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A New York businessmans glass is half full with taxpayer money that will help launch a

winery, but other vineyards in the surrounding area are not happy the government is
subsidizing a competitor.
The U.S. Department of Agriculture (USDA) awarded a $175,723 Value-Added Producer
Grant to Philip DeLuke who is opening Northern Flow Vineyards next May inside his current
business, DeLukes Garden Center.1330
The free federal cash must be matched with his own money. Ill have half-priced stuff
for three years with the grant, notes DeLuke. 1331
He will have three years to use the grant money, but DeLuke expects that it wont take
long to spend that much money. New computers for checkout counters and point-of-sale
software will be purchased with the grant. It will also cover some of the expenses for tasting
room labor and anything to do with selling the product new signs, websites, newspaper
advertising and consultation from other wineries. He thinks a new sign could be $10,000 or
$20,000. The funding will also cover a lot of advertising and marketing to promote his
wine. 1332
Were going to have 1,200 to 1,400 cases of wine ready to go in the spring, predicts
DeLuke. He expects much of his wine will be bought by women who purchase flowers at his
garden center. Whether they live here year-round or have seasonal cottages, all of those
women who come here to buy flowers are wine drinkers who like to go to the tasting rooms,
he says. 1333
Other vintners in the area have cried foul after learning a startup winery netted the
federal money. 1334
The government is picking winners and losers, and its not fair to the businesses that havent
gotten grants, says Steven Conaway, who opened Thousand Islands Winery in 2002. His
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annual marketing budget is less than a third of the federal grant that was handed out to
DeLuke. Im not happy that Im funding his winery for him through my tax dollars, says a
frustrated Conaway. Competing against government money puts me and every other small
winery up here at a severe disadvantage. 1335
The owner of Otter Creek Winery, Kyle Hafemann, said he was stumped after hearing
about the government grant, noting his marketing budget is only a fraction of the amount
provided to DeLuke. I get that hes trying to get going, but I did it all on my own and never got
a penny for my business thats been open nearly 10 years, he said.1336
Philip Randazzo, who owns Coyote Moon Vineyards, believes the USDA should not be
paying for marketing for individual businesses because it makes it more difficult for businesses
doing it the old fashioned way and earning it with their own money isnt really fair. 1337
The federal grant is not the only public assistance the new winery is receiving either.
Northern Flow Vineyards is also receiving support from a state-funded I Love NY marketing
campaign that is promoting some of the states craft beverage industry. The $182,000
marketing campaign began in September and will last for 18 months.1338
Roger Reifensnyder, the owner of Dark Island Spirits distillery, which will also be
promoted in the state-funded campaign, says the grant to Northern Flow Vineyards sounds
bizarre because were all already involved in one plan. I dont think its fair for someone to get
free money that puts them in direct competition with someone whos putting in their money.
He says he has never applied for grants as a matter of principle. 1339

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