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Sunday, April 18, 2021

Brewers hail bill that would let them own 5 Del. brewpubs instead of 3

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Iron Hill Brewery didn't even consider Delaware for a new locations because Delaware limits them to three locations.
Iron Hill Brewery doesn’t even consider Delaware for a new location because it has the maximum three allowed by law.

 

Cheers!

That’s what brewery owners say to a proposed bill that would allow their companies to increase the number of brewpubs they own in Delaware from three to five and to produce hard seltzer, a trendy commodity in the drinking world.

Mark Edelson, director of brewery operations and one of the founders of Iron Hill Brewery, pushed for an increase a few years ago when the limit was two.

“But we got a lot of push back, so we settled at three,” he said.

That limit affected Iron Hill’s decision to put a new production brewery, tap house and restaurant in Exton, Pennsylvania, instead of Delaware. It already has locations in Wilmington, Newark and Rehoboth Beach.

 

“Delaware was off the table,” Edelson said. The new site will employ about 85 people.

House Bill 45, introduced last week by Rep. Bill Bush, D-Dover West, would change the way the Office of Alcoholic Beverage Control Commissioner grants licenses.

“By capping these licenses at three, we are unnecessarily stunting the growth of our brewpubs, and in many cases, causing them to expand out of our state,” said  Bush in a press release. “Allowing additional licenses will give our local craft breweries the ability to grow, creating jobs and opportunities here in Delaware.”

He and others see it as a pro-business bill that’s especially important in a time when small businesses have been battered by the COVOD-19 pandemic.

“I don’t think we should be codifying arbitrary numbers that regulate business from growth,” said Sen. Ernie Lopez, R-Lewis. He and other Republicans were floating a bill that would have increase the number of brewpub sites to four, but now will swing support to Bush’s bill.

 

It’s not good government to dictate how and where a company can grow, Lopez said. And limits are usually just arbitrarily set with no specific strategic for that, he said.

“We should be looking for ways … to grow or support our small businesses that are looking to expand,” he said. “To me, now more than ever, that’s where our focus should be in Delaware in regards to our small business community.”

Consumers want choices, he said.

“There’s always been room in the sandbox for every business, even if they are similar, to have an opportunity to become established and to grow,” Lopez said.

Bills to expand the number of brewpubs recognize that brewpubs have collaborated as much as they have competed and so helped each other grow, he said. If HB 45 is passed, it will give them an opportunity to continue to do that, he said.

 

“The Delaware brewing industry, including microbreweries and brewpubs, all want to stay here in Delaware, so anything the Legislature can do to help us grow and expand our business here is a plus for everybody,” said Eric Williams, president of Mispillion River Brewing in Milford and legislative chair of the Delaware Brewers Guild. in a press release.

One of the reasons that brewpub licenses were capped was to try to keep international brewery conglomerates from overwhelming local ones, said Sen. Trey Paradee, D-Dover, in the press release.

“Today, our hometown breweries are one of Delaware’s great small business success stories,” he said. “Some are now so successful that they’re bumping up against the cap. By passing this legislation, we will continue to reasonably and responsibly foster that growth.”

The rule change in House Bill 46 to allow Delaware breweries to make and sell their own hard seltzers designates all “fermented beverages,” which can include sake.

 

The bill specifies products “containing one-half of one percent or more of alcohol by volume, brewed from substitutes for malt, including rice, grain, bran, glucose,
sugar and molasses.”

Delaware law has prohibited those kind of beverages, but federal law has allowed it. Paradee’s bill would update Delaware’s code to mirror the federal law.

Bush said in the press release that he was surprised to learn that breweries are not permitted to brew hard seltzer.

Changing that means “giving brewpubs and microbreweries another avenue to grow and compete with larger national companies,” he said.

Paradee pointed out that consumer tastes change fast, and the industry has to reflect that,.

“Taken together, these bills will give our brewpubs greater flexibility, encourage job creation and allow this booming industry to prosper for years to come,” he said.

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