State revamps rules for craft beverage industry

Brian McKenzie, founder of Finger Lakes Distilling: Thanks, guv.

The State Liquor Authority has approved a host of improved rules aimed at helping craft beverage manufacturers, retailers and wholesalers. The changes come in the wake of the third annual Beer, Wine, Spirits and Cider Summit, at which craft beverage makers had the chance to bend government’s ear on issues affecting the industry, which Gov. Andrew Cuomo has promised to support as a key New York job-builder.

Chief among the changes is authorization of contract brewing, allowing small breweries to use the facilities of larger producers to manufacturer beer. The policy is expected to give a leg up to small brewers trying to enter the market, while increasing business for established firms.

Another biggie: Lower fees for seasonal additional bars. Previously, restaurant, bar and tavern owners were allowed to operate one bar per license, with additional bars costing the equivalent of the original license. Retailers operating a bar on a seasonal basis — on an outdoor patio or deck, say — will now be charged a fee based on the time the bar will be in operation.

The new rules, issued today and effective immediately, also cure a host of smaller ills, including reversing a ban on salespeople representing multiple beverage manufacturers. The changes also permit beverage makers to share the same manufacturing or retail space and allow not-for-profits to charge for sampling events at which craft beverage producers show off their wares.

“It’s really very impressive that a concern voiced by a small business owner can turn into actionable advisories from the State Liquor Authority to help small craft beverage producers in New York work together to expand jobs and bring our New York State grown products to more and more people,” said Jason Barrett, head distiller and president of Black Button Distilling in Rochester.

The new rules also:

  • Update marketing permits to allow brewers to purchase beer used in tastings at a retail location from the retailer, increasing the number of tastings conducted and saving manufacturers transportation costs.
  • Authorize home wine making centers. The SLA will issue permits for wineries and farm wineries to operate as “home wine-making” centers, where customers can receive expert advice and utilize the winery’s equipment to produce wine for personal consumption.
  • Authorize tastings at wine schools and other alcoholic beverage education classes and seminars. The SLA will issue permits for bonafide schools to conduct tastings as part of their curriculum, introducing consumers to new craft products and supporting research.
  • Allow off-premises beer retailers to fill orders for growlers at a warehouse, rather than having to conduct the activity at their licensed premises.
  • Clarify the ability of out-of-state brew pub owners to operate a restaurant in New York. This change will allow these companies to expand their business in this state, and New York licensees to consider opportunities in other states.

“The changes that resulted from the most recent summit benefit the craft beverage industry by modernizing regulations, improving ways that we can access our customers, and lowering the costs of doing business,” said Brian McKenzie, president of the New York State Distillers Guild and owner of Finger Lakes Distilling. “We’re thankful for the governor’s support of our industry and look forward to showing how these changes can lead to economic benefits for the state, like additional jobs, tourism promotion and support of local agriculture.”