Day 14: Why Not Go For More?

As HB 660 consumes an increasing amount of my available brainpower, I’ve begun to rely on technology to keep me alerted to what others are saying about the bill. Yesterday, both my Twitter search and Google Alert email brought to my attention to a blog post written by Adam Gonzales of Independence Brewing Co.

Adam brings up a couple of good question in regards to both the scope and timing of HB 660, and this blog post is dedicated to addressing those questions.

Adam’s first question is about the size limitations placed on brewpubs as a result of HB 660. Brewpubs, currently limited to producing 5,000 barrels a year, would now be limited to 75,000 barrels a year (with 5,000 of that allowed to be sold to the ultimate consumer at the brewpub). Adam accurately points out that this immediately excludes three breweries in Texas: The A-B Plant in Houston, the MillerCoors plant in Fort Worth, and the Spoetzel Brewery in Shiner (the closest of the three to the threshold, Spoetzel produced over 400,000 barrels in 2009 – more the all Texas craft brewers combined). Adam also accurately points out that St. Arnold is about halfway to the threshold (so is Real Ale), so theoretically they would only be able to participate for a limited time, if they so chose.

The first important point to make from my perspective, is that HB 660 is a bill that specifically and only relates to Chapter 74 of the Alcoholic Beverage Code – brewpubs. Brewers (who licenses allows to them to make “Ale” in Texas) and Manufacturers (who can make “Beer” in Texas) are addressed in different parts of the code. While I agree that those portions of the code need to be revisited as well, they are simply outside of my scope as a brewpub owner. I wouldn’t want a non-brewpub working to get brewpub bills introduced, and likewise I wouldn’t work to initiate bills that affect business types that I’m not involved in. This bill is designed to help Texas brewpubs, 100% of which could be helped by this bill, if they opted to distribute. As a secondary effect, there are some production breweries which could switch their licenses to brewpubs, if they chose. I don’t view the bill as excluding anyone, but rather including more parties which it is primarily designed for.

Adam’s second question is in regards to the timing. On this point, I think there is a bit of confusion. All bills introduced into the legislature contain the following provision:

This Act takes effect immediately if it receives a vote of two-thirds of all the members elected to each house, as provided by Section 39, Article III, Texas Constitution. If this Act does not receive the vote necessary for immediate effect, this Act takes effect September 1, 2011.

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I agree with Adam that September may be too tight of a time frame for some breweries to begin dual operations. The good news is that September does relate to when breweries must do something, but rather when they can do something. The next possible opportunity would be 2013. If a brewery wanted to change their license, they could do so at any time.

Around the Web

Charles Kuffner has a post on HB 660 on his blog, Off the Kuff