28 or so wineries, the same number as North Carolina had 10 years ago.

A decade later, however, the number of wineries in North Carolina has more than doubled mainly because of more wine friendly laws. Dr. Morris says he finds that disheartening.

At a time when wine produced in the United States is enjoying national and even international popularity and fame, Tennessee is struggling to keep up with most of its Southern neighbors. According to a study released in January by the Congressional Wine Caucus, the wine and grape industry is contributing $162 billion annually to the national economy.

Dr. Morris estimates Tennessee's portion of that contribution at around $13 million from crops sold as wine and $46.2 million when factoring in tourism dollars. In contrast, North Carolina boasts an impact of $813 million.

The state's biggest hindrance, according to Dr. Morris, is the cap-on-production law, which until recently restricted wineries to 20,000 gallons sold to wholesalers only. That restriction is still in effect for vineyards that produce less than half of their product from within the state, and for those that can make the cut mark the restriction was expanded to 40,000 gallons sold to wholesalers only.

North Carolina lifted its production cap long ago, allowing for the expansion of wineries from vintners able to recoup their investment instead of relying upon wholesale distribution only, he says.

"This really hurts because potential winery owners in Tennessee who might want to come in and invest several million dollars in a flagship winery won't do so because of the cap on production. It wouldn't be worth their investment," Dr. Morris says.

Dr. Morris points out that in most other states consumers can buy wines in grocery stores, but not here. If they could, it could greatly boost sales of locally made wine, he says. Tennessee wine isn't well promoted in local restaurants either.

"Restaurants could do more to promote local wineries, but they have to buy from wholesalers and with middle-man prices they don't tend to do so," he says. Dr. Morris attributes much of Tennessee's strict wine laws mainly to the state's powerful liquor lobby.

"Liquor stores want to be the ones selling in large quantities, that way they get their cut. They don't like the idea of wineries selling straight out of the tasting rooms," he says.

Dr. Morris serves as a board adviser to both the TVOS and TFWA, advising both groups on technical and other growing issues, and giving speeches to the associations. He also testifies before various state House committees on behalf of the winegrowers.

"Both groups lobby the legislature for better wine laws," he says. On Feb. 6, TFWA showcased winners of its 5th Annual Wines of the South competition by hosting an awards reception in Nashville. Dr. Morris and members of the TFWA hope having large numbers of legislators present to taste some of the award winning wines will bring awareness to their cause.

Dr. Morris says he thinks Tennesseess wine industry will continue to grow, "but at a very slow rate unless friendlier laws are passed. Our associations are working on that."

CURRENT INITIATIVES

Tennessee is one of 17 states that prohibit direct shipment of wine by common carrier, and any violation of the legislation is a felony.  Onsite sales at all wineries within and outside of the state are limited to one gallon, or five bottles, per customer.

Additionally, Tennessee requires the distribution of wine through wholesalers to package stores only, and it is illegal to sell wine in grocery stores.

One Tennessee legislator recently challenged a portion of the current law by introducing two bills before the legislature on March 13.  Memphis Senator Shea Flinn proposed a bill that would allow the sale of wine in grocery stores as well as a bill that would allow liquor stores to open on Sundays.  

Both bills died in the Senate State and Local Government Committee. Although the Tennessee Grocers and Convenience Store Association is in favor of selling wine in grocery stores, they did not push for the bills this year.

Lobbyists for the state's liquor wholesale and retail associations were present to oppose the bills, and the one of the most powerful lobbyists in the state, Tom "Golden Goose" Hensley was in the front row during the session meeting. 

The state's liquor lobby, composed of wholesalers and retailers, do not see any reason to change current state law.  According to the policies listed on the Wine & Spirits Wholesalers of America webpage, its main concerns are monitoring illegal trafficking, loss of tax revenue to the state, and prevention of minors from obtaining alcohol. Local lobbyists are afraid of putting the state's "mom and pop" package stores out of

business.

According to a study done by the Massachusetts Wine at Food Stores Initiative , "State and national statistics shows that allowing grocery stores to sell wine does not increase underage drinking violations. The data shows that grocery stores are as good or better at complying with underage drinking laws than package stores. In fact, the 34 other states that allow grocery stores to sell wine actually have no greater incidence on average of underage drinking violations than the states that don't permit grocery stores to sell wine."

Loosening restrictions on Tennessee's direct shipping laws could benefit the customer's wallet as well as provide the convenience of ordering online.  A report released by the Federal Trade Commission found "that state bans on direct shipping prevent consumers from saving as much as 21 percent on some wines and from conveniently purchasing many popular wines from suppliers around the country."

The FTC report also found that states permitting direct shipping "generally report few or no problems with shipments to minors. Some states have applied safeguards to online sales similar to those applied to brick-and-mortar retailers, such as requirements that package delivery companies obtain an adult signature at the time of delivery. Some states also have developed penalty and enforcement systems to provide incentives for both out-of-state suppliers and package delivery companies to comply with the law."

THE IMPACT OF WINE ON THE AMERICAN ECONOMY: HOW WOULD TENNESSEE BENEFIT?

A recent study commissioned by Winegrape Growers of America and other national wine associations provided the first national study of the impact of the wine industry on the nation's economy.  The study found that the industry generates $162 billion in economic impact.

Important findings outside the dollar impact to the economy included the contribution the industry provides to the agricultural community by preserving farmlands and revitalizing rural communities.  Through the growth of the wine industry, many states that formerly relied on the farming of tobacco or other diminishing crops are now experiencing a revitalization through growing grapes for winemaking.

The report also cites the trend of a growing demand for wine among American consumers across all demographic segments, as well as national studies that show moderate wine consumption can be good for your health.  The nation's retailer and restaurants are responding to the greater demand for wine-related products and food pairings.

The impact on a state's tourism industry can be impressive as well.  The impact study found that "wineries have proven particularly effective tourist magnets, attracting some 27 million visitors nationwide, and the many businesses which support them from hotels and bed and breakfasts to shops, restaurants and travel organizations, often reinvigorating the economies of their rural communities."

In North Carolina , for example, many small tobacco farms in decline have made the switch to growing grapes and are thriving.  According to their winegrower's association, vineyards and wineries have created jobs and attracted tourist dollars to rural communities, while generating revenue for the state. They [wineries] offer an opportunity for farm diversification and farmland preservation.

TENNESSEE WINE EVENTS

Tennessee wine makers will be spotlighted at the annual Rivers & Spires Festival on April 19-27, 2007, in Clarksville, TN. The Jazz 'N Wine event will feature representatives from many of Tennessee's wineries and will be offering wine tastings and cooking demonstrations accompanied by jazz music.

Coming up on May 19, 2007, is the annual A Toast to Tennessee wine festival in Nashville, TN, where twenty Tennessee wineries will be pouring tastings. The festival will also feature music, gourmet food, and fine artisan offerings.