Tag Archives: beer

AG opines on immigrant beer license restriction

NASHVILLE, Tenn. (AP) — The Tennessee Attorney General’s office has issued an opinion that says a law barring some immigrants from obtaining a beer license is likely unconstitutional.

The opinion issued by Attorney General Herbert Slatery takes aim at a 2015 law that barred people from getting a license to sell beer unless they had been a lawful resident or U.S. citizen for at least a year.

The opinion says the law is unlikely to survive a court challenge because it discriminates against people based on immigration status and where they were born. It also says the law does not appear to serve a compelling state interest.

Lawmakers generally seek an attorney general’s opinion before passing a law.

Republican Rep. Martin Daniel said the city of Knoxville requested that he ask for the opinion.
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Note: The full opinion is HERE. The law, now officially Public Chapter 29, was sponsored as HB145 by Rep. Pat Marsh and Sen. Jim Tracy, both Shelbyville Republicans.

Legislature has made TN ‘a brew pub-friendly state’

Tennessee is already a “brew pub-friendly state,” says the leader of the Tennessee Malt Beverage Association, and it got a bit friendlier under a bill approved by the Legislature this week.

That doesn’t count a resolution, HJR162, which proclaims April as “Tennessee Craft Beer Month.” Or another recently-approved bill that liberalizes the rules for those who brew their beer at home.

Under legislation sent to Gov. Bill Haslam with a 27-0 Senate vote Wednesday, breweries in all 95 counties will be authorized to sell 25,000 barrels of their product each year on premises in conjunction with a restaurant and distribute it for local sales, as well.

Current law restricts such operations to counties with a population of 75,000 or more, leaving out many rural areas. HB639 makes the same rules — adopted several years ago — apply statewide. The measure had been approved earlier on a 73-9 House vote with sponsor Rep. Bill Sanderson, R-Kenton, describing it as “a matter of fairness” to smaller counties in the booming microbrewery business.

There is “vast variation” in beer laws from state to state, says Richard Foge, president of the Tennesseee Malt Beverage Association, which represents beer wholesalers, creating an “apples and oranges” situation and making it difficult to assess Tennessee’s status on a national curve.

Most states put a cap on how much beer can be made and sold by a microbrewery, and some limit the number of locations where microbreweries can operate. Tennessee’s cap of 25,000 barrels per year translates into 775,000 gallons per year (31 gallons are in a barrel).

Tennessee imposes no limit on number of locations.
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Beer battle underway in legislature; Anheuser-Busch loses first round

Tennessee’s wholesale beer distributors are pushing legislation that would ban brewing companies from buying or owning their own distributorships in the state — a move aimed at Anheuser-Busch and its multinational owner InBev.

Further from Richard Locker:

Anheuser-Busch InBev says the bill runs counter to the free-enterprise principles espoused by lawmakers. Beer wholesalers argue that it protects competition by maintaining the state’s “three-tier” legal system of financial firewalls between the manufacturing, distributing and retailing of alcoholic beverages.

The bill, sponsored by Rep. Ryan Haynes, R-Knoxville, and Sen. Ken Yager, R-Harriman, jumped its first legislative hurdle Wednesday, winning approval in the House Local Government Subcommittee.

Tennessee Malt Beverage Association President Rich Foge, who represents the state’s 20 beer wholesalers, said Wednesday that the three-tier regulatory framework was set up in most states as Prohibition ended “because one of the major contributing factors to Prohibition was that the distillers and brewers owned the whole system … including the saloons. That led to a lot of bad marketplace practices to keep people in the saloons drinking, which led to social problems.”

Tennessee’s laws regulating liquor already ban manufacturers of distilled spirits from owning liquor wholesale and retail businesses in the state. Foge said the bill would close a loophole in the system for beer, even though no beer brewer currently owns a wholesale distributorship in the state.

Similar legislative brawls have been fought in other states, including Kentucky, where Anheuser-Busch owns a Louisville beer distributorship that wholesales the company’s Budweiser beer and other brands to retailers.

…Haynes said that ownership of distributorships by big manufacturers would hurt craft brewers. “I think it’s important that we allow our craft beers to flourish, and if Anheuser-Busch is allowed to own a wholesaler, I think they would close them out of the marketplace,” the House sponsor said.

Haynes also said the brewing giant MillerCoors sent him a letter in support of this bill.

Jose Gonzalez, a regional vice president for Anheuser-Busch, said after the subcommittee action that House Bill 543 “represents an unnecessary and biased government intrusion into the free market and private sector growth … Tennessee’s craft industry is experiencing record growth, consumers have more choices than ever before and there is healthy competition in all tiers.”

Bill advances to allow high-alcohol beer sales outside of liquor stores

Supermarkets and grocery stores authorized to sell wine in the future will also be able to sell high-alcohol beer under a transformed bill approved by the House State Government Committee amid some contentious debate.

The new version of HB47, sponsored by Rep. Ryan Haynes, R-Knoxville, will also also increase the alcohol content of beer that can be legally sold in other stores.
As originally introduced last year, the bill would have decreased the length of time a person must live in Tennessee before obtaining a liquor sales license. Earlier this year, it was transformed into a backup bill for wine-in-grocery-stores legislation that could be used it the main wine bill was scuttled.

As it turns out,the wine-in-grocery stores bill was approved and Haynes made a third revision of HB47 in the final meeting of the State Government Committee, which he chairs. The measure was also the last bill to be acted upon by the panel.

Under current law, beer with more than 5 percent alcohol content by volume – known as “high-gravity beer” by retailers — can be sold only in liquor stores.

Under the latest transformation of HB47, the generally permissible alcohol content of beer will increase to 8 percent. But stores that become legally able to sell wine under the provisions of the wine-in-grocery-store will also be able to sell beer with an alcohol content of up to 15 percent, a typical alcohol volume for wine.

The amended bill was approved by the committee 6-3 with two members abstaining. The vote came after independent Rep. Kent Williams of Elizabethton spoke against it and Rep. Curry Todd, R-Collierville, engaged in a sharp exchange with Haynes.
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Beer Tax Reform Bill Goes to Governor

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The House gave final legislative approval Wednesday to legislation intended to eventually end Tennessee’s status of having the nation’s highest beer taxes.
The bill was approved 87-2 by the House on Wednesday without debate beyond sponsor Rep. Cameron Sexton, R-Crossville, describing it as “simply replacing an antiquated 1950s tax structure.”
The Senate approved SB422 last week, 30-1, under sponsorship of Sen. Brian Kelsey, R-Germantown. It now goes to Gov. Bill Haslam, who is expected to sign it.
The bill transforms Tennessee’s 17 percent tax on beer at the wholesale level to a flat-rate tax of $35.60 per barrel.

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Beer Tax Bill Zips Through Senate

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The Senate Monday night approved, 30-1, legislation that will switch Tennessee’s wholesale beer tax to a levy on volume rather than on price.
The current system has left Tennessee with the highest beer tax in the nation, according to the Tennessee Malt Beverage Association, which has been pushing SB422 by Sen. Brian Kelsey, R-Germantown.
The state’s present 17 percent wholesale beer tax amounts to about $37 per 31-gallon barrel and has increased 30 percent over the past ten years as beer prices have risen.
The bill effectively freezes the tax at current levels, avoiding future increases as prices rise.
“This bill will increase jobs in the brewing industry and help consumers by leading to a better selection at lower prices,” Kelsey told colleagues.
Who said the “traditionally we have taxed things in Tennessee based on their sales price” and questioned why beer should be treated differently.
Kelsey noted that beer is also subject to the state sales tax, which will continue to rise as beer prices increase, and said the legislation is needed to make Tennessee more competitive with other states in recruiting breweries.
He said the present system is particularly hard on microbreweries, which typically sell their brew at higher prices because of low volume. The tax now makes their products even more expensive, he said.
Campfield abstained on the final vote. The sole no vote was cast by Sen. Mae Beavers, R-Mount Juliet.
The bill is up for a House floor vote on Wednesday.

New Lobbying Twist: Beer (actually, ‘high tax ale’) Named After Beer Tax Bill

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By Eric Schelzig, Associated Press
NASHVILLE, Tenn. — A special joint offering from Tennessee craft brewers Yazoo and Calfkiller features an unusual sales pitch to beer aficionados: “Now With Even More Taxes!”
The new product going on sale this week is the latest effort among brewers to draw attention to Tennessee’s highest-in-the-nation tax scheme for beer, which high-end brewers argue disproportionately affects their ability to compete.
The beer is called “The Beacon: A Tennessee High Tax Ale,” and urges consumers to “Cut the red tape, pop the cap, and enjoy this oppressively refreshing ale.”
A legislative proposal to freeze the state’s beer tax cleared its first committee last week, and the brewing industry hopes it can avoid the fate of a bill to allow supermarket wine sales. The wine measure appeared to be gathering in momentum before its surprise defeat in a House committee last week. (Note: Don’t think there’s a valid analogy here. The beer bill (HB999) is virtually assured of passage.)
Tennessee’s beer taxes outstrip any other state’s because the bulk of the levy is based on price rather than volume. The more a beer costs, the higher the taxes that must be paid to buy it.

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Beer Lobby Backs Wine-in-Groceries (if high-alcohol beer sold, too)

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NASHVILLE, Tenn. (AP) — The beer industry has swung its support behind a bill to allow Tennessee supermarkets and convenience stores to sell wine as long as the measure also allows places to sell strong beer.
Tennessee Malt Beverage Association President Rich Foge confirmed to The Associated Press on Monday that his board decided to drop its long opposition to changing the law. In return, the beer makers want a provision allowing grocery stores to sell high-gravity beer, which has higher alcohol content and is currently only allowed to be sold in liquor stores.
“If the marketplace is going to change where regular beer and wine are sold side-by-side on a grocery store shelf, high-gravity beer should be, too,” Foge said.
Senate Speaker Ron Ramsey, R-Blountville, and House Speaker Beth Harwell, R-Nashville, have made it a priority to pass the bill seeking to allow cities and counties that already allow liquor sales to hold referendums on whether to allow supermarket wine sales.
Foge said the speakers’ strong support for the measure played into his association’s decision to change course on the bill.
“We had a long discussion about it and one of things that got serious consideration is that the speakers of both chambers urged the parties to come to the table,” he said. “And we’re heeding that advice.”
The bill opposed by liquor wholesalers and the association representing package store owners has cleared its first legislative committees in both chambers. The Senate Finance Committee was scheduled to take up the measure on Tuesday.

Effort Launched to Revise TN Beer Taxes

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Tennessee’s beer distributors have launched an effort to
change the state’s tax system for beer — basically moving it from a tax based on price to a tax based on volume. As things stand now, ennessee is reported as having the highest beer tax in the nation.
News release from Tennessee Malt Beverage Association:
NASHVILLE, Tenn. – A new legislative proposal promises to bring logic to Tennessee law and stabilize an out-of-control situation that has pushed the state into the beer-tax stratosphere.
Tennessee has the nation’s highest effective beer tax rate, 12 percent higher than No. 2 Alaska, and it is rising higher every year, regardless of whether beer sales rise. This effect is the result, likely unintended, from beer-tax policy established by the State of Tennessee in 1954. Since that time, Tennessee has blown past every state to be the nation’s highest taxer of beer.
“Tennessee beer drinkers are already paying more than their fair share, but this is getting out of control,” said Scott Turner, president of Ajax Turner Co. Inc. “We are completely out of step with the nation’s 49 other states. In addition to higher taxes, this is having a detrimental effect on economic development and consumer choice.”

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Nine Counties in Liquor Law ‘Pilot Project’

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The House has given final approval and sent to Gov. Bill Haslam a bill that makes nine counties part of a “pilot project” on enforcing laws governing the sale of alcoholic beverages.
The bill has bounced back and forth between the House and Senate for three weeks as lawmakers debated what counties should be included in the pilot project.
The final version of HB3633 includes Knox, Hamilton, Cocke, Claiborne, Grainger, Hancock, Hawkins, Jefferson and Union. With the House signing off on the latest Senate changes, the bill now goes to the governor.
The bill makes several changes in laws governing local beer boards, which issues licenses and enforces laws dealing with beer sales, and the state Alcoholic Beverage Commission, which issues licenses and enforces laws dealing with the sale of liquor and wine. The changes take effect on July 1 in the pilot project counties only and will continue for two years.
In general, the idea is to make the two agencies coordinate their efforts, said House sponsor Rep. Richard Floyd, R-Chattanooga. In the past, a local beer board has occasionally suspended the license of an establishment violations, but the business – typically a bar — remained open because the ABC license remained – or vice versa.
Examples of other changes include provisions intended to block the practice of a bar operator closing after being charged with law violations, then having the establishment reopen immediately in the same location under a new name or new ownership; and a ban on operators charged with breaking the law voluntarily surrendering their license – a move that allows them to later receive a new license with no violation on their record.