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For California winegrape growers watching vineyards get ripped out and contracts disappear, a bill that died last week in the Legislature promised a small boost. Under Assembly Bill 1585, wines sold as “American” would have to be made entirely from grapes grown in the U.S.
Yet the proposal opened an unusual rift among agriculture and wine groups that are typically aligned on taxes, regulations, trade and other issues affecting the industry.
The California Association of Winegrape Growers and Family Winemakers of California sponsored the measure, while Wine Institute, The Wine Group and Treasury Wine Estates opposed it. The split placed growers and smaller wineries against some of the state’s largest wine companies during one of the industry’s most difficult downturns in decades.
Asms. Damon Connolly, D-San Rafael, and Rhodesia Ransom, D-Stockton, withdrew the bill ahead of its first Senate committee hearing last week, ending its prospects for the year.
The move came less than a month after the Assembly approved the bill without opposition. The sponsors arrived in the Senate armed with more than 10,000 letters supporting the bill but ultimately concluded the committee would not give the proposal fair consideration.
The measure sought to close a gap between state and federal labeling standards. Wine carrying a California appellation must be made entirely from California grapes. Under federal rules, however, wine labeled American may contain up to 25% foreign wine.
Growers argued that allows wineries to buy lower-priced bulk wine from Australia, Chile and New Zealand while California grapes go unsold.
Asm. Damon Connolly (office photo)Connolly presented the bill as limited relief for an industry facing bankruptcies, vineyard removals and declining demand.
“Folks are increasingly concerned about how much longer they can hold on in this market,” Connolly told an Assembly committee in April. “In far too many cases, they are shutting down altogether.”
He emphasized that AB 1585 would not prevent wineries from importing or blending foreign wine. Companies using those blends simply could not market the finished product under an American appellation.
“Winegrape growers and wineries across the state are here to ask the Legislature for help,” Connolly said. “And AB 1585 provides a modicum of relief to an industry that is in need.”
Ransom said the effects would be particularly important in San Joaquin County, where growers have watched grape prices fall and wineries close.
“The Central Valley produces over 70% of grapes that are used in California’s wines,” Ransom said. “That industry is currently facing a crisis.”
She compared wine with other grape products that must meet stricter domestic content standards when advertised as American-made.
“If grape juice, table grapes and jams are labeled made in America, they must be 100% American grown,” she said. “Wine should meet the same standard.”
Ransom added that wineries could still sell imported blends under other descriptions.
“You can call them exotic. You can call them international,” she said. “But if it is an American wine, it should be 100% American grapes.”
A rare divide across the wine industry
The debate was notable not only for its intensity but for who was lined up on each side.
California’s winegrape growers, family-owned wineries and large wine companies routinely join forces against proposals they view as raising production costs or restricting the market. AB 1585 instead forced them to choose between protecting wineries’ blending flexibility and creating more potential demand for domestic grapes.
CAWG President Natalie Collins pushed back on descriptions of the measure as a growers-versus-wineries fight, pointing to support from Family Winemakers and regional organizations representing producers across California.
“This is a question of whether the American label should mean what it says,” Collins told lawmakers.
She argued that a wine’s origin is not simply another piece of label information but the foundation for how consumers understand the product.
“It tells you the land, the climate and the people who grew the grapes,” she said.
Opponents countered that existing labels comply with longstanding federal standards and accused proponents of suggesting that geographic appellations always require 100% of the grapes to come from the place named.
Jeannie Bremer, vice president of compliance and public policy for The Wine Group, noted that Napa Valley wines may contain up to 15% grapes from elsewhere in California. Sonoma County wines may include up to 25% fruit from outside the county.
“We are very concerned that the bill’s proponents are leading consumers to believe that a wine can only truly represent its origin if 100% of the grapes were grown in the stated region,” Bremer said. “This is not true.”
Bremer, who comes from a Lodi grape-growing family, also disputed the suggestion that large wineries casually add foreign wine to replace California fruit. Importing, transporting and incorporating overseas wine into existing blends is complex and can increase costs, she argued.
Treasury Wine Estates warned the proposal could create unintended labeling problems for its Penfolds wines that combine California and Australian fruit.
CAWG President Natalie Collins (Fred Greaves/Agri-Pulse)Debra Dommen, the company’s vice president of government and industry affairs, said two Penfolds products use blends of 85% California wine and 15% Australian wine. Because the products qualify for an American appellation under federal law, the labels may identify the vintage and grape variety.
Dommen argued that barring the American designation could force the company to label the products generically as “red table wine,” leaving consumers with less information.
“This outcome would be a disservice to consumers who reasonably expect to know whether they are purchasing a cabernet sauvignon or another varietal,” she said.
Assembly support gives way to Senate resistance
The opposition’s arguments did little to slow the bill in the Assembly, where lawmakers focused heavily on the financial strain facing agriculture.
Assembly Republican Leader James Gallagher of Yuba City — now representing the region in Congress — said growers are being squeezed by some of the nation’s highest electricity, fuel, fertilizer and labor costs, while commodity prices have not kept pace.
“I don’t think that can be overstated enough,” Gallagher said.
Senate committee staff, on the other hand, questioned whether California should impose a labeling rule that goes beyond federal standards and whether the measure could create different requirements for bottles sold inside and outside the state. Their analysis also challenged whether restricting one appellation would meaningfully address the broader decline in wine consumption.
The bill’s proponents viewed the staff recommendations as adopting the major wineries’ arguments, signaling the bill was unlikely to advance. Rather than proceed with a hearing, the authors withdrew the measure.
Afterward, Collins charged that powerful global beverage companies had prevailed over growers, family wineries and consumers.
“At a time when growers are removing vineyards and family wineries are struggling, it is troubling that preserving the ability to blend foreign wine into products labeled ‘American’ proved more important than strengthening consumer trust,” she said in a statement.
The bill’s defeat means wineries may continue using foreign bulk wine in federally compliant American blends, while growers face another season of excess acreage, weak demand and uncertainty over whether their fruit will find a buyer.
“This fight is not over,” Collins said. “But today should be a wake-up call.”
