One item lost in the shuffle following the Authentic Beverage v. TABC ruling is a telling statement from Senator John Carona, Chairman of the Senate Business and Commerce Committee, which hears alcohol-related bills.
“A Federal Court has ruled that Texas’ laws regarding the advertising and labeling of beer are flawed. In the case of Authentic Beverages Co. vs. TABC, the Judge awarded a summary judgment that certain laws directing the labeling and advertisement of beer are unconstitutional. While the three-tier system of manufacturer, distributor, and retailer has served Texas well since the end of Prohibition, it is an open question how well the Texas Alcoholic Beverage Code reflects today’s reality of Internet sales and the growth of the craft brewing industry. The Court’s ruling suggests this is a topic that may be taken up by the 83rd Legislature.”
Credit Lee Nichols’ I Love Beer Blog for the quote.
Senator Carona’s quote demonstrates that our legislators have becoming increasingly aware of the changing marketplace, and recognize that an 80 year old code may not be the best to regulate it. 2013 is looking better and better for Craft Beer to finally have a fair hearing for statutory reform.
Drink Beer, Save Texas!
And now for the lighter side. As I alluded to previously, Judge Sparks’ judgement is full of all kinds of funny lines. If this whole judging thing ever gets old to him, he’s got a career in comedy.
Judge Sparks wastes no time getting into the humor (and a little jab), and offers this in his background on the case:
The practice of law is often dry, and it is the rare case that presents an issue of genuine interest to the public. This is just such a case, however. Dealing as it does with constitutional challenges to the Texas Alcoholic Beverage Code, it is anything but “dry”and this Court wouldnever be so foolish as to question the sincerity of Texans’ interest in beer.
Given this obvious public interest, it is both surprising, and unfortunate for proponents of the Alcoholic Beverage Code, that the State of Texas does not appear to have taken as much of an interest in this case as it might have.
Judge Sparks did limit comedy to his commentary, and titled one section of his Judgement as:
2. Beers and Liquors and Wines, Oh My!
On the defense’s argument that The Texas Alcoholic Beverage Code is constitution because it is the Texas Alcohol Beverage Code:
In a remarkable (though logically dubious) demonstration of circular reasoninga tactic it repeats throughout its briefing, and which it echoed in open court TABC attempts to defend the constitutional legitimacy of the Code through an appeal to the statutory authority of the Code itself.
On the idea that the state should have the authority to define words however the legislature sees fit (and in what can only be seen as a tip of the hat to Freetail Brewing Co… right?):
Second, TABC’s argument, combined with artful legislative drafting, could be used to justify any restriction on commercial speech. For instance, Texas would likely face no (legal) obstacle if it wished to pass a law defining the word “milk” to mean “a nocturnal flying mammal that eatsinsects and employs echolocation.” Under TABC’s logic, Texas would then be authorized not only to prohibit use of the word “milk” by producers of a certain liquid dairy product, but also to require Austin promoters to advertise the famous annual “Milk Festival” on the Congress Avenue bridge. Regardless of one’s feelings about milk or bats, this result is inconsistent with the guarantees of the First Amendment.
This one isn’t so humorous as it is an insight into the larger issue that I have dealt with extensively: the restrictions of brewpubs to sell their beer to distributors or retailers for resale based on 3-tier arguments. Judge Sparks questions whether or not the concerns purported by the WBDT as reasons for not letting brewpubs sell their beer to distributors and retailers is a valid one.
Although unquestionablytrue whenthe Code was first written, andthe evils oforganized crime’s involvement in the alcoholic beverage industry were both immediate and substantial, it is less clear that vertical integration of the alcoholic beverage industry still poses a grave threat to Texas’s interests. In any case, in light of wineries’ exemption from these regulations, this purported interest is suspect.
In response to the defendant’s argument that the “Beer” and “Ale” distinctions are important for consumers to know how strong a product is in terms of alcohol, the Court reponds (my favorite part highlighted by me):
Although a typical member of the public may not be able, off the cuff, to state the average alcohol content of popular Texas malt beverages, the Court is confident that same person could, if presented with the alcohol content of a variety of malt beverages, come to a reasonably quick and accurate conclusion regarding their average range. Having determined the average range, this person could then make an intelligent choice whether to deviate from that range, in which direction, and by how much. The Court simply does not share TABC’s apparently low estimation of Texans, and remains steadfast in its belief that they are capable of basic math.
On why TABC’s lawyers presented what appears to be a less-than-full effort:
Regrettably, TABC has almost wholly failed to submit such evidence, and has often failed even to respond to Authentic’s arguments. Whether this failure reflects a tactical error, laziness, an implicit concession that the Code cannot withstand constitutional scrutiny, an erroneous assumption that TABC is entitled to special treatment, or a mere oversight, the Court cannot say. However, under the circumstances here, the Court is obligated to grant summary judgment in favor of Authentic on its First Amendment challenges.
On why just because TABC doesn’t know why it enforces stuff, it doesn’t make it unconstitutional:
However, as noted above, the state need not come forward with any record evidence whatsoever in defense of the Code. Further, just because particular individuals within the Texas governmenteven those of high rank within the administrative agency that enforces the law may not be able to articulate a reason for the Code’s disparate treatment, that does not mean no reason exists. Indeed, although it may well be desirable, there is no constitutional requirement that a personwho enforces of a law must also know the legislative purpose behind it.
Again, on defendant’s level of effort in defense:
The Court is shocked and dismayed at the Texas Attorney General’s halfhearted conduct in this case. The very purpose of having the Attorney General’s Office defend suits like this, is so the State of Texas can vigorously defend its duly enacted legislative mandates. Here, however, when TABC responded to Authentic’s challenges at all, it responded with little in the way of argument, and even less in the way of relevant evidence. The State of Texas is lucky the burden of proof was on Authentic for many of its claims, or else the Alcoholic Beverage Code might have fared even worse than it has.
Final note: I don’t feel the Attorney General let the TABC down as much as Judge Sparks thinks they did. Judge Sparks thinks the AG left arguments on the table, but I would contend THERE WERE NO ARGUMENTS TO PUT ON THE TABLE!
Been a fun day. Cheers everyone.
If you heard my testimony before the Licensing and Administrative Procedures Committee back on March 22, 2011 (or if you’ve been a regular reader of this blog), you might recall me talking about how the 3-Tier System is really the 5-Tier System. The beer industry in Texas isn’t just brewer, wholesaler, retailer and it is an affront to forget the 4th and 5th Tiers – consumers and the state itself, respectively – in a discussion on statutory reform.
I’m happy to see that the 4th Tier, the consumer, has organized to have a voice in the political arena. First of all, with due respect to members of the Wholesale Tier who seem to believe the world revolves around them, it needs to be acknowledged that the 4th Tier is the most important tier. Without beer drinkers, there is no beer for brewers to produce. There are no deliveries for wholesalers to make. There is nothing for retailers to sell. There is nothing for the state to regulate and tax.
The beer industry does not exist to be a piggy bank for bloated distribution companies who wish there was simply a commodity called “beer” in a non-descript white can – after all, that would make their jobs a whole lot easier. The beer industry exists because consumers want beer. And though it pains some industry members, it is becoming increasingly obvious that beer consumers want a diverse, well maintained selection of craft beer. Sorry lifelong Bud Light salesman, times have changed. Either board the train or get steamrolled by it.
Open The Taps is an organization founded by a group of Houston craft beer drinkers (that I’ve had the pleasure of meeting over the years: great folks, I can vouch) aimed at giving the 4th Tier an organized voice at the Capitol. I look forward to seeing how their fundraising efforts go and their impact on Texas lawmakers leading up to and during the next legislative session. Along with my organization, Texas Beer Freedom (which represents Texas Craft Breweries and Brewpubs), the increased awareness for the design for statutory reform will reach a point where it can no longer be ignored. You know I’ll be talking more on this topic here on my blog as the effort gets rolling again.
As one of the founding volunteers of Texas Beer Freedom, Andy Liddell, said before the Licensing and Administrative Procedures Committee:
“Alcohol regulation is supposed to protect the consumer. Well, unfortunately all our laws are doing is preventing me, the consumer, from getting the products I really want.”
Drink Beer, Save Texas.
On this day in 1933, the first brews were legally sold following prohibition – a movement that, at its end, saw even its original proponents lobbying to repeal it. As it turned out, Prohibition did more damage than good – creating the niche for highly organized crime and spawning some of the most notorious criminal masterminds in American history. We learned a valuable lesson from Prohibition: restricting people’s right to choose is a bad thing; and that typically the people pushing hardest for restrictions are those who stand to gain the most from it (in the case of Prohibition, the gangsters and racketeers).
Today, our state still struggles with the lingering effects of Prohibition – most notably in the form of laws that restrict our smallest and most innovative brewers from reaching the marketplace. Brewpubs are not allowed to sell to wholesalers. Production brewers are not allowed to sell you a six-pack at the brewery. Out-of-state brewers are treated preferentially by Texas alcoholic beverage code. And none of this in the name of consumer protection or the welfare of the state – but rather the protection and welfare of a handful of multi-million dollar businesses who seek to build the biggest and best walls in order to defend their castles.
A significant number of the wholesale-tier members, who have traditionally been against the reforms we seek, have had the same revelation as John D. Rockefeller Jr., Pauline Sabin and the Women’s Moderation Union had in the late 1920s: they would best be served having a part in the future of the alcohol industry, rather than protecting a system which serves to enrich the organized few.
We were proud to stand beside members of The Beer Alliance and the Licensed Beverage Distributors of Texas in support of HB 660 before the House Licensing Administrative Procedures Committee. Support from the wholesale-tier was echoed by endorsements from the Texas Restaurant Association (Retail-tier), in addition to countless consumers. Every tier of the beer industry is in favor of our bill (and recall, there are actually five tiers when you count consumers and the state itself) – even the state, which stands to gain much-needed tax revenue as its small breweries grow and the overwhelming majority of Texans agree it is good policy. Please, make another call to your State Representative and members of the LAP Committee and ask them to support HB 660 on this day, the celebration of American’s right to choose.
Around the Web
Not that they didn’t believe us, but the Austin American-Statesmen fact checked statements made by Rep. Villarreal (HB 660′s Author). The verdict: the Representative is rated as true!
Congrats to Brock Wagner, the folks at St. Arnold, and all the other Texas brewers, distributors and retailers supporting HB 602 which today passed the House Licensing and Administrative Procedures Committee by a vote of 6-0. Next up is the Local & Consent Calendar Committee, which will place the bill on the Calendar for a vote before the entire house.
As far as HB 660 goes, we are still trying to arrange for it to be brought up for a vote before the committee. No further news at this time.
(512) Brewing’s Kevin Brand has a post on his blog today about HB 2436, which I believe deserves the support of every Texas craft beer lover as well. You can read all about it here.
Around the Web
Charles Kuffner has a blog post today on HB 660 at Off the Kuff. Mr. Kuffner is rather critical of the anti-competitive nature of the system the WBDT is trying to protect. He’s got a great point. This is America, right?
Today the House Licensing and Administrative Procedures Committee is busy hearing a litany of gambling bills. interestingly, this article came out today with Senate State Affairs Committee Chair Robert Duncan quoted saying gambling bills have no chance. Lt. Governor Dewherst has said he’ll funnel all gambling bills through Duncan’s committee, which pretty much assures they are all DOA. (Which raises the question – what’s the point of going through the motions?)
Hopefully, “going through the motions” with no point isn’t what we’ve been doing with HB 660. It is up to Chairman Hamilton to decide whether or not to bring the bill (and the same is true with HB 602) back up for a vote. Keep those calls, letters and emails up encouraging his support of HB 660. A little advice I got from someone who works in politics: one handwritten letter is worth 20 emails. Something to keep in mind.
Come Party with us this Sunday to Support HB 660
This Sunday we’re going to party at the new Uncle Billy’s on Lake Travis with Two Tons of Steel, Mike and the Moonpies and Slowtrain in support of HB 660. Buy your tickets now and save $5 at the door!
***First, a programming note: I’ll be in San Francisco for the Craft Brewers Conference until Sunday – so updates may be sporadic until then.***
By now, you all know that yesterday House Bills 602 and 660 were heard before the Licensing and Administrative Procedures Committee.
Briefly on HB 602: No one expressed opposition, not even the Wholesale Beer Distributors of Texas, who have opposed the bill in the past. There is some forthcoming compromise on that bill that apparently everyone is happy with and it looks like you’ll be able to take beer home after a brewery tour later this year.
HB 660 had a tremendous number of supporters, and the roll of names read into the record as supporters of the bill was long and impressive. Among those in support but not wishing to testify were a number of beer distributors and the Texas Restaurant Association.
As you may have read, we’ve gained the support of the other tiers through thoughtful discussion with interested stakeholders. Beer distributors were concerned about self-distribution for a business type that already sells directly to the consumer, and we understand their points. Self-distribution has been removed from the bill. We also lowered the annual limit for aggregate production to 15,000 barrels per brewpub. A number we are very comfortable with. I’m pleased that we were able to come up with a bill that all three tiers really like.
We did have one person oppose our bill, however. Keith Strama, representing the Wholesale Beer Distributors of Texas, stood up and presented a semi-coherent rambling about how we should not allow these kind of changes to the code because… well, just because. Seriously. Strama did present some other barely comprehensible argument, which was called onto the rug in short order by Committee Vice-chair Chente Quintanilla of El Paso. Video of the entire hearing, which you can find here, proves quite entertaining. Strama should have just stuck to “Uh… just because” – turns out that was a better argument than the one he was trying to make.
A real comedic gem came when Mr. Strama suggested that HB 602 already accomplishes what brewpubs are trying to achieve by allowing us to simply change our license to a brewery and charge for tours and give away beer. Yes, that is MUCH simpler than just allowing brewpubs to sell to distributors.
Most interesting, to me, was that not a single industry member of the WBDT (of which many were present in the room) submitted themselves in opposition. It’s not hard to oppose in these kinds of hearings, you just fill out a card with your name, occupation, and your position. Why wouldn’t WBDT members bother to oppose? Could it be… they aren’t opposed?!??!?!?! This begs the question, who does the WBDT really represent? Certainly not their members, a handful of which have approached me about carrying my brand should the bill pass.
The conclusion seems obvious: the WBDT’s attorneys and lobbyists represent only themselves. They have to ensure they have a job in two years when this bill inevitably comes back up if it is defeated this time. These guys don’t care about brewers, that much is obvious. But now it is becoming clear they don’t even care about the distributors they supposedly represent, or the state’s best interested.
The writing is on the wall. The WBDT’s era of rule is coming crashing down around them as they have failed to keep up with changing times. They continue to lose members, fed up with the stuck-in-the-mud thinking of Keith Strama and his bosses, and they continue to lose influence.
With the WBDT exposed, the ball is back in our court. We have one or two weeks at the most to earn the votes of the committee, after that it will be too late to advance this session. Right now I think we have 4 votes. We need 5. Time to turn up the pressure and continue to urge members of the committee that this the right thing to do. Continue those calls and emails (I’ll post a sample follow up letter tomorrow).
Around the Web
Lee Nichols has a great story on the hearing for the Austin Chronicle. His article is also one of the last chances you’ll have to see my beard, which I said goodbye to this morning.
The blog, I Love Beer, has a great post on yesterday’s hearing.
And of course the Texas Tribune was covering the story as well.
And lastly, here is a written version of my testimony from yesterday in the event you were curious.
Members of the committee, thank you for allowing me the opportunity to speak on the matter of House Bill 660. My name is Scott Metzger, Founder and Chief Executive Officer of Freetail Brewing Company in San Antonio; Adjunct Professor of Economics at the University of Texas – San Antonio; and Executive Director of the non-profit organization, Texas Beer Freedom.
This bill is specifically about Texas brewpubs, establishments that brew artisanal, hand-crafted beer for sale to consumers on the premises of the brewery. Currently, the state’s alcoholic beverage code restricts brewpubs from participating in the well-established three-tier system and does not allow them to provide their products to the state’s wholesale tier for resale to the retail tier. This statutory restriction has significantly stunted the growth of the brewpub industry in Texas: while the number of brewpubs in the United States has gone from 5 in 1986 to over 1,000 today – we actually have fewer brewpubs in Texas today than we had in the 1990s.
The code as it is currently written not only restricts our state’s small businesses from growing but also provides a wide-open market for out-of-state producers of craft beer to come in and sell their products without the worry of competition from local brewpubs. I have a wealth of economic data to support the need for legislation like HB 660, but the argument is best demonstrated by this simple fact: brewpubs from California, Colorado, Delaware and Oregon are selling tremendous quantities of beer within our state’s borders while Texas brewpubs are shut out from competing in their own backyard. Put simply: currently, the best option for my brewery to expand the reach of our products in Texas is to move our brewery out of Texas. As a proud native Texan, that is a painful statement to make about any of our businesses.
In our great state, it is important to remember that we really have a five-tier system. In addition to the producers, wholesalers and retailers – we must not forget the consumers and the state itself. In the case of HB 660, all five tiers stand to benefit from this bill’s passage.
The benefits to brewpubs, the producers of the beer, are self-evident: the bill would enable them to grow beyond their existing walls. I was commissioned to perform an Economic Impact Study on behalf of the Texas Craft Brewers Guild to estimate the economic contribution of our industry today and in the event of statutory reforms such as HB 660. The study found the potential for more than $680 million of new economic activity, 6,800 new jobs and $192 million of new annual payrolls created.
The benefits extend to the wholesale tier. Today, the beer industry is declining in the aggregate with the exception of one sector: craft beer. Wholesalers are continuously expanding their portfolios to include artisan, hand-crafted beers like the ones Texas brewpubs make. HB 660’s passage would provide wholesalers with a wider-range of Texan products to offer. Speaking only for my brewery, since HB 660 has been introduced I’ve been approached by wholesalers from the Wholesale Beer Distributors of Texas and The Beer Alliance to discuss the possibility of carrying my brand. Quite simply, wholesalers want my beer.
Retailers stand to benefit by focusing their product offerings on high-quality local products. Every year, the National Restaurant Association releases its Top Trends. And for the last few years, “Local Food and Beer” has been at or near the top of that list. Thinking local is no longer a progressive ideal; it has become the standard way of life for Texans.
Consumers benefit by gaining a wider access to the products they desire. At my brewery, I am constantly flooded with calls and emails from folks around the state who want to know where to buy my beer. For Texans in Beaumont, El Paso or Garland, my answer of “only in San Antonio at my brewery” is disheartening.
Perhaps most timely is the benefit to the fifth tier, by which I mean Texas itself. The Texas Craft Brewers Guild Economic Impact Study concluded that statutory reforms like HB 660 can create upwards of $57 million of annual tax revenues for the state, without raising or creating any new taxes. That is enough for 1,300 teachers and firefighters or policemen. And $57 million is just a start. That number is based on the beer industry replicating the Texas Wine Industry’s growth following statutory reform in 2003. When we consider that Texans consume 19 times more beer than wine, we can see that we are only beginning to scratch the surface.
In closing, I ask you to support HB 660 not only for the brewpubs it will help grow; but for the wholesalers who will have an expanded range of supply, retailers who will be able to feature Texas-made products, consumers who will have access to the products they desire, and the tax revenue that you will be able to use in funding our state’s future.
Thank you, and I look forward to answering any questions you may have.
It is extremely rare to find me setting my alarm for 5:30am. It is even more rare to find me waking before a 5:30am alarm in anticipation of the day ahead. It just isn’t the lifestyle I lead. But today I opened my eyes and glanced at the alarm clock to find 5:15. Normally my reaction would be to go back to sleep, but not today. Today there was only one thought on the front of my brain:
Why hello there, Today. Hope you’re ready for an ass kicking.
Seventy days have passed since my first entry to this blog on the topic of HB 660. Exactly one half of the legislative session. A lot has happened. As you will see later today, a substitute bill has been drafted for HB 660 - a compromise we have reached with other parties in exchange for their support. The bill isn’t as big of a win as it previously was, but it is still a huge victory for Texas craft brewers, wholesalers, retailers, and consumers. It still generates tremendous benefits for the state of Texas and it’s ailing coffers. This is still a bill we cannot afford to not pass.
You know our position is sound. Today we show our legislators that position. Today we hold our line against those who would attempt to derail us in their own selfish interest. Today, we win the first battle.
HB 602 will also be heard by the House Licensing and Administrative Procedures Committee today. I don’t know which bill will go first, or even when. It will likely be between 8-10am, but it is possible we could be adjourned until the afternoon. It all depends on how other hearings go and which order they call them in. You can listen (and maybe watch) the hearings live today here.
Texas Craft Beer lovers, now is the time to make your voice heard.
House Bill’s 660 and 602 have been schedule for Public Hearing in the Licensing and Administrative Procedures committee at 8:05 Tuesday March 22. (Note, neither bill may be heard at 8:05, that is when the hearing starts of which we are on the agenda).
The future of both bills are now in the hands of the committee. If you haven’t make your voice heard yet, now is the time. If you have made your voice heard, now is the time to remind them of their need to support these bills.
Tuesday is also Texas Beer Freedom lobby day. I don’t have the info buttoned up yet, I hope to have it tomorrow. If you can, please come to the Capitol on Tuesday to help show your support.
Here we go.
Lots of buzz following yesterday’s meetings at the Capitol (which I still contend is made of Milk Chocolate. Get within 10 feet of it and you’ll be tempted to take a bite like I was) and last nights social gathering for the Texas Beer Institute, a consortium of production breweries.
Lee Nichols caught up with me and a handful of others last night (and even had a chance to take a fun picture of Live Oak’s Chip McElroy) and wrote a couple of stories on the matter. He has an Austin Chronicle piece up in addition to another story at his LegeLand area of the Chronicle. Both are recommended reading.
The Burnt Orange Report weighs in on HB 660 and HB 602 and suggests Texas could drink its way to fiscal solvency.
There will be tons more news tomorrow and over the weekend. I just did a couple of interviews for WOAI 1200 AM Radio (San Antonio) and Texas Public Radio who will have stories in advance of the rally, and will be covering the rally itself.
Things are looking up in Texas! Looks like I won’t have to make a last stand at the Alamo after all.
First, the great news. With my complete lack of medical training, I herby declare myself healed of the flu and fully capable of working from my office (HorrorPops radio on the Pandora, recommended for your fix of psychobilly fun), and nudging the ball forward on HB 660.
Big week, as HB 660 will get referred to the House Committee on Licensing and Administrative Procedures, probably today, and I meet with Representative Villarreal and a member of one of the beer wholesalers’ lobby groups in order to find that ever elusive “common ground”. No word on whether Harrison Ford will be available for filming “Indiana Jones and the Curse of the Common Ground” but rumor has it Spielberg is on board to direct.
In the news, the Houston Press has weighed in on HB 660 and 602 with a good piece that includes comments from a prominent beer distributor (and a bunch of non-approved Freetail prototype artwork). I’m not completely sure I follow the logic, but if I combine the learnings from the Houston Press story with what we gathered from the New York Times story from last Friday; then it appears the problem distributors have with HB 660 is they feel it would result in
- brewpubs selling beer in dry counties and to minors
- persons engaging in bootlegging and other unsavory prohibition-era acts
Huh? On the first point, brewpubs have little interest in being distribution companies (and in fact, HB 660 doesn’t allow us to be even if we did want to) so you aren’t going to find me out in Tyler illegally unloading kegs to portly men in 3-piece suits and bowler hats. As far as selling to minors goes – as brewpubs we are already trained on selling to minors – probably better than any beer delivery guy (since he doesn’t sell to consumers at all, we do). Let’s not start the cries of “THE CHILDREN! WHAT OF THE CHIIIIIILDREN?!?!?” just yet – unless we are going to talk about number of teaching jobs can be saved by the tax money HB 660 can generate.
On the second point of bootlegging and “other unsavory prohibition-era acts” – well I’m not sure I know what this means. In fact, I’m not sure ANYONE knows what this means since prohibition ended 78 years ago. Does the prohibition-era boogeyman still scare anyone? Maybe those who are a little too into HBO’s Boardwalk Empire? Nucky Thompson would definitely be against HB 660.
Big news today as House Committee assignments were announced. Below is a list of the members of the House Licensing and Administrative Procedures Committee, which both HB 660 and HB 602 will be assigned (probably next week). If you live in any of these members’ districts, it is especially important you contact them asking them to support beer reform (cities listed are where their home offices are located).
Rep. Mike Hamilton – Committee Chair (Mauriceville)
Rep. Chente Quintanilla – Committee Vice-chair (El Paso)
Rep. Joe Driver (Garland)
Rep. Charlie Geren (River Oaks)
Rep. Roland Gutierrez (San Antonio)
Rep. Patricia Harless (Spring)
Rep. John Kuempel (Seguin)
Rep. Jose Menendez (San Antonio)
Rep. Senfronia Thompson (Houston)
HB 660 Rallies this weekend
Hey Houstonians! I’ll be at the Flying Saucer downtown this Saturday at 3pm for an HB 660 mini-rally. Jake is tapping a few cool beers: Real Ale Volume XIV (Barrel Aged 14th Anniversary Ale); a cask of (512) Cream Stout; and Sierra Nevada Blackbird IPA. I’m there to hang out with fellow craft beer lovers, but I will have some HB 660 t-shirts available to help raise funds for the cause (no price on the shirts, you get one in exchange for donation).
Also, if you are in Denton this Saturday, Bobby Mullins of start-up Armadillo Ale Works is hosting an HB 660 Rally/Craft Beer Forum/Armadillo Ale Works tasting on Saturday starting at 8:30pm at The Hydrant located 208 W. Oak.
On Sunday at 5pm, Silas Parker and the good folks at Darkside Fermentation are celebrating their anniversary with live music. I’ll be there to talk HB 660 and we’ll have t-shirts available as well.
I’ve spent the last 27 days pretty much talking about how our state’s alcoholic beverage code handcuffs local business. But what about when it supports local business?
The Texas wine industry is a great example. In 2001, prior to legislative reforms that allowed wineries to sell wine to consumers on-premise, Texas wine was a $132 million business, employing about 1,800 people. Only 8 years later, when reform was in full effect but still in its early stages, the industry had grown to $1.35 billion and employed over 9,000 people. In the meantime, Texas had grown to the 5th largest wine producing state in the US.
In Oregon, where laws relating to breweries are significantly more supportive than in Texas, the states brewers produced over 1 million barrels of beer in 2008, employed 5,000 people at Oregon breweries and generated an estimated economic impact of $2.2 billion. Texas Small Craft Brewers (breweries and brewpubs under 75,000 barrels) pale in comparison, producing less than 75,000 barrels combined, employing a little over 800 people and generating an economic impact of approximately $45 million.
It is plain to see what is at stake for Texas. Why would we not support local breweries and allow them to help our economy the way wineries has here and breweries have in Oregon? HB 660 and HB 602 would be the first steps in the right direction.
Rolling blackouts? $27 billion dollar state budget deficits? All of a sudden it feel like California down here, except without all the brewery-friendly laws.
For those of you who don’t live in Texas, it’s cold today. Maybe not cold by whatever standards your state might go by – but really really friggin’ by South Central Texan standards. Wild chills in the city were at 5 degrees F and were expected around zero degrees F in the hill country. Because no one saw this coming, it also turned out the state didn’t have enough power for the sudden spike in demand, and rolling brown outs were instituted in many parts of the state. They effected our brewery twice this morning, and when I spoke to my good friend and Real Ale head brewer Erik Ogershok he had just gotten through putting out the proverbial fires of the power going out mid-brew and moments after firing up the bottling line. YIKES!
There aren’t a whole lot of HB 660 development to report today, but there are a couple of news stories to share:
Houston Chronicle writer Ronnie Crocker (who you can find on twitter @rcrocker) reports a sense of cautious optimism over HB 602, and makes a mention of HB 660. I always find the comments on Ronnie’s stories to be especially engaging.
Back closer to my home, San Antonio Express-News writer Eric Braun discusses how HB 660 would be a game changer… for Texas beer consumers.
The KENS 5 story on HB 660 gets a little national exposure at beernews.org.
If you’ve got any Imperial Stouts at home, crack one open and stay warm. Cheers!
Following up on the graphic I posted a few weeks ago of my local beer cooler, I’ve had a certain curiosity about the correlation between a breweries ability to do the things that HB 660 and HB 602 try to achieve and their perceived “greatness.”
There is an obvious problem in trying to build this list – the subjective nature of “greatness.” I could list my favorite breweries, but then I might be accused of just picking ones that prove my point. To provide at least a smidgen of objectivity, I decided to use a source that, in and of itself, is still full of subjectivity – but least it isn’t my subjectivity. So, here are the best breweries, as ranked by RateBeer.com (note, I filtered out non-US breweries), with a column added: whether or not they have a brewpub or some kind of retail outlet attached to their brewery*.
Click for full-size images.
I’m thinking the same thing you are. That’s a whole lot of blue. Especially at the top of the list. Also, Texans are notably missing from this list. Correlation, or causation?
*Some of these are traditional brewpubs that have grown into production breweries (Russian River, for example), some are breweries that have added full-scale restaurants (Stone Brewing Co., for example), and others are production breweries that have a tasting room or bar where you can buy pints (Great Divide, for example).
EDIT: Someone pointed out they’ve purchased beer at New Glarus before. I’ve never been to all these places, so I admit the list is not 100% accurate. To determine “Yes” or “No” I used BeerAdvocate.com – if you can review the brewery as a “place” (where you can buy stuff) it’s a “Yes”. If you can’t, it’s a “no”
Tomorrow marks the 1/7th mark of the session, so if the session were a week long we are about done with Sunday. We have made amazing progress so far.
Yesterday, a couple of HB 660 supporters and craft beer drinkers emailed me to tell me their HB 660 stories.
The first comes from Freetail fan (and notably the first person to get a serving of the 2010 version of La Muerta) Scott Thor.
Scott works at a high profile golf course in San Antonio, who recently hosted an outing from a certain Texas based distribution company. Scott got to talking to one of the gentleman and specifically if had heard of me or Freetail (he hadn’t) or HB 660 (he most certainly had). As they got to talking, it turned out this gentleman was in fact the president of said distribution company who though HB 660 would be good for the state and good for his company, which are strong supporters and carriers of craft beer. I’d also been working hard to get an audience with this gentleman, and I’m sure that Scott’s work will help pave the way in getting that audience. You never know when the “on-the-ground” work is going to pay massive dividends.
The second comes from Carlo Longino, who you can find on twitter @caaarlo. Carlo lives in Representative Naishtat’s District 49 in Austin, who many of you have reported is in full support of both HB 660 and HB 602 (working on a scoreboard where we can keep track of this, more at the end of this post). I thought Carlo’s letter to the Representative was excellent, and I asked him if it was okay to share it as an example of what you can say to your reps.
Dear Rep. Naishtat,
I am a constituent of yours from Austin and am writing in support of the recently proposed House Bills 602 and 660, which would expand the business opportunities for small breweries and brewpubs in Texas.
Over the past several years, the number of small breweries in Texas has increased dramatically, in spite of the restrictions on how small brewers can operate their business. This is a thriving Texas industry that is creating jobs and tax revenues, and it deserves the support of the Legislature.
Two major barriers exist in the regulations governing small brewers: brewpubs cannot sell beer off-site, and brewers can’t sell beer on-site. This means that my good friend Amos Lowe can’t sell the fantastic beer he brews at Uncle Billy’s brewpub on Barton Springs Road (also in your district) in bottles at Whole Foods, while the folks at 512 Brewing (just east of your district) can’t sell their great beer directly to consumers, either for off-site consumption or at a brewpub. These caps limit the growth of these local businesses and hamper their ability to further create jobs.
Bills seeking to reduce or eliminate these barriers have been introduced in many past sessions of the legislature, but have fallen victim to the lobbying interests of beer wholesalers and large brewers. While it is very early in the session and these bills have not yet been referred to a committee, I hope that you will support them, and Texas brewers in their effort to grow their businesses and become a significant and thriving contributor to our state’s economy.
Thank you for your time,
As mentioned earlier, I’d like to start a scoreboard where we can keep track of what Representatives have said they will support the bills. If you’ve heard back from your Reps, post in the comments or send me an email!
The title of today’s post is both a reflection of the growing interest in HB 660, and the way I spent most of yesterday.
Thursday is typically the day I take “off” (I use the term “off” lightly since you’ll still usually find me at the brewpub), but yesterday ranks right up there with some of the busiest days I’ve had. I spent a good chunk of the afternoon on the phone with various journalists. One of them was Jeorge Zarazua who wrote a great piece for today’s Express-News (link can be found below). A little later I entertained (and was actually entertained myself by his sense of humor) the paper’s photographer as he captured the print debut of my beard (also found in the link below). Then KENS 5 came in for interviews with myself, Joey Villarreal of Blue Star Brewing Co. and Representative Mike Villarreal who of course authored the bill (no relation to Joey). The KENS story will air today, and they’ve promised me it will be online – I’ll post it (or a link to it) as soon as it’s up.
One of the most uplifting things I’d heard was from the Representative, who told me that he would have never predicted such a public response from this bill. You all are being heard! Paraphrasing, he told me that every session there is a relatively small bill that, for whatever reason, turns into a big deal. This is that bill, he told me. Obviously it is something that was very important to us craft beer drinkers, but for other folks to be rallying behind us to is huge. Even folks who may not drink craft beer are in support – they know it is just the right thing to do.
Equally as uplifting in my conversation with the Representative was that he’s already engaged with the wholesalers on discussing the bill. The wholesalers aren’t against us brewpubs having the ability to sell them beer. They are only concerned that it doesn’t result in the dismantling of the 3-tier system through legal challenges. The success of this bill rides on our ability to show that it doesn’t. Luckily, the evidence from other states and our own wine industry backs us up.
Keep writing those letters, sending those emails. I’m proud of what we’ve accomplished already in 11 days, and we’ve only just begun.
Around the Web
Jeorge Zarazua has a great story on the bill in the business section of the San Antonio Express-News, which you can read here.
And Beer Town Austin has news on the forthcoming collaboration beer.
If you follow me on twitter (@beermonkey), you may have caught this tweet last night:
Was told today that the Governor’s office is aware of #HB660 and is asking questions. Our voice is being heard. Let’s keep it up!
It’s a good sign that our very young campaign for HB 660 is being noticed. Thanks again for all the letters, emails, phone calls and faxes you’ve been sending.
In addition to HB 660, there is another craft beer bill for consideration before the congress this year. HB 602 (follow link for the text of the bill), filed by Jessica Farrar (D-Houston) is another go around for a bill filed in the past that would make it legal for microbreweries to offer cases of beer to tour-goers.
A few of you have asked for more information on HB 602 and how it compares and/or contrasts with HB 660. Here is my take on it:
HB 660 would:
- allow Texas brewpubs to sell to distributors and wholesalers
- allow Texas brewpubs to sell up to 5,000 barrels per year at the pub, directly to consumers
- allow Texas brewpubs to self-distribute their product to retailers so long as they are under 10,000 barrels per year
- allow Texas brewpubs to have total production of up to 75,000 barrels per year
- allow Texas microbreweries to change their license to a brewpub so long they meet the qualifications above
HB 602 would:
- allow Texas breweries (excluding brewpubs, but including breweries like the A-B plant in Houston) to charge admission for a tour
- allow Texas breweries to give tour participants up to 48 12-ounce bottles to take for off-premise consumption, without charge
- not allow Texas breweries to sell beer to the ultimate consumer
Obviously, I support HB 660. I also believe that the activities that would be permitted by HB 602 should be legal. If a brewery wants to give you a couple of cases of beer, I believe they should be allowed to. It should be noted, however, that HB 602 has a very narrow focus that affects only a handful of breweries: A-B in Houston, MillerCoors in Ft. Worth, Spoetzel in Shiner, St. Arnold in Houston, Real Ale in Blanco, Rahr in Ft. Worth, and Independence in Austin (in other words, only the breweries that package beer in 12-ounce bottles).
I support this bill and the efforts of the breweries who would be helped by its passage. I would however, point to HB 660 as a more comprehensive piece of reform legislation that has a greater reach. And with the exception of A-B, MillerCoors and Shiner who all exceed HB 660′s size restriction, the Brewpub bill allows the activities that HB 602 seeks to allow, should a brewery decide to change to a brewpub license. A brewpub is legally allowed to sell you packaged product for off-premise consumption, so long as they have packaged product to sell (most don’t).
You will never find me campaigning against HB 602, as I think it’s a bill that should pass. However, I believe our state is in need of greater reform that benefits our craft beer industry.