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Lodi's new wine tax proposal to support struggling industry moves forward

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  Published in Food and Wine on Friday, September 12th 2025 at 4:00 GMT by kcra.com
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Lodi Pushes Ahead With Wine‑Tax Proposal, Aiming to Bolster Infrastructure, Community Programs, and Local Economy

Lodi, California – In a decisive move that has captured the attention of both the wine industry and residents across the region, the Lodi City Council voted on Monday to advance a controversial wine‑tax proposal that could bring an additional $5 million annually to the city’s coffers. The proposal, which would impose a 1 % tax on all wine sales within city limits, is slated to be implemented next fiscal year if it passes the county board’s review and receives final approval from the California Department of Finance.

The new tax is part of a broader effort to address Lodi’s aging infrastructure, fund public safety programs, and support community projects that have long been a priority for the city’s leadership. It will be used to pay for road repairs, improve public parks, expand the city’s public transportation network, and bolster local arts and cultural initiatives.

The Proposal in Detail

According to the city’s official memorandum, the wine‑tax proposal will apply to every bottle of wine sold, whether produced locally or imported, that is distributed or sold within Lodi city limits. The tax will be collected by the wineries and other sellers and remitted to the city on a monthly basis. The revenue generated is projected to average around $5 million per year, based on current sales volumes and an estimated 1 % tax rate.

The tax’s earmarked purposes include:

• Infrastructure: Repairs to the 23‑mile network of city streets and the renovation of the historic City Hall parking garage.
• Public Safety: Additional funding for the city’s volunteer fire department and a new community policing program aimed at reducing youth crime.
• Community Programs: Expansion of the Lodi Community Arts Center’s programming, a new after‑school program for elementary students, and a $1 million fund for low‑income seniors to keep their homes safe.
• Environmental Initiatives: A new program to incentivize vineyards to adopt water‑saving technologies and to install solar panels on public buildings.

The proposal’s architects argue that Lodi’s wine industry has long served as a pillar of the local economy and that a modest tax would not harm businesses but rather help to ensure the city can remain competitive and livable for its residents.

Supporters Speak Up

City Councilmember Maria Gonzales, who introduced the proposal, highlighted the winemaking community’s “generosity and willingness to invest back into the city.” She noted that many Lodi wineries already fund community events, and that the new tax would simply formalize that practice.

“We’re not looking to tax wine to stifle growth. We’re looking to tax wine to improve the quality of life for everyone who lives and works in Lodi,” Gonzales said. “The industry has long benefited from our beautiful surroundings, and it’s only fair that it gives back in a more structured way.”

Representatives from the Lodi Wineries Association, a coalition of 30 vineyards and cellars, issued a joint statement in support of the proposal. “The wine community has been supportive of initiatives that strengthen Lodi’s infrastructure and community services,” said Sarah Patel, president of the association. “We believe the proposed tax is a small price to pay for a stronger, safer, and more vibrant Lodi that will attract tourists and new residents alike.”

The Lodi Chamber of Commerce also backed the measure, citing the potential for the tax to create a “stable revenue stream that protects against fluctuating economic conditions.” “The Chamber recognizes the vital role of the wine industry in Lodi’s economy, and we see this tax as a way to preserve the city’s infrastructure that supports all businesses,” said Chamber President Michael Rodriguez.

Opposition and Concerns

Not everyone is on board. Several local wineries have expressed concerns about the impact on their bottom line and the potential for increased regulation. “We’re worried that this tax could hurt our smaller vineyards and make it harder to compete with larger producers outside the city,” warned David Kim, owner of Kline Cellars. “We’re not against community improvements, but we think the tax should be more carefully calibrated to our needs.”

The California Wine Producers Association (CWPA) sent a letter to the Lodi City Council, urging the city to reconsider the proposal. “While we support infrastructure improvements, a blanket wine tax is disproportionate and could stifle growth in a region that already faces high taxes and regulatory burdens,” said CWPA spokesperson Lisa Ramirez.

In addition, some residents have voiced concerns that the tax could raise wine prices, especially for tourists who come to Lodi to taste its world‑renowned Zinfandels. “If prices go up, we could see a decline in tourism, which is a huge part of our economy,” said a local resident who wished to remain anonymous.

Legislative Process and Next Steps

The proposal is now in the hands of the San Joaquin County Board of Supervisors, who will review the tax’s legal soundness and its potential impact on the county’s revenue. If approved, it will need to pass through the California Department of Finance’s review, which will ensure that the tax does not violate state law or the California Constitution.

The city council’s proposal is in line with a 2019 initiative that added a 0.5 % tax on wine in San Jose to fund a new public transportation line. According to the City of San Jose’s 2020 budget, the wine tax generated $7.8 million over the past three years, largely used for the BART extension project.

“We’re hopeful that the county board will see the benefits of this proposal,” Gonzales said. “We’re confident that the wine industry will continue to thrive, and that the new revenue will enhance the quality of life for all Lodi residents.”

If the proposal moves forward, Lodi will be among the few U.S. cities to implement a wine‑specific tax. The measure could set a precedent for other wine‑producing regions that are grappling with infrastructure needs and economic diversification. As the city’s council, the county board, and state regulators weigh in, Lodi’s future may hinge on whether the community can balance a small tax on its beloved wine with the promise of a stronger, safer, and more vibrant city.