February 26, 2026 — California’s wine industry is facing mounting pressures: rising production costs, increased competition, and shifting consumer habits. But a new Santa Barbara County ordinance—a mandate that all local wineries join a private marketing association and pay a 1% fee on their sales—is not only accelerating the squeeze on smaller operations, it’s also unconstitutional.
That’s why the Goldwater Institute sent a letter this week to Santa Barbara County leaders urging them to amend their ordinance and to make both the fee and the association membership voluntary. Goldwater sent the letter on behalf of its client, Flying Goat Cellars, a local winery in Lompoc, Calif., whose owners are standing up against the county’s forced arrangement.
“I’m not opposed to partnerships or marketing,” said Flying Goat founder Norm Yost. “But as an independent business owner, I am opposed to being forced into an association I don’t necessarily agree with and paying fees that may not benefit my business. I just want to make wine I love and connect with customers on my own terms.”
Last year, Santa Barbara County approved the creation of a wine “Business Improvement District,” (also known as a Wine BID) requiring all local wineries to pay a 1% fee on sales to fund regional marketing efforts. It also requires them to become members of the Santa Barbara County Vintners Association, which controls how the money is spent.
But that’s unconstitutional, and here’s why:
- It violates the First Amendment’s protections for the freedom to associate—or not associate—with a private organization. Santa Barbara’s ordinance effectively makes all local wineries de facto members of the Vintners Association.
- It violates the First Amendment by compelling Flying Goat to subsidize the speech of the Vintners Association—speech it doesn’t agree with.
- It violates the Fifth Amendment’s taking clause by taking Flying Goat’s property—its money—and redirecting it to the Vintners Association with no legitimate public use.
“The Supreme Court has made clear that the government cannot force Americans to subsidize speech they disagree with,” said Goldwater Institute Senior Attorney Adam Shelton, who represents Flying Goat Cellars. “It has also recognized a fundamental right not to be compelled into private associations. Santa Barbara County’s mandate violates both principles.”
“This is the most challenging time in the history of the wine industry since Prohibition,” said Flying Goat co-owner Kate Griffith. “Santa Barbara County is adding insult to injury by forcing us to pay a 1% fee and join an association against our will. The timing could not be worse for small wineries like ours.”
Read more here: https://www.goldwaterinstitute.org/california-winery-challenges-government-mandate-forcing-businesses-to-fund-speech/
Read the Goldwater Institute’s demand letter here: https://www.goldwaterinstitute.org/wp-content/uploads/2026/02/Santa-Barbara-BID-Constitutional-Issues.pdf
