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Frederick News-Post: A ray of hope at Flying Dog

To all of our readers who are beer drinkers — or to those who just care about a more business-friendly environment in Maryland — we propose a toast: Raise your glasses to Peter Franchot!

Franchot, who as the state comptroller collects taxes and other revenue, announced recently that he will introduce a bill with a “12-pack” of craft brewery reforms in the 2018 General Assembly session. We hope this reform package will be able to pass the General Assembly, and we hope it is in time to help Frederick.

We told you in October that the assembly had made a mess of policy while creating new regulations on breweries in the last session in the spring. Brewers had asked for changes to the state laws to allow them to be better able to expand their business. In typical legislative fashion, the lawmakers offered the brewers something less than half a loaf of bread, and told them it was a good compromise. It wasn’t, but brewers were left with no choice.

The bill that was signed into law raised the yearly limit on beer sales at brewers’ taprooms from 500 barrels to 2,000. The law also allows a brewery to sell an additional 1,000 barrels of its own beer in the taproom, but it must first sell that beer to a wholesale company, then buy it back at a markup. That sounds like a fair compromise, right? No!

Franchot’s reforms, the Reform on Tap Act of 2018, would remove all limits on beer production, taproom sales and take-home sales; allow counties to set guidelines for taproom operating hours; eliminate franchise law requirements; remove restrictions on contract brewing; and allow smaller brewers to self-distribute.

The bill is named for a 40-member task force Franchot established shortly after the 2017 General Assembly session to review the state’s liquor laws.

The General Assembly’s feeble efforts last year have left cities including Frederick to deal with the fallout. And in October we saw the biggest fallout of all. So far, no other Maryland community is faced with the kind of problem we have here.

That is because Jim Caruso, the CEO of Flying Dog Brewery, announced in October that his company had permanently halted its planning for a new $50 million brewery in the city because of ”legislative issues.”

Richard Griffin, the city’s director of economic development, told News-Post reporter Mallory Panuska then that it was not a surprise.

“[Caruso] had worked very hard during the last legislative session to improve brewery regulations for brewers around the state and did not feel as though his efforts were fully successful,” he said, in a massive understatement.

Remember, Flying Dog moved from Denver to Maryland in 2006 to increase production of its popular brews. It bought the old Frederick Brewing Co. and grew and grew and grew. In 2016, it announced plans for a new brewery near the airport to increase capacity from the current 100,000 barrels per year to 700,000 barrels.

The most worrisome part of Caruso’s announcement was his saying the company “is developing other viable options and making long-term commitments to ensure that it has an uninterrupted supply of beer.”

Does that mean the company is considering moving out of Frederick? Caruso says no. But Flying Dog moved before when it needed more brewing capacity. It needs more capacity again. No one should deceive themselves that moving is out of the question.

Frederick’s city, county and state elected leaders need to be on Franchot’s reform bandwagon from the very beginning. Luckily, we have a head start.

Sen. Ron Young (D-District 3), of Frederick, was a member of Franchot’s task force and is chairman of the Senate subcommittee that addresses issues related to alcoholic beverages. He said he hopes that the legislation will pass this upcoming session.

“I think they’ve got something to rally around,” Young told News-Post reporter Danielle E. Gaines. The pressure is on for Young to deliver on this issue.

Will Franchot’s reform laws pass? Will it be enough to save the Flying Dog project for Frederick? Who knows? At least now, we will have a chance.

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