MONROE — Anyone running a winery, brewery or distillery in King County faces new hurdles this year.
All adult beverages must be brewed, fermented, crushed, distilled, aged or finished on site, according to a measure passed by the county council. Alcohol makers must perform at least two stages of production on the property. Tasting rooms can take up no more than 30% of the floor plan, and for breweries and wineries under 1,500 square feet, tasting rooms are banned.
The regulations impact a booming business for communities built on the back of the adult beverage industry, like Woodinville.
Maybe it’s enough to make a vintner look for greener vineyards.
Bottoms-up, says the city of Monroe, a town of 18,000 that’s trying to expand its liquor cabinet and wine cellar.
On Feb. 21, city government sent letters to nearly 50 wineries and tasting rooms across King, Snohomish, Pierce, Kitsap and Chelan counties, pitching the idea of moving or expanding to Monroe.
Monroe’s letter outlines recent tourism data for the city and a list of incentives, including fee waivers. A dozen pitches have already gone down Highway 522 to nearby Woodinville, where business owners for more than 70 wineries, breweries, distilleries and tasting rooms have to comply with the new rules or take operations elsewhere.
Woodinville city manager Brandon Buchanan said he isn’t worried about the city’s signature industry getting poached.
“While we’re always supportive of the broader Washington wine industry, and see imitation as the sincerest form of flattery, we’re also confident that Woodinville, with all that it has to offer visitors and producers alike, will always be the preeminent home to wine, beer, and spirits in Western Washington,” he said in an email.
If Monroe was trying to steal business, they’d offer tax credits, Monroe Mayor Geoffrey Thomas said.
“It is natural that as we see wineries and distilleries expanding in the region,” he said, “to reach out to them and say: ‘We’re here, we’re open for business and we want you to to choose Monroe.’”
A hazy future
The King County Council’s new rules passed narrowly in December, updating a code for alcohol producers that was originally written in 2003, when the number of wineries, breweries and distilleries in the area was a fraction of what it is today.
A decade ago, there were 136 craft breweries operating in Washington state, according to the national Brewers Association. Today, the number is nearly 450.
Washington state is now the second-largest producer of wine in the country and third for both craft breweries and distilleries, according to multiple studies.
In recent years, neighbors of the Woodinville wineries, taprooms and distilleries complained loopholes allowed businesses to operate as bars without the proper permits. Some farmers said they were bad for the environment and didn’t belong in the rural zone.
“In my mind, Woodinville offers the solution: ample space within the urban growth boundary to accommodate producers and tasting rooms, coupled with the long-established network of knowledge to support the industry,” Buchanan said. “That’s why we see the industry continuing to grow here.”
A provision in the bill grandfathers in about a dozen businesses in the Sammamish River Valley that would be in violation of the new code.
Matthews Winery, owned by Cliff and Diane Otis, isn’t on that list.
The owners, along with their lawyer and civil engineer, sat down with county code enforcement officials last week to figure out how they can comply with the new law.
“We’re still kind of distilling the impact on our business,” Cliff Otis said. “We have hundreds and hundreds of customers that come to our company. We want to make sure we can accommodate them properly.”
Matthews Winery isn’t going to move, Diane Otis said.
They’ve been on the property for more than 20 years, but “for any new business, any additional locations that businesses are wanting to consider opening up, I think they would find an easier path going outside of King County,” she said.
That includes tasting rooms.
Under state law, wineries can run two off-site tasting rooms, with no production requirements.
The 60% on-site production rule also affects breweries, distilleries, cider houses and taprooms.
Rich Nesheim opened Woodinville’s Sumerian Brewing Company in 2012.
His current business isn’t impacted, but he’s always looking to expand, he said.
Opening a new store is risky due to the high volume of craft breweries almost everywhere in the state, he said.
“If you have a certain amount of people that fall into that craft beer consumer category, you divide that up by the number of options people have and you see how small that pie gets,” Nesheim said. “… I’m constantly looking for underserved areas. It’s a diamond in the rough if you can find it. And it’s like wet spaghetti when you find it — you’ve got to throw it against the wall and see if it sticks.”
A clear pitch
Another batch of letters from the city of Monroe is going out next month, to breweries and distilleries.
The campaign is part of an effort to cash in on the rise of l0cal wine and craft beer, cider and spirits.
Currently, two breweries in Monroe serve their house pints, Twin Rivers and Dreadnought.
“A lot of this is just to let people know we’re there and we’re open for business,” said James Palmer, the city’s contracted economic development specialist. “If they’re impacted, we’re here to help them evaluate moving to Monroe.”
Palmer is the liaison between the city and the targeted wineries, breweries and distilleries.
“My goal is to get them to come out and see the community,” he said. “I’ll take them out, we’ll look at some properties and start the dialogue. It’s half economics and half relationships.”
Monroe sits at the crossroads of U.S. 2, Highway 522 and Highway 203. If you’re a Seattle skier on the way to Stevens Pass, you can’t miss it — but the city wants more of its traffic to pull over and stay awhile.
“We’re letting people know what Monroe has to offer,” he said. “There are businesses that may not know we’re at the center of a transportation hub. They may not realize that the fairgrounds draw people as far north as Canada and as far as east as Montana.”
The city isn’t expecting any businesses to open shop in Monroe right away, said the mayor, Thomas. The focus is getting the city’s foot in the door.
With that caveat, Thomas and Palmer both said they’re hoping to see three to four tasting rooms, breweries or distilleries open in town within a year.
“Even if I don’t have a business moving here,” Thomas said, “if we’re building those relationships and that’s leading to more interest in moving to Monroe, that’s a benefit, too.”