Wine & Spirits Wholesalers of America (WSWA) has announced the findings of an economic study commissioned to assess the economic costs resulting from the enforcement of direct-to-consumer (DTC) alcohol shipping laws at both a national and state-by-state level. The findings of the new economic model place the total cost of state DTC enforcement needs, from the labor needed to audit licenses and track illegal shipments to initiating sting operations, at more than $255 million.
“As state legislatures consider DTC bills, it’s important that they have a clear understanding of the direct costs their states will incur to ensure that enforcement agencies maintain regulatory oversight of these regulated products,” said WSWA’s Vice President of State Affairs, Chelsea Crucitti. “DTC alcohol shipping introduces a host of public health and safety concerns into the U.S. market that have never existed before – but money talks and we want policy makers to really understand that DTC shipping is the equivalent of an unfunded mandate.”
The study found staggering enforcement costs nationwide. California currently spends $1.4 million enforcing its DTC wine law; should DTC spirits legislation be enacted the study suggests that the total cost to properly enforce DTC alcohol shipping would balloon to $116.9 million. The study further breaks down the total cost of enforcement to include new regulatory agency employees and wages, new equipment, lost tax revenue and more.