Tennessee Raises ABW Cap, Freeing Brewers to Produce Stronger Beer

Austin Ray

THE GIST
Starting in January, Tennessee brewers will no longer need to acquire a specialty license in order to brew stronger beer. Thanks to a bill passed back in 2014, which finally takes effect the first day of the new year, brewers will soon be able to freely produce beer that registers as high as 8% ABW (or roughly 10.1% ABV). Previously, brewers were capped at producing beers at or below 5% ABW (or 6.2% by volume). Previously, in order to produce stronger beers, Tennessee brewers had to get a separate license.

WHY IT MATTERS
This is ostensibly good news. Lifting the cap essentially tears down a barrier that was, for a lot of brewers, too burdensome to bother trying to hurdle. As one relayed to The Tennessean, “many have been deterred by the financial costs of obtaining a separate license and the restrictions associated with making those brews.” Now, they’re free to make stronger beer, and already a number of brewers in the state have plans to introduce such offerings to the marketplace. It’s a long overdue rule change.
 
But the legislation falls short when you consider it this way: Tennessee brewers are being forced to celebrate a change that still leaves the state with one of the strictest alcohol content caps in the nation. For comparison, as noted by The Tennessean, Alabama limits alcohol by volume in beer to 13.9%, Georgia imposes an approximate 14% cap, while Mississippi is about as restrictive as Tennessee. (That being said, all these caps in the Southeast are indeed the result of law changes in recent years). It would be a bit condescending to call the new rule a Pyrrhic victory. In reality, though, the updated legislation merely chips away at a millstone that many states have removed entirely. Or, as another brewer there put it, “Even though it’s a step in the right direction, we’re still years behind.”
 
In a day and age where 15% barrel-aged Stouts are common and sought after, caps like these obviously serve to stifle innovation, as it bars breweries from experimenting with different styles and brewing techniques. But more than that, these caps deprive brewers of the ability to simply give consumers what they’re demanding in nearly every mature beer market. There is a reason so many so-called “whales” seem to originate in all the same geographic locations, and it’s not because brewers in places like Tennessee lack the talent to produce them. This the most tangible issue here.
 
That said, there’s a really, really big intangible issue, too, one that relates to losing out on hundreds of jobs and, perhaps, hundreds of millions of dollars in economic impact. Out-of-state breweries looking to build production facilities in new markets aren’t interested in setting up shop where they’re restricted by outdated regulation. Tennessee knows this first hand.

“We looked at opening the brewery in Chattanooga, and I think Chattanooga is a great potential craft beer city, but Tennessee is a terrible craft beer state,” Wicked Weed co-owner Walt Dickinson told GBH in April. “There, we couldn’t be the brewery we are. I couldn’t really make a lot of beer with the distribution laws, what you can sell in-house, what you can do with taxation, and on top of that, the ABV level. Those laws kind of pushed us out.
 
Before Stone decided to invest $74 million to build a brewery in Virginia, economic development agencies in The Volunteer State were trying to court the California staple. One such agency in Blount County was specifically promising impeccable water and unparalleled quality of life. However, considering Stone is known for aggressive beers, it's tough to imagine the company was ever going to wind up in a place that sought to so stringently harness its brewing ambitions (even though acquiring the specialty license would likely not pose a huge problem to a company of Stone’s size). The same agency made a play for Sierra Nevada, who ultimately went with North Carolina.

This is a good start, of course. But if states like Tennessee, Georgia, Mississippi, and Alabama want to compete with places like Colorado, Oregon, California, and North Carolina, they've got a lot of work to do. Until then, breweries will keep passing them over.

—Dave Eisenberg

READ MORE
Stronger beer coming to Tennessee stores, breweries [The Tennessean]