Friday, June 22, 2012

Guild bill passes Assembly, 64-13

Tote board from Assembly vote
With a favorable Assembly vote in their pockets, New Jersey's craft brewers are now turning their attention to a Monday state Senate session and scheduled vote on companion legislation that would give those brewers more leeway in marketing their ales and lagers to Garden State beer enthusiasts.

Lawmakers in the Assembly on Thursday voted 64-13, with one abstention, to pass legislation to modernize New Jersey's craft brewing regulations, a long-sought change to the rules under which the state's combined two dozen production breweries and brewpubs do business.

Members of the Garden State Craft Brewers Guild, which developed the legislation with the help of lobbyists from the Kaufman Zita Group, are optimistic for passage in the upper chamber. (As many Jersey beer drinkers know, the guild is umbrella group that represents most, but not all, of the state's craft breweries.)

The Senate version of the bill has key bipartisan sponsorship from Republican Sen. Tom Kean Jr. of Union County (home to Trap Rock brewpub and Climax Brewing) and Democrat Sen. Donald Norcross of Camden County (home to Flying Fish Brewing and the planned Iron Hill Voorhees location). If passed by the Senate, the legislation would go to Governor Chris Christie for his consideration.

However, even with the tailwind that the legislation is now enjoying, the guild is renewing an action alert, again asking beer enthusiasts across the state to call or email their senators and urge them to vote yes on the bill. (The guild has posted a link to the state League of Municipalities so beer drinkers to find their legislators.) The state's restaurant association has been a staunch opponent to changing the brewery rules, complaining the proposed rewrite would erode the three-tier system under which alcoholic beverages are produced and sold.

Heading into Thursday's session, the guild had expected votes in both the Senate and Assembly. However, the legislation did not make it onto the Senate's list of bills to be considered for a vote.

And, when the bill came up for a vote in the Assembly, it wasn't without some surprises: Assemblyman Anthony M. Bucco, an early sponsor of the bill, was among a bloc of Republicans voting no that also included Assemblymen Alex DeCroce and Jay Webber, whose legislative district includes Butler, the host town of High Point Brewing.

(If you've ever been to a Ramstein beer open house, then you know that High Point Brewing enjoys a lot of support from local elected officials, including some who have swung the mallet during the ceremonial oak barrel tappings.)

Bucco and DeCroce were joined in dissent by  Republicans from the Shore area: Monmouth County Assembly members Sean Kean, David Rible, Amy Handlin, Caroline Casagrande, and Mary Pat Angelini; and Ocean County Assembly members Brian Rumpf and Diane Gove.

In fact, Republicans accounted for all of Thursday's 13 no votes and the lone abstention, from Assemblyman Ronald Dancer. (Despite opposition from that particular group of Republicans, the bill did pass the Assembly with bipartisan backing.)

And like DeCroce, Assemblywomen Angelini and Casagrande voted against craft breweries in their districts: Carton Brewing (Atlantic Highlands) and Kane Brewing (Ocean Township) and Basil T's in Red Bank; while Assemblywoman Donna Simon's dissent was a vote against newly licensed Flounder Brewing in Hillsborough.

Metaphorically speaking, the Assembly's vote, and recent affirmative Senate committee votes on the bill, represent a tectonic shift in Trenton's attitudes toward craft brewing, a small, but now-growing, industry the Legislature had largely ignored and even rebuffed when it came to the industry's prior pleas for a rule rewrite that would make the Garden State competitive with its neighbors Delaware, New York and Pennsylvania.

Until lately, the most craft brewing ever got from Trenton, after lawmakers authorized small-batch brewing back in the mid-1990s, was a millstone of a rule hung around the industry's neck: a regulatory change a few years ago that made it difficult for production brewers to cut loose distributors they had entered into agreements with.

But as craft beer and the craft brewing industry raised its profile nationally over the past few years, the legislative climate in New Jersey has grew more favorable. The measure just approved by the Assembly, and to be taken up by the Senate on Monday, would allow brewpub owners to operate up to 10 establishments and to sell their beers through wholesalers – essentially enabling beer drinkers to get those brews at places other than the pubs.

Right now, the only place you can get an Avenel Amber is at J.J. Bitting in Woodbridge; the same thing goes for Ironbound Ale (Iron Hill in Maple Shade) and Leatherneck Stout (Tun Tavern in Atlantic City). As many beer drinkers know, if you enjoy those brews, you must go to those brewpubs to get them.

For production brewers, meanwhile, the legislation would allow retail beer sales to tour patrons for consumption on and off premise, a change that means going beyond the sip-size samples and two-six pack/two growler limit that have been the customary practice in the Garden State for practically all of the 17 years that craft brewing has been going in New Jersey. (For instance, the legislation would allow people to buy a keg – 15.5 gallons – from the brewery.)

The legislation's sponsor, Assemblyman Craig J. Coughlin, a Middlesex County Democrat, sized up the proposed regulatory changes as some key help to small businesses, and as a way to bring New Jersey in line with the national craft beer trend – a $7 billion industry that finds craft beers enjoying unprecedented popularity. (For whatever it's worth, Middlesex County is home to three brewpubs – Harvest Moon in New Brunswick, J.J. Bitting, and Uno Chicago Grill in Metuchen.)

"Like much of the rest of the country, New Jersey is experiencing a craft beer brewing renaissance," Assemblyman Coughlin says. "The appeal of these regional beers is making microbreweries and brewpubs tourist destinations. To help these small businesses capitalize on their newfound popularity, we need to update the state's antiquated laws regarding microbrewing."

Said co-sponsor Patrick J. Diegnan, another Middlesex County Democrat: "By making these changes to our brewing laws, we can help better promote New Jersey's existing breweries and attract new brewers looking to make their mark on the world of craft beer. This is good for economic development, job creation and our state's tourist industry."

Monday, June 18, 2012

Guild legislation gets 2 more OKs in Trenton

Legislation that would give New Jersey craft brewers a freer hand when doing business on Monday cleared two more committees, passing the state Senate Budget and Appropriations Committee without comment, but again encountering opposition from the state's restaurant association before a corresponding Assembly panel.

Though less vociferously than during Senate and Assembly committee hearings held in March and earlier this month, the restaurant association cited the three-tier system in renewing its complaints against the legislation.

The three-tier system was put in place after the repeal of Prohibition, requiring producers to sell through wholesalers, who sell to retailers, who in turn sell to consumers. The system was set up to prevent abuses and ensure competition, but critics say it has had a countereffect in the era of craft brewing, with small producers being denied access to markets.

(Washington State is the only state in the country where producers can sell directly to retailers. The three-tier system also gets blamed by critics for adding to the cost of beverages bought by consumers.)

The bills (S642 and A1277) put forth by the Garden State Craft Brewers Guild, the umbrella organization that represents most of New Jersey's small-batch brewers, would allow brewpubs to own up to 10 establishments (the current limit is two) and sell beer through wholesalers, and allow production breweries to sell beer to tour patrons for on- and off-site consumption.

The restaurant association maintains the legislation turns production breweries into bars and package goods stores. The organization has complained that allowing brewpubs to exceed two establishments is also an erosion of the tier system.

Nonetheless, the bills were advanced by both appropriations committees with a dozen votes from each panel, clearing the way for votes by the full Assembly and Senate. When those votes could take place isn't immediately known.

Monday's vote was largely housekeeping on the part of the Legislature since the bills would also raise the ceiling for the amount of beer that brewpubs and production brewers can make, and that has a bearing on the state budgeting process and potential revenues (i.e. fees and taxes).

The vote was also the second time this month that the legislation got a thumbs-up from lawmakers. Ten days ago, members of the Assembly's Law and Public Safety panel gave the bill the green light. A similar committee in the Senate approved the bill in March.