(1) A winery may be established as a permitted use on land zoned for exclusive farm use under ORS § 215.213 (1)(p) and 215.283 (1)(n) or on land zoned for mixed farm and forest use if the winery produces wine with a maximum annual production of:

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(a) Less than 50,000 gallons and:

(A) Owns an on-site vineyard of at least 15 acres;

(B) Owns a contiguous vineyard of at least 15 acres;

(C) Has a long-term contract for the purchase of all of the grapes from at least 15 acres of a vineyard contiguous to the winery; or

(D) Obtains grapes from any combination of subparagraph (A), (B) or (C) of this paragraph; or

(b) At least 50,000 gallons and the winery:

(A) Owns an on-site vineyard of at least 40 acres;

(B) Owns a contiguous vineyard of at least 40 acres;

(C) Has a long-term contract for the purchase of all of the grapes from at least 40 acres of a vineyard contiguous to the winery;

(D) Owns an on-site vineyard of at least 15 acres on a tract of at least 40 acres and owns at least 40 additional acres of vineyards in Oregon that are located within 15 miles of the winery site; or

(E) Obtains grapes from any combination of subparagraph (A), (B), (C) or (D) of this paragraph.

(2) In addition to producing and distributing wine, a winery established under this section may:

(a) Market and sell wine produced in conjunction with the winery.

(b) Conduct operations that are directly related to the sale or marketing of wine produced in conjunction with the winery, including:

(A) Wine tastings in a tasting room or other location on the premises occupied by the winery;

(B) Wine club activities;

(C) Winemaker luncheons and dinners;

(D) Winery and vineyard tours;

(E) Meetings or business activities with winery suppliers, distributors, wholesale customers and wine-industry members;

(F) Winery staff activities;

(G) Open house promotions of wine produced in conjunction with the winery; and

(H) Similar activities conducted for the primary purpose of promoting wine produced in conjunction with the winery.

(c) Market and sell items directly related to the sale or promotion of wine produced in conjunction with the winery, the marketing and sale of which is incidental to on-site retail sale of wine, including food and beverages:

(A) Required to be made available in conjunction with the consumption of wine on the premises by the Liquor Control Act or rules adopted under the Liquor Control Act; or

(B) Served in conjunction with an activity authorized by paragraph (b), (d) or (e) of this subsection.

(d) Carry out agri-tourism or other commercial events on the tract occupied by the winery subject to subsections (5), (6), (7) and (8) of this section.

(e) Host charitable activities for which the winery does not charge a facility rental fee.

(3) A winery may include on-site kitchen facilities licensed by the Oregon Health Authority under ORS § 624.010 to 624.121 for the preparation of food and beverages described in subsection (2)(c) of this section. Food and beverage services authorized under subsection (2)(c) of this section may not utilize menu options or meal services that cause the kitchen facilities to function as a cafe or other dining establishment open to the public.

(4) The gross income of the winery from the sale of incidental items or services provided pursuant to subsection (2)(c) to (e) of this section may not exceed 25 percent of the gross income from the on-site retail sale of wine produced in conjunction with the winery. The gross income of a winery does not include income received by third parties unaffiliated with the winery. At the request of a local government with land use jurisdiction over the site of a winery, the winery shall submit to the local government a written statement that is prepared by a certified public accountant and certifies the compliance of the winery with this subsection for the previous tax year.

(5) A winery may carry out up to 18 days of agri-tourism or other commercial events annually on the tract occupied by the winery.

(6) For events described in subsection (5) of this section for a winery in the Willamette Valley:

(a) Events on the first six days of the 18-day limit per calendar year must be authorized by the local government through the issuance of a renewable multi-year license that:

(A) Has a term of five years; and

(B) Is subject to an administrative review to determine necessary conditions pursuant to subsection (7) of this section.

(b) The local government’s decision on a license under paragraph (a) of this subsection is not:

(A) A land use decision, as defined in ORS § 197.015, and is not subject to review by the Land Use Board of Appeals.

(B) A permit, as defined in ORS § 215.402 or 227.160.

(c) Events on days seven through 18 of the 18-day limit per calendar year must be authorized by the local government through the issuance of a renewable multi-year permit that:

(A) Has a term of five years;

(B) Is subject to an administrative review to determine necessary conditions pursuant to subsection (7) of this section; and

(C) Is subject to notice as specified in ORS § 215.416 (11) or 227.175 (10).

(d) The local government’s decision on a permit under paragraph (c) of this subsection is:

(A) A land use decision, as defined in ORS § 197.015, and is subject to review by the Land Use Board of Appeals.

(B) A permit, as defined in ORS § 215.402 or 227.160.

(7) As necessary to ensure that agri-tourism or other commercial events on a tract occupied by a winery are subordinate to the production and sale of wine and do not create significant adverse impacts to uses on surrounding land, the local government may impose conditions on a license or permit issued pursuant to subsection (6) of this section related to:

(a) The number of event attendees;

(b) The hours of event operation;

(c) Access and parking;

(d) Traffic management;

(e) Noise management; and

(f) Sanitation and solid waste.

(8) A local government may charge a fee for processing a license or permit under subsections (6) and (7) of this section. A fee may not exceed the actual or average cost of providing the applicable licensing or permitting service.

(9) A winery operating under this section shall provide parking for all activities or uses of the lot, parcel or tract on which the winery is established.

(10) Prior to the issuance of a permit to establish a winery under this section, the applicant shall show that vineyards described in subsection (1) of this section have been planted or that the contract has been executed, as applicable.

(11) A local government shall apply the standards described in this subsection. Standards imposed on the siting of a winery shall be limited solely to each of the following for the sole purpose of limiting demonstrated conflicts with accepted farming or forest practices on adjacent lands:

(a) Establishment of a setback of at least 100 feet from all property lines for the winery and all public gathering places unless the local government grants an adjustment or variance allowing a setback of less than 100 feet; and

(b) Provision of direct road access and internal circulation.

(12) A local government shall apply:

(a) Local criteria regarding floodplains, geologic hazards, the Willamette River Greenway, solar access and airport safety;

(b) Regulations of general applicability for the public health and safety; and

(c) Regulations for resource protection acknowledged to comply with any statewide goal respecting open spaces, scenic and historic areas and natural resources.

(13) When a bed and breakfast facility is sited as a home occupation on the same tract as a winery established under this section and in association with the winery:

(a) The bed and breakfast facility may prepare and serve two meals per day to the registered guests of the bed and breakfast facility; and

(b) The meals may be served at the bed and breakfast facility or at the winery.

(14) As used in this section:

(a) ‘Agri-tourism or other commercial events’ includes outdoor concerts for which admission is charged, educational, cultural, health or lifestyle events, facility rentals, celebratory gatherings and other events at which the promotion of wine produced in conjunction with the winery is a secondary purpose of the event.

(b) ‘On-site retail sale’ includes the retail sale of wine in person at the winery site, through a wine club or over the Internet or telephone. [1989 c.525 § 4; 1993 c.704 § 6; 1997 c.249 § 61; 2001 c.613 § 20; 2009 c.850 § 11; 2010 c.97 1,2; 2011 c.679 2,3,3a; 2013 c.554 § 2]