Thursday, February 17, 2011

Bill to Shift Tap Room Hours Tabled on 10-1 Vote

And the turf war rages on. The Montana Senate's Business, Labor and Economic Affairs Committee held a hearing today on Senate Bill 202 which seeks to shift tap room hours from 10:00 a.m. to 8:00 p.m. to 12:00 p.m. to 10:00 p.m.  The hearing lasted 1.5 hours with ten proponents and fifteen opponents squaring off.  The arguments for and against were predictable, revealing nothing more than the fact we've got a mess of a licensing structure in Montana.  Following the hearing, the Committee voted 10-1 to table the Bill.

Make no mistake, "tabled" means dead, here.

Tony Herbert, representing the Montana Brewers Association, kicked off the public portion of the hearing, tying the bill to its benefits for tourism, agriculture, demands of consumers, job creation and support for small businesses. Brian Smith, one of the founders of Blackfoot River Brewing Co., touted the quality of the jobs Blackfoot provides, including health insurance, paid vacation, and matched retirement accounts for all employees working more than 20 hours a week.  They are "exactly the kind of business the legislature should be encouraging," he told the Committee.  He's right.

Chuck Schnabel, Quarry Brewing, Max Pigman, Lewis and Clark Brewing, Nicol Bozik, Bitter Root Brewing, Michael Uhrich, Carter's Brewing, and Paul Marshall, who is developing a new brewery in Missoula, all spoke in support.  So did Mellisa Lewis, lobbying for the City of Shelby.  It seems the City identified a brewery as a potential source of economic development for downtown Shelby, but recognized the main limitation is the restricted business hours. The Montana Farmers Union also showed its support.

Mark Staples, lobbying for the Montana Tavern Association, accused the brewers of breaking the deal they struck back in 1998 when the legislature approved the current scheme allowing breweries to sell limited quantities in tap rooms. He suggested breweries should go buy beer and wine licenses if they want to be in the retail business, reluctantly admitting breweries are prohibited from doing so now. It's apparently an idea the MTA put on the table in earlier negotiations with the Brewers Association.  Mr. Staples argued breweries are intended to be a manufacturing sector, not a retail sector, and are cannibalizing the very businesses who sell their beer - and the "billions" they have spent on licensing in Montana. Billions? Really? 

Following Mr. Staples, a variety of representatives of individual bars and local tavern associations expressed the common theme that breweries should not be allowed to enter the retail business because they haven't forked over bundles of cash for the expensive privilege to sell alcohol.  Many simultaneously argued the breweries haven't had to incur the overwhelming expense of the licenses while pointing out that beer and wine licenses can be had in many places for $7,500 or less.  Two threatened to remove all Montana craft beer taps from their bars if the bill passed.  Now there's a smart business plan.

Not all breweries are on board with the proposal, including Missoula's Kettlehouse and Billings' Himmelberger Brewing.  Similarly, not all tavern owners oppose the shift.  Brad Martens, co-owner of The  Rhino in Missoula and its 50 taps says in this story on NBC Montana.com (link no longer works) that the bill may help develop more craft beer drinkers who will patronize his business.

During discussion prior to the vote several of the Committee members acknowledged the current licensing system escalates the turf war and needs to be fixed.  Only one Senator was willing to approve the bill as an interim measure.  Unfortunately, no one appears to be willing to convene an interim legislative committee to work on solutions, either.

We're fortunate in Montana to have such good, local craft beer.  We'd all be so much more fortunate if we could eliminate the turf wars.

3 comments:

  1. Really makes it difficult to find funding/investors for your brewpub when you have to explain to them that we will have to open at 10AM and close by 8PM. I am about at the point where I am going to open in CO. (Denver) instead which sucks because we have the potential in this state to become another CO. in terms of craft beer with all of the advantages we have in the state when it comes to producing great craft beer (grain, clean water, the Montana mystique).

    I still am having difficulty understanding how merely shifting the hours of operation from 10am-8pm to 12noon-10pm will have such a catastrophic impact on full service bars. Highly doubtful that the majority of those who specifically go to their local brewpub would shift to the tavern at 8pm to continue to drink. No, they will hit the grocery or liquor store and pick up a 6 pack of craft beer if they want to continue drinking

    The notion of pulling the taps of brewpub beer from the taverns also makes a lot of sense - lets take away something that got them into the tavern in the first place/would allow them to stay since they can get the same thing at the tavern as they can at the brewpub.

    Hopefully the powers that be in Helena will soon realize that a rising tide lifts all boats and that we will all benefit economically by allowing brewpubs to operate with more realistic and profitable hours of operation.

    Nice blog BTW.

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  2. You're right. Shifting the hours would not have a catastrophic effect on the full service bars, though I don't think we can say it would have no effect, either. Much of the anger from the bar owners stems from the compromise made back before the 1999 legislative session to allow on-premise brewery sales. The breweries who were active in reaching that compromise represented at the time that the deal was fair and they weren't trying to become "bars." Thus, when this bill came around, many tavern owners believed they were going back on their word. It is the "given them an inch, they'll take a mile" theory.

    We need to get past that. Our brewing industry is a very bright spot in Montana. Our licensing system - particularly the quota part - is a broken mess.

    Having good craft beer on tap is what gets me in to places whether they're bars, restaurants or breweries. I have stopped at a brewery many times to have one beer before moving on to a restaurant or bar. The reverse is also true. My choice of restaurants is often determined by whether or not they serve great beer along with good food.

    If a tavern owner believe it makes good sense to pull the local craft brew taps in retaliation, I'm guessing it isn't a place that captures my attention. That's to say, they probably only have one or two taps of basic brew that never rotate and probably aren't generating much revenue from them.

    I understand Senator Zinke hopes to introduce a resolution setting up an interim legislative committee to study Montana's alcohol licensing system and make recommendations for changes. That is the right first step and hopefully there will be broad representation at the table. It will only work, however, if everyone can agree that positive change can be made.

    I do hope you'll choose to stay in Montana. There's plenty of room here for more great beer.

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  3. The licensing system is broke and corrupted by a very strong MTA loby. Been that way for too long. Liquor tied with gaming...common. Licenses allocated by population, restrictions everywhere you look. The brewers and vintners in Montana need to be strong and fight the good fight for the economy of the state and their industry. Talk to your customers, educate your consumers, enlist the consumers in this struggle. They are the voice of change.

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