State’s top alcohol regulator proposes reforms for craft breweries

Comptroller Peter Franchot unveiling his proposals at Denizens. Photo by David Lay.

Maryland Comptroller Peter Franchot, the state’s chief alcohol regulator, announced a package of legislation that would bring major reforms to the state’s craft breweries.

The measures were announced during an event held Monday at Denizens Brewing Company. According to a press release, the legislative package, if passed, would:

  • Remove all limits on beer production, taproom sales and take-home sales
  • Repeal the “buy-back “ provision that requires brewers to purchase their beer from distributors at a marked-up cost if they exceed the 2,000-barrel limit on taproom sales
  • Lift unnecessary restrictions for take-home sales
  • Guarantee the issuance of Class B or D beer licenses to microbreweries on request
  • Let local jurisdictions set guidelines for taproom hours
  • Allow smaller brewers to self-distribute
  • Eliminate franchise law requirements, and
  • Remove restrictions on contract brewing that inhibits start-up businesses.

“We simply cannot ignore the fact that our laws and regulatory framework have stood in the way of the limitless potential of Maryland’s craft beer industry,” Franchot said.

The proposed reforms reflect the work of the comptroller’s “Reform On Tap” Task Force formed in April 2017. The task force was chaired by Franchot and included 40 members from key stakeholder groups within the beer industry. The group was charged with undertaking a comprehensive review of the state’s laws that govern the manufacturing, distribution, and sale of Maryland craft beer.

“Comptroller Franchot’s proposed legislation will hit the gas pedal on the independent craft beer industry. I see it as building on the work done by Montgomery County’s Nighttime Economy Taskforce in 2013 and ’14,” said Julie Verrati, Denizens’ cofounder and director of business development, in an email responding to the Source. “This bill is the logical next step in breaking down arcane barriers on the beer industry. This is a good thing for small businesses and consumers alike in Silver Spring, Montgomery County, and the state as whole.”

According to the Bureau of Revenue estimates, the craft brewing industry in Maryland had an overall economic impact of $802.7 million, supporting or creating 6,541 jobs in 2016. The state’s craft breweries produced 247,000 barrels of beer.

A copy of the comptroller’s presentation is available online.

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