Harsdorf called the three-tier system "archaic" and said it is actively hampering economic development in her district.

"We have a lot of economic development opportunities ... but don't have the liquor licenses that are critical to attracting businesses," she said.

Zimmerman owns a winery, and said he has seen firsthand how the current system of laws limits business growth. He said he does not see his ownership of a winery, that would stand to benefit from the bill he is promoting, as a conflict of interest. He said many other small businesses would benefit from the bill, which would affect brewers and distillers, too.

“ I do not need that winery to pay my mortgage," he said. The other components of the bill can help hundreds of other businesses, including distillers and craft brewers, he said.

Craft brewers cheered the bill as an important step.

Carl Nolen, president and CEO of Wisconsin Brewing Company, said he has experienced the three-tier system from all sides. He worked as a beer distributor before becoming a beer manufacturer and his father and grandfather owned taverns in the state.