E-Malt.com News article: USA, WI: Proposal would exempt craft brewers from new law

State of Wisconsin Reps. Janis Ringhand and Janet Bewley began circulating legislation on August, 1 that would exempt craft breweries from beer distribution changes made in the 2011-13 state budget, the Business Journal reported on August, 1.

Strong opposition from consumers and small businesses throughout the state prompted the action, they said.

“Craft brewing is a growing industry in Wisconsin and they are putting communities across Wisconsin on the map. We should be supporting the entrepreneurs and small business owners that are helping rebuild our economy,” said Ringhand (D-Evansville). “They have made it clear that the new regulations hurt competition, limit trade and discourage investment. If Wisconsin is truly open for business, we will protect craft brewers from these damaging new laws.”

Added to the budget by the Joint Committee on Finance, the new beer distribution model restricts small brewers’ ability to get critical wholesale licenses and limits where and how they distribute their products, Ringhand and Bewley said.

The Ringhand-Bewley proposal would exempt craft brewers that manufacture fewer than 300,000 barrels per year from this new model. The bill is endorsed by the Wisconsin Craft Brewers Guild.

“We should be concentrating on helping small businesses and finding ways to keep our neighbors on Main Street up and running,” said Bewley (D-Ashland).

Despite a great partisan divide on the overall budget, there was significant bipartisan cooperation in an attempt to defeat the beer distribution model changes, Ringhand and Bewley claimed.

The budget signed June 26 by Wisconsin Gov. Scott Walker combined the brewer’s permit and wholesale and retail licenses into a single permit under state — not municipal — control that effectively bans brewers from having ownership stakes in wholesale distributors. Under the previous law, brewers could obtain three separate licenses — a brewer’s permit, a wholesaler’s license and retail license.

The legislation prohibits wholesale distributors from investing in a brewery, but grandfathers in any existing deals. Breweries that produce fewer than 300,000 barrels of beer each year can sell their own product without a distributor.

Despite considerable opposition, Walker didn’t veto the controversial provision in the state budget.

Backers of the provision claimed the legislation was needed to stop St. Louis-based Budweiser and Bud Light brewer Anheuser-Busch Cos. from buying wholesale distributors in Wisconsin. The vote sends a strong message to the nation’s dominant brewer, which has been pursuing a national agenda to develop so-called brewery branches throughout the country, said those in favor of the legislation, including the Wisconsin Beer Distributors Association.

05 August, 2011