Press-Republican

March 16, 2013

Schumer moves to help apple growers

JOE LoTEMPLIO
Press-Republican

PLATTSBURGH — If new legislation amending the description of hard cider becomes law, business will be better for Elfs Farm Winery & Cider Mill and other producers.

Now, to avoid a federal tax that undermines the Plattsburgh mill’s effort to make hard cider pay, it produces the beverage at 7 percent alcohol per volume, which classifies it as wine.

As wine, said Head Elf Tom Frey, “we can’t put it in a grocery store. We can only sell it in our tasting room or store or at a liquor store.”

The Cider, Investment & Development through Excise Tax Reduction (CIDER) Act, sponsored by U.S. Sen. Charles E. Schumer, would increase the allowed alcohol by volume from 7 to 8.5 percent, encompassing significantly more hard-cider and pear cider products and allowing them to be labeled and taxed as such, rather than wine, a news release said.

His proposal would also address existing tax issues in the Internal Revenue Code related to carbonation levels in hard cider and would put the new definition in line with that of the European Union, so producers can better compete with products abroad.

“It would be phenomenal,” Frey said. “It would it expand the market greatly.”

New York has more than 20 existing producers of hard apple cider and 650-plus apple growers, including a number of orchards in the North Country.

ALCOHOL CONTENT

In a telephone news conference this week, Schumer (D-New York City) explained that the alcohol content of New York’s hard cider fluctuates greatly due to sugar content and that current law often forces it to be taxed at a higher rate, preventing it from being labeled as hard cider.

Compliance adds a significant financial burden to producers and consumers, he said, and makes the business unpredictable and less attractive for potential new cider producers.

EMERGING MARKET

“New York is the second-largest apple producer in the country, and there’s no doubt it should be at the core of the hard cider industry, which is rapidly growing in popularity,” he said.

“However, current federal tax rules make it extremely costly for producers and consumers alike to produce, market and sell this product, which could prevent New York’s hundreds of apple growers and hard-cider producers from fully benefiting from the stable income that comes with this new product.”

New York harvested a total of 29.5 million bushels annually from more than 650 farms and 41,000 acres across the state.

In recent years, many apple growers have turned to producing hard cider as a way to diversify their crops.

“Cider,” Frey said, “was originally America’s national drink. Every farmer that came over here (to settle), the first thing mom and dad did was plant an apple tree.”

Hard cider was produced to last through long winters, he said.

“But with Prohibition, hard cider dropped out. Until 1996, there were maybe 100 cideries in the country that made hard cider.”

A slow resurgence would speed up with the passage of Schumer’s bill, Frey said.

SUPPORT

The College of Agriculture and Life Sciences at Cornell University applauded Schumer’s proposal.

Kathryn J. Boor, Ph.D, the Ronald P. Lynch Dean of the College of Agriculture and Life Sciences, said in a release that hard-cider production “is already an important provider of value-added income for many of New York state’s 650-plus apple growers. Sen. Schumer’s proposal will regularize the tax rates on hard cider, allowing New York’s cider producers to label and market their products independently of wine, thus helping to unlock the full potential of this stable and profitable source of revenue.

The New York Farm Bureau is supporting Schumer’s plan.

“The popularity of hard cider is seeing a big boost as consumers get a taste of the great products being offered by New York growers and cider makers,” Farm Bureau President Dean Norton said in a statement endorsing the idea.

— News Editor Suzanne Moore contributed to this report.