Alcohol bill on the rocks

Contentious cut to brewery and distillery serving sizes may die with session’s end

A bill cutting serving sizes at the state’s breweries and distilleries appears likely to die in the Legislature this year, lawmakers said Wednesday.

 

Rep. Adam Wool, D-Fairbanks, said he believes there is not enough time remaining in the Alaska Legislature’s 121-day session to consider Senate Bill 76 in the House Finance Committee, make changes, and send the bill back to the Senate for agreement with those changes.

“To do it properly would take a week, and I don’t think anyone wants to spend a week … when we want to go home soon,” Wool said. Lawmakers are seeking to finish their business by Saturday, and even if they don’t, the Legislature’s constitutional limit is Wednesday.

SB 76 contains a sweeping reform of the state’s alcohol licensing system, not just the serving size restrictions.

The latest version of the bill is 113 pages, and in order to pass this legislative session, the House Finance Committee would have to read, analyze and vet those pages within a day or two before sending it to the full House of Representatives for a vote.

“To expect them to go through it and pass it out in a day or two’s time just isn’t a realistic want, in my opinion,” said Rep. Louise Stutes, R-Kodiak.

While most of the bill is uncontroversial, included within Senate Bill 76 is an amendment that would slash serving sizes at Alaska breweries and distilleries by one-third. For breweries, the maximum daily pour per customer would drop from 36 ounces to 24 ounces. For distilleries, the maximum amount of alcohol would drop from 3 ounces to 2.

The amendment was introduced by Stutes in the House Labor and Commerce Committee, where Wool serves as vice chairman. All members of the committee approved the amendment, and the amended bill advanced without dissent.

The amendment is controversial because it touches the heart of the bar wars, a dispute between alcohol manufacturers and retailers caused by Alaska’s changing drinking habits and prior legislative attempts to cope with demand.

As the Empire reported last year, Alaska is drinking less beer, more liquor and more wine. It’s drinking less mainstream beer and more craft beer. It’s also drinking less alcohol overall.

The Legislature met this changing demand by allowing breweries to operate “tasting rooms” that sell limited quantities of beer to be consumed at the brewery. In 2014, the Legislature again tried to meet demand by allowing the same privilege to the state’s growing number of distilleries.

As the number of distilleries and breweries has grown, owners of traditional alcohol businesses, like bars and liquor stores, have begun pushing back. In public, and to the Legislature, they have said that breweries and distilleries are blurring the line between what is a bar and what is not.

Of particular concern over the past year is the issue of cocktails, which are served by distilleries across the state.

SB 76 passed the Senate in a 20-0 vote on April 30, and on May 7, it was taken up by the House Labor and Commerce Committee, which made several significant changes that matter to partisans in the bar wars.

Stutes and Wool were trying to negotiate an armistice in those wars. To help distilleries, the committee’s version of the bill includes language explicitly allowing mixed drinks at distilleries. To help bars and liquor stores, it passed the amendment limiting sample sizes at breweries and distilleries.

In the Senate, the bill contained a measure that would have required breweries and distilleries to sell 80 percent of their product wholesale, and only 20 percent through tasting rooms. That requirement would have become effective six years after a distillery or brewery opened its doors.

The 80/20 measure, sought by retailers, was removed before reaching the House.

“We said, let’s give another give to the beverage side to offset the 80/20 to some degree,” Wool said of the thought behind the amendment.

Stutes said the alternative was another amendment, one that would have cut sample sizes by a half.

“I own that amendment. No problem, but I figured a third was better than a half,” she said.

After the amendment passed, public outcry hit the Capitol. Wool said he’s received more public response from this one issue than on the budget or cuts to the Permanent Fund Dividend.

“I can do all that, they don’t care, but lose 12 ounces of beer, and it’s the end of the world,” he said.

Some of the outcry has focused on the fact that Wool owns the Blue Loon, a Fairbanks bar, and that Stutes is a former bar owner.

Both denied that their connection had anything to do with the amendment. Wool compared his involvement to having a schoolteacher on the education committee or a nurse on the health and social services committee.

“They sort of have some knowledge of that industry,” he said.

Sen. Peter Micciche, R-Soldotna, is the prime sponsor of SB 76. After some consideration, he requested the House Finance Committee take up the bill, but on one condition: If the amendment isn’t removed, he will seek to kill the bill.

“If that remains in the bill, I will kill the bill,” he said.

Time pressures may end up doing that anyway.


• Contact reporter James Brooks at jbrooks@juneauempire.com or 523-2258.


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