Monday, March 25, 2013

Beer reform laws reported out of Senate Business and Commerce Committee

Laws regulating the marketing and sale of beer in Texas not changed much since the repeal of prohibition, but efforts to change them and and bring them into the age of craft breweries seems underway. That said, there's a great deal of conflict among the different interests involved in Texas beer industry, and this is reflected in the battles over the different bills being considered.

Despite the fact that I like craft brews, I'm no expert on the different groups involved (brewers large and small, brew pubs, distributors and all), so I recommend a look at the following to get into the nuances if that's your thing:

- My SA.
Brewed and Never Battered. (this contains a great compilation of comments on the bills and their process through the legislature).
-  A Small Rant about Beer Laws. (commetary on the last legislative session)
- Changing Beer Laws in Texas One Bottle at a Time.
- Open the Taps.
- Compilation of posts from Off the Kuff.

There's more, but they should give you a better idea of the issues involved thatn I can. Suffice to say that two competing groups have been attempting to enhance their respective interests. The Texas Craft Brewers Guild has developed and had had introduced four bills - SB 515, 516, 517, and 518 -- intended to allow smaller brewers to sell and distribute their product, as well as sell their beer on premises.

These are supported by the lobbying groups that supports the beer industry in Texas: the Texas Beer Alliance.

An additional bill -  SB 639 - was introduced with the support of the Wholesale Beer Distributors of Texas. The bill was intended to ensure that the rules governing the distribution of beer favored the statust quo. This raised objections by the craft brewers, but a compromise seems to have been reached by the interested parties:
A fifth bill, SB 639, was introduced at the last moment by committee chairman Sen. John Carona. It was a wish list of demands from the Wholesale Beer Distributors of Texas, one of the distributor trade organizations. As written it would also have forced brewers to give distributors uniform pricing for all geographical areas, something very disadvantageous for breweries. Rarely are ABInBev and MillerCoors on the same side of an issue as the likes of Real Ale and St. Arnold, but this issue accomplished that.

In the end, the Brewers Guild and Texas Beer Alliance was able to have some provisions stripped from the bill to make it less onerous, and even managed to define certain brewery-distributor agreements on issues of shared marketing costs and services that were formerly in a legal no-man’s land that few were willing to touch. But what many saw as the worst part of the bill was the disingenuous way that it was introduced. Since the last legislative session, Sen. Carona has been involved in discussions between the Craft Brewers Guild, distributor and retailer organizations, and other pro-craft lobbying groups such as Open The Taps to hammer out a set of legislation all could live with. Keeping the demands contained in SB 639 secret until the last moment and then threatening to hold all the bills hostage until a compromise was found was disingenuous at best. Some point at the fact that Sen. Carona has been a leading beneficiary of distributor campaign contributions as a motivator for his actions.


Regardless, observers think substantive changes are in order, meaning that beer drinkers in the state will likely have even more choices. The craft brewers guild commissioned a study suggesting that they already have a $608 million imapct on the state economy, and that this may well rise to over $5 billion in eight years if the industry is allowed to expand.

I promise to do my part to help them succeed.