TRAVERSE CITY -- A decision by Peninsula Township's Zoning Board of Appeals opened old wounds and could create new ones in the area's wine-making industry.
A group of wineries on Old Mission Peninsula on Monday filed suit against Peninsula Township to overturn the ZBA decision and stop the Winery at Black Star Farms LLC from opening this month.
At issue is a special exception the township ZBA granted in August that will allow Leelanau County-based Black Star Farms to temporarily sell wine made in Suttons Bay at its new Old Mission Peninsula facility.
The exception expires at the end of 2009.
Peninsula Township's zoning ordinance requires grapes be both grown and processed on the peninsula to allow retail sales. It takes a winery six to 12 months from the fall harvest to create a complement of wines available for retail sales.
The lawsuit alleges the ZBA granted a special privilege to the Winery at Black Star Farms, exceeded its authority, misapplied the exception and changed the intent of the township ordinance.
"The ZBA thought they were doing something good for the wine community and apparently they didn't realize it was such a sensitive issue with the other wineries," said township Supervisor Rob Manigold.
The Winery at Black Star Farms LLC gets over 90 percent of its grapes from Old Mission Peninsula and is expanding at a former cherry processing plant on McKinley Road just east of Center Road to be closer to its fruit, said Lee Lutes, winemaker and winery manager for Black Star.
"The (plaintiffs) see us as an established winery with an established brand moving into their backyard and they are concerned from a business standpoint," Lutes said.
The winemakers, however, said it's about fairness and making everyone play by the same township rules under which they had to grow their businesses.
"We're not opposed to Black Star Farms being here, this is more about looking to preserve the process and existence of winemaking on (Old Mission)," said Jim Krupka, president of Chateau Chantel and spokesman for the trade group representing the five existing wineries on Old Mission.
In 2000, Peninsula Township voters killed a winery zoning ordinance many thought too lenient and "tore the community in half," Manigold said. The ensuing compromise took two years and provided a streamlined permit process for small wineries that grow and process their own grapes on site.
Larger wineries that import fruit must continue to go through the lengthy, complicated special-use permit process.
Lutes said it would make sense for the township to allow start-up wineries to custom-make their wine at another facility so they have wine to sell when they open.
"It's a massive capital investment and you need to have some way to capture your retail dollars as soon as possible," Lutes said.
The new 2 Lads Winery began processing grapes from Old Mission this fall, but it must wait until the spring to open its retail operation.
"(Black Star Farms) is cutting some corners that the rest of us had to go through," said Chris
Baldyga, general manager of 2 Lads Winery. "It's a little bit of an unfair advantage, but if we want to compete we'll just make the best ... wine we can."
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