Guild bill clears NJ Assembly panel

Iron Hill's Mark (on crutches) after hearing

Garden State craft brewers won another round in Trenton when a bill to modernize the rules under which they operate cleared a second key legislative panel on Thursday.

The Assembly Law and Public Safety Committee advanced the bill, A-1277, by an 8-2 vote, handing the state's craft brewing industry the prospect of the measure landing on Gov. Chris Christie's desk before the end of year, or possibly even before the Legislature takes a summer break at the start of next month.

A Senate version of the measure cleared a corresponding committee in that chamber in March by a unanimous vote.

Despite that, it's not a straight shot toward getting the bill posted for votes by the full Senate and Assembly. The legislation must now go through an appropriations committee (a circumstance tied to the fact the bill would increase production ceilings for craft brewers). However, based on the current momentum – and despite dissent by two lawmakers – the bill is unlikely to get held up, supporters say.

The two Assembly committee members who voted against the bill on Thursday, Republicans Sean Kean and David Rible of Monmouth County predicated their reservations on fears that new freedoms the bill would grant brewers would come at the expense of taverns and restaurants with bars. (Incidentally, Monmouth County is home to three craft breweries, though not in the Kean and Rible's 30th district. But East Coast Beer is, and the folks behind the Beach Haus brand are planning a brewery in New Jersey. Still, there is this: Distributor Ritchie & Page, which acquired Bud purveyor Crown Beer a while back, operates out of the 30th district.)

The lawmakers' dissent drew from arguments laid out to the committee by lobbyists for the tavern and restaurant groups, who complained the bill would undercut the value of bar owners' licenses at a time when some owners are struggling in the economic downturn. Additionally, the lobbyists said, the bill attempts to side-step long-established rules and practices for the state's alcoholic beverage industry.

That aside, Thursday's committee action indeed represents sea change for craft brewing in New Jersey.

Since the mid-1990s, when craft brewing was first sanctioned by the Legislature, the state's small-batch brewers have been hemmed in by regulations that left them at a disadvantage compared with brewers in neighboring states.

That's a reason Iron Hill brewpub, founded by a trio of New Jerseyans, got its start in Delaware and likely why Triumph Brewing in Princeton, an early pioneer of craft brewing in the Garden State, opted to expand in Pennsylvania rather than in New Jersey.

Other long-time craft brewers in the state could be counted on to utter the refrain that if they had known New Jersey would prove to be so difficult for doing business, they would have looked across the Delaware River to start their breweries.

Over the years, attempts to make the rules more business-friendly often had trouble finding a sympathetic ear in Trenton.

But this time, efforts to level the playing field – spearheaded and shaped by the Garden State Craft Brewers Guild, the trade group that represents most but not all of the state's microbrewers and brewpubs – have gained traction as craft brewing's profile and fortunes have risen across the country. (Nationally, craft brewing is a $7 billion a year industry.)

Essentially the legislation would put New Jersey on par with Delaware and Pennsylvania.

Production brewers would be allowed to retail kegs (half barrels, quarters and sixtels) directly to the public and serve more than just small samples during tours, for which the breweries could charge. Currently, production brewers are limited to selling only two six-packs or two growlers to tour guests and often provide the beer samples for free. However, under the bill – and unlike in Pennsylvania – production breweries would not be allowed to serve food, a concession made for the sake of bars and restaurants.

For brewpubs, the bill would boost the number of locations that can be held by a single owner from two to 10, and allow brewpubs to distribute their beer through wholesalers. That means beer drinkers would be able to get their favorite Gaslight or Trap Rock beers at a packaged goods stores, instead of exclusively at those brewpubs, as is the case now.

Until last month, New Jersey only had one brewpub owner that ever maxed out the licensing, Basil T's in Red Bank, which owned a second location in Toms River before spinning it off several years ago. (The Toms River location kept the Basil's name until changing it to Artisan's a couple years ago.)

In May, Iron Hill brewpub, which owns a location in Maple Shade in Burlington County, announced it had signed a lease for a second store in Voorhees in Camden County, with a projected opening around the end of the year.

Before the Assembly committee, Mark Edelson, one of Iron Hill's founders, pointed out that unless the law is changed, the Voorhees location means Iron Hill, which owns eight other locations spread among Delaware and Pennsylvania, would be legally finished investing in New Jersey.