Thursday, February 22, 2018

BC-Alberta wine war may not be over

Photo: Views like this at Forgotten Hill B&B bring visitors to wine country

The announcement that Alberta is suspending its ban on BC wine after just three weeks is great news.

The ban was announced on February 6. The BC Wine Institute estimated this week that, in the ban’s first month, lost sales will be $4 million. That will ramp quickly since BC wine sales to Alberta in 2017 totaled $70 million.

Earlier this week, the BCWI said it will challenge the constitutionality of that ban in court. “We believe it is unconstitutional to prohibit the import of Canadian goods into another province based solely on where they come from,” said Miles Prodan, the president of the BCWI. Presumably, legal action will now be suspended, at least for the time being.

Premier Rachel Notley called off her ban when BC Premier John Horgan announced a slightly more conciliatory stand on his government's determination to thwart the Kinder Morgan pipeline expansion. He has agreed to let the courts decide whether his has the jurisdiction to frustrate a federally-approved pipeline project.

The wineries should not assume it will be business as usual in Alberta. Supply chains and relationships have been muddied, even if the ban is not imposed again.

Meanwhile, the British Columbia government is moving to add another irritant in the relationship with Alberta. This week’s provincial budget proposed to extend the empty homes tax to include vacation properties in such places as the Okanagan (Kelowna and West Kelowna) and parts of Vancouver Island.

The government is trying to force owners to add properties to the rental pool when they are not owner-occupied.

That is a good idea when it applies to speculative properties left empty in urban areas where there is an urgent need for long-term rental properties. However, many vacation properties are not located in urban areas and often are not designed for year-round occupancy.

Hundreds of vacation properties in BC are owned by Albertans. They now may consider selling them; they certainly will not buy more. And they will side with their own government in the BC wine ban.

Albertan vacationers and tourists had become major buyers of wine from BC wineries when they are vacationing here, whether for a week or for the season.

“According to a wine industry study, one million tourists visited BC wineries in 2015, generating $452 million in direct and indirect revenue for the broader BC economy,” the BCWI says. “In the past two years, 23 percent of Alberta residents have experienced a wine tour in British Columbia, and 15% of those residents have identified wine as the primary motivation for their trip.

“In the past four years, 46% of Albertans attended a British Columbia wine tour,” BCWI added (emphasis added).

I would like to see figures on how many of those Albertans stock BC wine in their vacation properties. The empty homes tax on vacation properties, well-intentioned that it may be, looks to me like bad news for BC wine sales.


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