Presentation on theme: "NABI Membership and Board Meeting Presentation Materials The following slides are provided as background for both meeting Attendees and members who were."— Presentation transcript:
NABI Membership and Board Meeting Presentation Materials The following slides are provided as background for both meeting Attendees and members who were not able to be in New York on March 23 rd. These notes are not intended on substituting for meeting minutes but can give you An overview of the gathering and the topics discussed.
Presentation by Jim Squeo, Chief Executive Officer of the National Alcohol Bverage Control Administrators Jim made a presentation on The current status of Privatization Within the control states. His PowerPoint Presentation slide follow. Details of Jim’s presentation in these balloons
Control States - Spirits Montgomery Co. Worcester Co.
Control States - Wine
Wholesale Distribution Spirits Only Spirits & Wine Spirits, Wine & Beer
Retail Distribution Government Government & Agency Private Agency WV
Privatization Washington Virginia North Carolina Pennsylvania Ohio
Washington Back Following the defeat of both referendums on system revision state ABC officials have promised to change the system to make retail more accessible and convenient. They have suggested providing shipping to Washington state consumers of retail items. COSTCO is suggesting more pressure to change the system including legislation or a new referendum
Virginia Back Privatization as a legislative process is finished for this session in VA. Governor McDonalds fellow republicans in the legislature did not support his bill. The lack of a reliable revenue stream to replace the annual $120M from current alcohol sales doomed McDonald’s plan. He has vowed to bring a modified plan back next year.
North Carolina Back The NC system is decentralized down to the county level where 167 ABC boards run 422 retail sales operations and retain the profits for use within the county. This creates a disincentive to privatize without replacing the revenue stream
Pennsylvania Back Pennsylvania Gov. Corbett has established a commission to study privatizing. He is from a policy point of view opposed to state government operating a business of this type. State Senator John Pippa has a hearing scheduled for May 4 in Harrisburg, PA to vet the issue.
Ohio Ohio Governor Kasich has proposed setting up a quasi- governmental unit called JobOhio that would use alcohol taxes to pay off bonds.
Energy Drinks There is a continuing interest by state administrators in this category. They may be looking at the consequences if the size and alcohol content of flavored malt beverages from a tax standpoint. Editor note: Monster Energy is not one of the products targeted by FDA and TTB and ought not be included in this category.
H.R Though NABCA supported this bill in the past the board has not yet taken a position of the new bill HR NABCA ‘s annual meeting will be held in Phoenix, AZ on May 17. NABCA officers have a conference call on May 4 to discuss their position on the current bill.
Alcohol is Alcohol Jim made the point that as beverage alcohol products morph into new variations not associated with their basic style and type administrators may be looking to assign higher tax rates and placement restrictions.
Author Daniel Orkent speaks at the annual NABImemberhsip and Board meeting Author Daniel Orkent spoke to the group about his book “Last Call: the rise and fall of Prohibition. Mr. Orkent answered questions and signed copies of his book for meeting attendees. In response to one question he revealed that Joe Kennedy was not in fact involved in the illegal prohibition liquor running activity but was well positioned to take advantage of the end of the “dry” era.
2011 NABI Budget Status Actual Dues Income$456,720 Reflects new members and non renewal of a few small associate members 2011 Budget 450,000 YTD Expenses 165,769 Avg. Monthly Spend Rate 33,153 Spending at the same rate as prior year in spite of additional meeting expense in Jan Projected Total year revenue and spend within budget. Budget / Expenditure detail in the Conf. Materials
Cash on hand Capital One Cash on hand$ 383,343 Eagle Bank CD 105,039 PNC Bank 95,438 Total$ 583,820
Outside Audit Report and Letter NABI outside auditors state that all accounts and practices are in conformance with generally accepted accounting principles. The Association receives a clean opinion. Auditors recommend establishing a policy on staff leave accumulation. – Action Step: Conduct a review of leave hours over the past year, apply any adjustments and determine final current leave balances. Report to
Audit report continued report to offices on the next monthly conference call Leave Policy for Association Staff Follow the Federal Government policy to accumulate not more than 240 hours of vacation time to be carried over from year to year. Leave earned at the rate of 4 hours per pay period or 15 days per year. Sick leave earned at 4 hours per pay period or 15 days per year. No cap on sick leave ceiling but no cash value.
Audit report continued Personal days available not to exceed 15 days per year. Vacation leave balance for the President would not be paid out at end of employment or be an obligation of the association. Special Projects expenses – auditors commented that dues can be taken as a valid member business expense. Other payments to the association would have to meet the criteria to be taken as business expense. Expense for “lobbying” may not meet this criteria.
Ratification of Auditors Auditors – Linton, Shafer, Warfield & Garrett, P.A. have agreed to be retained for the coming year at the same rate as last year $7,500. – Action: Approve Auditors for the current fiscal year. The board approved retaining Linton, Shafer… as association auditors for
Election of Board of Directors Katja Zastrow Anheuser-Busch Inbev Marc Pl GoodrichBanfi Vintners James P. RyanCrown Imports William J. DeutschW.J. Deutsch & Sons, Ltd. Barbara J. AndersonDIAGEO-Guinness USA John R. FrankSidney Frank David FranckeFolio Fine Wine Partners T. Daniel TearnoHeineken USA Inc Robert DeRooseKobrand Corporation Christopher J. O’RourkeMoet Hennessy USA Inc John F. BeaudetteMHW, Ltd. Timothy ScullyMiller Coors LLC Michael P. O’BrienPalm Bay International David P. BabkowRemy Cointreau USA, Inc. John A. ScribnerTerlato Wines International Fred CooperWirtz Beverage This slate of officers were approved by the membership
Election of Executive Committee James P. RyanCrown Imports William J. DeutschW.J. Deutsch & Sons, Ltd. Barbara J. AndersonDIAGEO-Guinness USA John R. FrankSidney Frank David FranckeFolio Fine Wine Partners T. Daniel TearnoHeineken USA Inc Robert DeRooseKobrand Corporation Christopher J. O’Rourke Moet Hennessy USA Inc John F. BeaudetteMHW, Ltd. Timothy ScullyMiller Coors LLC Michael P. O’BrienPalm Bay International David P. BabkowRemy Cointreau USA, Inc. John A. ScribnerTerlato Wines International Fred CooperWirtz Beverage This slate of members were approved by the board as an executive committee. In addition member Anheuser- Busch Inbev was elected to the executive committee
Election of Officers Chairman Board of DirectorsMichael P. O’Brien Chairman of the Executive Com.John F. Beaudette Vice Chair Board and Exec. Com.Michael J. Rudy TreasurerT. Daniel Tearno PresidentWilliam Earle VP, Asst Treasurer & Corp Sec.Bernadeen P. Emamali These individuals were elected by the board to be the officers of the association for the period. Board member T. Daniel Tearno was elected to fill the position as Treasurer. Past Chairman Jim Ryan was congratulated on his productive leadership of the association.
NABI Executive Committee duties, goals and alignment By-laws designate the Executive committee to act on behalf of the board between Board meetings. The Executive committee currently has 14 members representing all product segments Response from the Board and Executive committee as a whole have often been slow on time critical issues. Issue: The association often needs to act promptly in response To issues, actions or positions confronting the import community
Proposal to the Board Designate the immediate past Chairman of the Board a member of the Executive committee leadership team Continue to endorse the Executive Committee Chairman, Officers and members to act on behalf of the Board of Directors between regular meetings of the board consistent with the by-laws Recognize the following positions as forming a quorum for actions by the Executive Committee. This group will meet on the first Thursday of each month by conference call Chairman of the Board Immediate past Chairman of the Board Chair Executive Committee Vice Chairman of the Board Treasurer NABI staff will promptly advise the Board of all actions taken on its behalf Remind Executive Committee members of the need to remain engaged and responsive to requests for their input and approval
Significant turmoil in the budget and funding authorization area Agency is being asked to justify its allocation of resources Prior approval of Labels under review Last year processed 103,000 labels average of 7,000 per week Label review staff has been held at about 10 positions Alternatives such as requiring label filing without approval, shifting review to market sampling The value of the system for use by other federal, state, and local agencies is recognized User fees may be proposed once again
EU wine negotiations 2 nd phase labeling talks underway in Brussels March 23. Traditional terms, semi generics, champagne, Vintage dated varietals. Currently barred by US regulations for wines with an national appellation. EU petitioned the US in 2010 to provide relief TTB is writing a proposed rule to respond to the petition and seems agreeable to support a change. This would also mean that domestics could label nationally with a vintage date.
World Wine Trade Group – Negotiating and MOU among the members to forgo certification requirements among member states. Currently Argentina requires certificate of analysis from the US. South Africa has not signed the mutual acceptance agreement with the group. Therefore South African imports are still required to certify for entry. SA Parliament has been slow to act.
Certification for 2006 Brunello has been received from government of Italy TTB is requiring two more years of certification. The 2008 vintage will be the last to need a certification. The Italian government could certify all stocks currently in inventory as meeting the standard and no further certifications would be required.
French Pinot Noir – French are not providing certifications. Import of this category (Languedoc-Roussillon Region) continues to require that the importer holds a certification from the French government. TTB acknowledges mixed and misleading messages between FDA under 7% wine products, FMB, wine and distilled spirits specialty labeling.
FTC Federal Register notice – comment on information collection on compliance with self- regulatory advertising code. Up to 14 of the largest beverage alcohol advertisers will be selected. Smaller companies previously audited likely excluded. Comments due April 26, 2011 Commission not backing off it’s position that the voluntary standards should move from 70 % to 75% above LDA. Census data may counter this position. Still working on caffeinated alcohol beverages would not comment on follow on actions.
Near term Events FDA’s First Public Meeting on the FDA Food Safety Modernization Act: Focus on Imports March 29, 2011, Silver Spring, MD FTC Notice Seeking Comments on Proposed Information Requests to Beverage Alcohol Manufacturer: Comment due April 26, FDA issues guidance on calorie labeling for food items on menus for businesses with 20 or more units: Imminent Petitions submitted by Center for digital decency and Berkley Media Estimated burden cost $253K Industry has recommended use of the King Country, WA standard The FDA has announced that information about menu labeling will be posted to: d/LabelingNutrition/ucm htm d/LabelingNutrition/ucm htm FDA deferred to TTB and exempted beverage alcohol from the menu requirement pending comments in their notice. The FDA has announced that information about menu labeling will be posted to: d/LabelingNutrition/ucm htm d/LabelingNutrition/ucm htm FDA deferred to TTB and exempted beverage alcohol from the menu requirement pending comments in their notice.
FDA to Convene Public Hearing on Ensuring the Safety of Imported Foods and Animal Feed: Comparability of Food Safety Systems and Import Practices of Foreign Countries: College Park, MD, March 30-31,2011 ( future events continued) The Agricultural Marketing Service (AMS), US Department of Agriculture (USDA), National Organic Program – Continued need for the regulations; Complaints or comments received; Complexity of regulations; Extent of overlap in the regulation, duplicate, or conflict Length of time last evaluated or the degree to which technology, economic conditions or other factors have changed in the area affected by the regulations. Comment by April 26, 2011 Both Bernie and Bill attended this event
(Near Term events continues) Follow up on TTB advance notice of proposed rulemaking to define estate bottled to encompass terms including estate, estates, estate grown, proprietor grown, vintner grown, orchard, farm, single farm, single ranch, proprietors blend, Old vine, Barrel fermented, Old clone, reserve, select harvest, bottle aged……………. NABI commented on this advanced notice These terms are in broad use and harm could result in new definitions No evidence they are misleading by consumer complaints
The New CARE Act HR 1161 Introduced by Congressman Chaffetz (R-UT) on March 17. Wholesalers have legal protections, franchise laws in place One Third fewer wholesalers over 20 years Craft brewers, small wineries proliferating, wholesalers no long the only source of product Texas case rejected by the Supreme Court Doesn’t seem that sponsors asked state administrators for input No crisis of deregulation Wholesalers will seek additional co-sponsors 50 + co-sponsors as of April 29, 2011
Gray Market Project Focus on the FDA Compliance Policy guide Require that Importers provide the manufacturer registration number and other information required by the Bioterrorism Act Require FDA coordination with the authorized US based manufacturer’s agent when Key information is missing from prior notices Engage Hill and Administration officials with the goal of developing critical changes to the CPG Retain Capital Counsel to complete the final phase of this project
Member benefit Congress in you Pocket For Blackberry Available soon on the NABI website Member resources page m/blackberry.cfm
Other Business Renewal of office lease for 3 years Activities of the Wine and Beer Committees Benefit for Jeff Becker –May 2, 2011 American Beverage Licensees Opening night reception, June 18, Milwaukee, WI Performance Plans