Support the Drink Local Economic Recovery Act

Minnesota’s craft brewers have been an economic success story over the last decade. From 2011 to 2020, Brewer’s Association data shows the number of craft breweries increased by 520% statewide, from 35 to 217. While the craft beer boom has been a nationwide phenomenon, Minnesota has been something of a leader: we rank 13th nationally for breweries per capita.

This success is largely due to free market policies of tax cuts and deregulation which have given these brewers the freedom to innovate and grow. The federal excise tax has fallen since the 1970s and smaller breweries have been exempted. Deregulation legalized home brewing. Brewpubs—breweries with restaurants or pubs on the premises—were legalized in every state, Minnesota doing so in 1987. In 2011, Minnesota’s production breweries won the right to operate and sell their own beer onsite in a taproom.

Even so, legal barriers to further growth remain. Removing these can help our state’s craft brewers and distillers to continue their success. As the sector struggles to recover from the COVID-19 pandemic, this need is more pressing than ever.

One of the main barriers to the expansion of craft breweries in Minnesota is the ‘Growler Cap.’ This law prevents breweries producing more than 20,000 barrels annually from selling ‘growlers’ (containers that can be used to transport beer). Breweries that reach this level of production face a choice between continued expansion or ending the sale of growlers, which can make up a substantial share of taproom sales.

Minnesota’s distilleries face a similar problem. When a distillery hits production of 40,000 proof gallons annually, they either have to stop expanding or close their cocktail room (and they can no longer sell half-bottles to guests).

Minnesota’s brewers and distillers also face rules governing what sized vessel they can sell from their taprooms. Minnesota law currently limits breweries to selling off-sale beer in vessels under 750ml. Distilleries cannot sell full-sized bottles at all, they are limited to sales of just one 375ml (half-bottle) per customer per day.

There is no justification for these laws. Fortunately, the Drink Local Economic Recovery Act (SF 1176 and HF 1192) will go some way towards removing them.

This bill would allow all breweries to sell beer to-go in cans, bottles, and growlers up to 64oz, with a per person/day purchase limit of 768oz (and an annual limit of 750 bbls); Allow brewpubs to distribute up to 200 barrels of their own product; Allow cideries up to 75,000 gallons of self-distribution; Create more standard taxation for cideries/wineries to align with federal statute; Allow distilleries to sell up to 1.5 liters per person per day; Allow bars and restaurants to permanently sell limited amounts of beer (72oz), wine (1 bottle), and cocktails (34oz) to go with take-out orders; and allow liquor stores & bars/restaurant to fill growlers.

Minnesota’s craft breweries and distilleries are American success stories of people following their dreams to make a living doing something they love and the law should not stand in their way. Minnesota’s policymakers should pass the Drink Local Economic Recovery Act and expand the Freedom to grow for Minnesota’s brewers and distillers.

This op ed originally appeared in the Owatonna People’s Press on February 24, 2022.