1.1 	A bill for an act
1.2 	relating to alcoholic beverages; allowing a farm winery to produce wines and 
1.3 	fortified wines; increasing the amount of non-Minnesota produce that may be 
1.4 	used in a farm winery operation; allowing a phase-in for start-up operations;
1.5 	amending Minnesota Statutes 2004, sections 340A.101, subdivision 11, by 
1.6 	adding a subdivision; 340A.315.
1.7 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.8 	Section 1. Minnesota Statutes 2004, section 340A.101, subdivision 11, is amended to 
1.9 	read:
1.10 		Subd. 11.Farm winery. "Farm winery" is a winery operated by the owner of 
1.11 	a Minnesota farm and producing fortified wine, wine, table, or sparkling wines from 
1.12 	grapes, grape juice, other fruit bases, or honey with a majority of the ingredients grown or 
1.13 	produced in Minnesota.

1.14 	Sec. 2. Minnesota Statutes 2004, section 340A.101, is amended by adding a 
1.15 	subdivision to read:
1.16 		Subd. 11a.Fortified wine. A "fortified wine" is any product described under 
1.17 	subdivision 29 that is fortified by the addition of alcohol or spirits.

1.18 	Sec. 3. Minnesota Statutes 2004, section 340A.315, is amended to read:
1.19 	340A.315 FARM WINERY LICENSE.
1.20 		Subdivision 1.Licenses. The commissioner may issue a farm winery license to the 
1.21 	owner or operator of a farm winery located within the state and producing fortified wine, 
1.22 	wine, table, or sparkling wines. Licenses may be issued and renewed for an annual fee of 
1.23 	$50, which is in lieu of all other license fees required by this chapter.
2.1 		Subd. 2.Sales. A license authorizes the sale, on the farm winery premises, of 
2.2 	fortified wine, wine, table, or sparkling wines produced by that farm winery at on-sale or 
2.3 	off-sale, in retail, or wholesale lots in total quantities not in excess of 50,000 gallons in a 
2.4 	calendar year, glassware, wine literature and accessories, cheese and cheese spreads, and 
2.5 	the dispensing of free samples of the wines offered for sale. Sales at on-sale and off-sale 
2.6 	may be made on Sundays between 12:00 noon and 12:00 midnight. Labels for each type 
2.7 	or brand produced must be registered with the commissioner, without fee prior to sale.
2.8 		Subd. 3.Applicability. Except as otherwise specified in this section, all provisions 
2.9 	of this chapter govern the production, sale, possession, and consumption of fortified wine, 
2.10 	wine, table, or sparkling wines produced by a farm winery.
2.11 		Subd. 4.Minnesota products. If Minnesota produced or grown grapes, grape 
2.12 	juice, other fruit bases, or honey is not available in quantities sufficient to constitute 
2.13 	~~a majority~~ forty percent of the fortified wine, wine, table, or sparkling wine produced by a 
2.14 	farm winery, the holder of the farm winery license may file an affidavit stating this fact 
2.15 	with the commissioner. If the commissioner, after consultation with the commissioner of 
2.16 	agriculture, determines this to be true, the farm winery may use imported products and 
2.17 	shall continue to be governed by the provisions of this section. The affidavit is effective 
2.18 	for a period of one year, after which time the farm winery must use the required amount 
2.19 	of Minnesota products as provided by subdivision ~~1~~ 5 unless the farm winery holder 
2.20 	files a new affidavit with the commissioner.
2.21 		Subd. 5.Start-up operations. An applicant for a farm winery license may use 
2.22 	imported farm products during the first three years of operation as follows: 
2.23 	(a) during the first 36 months of operation after first being issued a license under this 
2.24 	section it may use as much as 100 percent imported products; 
2.25 	(b) during the following 24 months it may use as much as 80 percent imported 
2.26 	products; and 
2.27 	(c) thereafter may use as much as 60 percent imported products.