A Brew Ha Ha over proposed brewery?

Surly illustration-650.jpgSurly Brewing Company announced today that it wants to build a $20 million brewery in Minnesota. The plan includes a 60,000 square foot, two story brewery, a 250 seat restaurant, a 30 foot bar and a beer garden. Here’s part of the plan from Surly’s blog:

The brewery is good for us, and great for Surly fans, but it’ll also benefit our state by creating as many as 85 construction jobs to build it over nine months and 150 permanent Minnesota jobs, and offer a complete event center, for concerts, parties, business events, weddings, and more. Now there’s a reason to renew your vows.

The only problem is that Surly needs to change the law in order to build the brewery and have a restaurant. That’s because a law prohibits large brewers from owning a restaurant and bar for fear that they’ll sell their beer at a lower prices than other bar owners.

A lobbyist for the Minnesota Licensed Beverage Association, which represents bar owners, told me they’re against changing the law.

Liquor laws are complicated and controversial. A small proposed change in law can mean a huge fight in the Legislature. The MLBA is also a pretty powerful organization because there are bar/restaurant/package owners in every legislative district. A heavy lobbying effort can slow down or defeat any form of legislation.

No lawmaker has introduced legislation on behalf of Surly but I’m told it will come soon. Surly has also hired a well known lobbying firm to help them with their efforts.

I’ll post a more formal response from MLBA if/when they send it to me.

Update: Here’s a response from Frank Ball, with the Minnesota Licensed Beverage Association:

It’s pretty simple within the parameters of the three-tier structure we have in Minnesota. The manufactures make the product, the wholesalers distribute the product and we, the retailers, sell the product to the consumer. It’s even more simple if you say it the way my retailers say it: “you make it, we’ll sell it”…you make it ‘and’ sell it, we won’t buy from you”.

The reason for the three-tier structure was to keep the integrity of the distribution of a controlled, highly regulated, commodity. Alcohol — like prescription drugs or firearms — is no ordinary commodity. In fact, alcoholic beverages are the only commercial products specifically named in the United States Constitution. Because our society recognizes the importance of controlling alcohol use and access, alcohol has always been treated differently under the law than most other products.

The manufacturers (breweries, vineyards and distilleries) supply distributors. Under the laws which created the three-tier system, each level of the system is independent of the others, ensuring accountability to the public as well as the benefits of healthy competition. By preventing tied houses (i.e. Retailers that sell the products of only one supplier), the three-tier system limits the number of retail outlets and therefore promotes moderate consumption, hence our position with the Surly matter. We want the Surly product to sell in our stores, we don’t want the manufacturer of a great beer to sell to the public, we’ll do that enthusiastically as possible.