Kansas’ Limited Direct-to-Consumer Shipping Law

Governor Kathleen Sebelius on May 23, 2006 signed a DTC shipping bill in KANSAS that gives us only half of what we were seeking. This was an extremely hard-fought battle in a state that had previously banned all DTC shipments. Unfortunately, the success Chuck McGrigg and our local lobbyists had in passing our version of the bill from the House were undermined when the Kansas wineries, faced with uncertainty as to self-distribution, made an agreement with the Kansas Wine & Spirits Wholesalers, leading us ultimately to oppose an important component of the final bill.

The new law allows both in-state and out-of-state wineries to ship directly to consumers, although “the consumer must purchase the wine while physically present on the premises of the wine manufacturer.” Consumers will be responsible for paying the necessary taxes on such on-site shipments. The portion of the legislation we opposed dealt with complex procedures that will be required for off-site purchases. Here, the consumer must identify a retail licensee in KS to which the winery will ship the wine, for pickup by that consumer. The retailer will be required to collect and remit all taxes due, and may charge the consumer up to $5 for each delivery received on their behalf. A further restriction requires that wineries over 100,000 gallons can only send the wine to the designated retailer via their in-state KS wholesaler, who will deliver the package on to the retailer for pickup by the consumer. Wineries are required to complete a direct wine shipping permit application and agreement, file annual reports and pay required taxes for off-site shipments.