Florida Bills Could Give Way to Limited Self Distribution

Austin Ray

THE GIST
Florida lawmakers are trying to make it easier for smaller craft brewers—particularly new startups—to get their beer out to market. Twin bills filed this month in the state’s House and Senate would allow brewers that produce less than 7,000 kegs a year to self distribute, provided they haven’t yet entered a franchise agreement with a wholesaler. If passed, the new law would take effect July 1, 2017.

WHY IT MATTERS
The bills in question (Senate, House) come with their own limitations. Coverage only applies to brewers of a certain size, for instance, and it’s exclusively applied to their kegged product. But they nevertheless represent a viable attempt to loosen the restrictions inherent in the state’s three-tier system. That, alone, is significant, as this fight has been ongoing in Florida—and throughout much of the country—for years.

As such, even Florida brewers who aren’t covered in the proposed legislation have voiced support of the measure. “We just started to distribute, so I understand the impact,” Tom Adams, owner of Deadly Sins Brewing, told the Orlando Business Journal. “We’ve got so many places around us that want to carry our beer and our distributor has been great. But most distributors can take up to 30 percent of the profit, so that’s the largest impact this bill could have.”

Some of the state’s more established breweries, like Cigar City, who likely wouldn’t bother with self-distribution due to their size, have also voiced similar support in the past.

The effort won’t likely be free of opposition, though. Predictably, the state’s wholesalers are positioned to put up a fight. Speaking with the Tampa Bay Times, Mitch Rubin, executive director of the Florida Beer Wholesalers Association, said such a law “creates an unlevel playing field," while simultaneously sidestepping a 2015 compromise that allowed brewers to sell their own products in tasting rooms.

Rubin did not return GBH’s request for comment as of press time. But this latest attempt is a considerably reigned-in proposal from what the state was debating just two years ago. In 2015, another state rep filed a 50-page bill (the current bill in question is, barely four pages, to put that into perspective) that sought to more or less overhaul the way the state’s beer industry was regulated. Not only did it aim to legalize self-distribution (up to 5,000 barrels, not kegs, worth), it most notably aimed to put five-year contract limits on wholesaler contracts. Meaning, after five years, a contract would end and a brewer whose beer comprised less than 50% of a distributor’s volume would be free to test the market.

That bill didn’t pass. Now, brewers are hoping that, by dramatically narrowing the legislative focus, change will seem a bit more palatable to all concerned parties.

—Dave Eisenberg

READ MORE
New proposed law could shake craft brewers’ 3-tier system [Orlando Business Journal]