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Minnesota’s craft brewers are left high and dry by the Omnibus Liquor Bill

There has been some bad stuff going on at the state capitol this week. Sadly, it wasn’t confined to the House. Yesterday the state Senate passed its omnibus liquor bill, SF 2130, but without two important amendments.

The Vessel Size Expansion Bill

At present, Minnesota law restricts breweries from selling beer from their taprooms in vessel sizes of their own choosing; they can only sell off-sale beer in vessels under 750mL. The Vessel Size Expansion Bill (S.F. 1849/H.F. 1799), would have freed them to sell beer from their taprooms in vessels sized from 350mL to 2L (or 12oz to 67.6oz). As the Minnesota Craft Brewers Guild explains, this would have allowed breweries to invest in new packaging and provide consumers with more options for takeaway beers, consumers to access more shelf-stable beer in smaller package sizes, and liquor stores to have access to new products put into market as breweries begin to invest in new packaging.

The bill had cross-party support. In the Senate, the bill’s authors were Sens. Osmek (R), Kent (DFL), Franzen (DFL), Pappas (DFL), and Klein (DFL); in the House, it was Rep. Nash (R). Sadly, it was was not offered as an amendment to the Omnibus Liquor Bill.

The Growler Cap Bill

Minnesota law currently restricts breweries producing more than 20,000 barrels annually from selling growlers (containers that can be used to transport beer). The Growler Cap Bill (S.F. 1737/H.F. 1802) would have allowed any brewery with a taproom to sell growlers. This would have freed Minnesota’s smaller breweries from the choice between growth and sales and allowed consumers greater choice.

Again, the bill had cross-party support. In the Senate, the bill’s authors were Sens. Housley (R), Pappas (DFL), Dziedzic (DFL), Benson (R), and Bakk (DFL). In the House, they were Reps. Loeffler (DFL), Becker-Finn (DFL), Nash (R), Boe (R), Zerwas (R), Olson (DFL), and Koegel (DFL). But, as The Growler reports,

The Growler Cap Bill (S.F. 1737) was offered for debate by Sen. Housley, who altered the amendment by dropping the cap for breweries to sell growlers from those producing 250,000 barrels of beer per year to 40,000 barrels of beer per year—a compromise meant to assuage the concerns of the bill’s critics…

After a debate between Sen. Dahms, who voiced his opposition to the amendment to his Omnibus Liquor Bill, and senators Housley, Pappas, and Osmek, who spoke in favor of the amendment, Sen. Housley withdrew the amendment. 

Regulation to protect who?

This is unfortunate. As I wrote in the most recent edition of our magazine, Thinking Minnesota, our state’s craft brewers have been an economic success story in the last decade. This is largely the result of the repeal of various regulations, such as those which would have been repealed by these two bills. Regulations are generally pushed as protecting the consumer or the public more generally. But who is being protected by state regulations limiting the size of vessel smaller brewers can sell or whether they can sell growlers or not? Are the consumers being protected from too much choice? No. It is it larger competitors who can afford the lobbyists to push these regulations who are really being protected.

It is possible that one or both bills could be brought to the floor for a vote as standalone legislation later this legislative session. Lets hope they are. Minnesota’s craft brewers have succeeded in recent years despite these regulatory barriers. Just imagine how they could flourish without them.

John Phelan is an economist at the Center of the American Experiment. 

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