New rules on LA breweries need relaxation
Gov. John Bel Edwards has picked up a couple of nicknames in his short tenure: the Accidental Governor, because of his fluke victory, and, more derisively, Gov. Honor Code, because of his insistence during the campaign that he follows his alma mater’s version of that yet has been caught applying it inconsistently. Now might he add the appellation Gov. Blue Nose?
That may come from a decision by his handpicked Commissioner of Alcohol and Tobacco Control Juana Marine-Lombard that restricts the ability of state breweries to sell their products. She provided guidance in March and clarified it at month’s end regarding interpretation of statute that defines brewery operations.
Her conclusions took a restrictive approach and will hamper these establishments’ operations, some potentially severely. Among others things, she declared that on-site prepared food sales could not exceed 25 percent of total sales on premises; that off-site food preparers selling on premises could not have a license to serve alcohol even if not serving any on the premises; no other party could sell on or bring other alcoholic beverages onto the premises; and advertising of any other event involving alcohol cannot occur unless it involves sampling on the premises, which in that case cannot advertise retail pricing. Already, state law permits on-site sales only to a ceiling of 10 percent of total sales, or no more than 250 barrels, whichever is greater.
None of these additional parameters exist in statute, so the industry took the approach that things not prohibited were permitted, a view that now Marine-Lombard has mooted. It believes that bars and restaurants, their competitors, lay behind this change. Some in the industry think such strictures could close down some breweries.
At the very least these interpretations would impact substantially those few breweries that have kitchens, reducing offerings or shutting down such facilities. Most of the others would feel an adverse impact by the limitation on food trucks or other vendors who provide off-premises prepared food whose own establishments serve alcohol, in some cases substantially reducing options. Events along the lines of tasting products from others would vanish, as they could not sell their products at any place but their own brewery. Some operators permit patrons to bring in their own food or drink, but that now cannot include, for example, wine to go along with beer sold on the premises.
All in all, these do restrict trade. Louisiana doesn’t have a great history when it comes to homegrown alcohol sales, despite the state’s reputation (although largely shaped south of Alexandria) for letting the good times roll. Even with recent legal changes, it still has some of the most restrictive laws in the country for shipping wine into the state. Only in the past few years has Louisiana joined the surge of breweries opening across the country, yet still ranks in per capita terms third-to-last among the states and District of Columbia in penetration of smaller/independent brewers.
Legislators could provide beneficial relief, realizing that on-premises consumption of products does not provide direct competition to bars and restaurants. Breweries usually charge higher prices for their product than comparable domestic brands served in other establishments (or sometimes even the draft version of their own product sold elsewhere), because their selling point is the beer itself. Lawmakers do have a lot on their plates this upcoming session, but brewers and consumers would welcome any intervention on their behalf that relaxes the recent ruling.
Posted by Jeff Sadow at 13:05