Plan on a 1-3 Month Delay for New Wine Label ApprovalsJuly 26, 2011
If you’re not in the wine industry, it may surprise you to know that every wine label in the USA, including the most artistic, colorful, and offbeat labels, has been approved by the US government. Unfortunately for wineries, the once routine process of having wine labels approved by the Alcohol and Tobacco Tax and Trade Bureau (TTB)is causing more headaches than consuming too much wine.
Winery applicants can submit their wine labels for approval to the TTB either through the mail or online.
In the past, the average approval time for a wine label application was just 1 to 2 days for an online submission and one week by mail. Since the fall of 2010, however, the approval process has been bogged down to a one month approval time by online submission and up to three months if the label application was submitted by mail.
If your label and application are rejected, you must re-submit and the clock starts again on the waiting time.
Complaints from Wineries About Label Delays
An article from the Associated Press presents the delay that is currently going on in the wine industry. The AP reports that TTB staff has been reduced by a decade of cutbacks during a time when the wine industry has been booming.
The President of the New York Wine & Grape Foundation says he has seen a slower pace in wine label approvals after staff “cutbacks” at the TTB were made. In a statement, Jim Trezise said “[The TTB] has been a responsive agency for the wine industry, but delays have gotten longer and that does affect the distribution and cash flow for the wineries.”
In 2008, the wine industry in the state of New York employed 40,000 workers and was responsible for $3.7 billion in economic impact.
The 300+ wineries in the state of New York believe they have been hit particularly hard by the recent label delays. Many NY wine makers have voiced their concerns on the current label approval situation. John Martini, co-owner of Anthony Road Wine Co. said that he submitted a label on May 12th of this year and did not receive an approval until June 15th – over one month of waiting before he could bring his wine to market. Some others have waited 75 to 90 days.
US Senator Chuck Schumer, (D-NY) has come to the defense of NY wineries and asked the TTB to speed up the label approval process.
How Big is the Current TTB Wine Label Approval Staff?
Reportedly, the TTB now staffs 13 employees who will handle approximately 130,000 labels submitted to them for approval this year – 10,000 labels per person, or more than 38 labels per day for every weekday in the year. The TTB website states that the average processing time for each wine label application is now 36 days.
That’s a big difference between what wine industry experts said would once have taken one day if filed electronically and about one week when submitted by mail!
This graphic shows the correlation between wine label approvals and wine labels that are pending for the month of June. You can see the increase in label submissions for the spring and summer months, and the high number of pending labels.
Why Are TTB Cutbacks Causing Delays for the Wine Industry?
Although the TTB is federally funded, the funding goes to all areas of the TTB which includes – beer, wine, spirits, alcohol, tobacco, firearms and ammunition. This year the TTB was funded somewhere around $100 million and it is looking like it will be reduced for the coming year.
On top of possible decreases in funding, there is no charge for COLA (Certificate of Label Approval) applications and certification. Wendell Lee of the Wine Institute explained that there have been many attempts to obtain revenue for the TTB, and “at one point there was talk of assessing user fees for label approvals.”
Lee also suggested to Wines & Vines magazine that the TTB consider a less stringent and less detailed examination of labels and instead examine only the mandatory information as a way to help save time and complete more label approvals.
Custom Wine Labels Need to be Approved Too!
Customized wine labels are causing even more approval setbacks. Did you know that custom wine labels need to be sent in for approval by the TTB even if the label is use for only a few cases of wine? Labels containing custom “Happy Anniversary” or “Congratulations” sayings on them must all be approved before they can be sold.
The TTB’s View on the Issue
Label approval applications submitted to the TTB have more than doubled in the past ten years, according to TTB spokesman Tom Hogue in an interview with Wines & Vines.
Hogue continued, “And that doesn’t take into account any of the time going back and forth with an applicant to make sure labels they’ve submitted actually meet legal requirements.”
Hogue recently told Wines & Vines that, “Approving labels gets people in business, if we don’t get them out, or make sure people get their permits and pay their lawful taxes, everyone is not on a level playing surface. That doesn’t help business. It’s not good for the industry – especially if you have smaller guys with no margin for error. In the wine industry, you see a lot of that.”
Hogue provided some TTB staffing numbers but did not specify how many individuals act to approve labels. The US federal agency also employs 500 people nationwide as auditors, investigators, licensors, tax processors, among other positions.
“We’re not getting more resources,” Hogue said. With the staffing reductions at the TTB well-known within the industry, Hogue recommended that wineries plan to allow more time to receive label approvals. Hogue continued, “People need to take this into account in planning, and make their business decisions accordingly. We understand it has an impact on them; they have to understand what’s available in terms of resources.”
In a recent statement posted on its website, the TTB advised that “it is likely that COLA processing times will remain longer than you have experienced in the past and we strongly suggest that you build in extra time for receiving label approval from the TTB.” TTB & Wine Industry: Where Should We Go From Here?
It’s obvious to me that some changes are needed to bring the capacity of the TTB in line with the needs of wine industry. What sort of changes do you think should be made? Less detailed label examinations, with the possibility of recalls if something is overlooked? Or possibly charging for COLAs (Certificate of Label Approvals) in order to generate more revenue so the TTB to employ more label inspectors? What do you think?
More information about TTB wine label approvals:
Can TTB Keep Up with the Wine Industry? – Wines and Vines Magazine