Annapolis, MD, Friday, February 23, 2018
Last Friday, I went to the fights and a hearing broke out. The main event was Delegate Dereck Davis, chair of the Maryland Economic Matters Committee versus Maryland Comptroller, Peter Franchot, a champion of the Maryland brewery industry.Peter Franchot was scheduled to speak about House Bill 518 (Reform on Tap Act of 2018, a World Without Limits) sometime after 1:00 PM on Friday, February 23rd.
A little background
The feud began almost a year ago when Delegate Branch introduced HB 1283 which in its original form raised the taproom limits to 2000 barrels with a buyback provision for an addition 1000 barrels, ended contract brewing, and restricted taproom hours statewide. The final compromise, which is now law, allows contract brewing and grandfathers existing brewers taproom hours to their current times. New breweries have the more restrictive statewide hours.
Maryland brewers felt blindsided by HB 1283. As Julie Verratti, owner of Denizen Brewing, stated, the breweries felt they did not have any input in HB 1283.
Sparring began, when in May of 2017, Peter Franchot established the Reform on Tap Task Force, a panel of 40 participants, mostly from the 3-tiers of the beer industry. The task force’s mission was to revise the antiquated Maryland beer laws which included the much-maligned HB 1283. After eight forums, the Reform on Tap Act of 2018 was presented, eventually becoming HB 518. That bill removes taproom limitations, allows for local jurisdictions to determine taproom hours and removes franchise laws.
The Hearings
At 1:00 pm, the Economic Matters Committee room was overflowing with people. Outside, the hall was full of brewers, politicians, craft beer advocates, and camera crews.
Delegate Davis landed the first punch announcing that HB 518 would be heard last of 19 bills. Indeed, Peter Franchot did not speak until 5:15 pm, waiting more than 4 hours.
Alan Beal of Seawolf Brewing, a brewery in planning, stated they were considering investing $5 – $8 million in new breweries in Maryland. Delegate Wilson asked 2 probing questions – “How long have you been in business?” The answer, “3 months”. How many employees do you currently employee”? Response – “One”.
Another brewery talked about their beer. Del. Branch asked what is the alcohol content of his beer. Response – around 6.5%. Del. Branch asked what is Budweiser. Response – 5.2%. (Apparently Del. Branch is a spokesman for AB Inbev).
Del. Warren Miller threatens all those Facebook trolls with “If the tone and tenor doesn’t change, I suspect there will be a rough time. You guys need to straighten up your act.”
Carly Ogden of Attaboy Brewing questioned why taproom beer sales had limits while drills and milk did not. Del. Kramer pounced on this statement, asking if anyone had died in an auto accident by purchasing too many drills. Much later, Len Foxwell later countered by noting taproom sales are a tiny fraction of the beer sold in Maryland. Why aren’t the unlimited alcohol sales in restaurants, bars, sports and music venues all dwarf taproom sales.
Delegates Kramer and Branch introduced HB 1316, attempting to remove the comptroller’s role as chief regulator of alcohol in Maryland.
After 5:30, Peter Franchot with Jim Kelly and Len Foxwell in his corner spoke for HB 518. Again, Mr. Franchot called HB 1283 a terrible bill and continued his bull dog tactics.
Kevin Atticks has direct knowledge of two breweries, Stone Brewing and Ballast Point, who both initially selected Maryland locations for their new brewery sites but eventually chose Virginia locations due to restrictive Maryland laws.
Davis said he and Branch introduced the bill in order to “put things back the way they were.”
“We heard the cries of the craft beer industry of how deleterious that piece of legislation was,” he said earlier this month. “Sometimes we don’t get it right, so we were hoping to erase whatever we were doing wrong, whatever harm we had caused the industry.”
“If you are giving your child an allowance of $5 a day and they are only spending $2.30 but still they are asking for $30 a day, that doesn’t make sense,” said Davis, whose panel oversees liquor regulation. “They are asking for more and complaining about something that they are not even close to reaching.”
Click on House Economic Matters Committee Hearing, February 23, 2018, to see the full testimony (8 hours and 16 minutes). Note: HB 518 is the last marker on
Cheers!
Warren