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Frederick News-Post: Franchot continues push for brewery reform
January 17, 2018
Peter Franchot is on something of a crusade.
The Maryland comptroller is pushing for a series of reforms to the laws regulating breweries, and painting himself as the champion of the state’s beer makers.
Franchot has been a regular presence at events with Frederick brewers to push new legislation.
He came to Brewer’s Alley in December to promote the potential reforms, and he made an appearance Wednesday at Rockwell Brewery on East Street, urging attendees to sign a petition of support for the “Reform on Tap Act of 2018.” A bill passed by the General Assembly last session increased the barrel limits for brewery taprooms from 500 barrels a year to 3,000, but also required brewers that sold more than 2,000 barrels to buy the extra 1,000 barrels from a wholesaler at a markup. That law also limits the hours that new breweries can keep taprooms open, while allowing brewery taprooms that were open before July 1 to keep their hours.
Opponents criticized the bill for creating an uneven playing field for the industry and unnecessarily restricting the future growth of brewery taprooms.
The fight over regulations for brewery regulations evolved last year when lawmakers wanted to increase brewery taproom sales and loosen other limits to try to accommodate a large brewery taproom in Baltimore County by the company that owns Guinness, Diageo.
Franchot’s new proposal 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 let smaller breweries distribute their own product.
Franchot is trying to get 6,500 signatures for his petition before it’s unveiled in early February, representing the number of jobs the craft brewing industry creates.
He told the crowd at Rockwell that lobbyists for Budweiser and other big beer companies told the General Assembly what should be in the last bill, which he called a “knife in the back” of the Maryland craft brewing industry. “I don’t blame [the General Assembly] for this. It’s the process more than anything,” he said.
But he urged people to contact their legislators and demand the reforms, which he said are gaining momentum. “It has now become a movement,” Franchot said.
He also presented a proclamation to Rockwell, which opened in March 2017.
The new law hit the brewery hard, especially limits on “contract brewing,” in which breweries have their beer produced to their specifications at another location because of capacity issues, said Paul Tinney, one of Rockwell’s owners. Their business model had been to let the money from the brewery fund its own growth, and they weren’t brewing enough to be self-sustaining. They filled the void by contracting to other brewers to use Rockwell’s recipes, then brought the kegs of beer to serve in their taproom.
Without the rules on contract brewing, they wouldn’t have to worry about their next steps for growth, Tinney said. “We would really just attack it,” he said.
The bill did push them to buy more equipment, said Matt Thrasher, Rockwell’s other owner.
It was sooner than they wanted to make that move, but it has worked out, he said.
Tom Barse, of Milkhouse Brewery, said he came to Wednesday’s event to show his support for Franchot and Maryland craft beer.
Barse serves on the legislative committee for the Brewers Association of Maryland, and said the group plans to be prominent in Annapolis during this year’s General Assembly session.
If all of Franchot’s reforms pass, “First I would faint, then I would celebrate,” Barse said.
Frederick County has a diverse craft alcohol culture. The county is home to more than 30 breweries, wineries and distilleries.
Other than Baltimore, Frederick is “the absolute center of Maryland craft beer,” Franchot said after addressing the crowd.
Frederick Mayor Michael O’Connor said the city and Frederick County are “ground zero” of the craft brewing industry. Businesses such as Rockwell contribute to Frederick’s reputation as a thriving community, O’Connor said.
The thriving craft scene is an important symbol for Frederick because it signals to millennials that Frederick is a place they might want to live or visit, Franchot said.
The city is still analyzing the economic impact of the craft brewing industry, said Richard Griffin, the director of Frederick’s Department of Economic Development.
It’s been only a few years since the city changed its zoning laws to allow craft brewing in more areas, he said. Once it has a few years of data, it will have a better picture of the industry’s impact, he said.
But there are more immediate benefits.
In addition to the jobs the industry creates, the craft beer industry is helping to boost Frederick’s tourism, Griffin said. He said the city has 1.7 million visitors a year, and they spend a million dollars a day.
They dine downtown, and the area’s breweries, wineries and distilleries are popular destinations, he said.