Louisiana Brewers Fear New Regulation Guidelines

Austin Ray

THE GIST
Louisiana breweries are fearful that new state regulation guidelines could force a number of homegrown beer companies out of business. Namely, brewers contend an advisory issued Friday by the Louisiana Office of Alcohol and Tobacco Control (ATC) tightens boundaries and needlessly complicates operational practices, most notably as they relate to food sales. Brewers believe the advisory was issued, at least in part, in response to “pressure” from the restaurant industry, according to The Advocate, because brewers have been “eating into restaurant business.”

WHY IT MATTERS
As reported by The Advocate, the advisory came after breweries were given cease and desist letters—and, in some cases, citations—this past fall for practices they believed to be legal. Those practices included, among other things, hosting yoga events, live music, and food trucks. The advisory, though (which was approved in advance by the Louisiana Craft Brewers Guild), explicitly clarifies that such activities are, in fact, permissible. So what’s the problem?

Although the advisory more or less reads as a primer in what breweries can do as opposed to what they can’t, there is a controversial provision about food sales. Specifically, the state’s liquor board writes, “If a brewery has a restaurant or kitchen operating on the premises/under the roofline, the restaurant’s food sales and marketing shall be incidental to the beer sales. Thus, sales from the restaurant/kitchen within the brewery’s premises shall not exceed 25% (twenty five percent) of the beer sales on premises.”

This sales cap would shut down NOLA Brewery’s newly opened on-premise barbecue restaurant, resulting in the loss of 20 jobs, according to The Advocate. And NOLA CEO Kirk Coco “would guarantee you” up to four more closures would follow in six months, putting an estimated 100 people out of work. It wouldn’t stop at closures either. Other breweries, like Parish Brewing, might look to take costly expansion projects out of state on general principle. 

“I am in the process of planning a multimillion dollar expansion and I am considering doing so across the border in Texas or Mississippi if the government is against breweries here,” Parish owner and brewmaster Andrew Godley tells the Advocate.

To be fair, the ATC says it’s open to negotiating and easing such restrictions with help and input from the state’s brewers. That reportedly includes a proposed follow-up food sales cap at 25% of all sales, not just beer sales. That, says Coco, would be “more than adequate.” Regardless, you know you have a conflict worth watching when a brewery threatens to defect to Mississippi because it boasts a friendlier regulatory environment. You certainly don’t hear that one too often.

—Dave Eisenberg

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Louisiana breweries fearing closures after regulations, clash with state officials [The Advocate]