As California’s wine industry navigates tightening sales, regulatory hurdles and shifting consumer preferences, newly passed legislation in Sacramento is stirring debate among North Coast vintners from Napa to Mendocino counties.
The passage of Assembly Bill 720, which allows wineries to host a limited number of “estate tasting events” at vineyard sites beyond their bonded production facilities, has been hailed as a breakthrough by statewide advocates.
AB 720, its supporters argue, gives vintners new tools to reconnect consumers with the vineyard and the agricultural roots of California wine. But in Napa County, where land-use policies remain among the strictest in the nation, and in Sonoma County, with relatively new rules on industry events, the path forward is less clear. Yet AB 720 explicitly defers to local land-use laws, meaning counties such as Napa and Sonoma, which have their own rules for winery events, retain authority over zoning, permitting, and event caps.
Declining U.S. wine sales have been widely reported, with oversupply and shifting consumer tastes pressuring producers from the North Coast to the Central Valley, according to industry reports this year from Silicon Valley Bank, BMO and Gomberg Fredrikson Report.
Gov. Gavin Newsom has 30 days to sign or veto AB 720, which cleared both chambers of the Legislature earlier this month with unanimous support. The bill permits up to 36 events annually at vineyard properties, creating new opportunities for consumer engagement across the state’s 6,200 bonded wineries, 90% of which are family-owned, according to trade group Wine Institute.
“California wineries have been built on a legacy of innovation, stewardship and storytelling,” said Robert P. Koch, president and CEO of Wine Institute, in a news release. “AB 720 is an example of how that work pays off, delivering both for wineries and for the millions of visitors who want to experience California wine at its source.”
Cautious optimism, lingering questions
In Napa County, a world-renowned winegrowing region, the new legislation has prompted cautious optimism. Michelle Novi, counsel and senior director of industry relations at Napa Valley Vintners, said the organization did not take a formal position on AB 720 but sees promise.
“The bill certainly reflects the necessary flexibility to meet evolving consumer expectations during a challenging time for the wine industry,” Novi said. “It represents a modest but low-impact solution that could really foster connection to the land for consumers while supporting our wineries.”
Still, Novi emphasized that Napa’s unique regulatory environment will complicate implementation. After years of discussion the county Winery Definition Ordinance was adopted in 1990, specifying what industry functions can happen and where. A key effort was to keep vineyard properties largely for growing grapes and making wine, and encouraging visitor-oriented functions thereafter to shift to urban areas.
“There’s a lot to work through as to how this (AB 720) could potentially work in Napa County within the existing framework,” she said. “But it also offers an opportunity to look at the existing framework with fresh eyes and an understanding that having more tools to tell the Napa Valley story is a positive step.”
Novi also drew a distinction between AB 720’s event provisions and Napa County’s “micro-winery” permit system, adopted in 2022.
That ordinance was designed to help small grape growers produce and sell their own wine. But it does not permit marketing or hospitality events beyond tastings — and only at a bonded winery. AB 720 allows for state alcohol permits for a limited number of tasting events properties adjacent to the primary licensed winery or at an owned property elsewhere.
“This is a challenging time,” Novi said. “But through collaboration, through innovation, through conversation, we can find a path forward.”
Opening the vineyard gates
Rachel Newman, senior vice president of marketing at Bonterra Organic Estates in Mendocino County, highlighted how AB 720 would change the playing field for wineries statewide.
“The biggest hurdle for us previously was … the fact that we weren’t able to sell or provide wine to consumers at any for-profit events outside of where we hold our license,” Newman said. “This new legislation opens the door for us to take people to bucolic vineyard sites that have previously been completely off limits.”
Newman added that the ripple effects could extend far beyond tasting rooms.
“There are contractors that stand to benefit, event planners, rental companies. One of the things we’re most excited about is working with local farmers and securing produce for some of these events,” she said.
Frustration from small family farms
Local backers of AB 720 are Winegrowers of Napa County, Russian River Winegrowers, Wine Road of Sonoma County, Mendocino Winegrowers and Anderson Valley Winegrowers Association.
Some Napa Valley producers, however, reluctance to adopt the state law is a source of frustration.
Elise Nerlove, vice president of Save the Family Farms, a key proponent of microwinery ordinance, said she has tried to get buy-in on AB 720 from local trade groups and officials. She said the bill represents an opportunity to align Napa County policies with a statewide effort to make it easier for struggling vintners to connect with consumers.
“Napa County is choosing to not empower the small family farms community by embracing the state bill and offering it to Napa County small grape growers and winemakers,” Nerlove said. “It’s a big disappointment.”
County officials didn’t respond for requests for comment by time of publication.
Nerlove pointed to broader industry struggles that compound the challenge, including a sizable amount of grapes in the county that weren’t picked last year and estimates of more to be left on the vine this year even as picking is going on right now.
“That’s not helping stimulate the wine business at all,” Nerlove said.
Balancing agritoursm, rural impacts
In neighboring Sonoma County, the local regulatory framework already sets firm limits on winery events. The county adopted its Winery Events Ordinance in 2023 after nearly a decade of debate between vintners and rural residents over traffic congestion, noise and event clustering in subappellations such as Russian River, Dry Creek and Sonoma valleys.
The ordinance created a tiered system, allowing smaller wineries to hold a limited number of events — often fewer than AB 720’s 36-event-per-year maximum — under streamlined permits, while larger facilities must go through more rigorous review. It also set annual event caps, required traffic-management plans, and mandated setbacks to minimize neighborhood impacts.
“Permit Sonoma did not have any involvement in the crafting of AB 720,” Scott Orr, interim director of Permit Sonoma, the county’s permitting agency, wrote in an email. “The changes to alcohol licenses as part of AB 720 won’t have any immediate impact on our local zoning ordinances.”
Orr said the county does track law changes at the state level to inform potential future code amendments the community may want to pursue.
“And, we’re especially mindful of the challenges facing the agricultural community within the county and region,” Orr wrote.
Jeff Quackenbush joined North Bay Business Journal in May 1999. He covers primarily wine, construction and real estate. Reach him at jeff@nbbj.news or 707-521-4256.
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