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Texas Lawmakers Vote to Lift Restrictions on Craft Breweries

Texas Lawmakers Vote to Lift Restrictions on Craft Breweries
LDD

On Friday afternoon, at 4:07 p.m., a round of applause and cheers wafted down from the balcony seats in House of Representatives as a five-pack of craft beer bills were passed with five thick slams of the gavel. It was technically the second vote of three, and the third, as a matter of formality, should take place Monday. Then the bills will head over to the governor's desk for his signature.

See also: Want to Own a Brewery? Kickstart it! Get a Lamborghini Too!

Scott Metzger of Freetail Brewing in San Antonio was one of those in the upper tier waiting to hear the bills read and tweeted shortly after "All Beer Bills pass to third reading on voice vote! #txbeer4tx we did it!"

Once the final reading is taken care of and the governor signs the bills, the laws will take effect on September 1. For more than a decade craft brewers have fought for tweaks to the restrictive three-tiered system to allow for expanded sells and distribution.

After an unsuccessful campaign in 2011, "craft beer working groups" were set up to bring everyone together and, once and for all, create a package that everyone could agree on. And they sort of did that. In the end there were four bills that covered the main issues.

Then, at the last minute, after the four bills were introduced, Sen. John Carona and the Wholesale Beer Distributors of Texas threw a curve ball and introduced another bill that that would (will) make it illegal for brewers to sell their distribution rights, an issue they failed to bring up in the working group (that Carona himself set up). Deep Ellum Brewing Co. called it a "huge step backward for microbreweries."

After some tense back-room negotiations, Brock Wagner with Saint Arnold relented that it was an "imperfect compromise," but still feels like the set of bills in sum will allow Texas craft breweries to move forward.

Here's a recap of the primary points in the beer legislation:

• Breweries that produce less than 225,000 barrels of beer annually and are allowed to sell up to 5,000 barrels directly to consumer for on-site consumption.

• Brewpubs are allowed to package and sell 10,000 barrels of beer at the retail level.

• Breweries that produce up to 125,000 barrels annually will be allowed to self-distribute up to 40,000 barrels annually.

• Breweries are no longer allowed to receive payment from wholesalers for the right to distribute their beer. However, they will share in some marketing and promotional costs with distributors.

One issue that was left out this year was the right for small breweries to sell beer for off-site consumption, similar to wineries. There's always 2015.


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