We attended the State Senate Committee hearing on SB 63 and this is the long and the short of it.
If you are unaware of SB63, it is in favor of creating Georgia jobs by granting breweries and brew pubs the same rights which currently stand for both Georgia Wineries and Distilleries. It would give brewpubs legal ability to package their product, and give both breweries and brew pubs the ability to sell their product directly to the consumer. This will benefit Georgia by increasing the amount of products both made and sold in Georgia, increasing tourism dollars across the state, and attracting more businesses to the state. These limiting laws have not only been holding back people from starting and/or successfully operating breweries, but have also been a key reason some big breweries are building production facilities in other states, and not Georgia.
The presentation of the bill:
Hunter Hill (http://www.senate.ga.gov/senators/en-US/Member.aspx?Member=803&Session=23) presented the bill, and is the sponsor of the bill. In short he presented how SB 63 will increase Georgia jobs and be a positive factor for all parties involved. These parties are the 1) Producers of beer, 2) Distributors of beer, and 3) Retailers of beer. If passed, the bill would allow on premise (up to 72 oz) and off premise (up to 144 oz) retail sales from a brewery and brewpub. This would allow the producers a much needed revenue stream which would be focused back into the brewery to increase production, improve processes and hire employees. The total amount sold would account for less than 1% of total beer sales in the state, so the affect on distributors and retailers would be completely offset by the amount of brand awareness this would create for the products they are already selling. Everybody wins.
After the bill was presented there were some comments made by the committee which made it clear these regulations are not well understood even by the people voting on them. This is understandable since they are very nonsensical, and haven’t garnered much attention up to this point. To make a point of how little the laws pertaining to this case are understood, even by the committee in charge of regulating this industry, one senator commented that “it’s economically bad to give away free beer” which is, of course, what the current law forces breweries to do.
In defense of the bill Nancy Palmer, Executive Director of the Craft Brewers Guild of Georgia, brought out some very key points in the antiquated nature of our current treatment of these issues. She stated Florida passed this same law, and to a greater extent than what we are asking for in 1963, and North Carolina in 1986. This is why both of them trounce us in number of breweries per state, and North Carolina has seen such a rise in Beer Tourism and investment in their state from breweries in the past decade.
5 Seasons brew pub also commented in favor of the bill. They have obtained over 26,000 signatures in favor of the bill. Currently 5 Seasons, by law, can sell you wine to go but cannot sell you the beer they make on site to go.
Bart Watson, chief economist at the Brewers Association, proposed the three reasons this bill will increase economic impact, rather than shifting it.
1) Tourism dollars we are not getting from beer tourism is net new impact.
2) Capital from the increase in sales from breweries will go back into local investment, and the investment in net new breweries will be a net new increase.
3) Georgia products created and consumed in Georgia are sold at a higher value creating a larger increase in gross revenue for the state, the vast majority of which remains in the state.
Nick Economos, President of Eagle Rock Distributing and acting President of the Beer Distributors Association. He stated the bill is unnecessary not because the brewing industry is growing and does not need additional help. He did, however, concede that passing this bill would not take away jobs or revenue from his business or others in the state.
Martin Smith, lobbyist for the beer wholesalers of Georgia, had a different story to tell. His comments were that, currently, Georgia is 18th in craft beer production (he is correct, but only because Sweetwater produced 170,000 bbls, and the next closest is Terrapin at 44,000 bbls) last year so there is no need for change to the system. In response to Nancy’s comment on other states passing beneficial beer laws well a head of us, he stated: “they should be asking themselves why are they not like Georgia”.
In further opposition there was a retailer from a package store that give his thoughts on how this will affect his business. The comment was that this would be “unfair for breweries to be able to sample and sell beer when they can not”. At which point the Department of Revenue stepped in and said they are allowed to sample beer as long as they don’t sell Liquor, but they cannot because they made the choice to sell spirits. Finally, the retail owner’s son stepped up and said “I would love to go to a brewery, and leave with beer I bought from them! But that would be a perfect world, and we don’t live in a perfect world”.
All in all this is very large fight which comes down to all breweries located in Georgia being in favor of this bill, the distributors saying it will not hurt their business, and the retailers stating they would like to participate in exactly what is being proposed. Regardless of the obvious nature of the bill, it will still be a closed door conversation and the best thing to be done is to email your state representatives and other pertinent government officials and let them know that you stand in favor of bettering GA through the passage of the SB 63 – The Beer Jobs Bill.