Alcohol Regulation Roundup: February 10, 2011

Massachusetts: State Representative Alice Peisch filed legislation this week (HD 2759), which would amend the state’s outdated laws from the 1970s that make it impossible for small brewers to switch distributors. Brewers are required to use distributors — but if the distributor fails to get their products in front of consumers, there’s little that brewers can do about it. While current Massachusetts law does allow switching if brewers can show “good cause” (i.e., disparagement of a brand by wholesalers or proof that the distributor failed to put its best efforts into promoting a specific brand), craft brewers don’t have the resources for an expensive legal fight — unlike distributors which are usually well-funded.

“This bill will allow small brewers to make their product more widely available, while also giving adequate protections to wholesalers,” said Representative Peisch.

Minnesota: The Gopher State might finally get Sunday sales. A bill introduced by Roger Reinert in the state House aims at reforming the Prohibition-era law that forces liquor stores to close on Sundays. This would be good for Minnesota’s tax revenue, as the Distilled Spirits Council of the U.S. (DISCUS) found ” that cross-border purchases by Minnesotans driving to Wisconsin account for nearly 3.1 percent of our neighbor state’s taxed liquor sales.”

“This bill is about the free market, giving both businesses and consumers a choice,” Sen. Reinert said. “Stores could still choose to be closed on Sundays, and consumers could choose not to make a purchase. But let’s allow for the choice.”

Also in Minnesota: Small craft beer maker Omar Ansari of Surly Brewing plans to introduce legislation next week that will change state law allowing them to sell their products to local liquor stores as well as opening their own brewpub restaurant. Current law prevents brewpubs, which are qualified as producing under 3,500 barrels a year, from selling their product in local stores.

Oregon: In the next week both branches of Oregon’s state government will consider bills that clarify the legality of competitions involving homemade beer and wine. The controversy arose last year when the Oregon Liquor Control Commission interpreted the law in a way that bared judging in competitions of homemade beer and wine at the State Fair.

Pennsylvania: While Virginia’s attempt at privatizing liquor sales appear to be dead in the water (see below), Pennsylvania’s prospects are looking brighter. A series of public hearings on privatization will begin on the 14th in the Senate Law and Justice Committee. Public sentiment seems to be for privatization, especially in light of the recent news that the PLCB will be dramatically reducing the variety of products it offers.

The wine and spirits being yanked from shelves would remain available for shoppers to purchase in a private market, said State Rep. Scott Perry, R Dillsburg.

“Now you won’t even be able to get them … I personally think this is just an indication the state liquor system’s time has come and gone,” he said.

Utah: Republican Rep. Gage Froerer’s bill  HB42 passed the Utah House on Monday and now goes to the Senate. The bill would solve an “acute shortage of alcohol licenses” in the state by changing licensing quota formulas to convert unused beer bar licenses, of which there are 41, into restaurant permits — 21 of which would allow all types of alcohol to be served and the remaining would allow restaurants to serve beer and wine. The bill has been dubbed as a “Band-Aid” to immediately address the issue though sweeping reforms are expected to be considered later in the year.

Virginia: Gov. Bob McDonnell’s hard fight for privatization of the state’s liquor store system seems to be over, at least for now. Tuesday, the deadline for House and Senate to pass bills came and went without action.

Republican House Speaker Bill Howell and other GOP leaders declared the bill dead at the beginning of this month. While the GOP in Senate was supportive of his plan, Chairwoman Sen. Toddy Puller said she wouldn’t hear the proposal until House of Delegates advanced the proposal.

The governor has said he still believes in privatization and will continue to push it during the remainder of his two year term.