SLO County is home to world class wineries and winemakers gaining national and international recognition. As competition between wine destinations increase in California and beyond, a wine district creates an opportunity to strengthen promotional capabilities of our wineries with a more reliable and stable funding stream.
A wine district is a geographically determined area (a “district”) in which wineries contribute stable funding to promote the wine region. Owners and operators within the district work together to market their wine destination and attract new visitors to the wineries. The proposed wine district is San Luis Obispo (SLO) County.
Wine districts are funded through an assessment generated by wineries in the district based on a percentage of direct-to-consumer sales. The methodology is determined and approved by the winery owners during the formation process and is typically passed on through direct to consumer (DTC) retail sales or absorbed directly by the winery. The proposed assessment in the SLO County Wine District is 1% on all DTC retail sales. For example, 1% of a $50.00 purchase = $0.50.
Wine district funds are spent solely for the benefit of the wineries paying the assessment through a nonprofit membership organization comprised of all the assessment-paying wineries. This is typically the wine industry’s existing association; in our case, the Paso Robles Wine Country Alliance (PRWCA) and SLO Coast Wine Collective (SLOCWC).
A detailed description of the allocation of funds will be provided in a Management District Plan (MDP) which is a legally binding document created by the PRWCA and SLOCWC Boards of Directors that must be approved by both the assessed wineries and the County Board of Supervisors. The MDP will outline the governance of the district throughout its term and will contain specific information like a proposed assessment rate, collection, budget, and description of how the funds will be used.
California is home to a couple of wine districts with several others in progress including:
• Temecula Valley Wine and Agricultural Heritage District – 1% on retail sales.
• Livermore Valley Wine Heritage District – 2% on retail sales.
All wineries within the district would pay the assessment. It is common practice for wineries to pass the assessment onto the consumer directly through the point of sale (POS) system or they can absorb the assessment and pay it directly.
To keep information confidential, a third-party accounting firm collects the assessment and then distributes the funds to the managing non-profit.
The data needed to process the assessment collected from the customer is the same data used to submit California sales tax. The assessment payment will be audited against a winery’s tax data.
No, this is not a tax. These funds are for the exclusive benefit of the wine region with promotion of the wineries and do not go to any government entity or any other industry. This is not a tax as taxes fund the government.
The SLO County Wine District will initially be formed for five years, then can be renewed for up to 10 years.
The petition process could happen as early as the summer of 2024.
Please email info@pasowine.com or call (805) 239-8463. A member of the Board of Directors, Formation Steering Committee, or association staff will get back to you.