Though it’s not been much reported, a bill before the California state senate, SB 1548 — and sponsored by Anheuser-Busch — will expand the laws regarding the tasting of alcohol to include beer. Specifically, a wholesaler, brewer or importer will be permitted to give up to 8 oz. of beer to sample in an on-premise retail setting and at no charge. No more than six tasting events per location per year can be held.
The original bill would have allowed a sample of 12 oz. in the original package unlimited times, meaning companies could have gone into bars and bought patrons a bottle or can of their beer as a promotional tool to increase business. Obviously, this would greatly benefit the larger companies with greater resources who could afford to “buy the world a drink.”
The California Small Brewers Association (CSBA) was successful in negotiating an amendment to the bill so that the amount was less than a full bottle or can and — perhaps most importantly — was not in the original packaging and could only be done six times per year in any one location. This makes it harder for companies to simply buy up the market by plying customers with a bottle of their product, but it still doesn’t really remove the impetus for abuse or the uneven way in which this would benefit the large company and further make doing business on a level playing field impossible for the small craft brewer.
The CSBA, who opposed the bill in its original form, is now taking a neutral position on the bill. If they had opposed it outright, they would not have been able to change it at all. In it’s amended form, it has now passed unanimously the first hurdle, the Assembly Government Organizational Committee, and is now on its way the Senate GO committee. After that it goes to the the House floor to be voted on, which should take place before the end of this month when their current session ends. If it passes there, then it’s over to the Governator for signature.
I certainly understand the CBSA’s removal of opposition to this bill, especially since the politics and issues make it such a complicated one. But I think there’s no doubt that their members will still be harmed when it is passed into law. The difficulty in opposing this law is that wine and spirits companies currently operate under essentially similar rules, and so do many other states. Rumor has it that A-B is, in fact, quite unhappy about opposition to this bill. Because in their mind, adding beer to the existing law for wine and spirits will simply — as they argue — “even the playing field.” There certainly are big wineries and small wineries and big spirits companies and small ones, too, so it would appear that inequities would exist there yet I know of no particular burden placed on the smaller producers with presumably smaller resources. Of course, that may be because I don’t follow those industries very closely. But my sense is that there is so much more profit built into wine and especially spirits that the difference between small and large producers — at least with respect to sampling resources — is not dramatic. Beer, on the other hand, is such a volume driven business with small per unit profits that the available resources difference between the big breweries and almost all the craft brewers is quite vast indeed. So at first blush, it may appear that this law will create a level playing field across all alcoholic beverages but I think the reality is that it will do just the opposite. I believe it will only deepen the divide between big and small breweries.
The bill’s language refers to the authorized tastings as “courses of instruction for consumers” which on its face would be a good thing except that I haven’t seen a high level of wine “instruction” in the tasting rooms of wineries across Napa and Sonoma to give me much cause for confidence that this is aimed at creating beer schools.
The idea of a large brewery sponsoring in effect a “free beer night” at bar after bar is a truly frightening one. Radical neo-prohibitionists would have a field day with that one but that could actually help in defeating this bill, along with possible opposition by law enforcement groups. And let’s not forget this is an election year.
It will probably do no good, but I think this bill should be opposed. Personally, I’d like to see a competing bill that would allow educational sampling along lines that make sense and don’t give a huge advantage to the big breweries. Why not 2 oz. samples? That’s enough for most educational purposes, especially if you’re tasting multiple beers. Most beer festivals and judging events don’t require much more than that to get enough of a sample to give you an idea of the beer.
The current bill allows for sampling “up to 8 oz.,” meaning you could give customers four samples of 2 oz. each. That’s probably what craft brewers would be likely to do, but I can’t see the big breweries taking that approach. And make it an 8 oz. sample and I can easily predict we’ll start seeing the big companies making 8 oz. logo tasting glasses for the bars who cooperate (and who wouldn’t?) to serve. Undoubtedly if the bars “buy” the glasses then they’ll be used instead of pint glasses for promotional “pint nights” where when you buy a beer, you keep the glass. If the brewery buys the customer the beer through this new law, and they also get a free tasting glass then you’ve got a system ripe for abuse.
It feels weird arguing that the status quo is adequate but in this case the current laws do provide something of a level playing field with regard to tasting. No one currently has any particular advantage, small, medium or large. This law will, of course, undo that and it’s hard to argue that it won’t give an advantage to the businesses with the most money. There has been a separation of the brewers and distributors from the retailer and this has mostly served the industry well to date. It has kept at least a semblance of distance between the two. If the curtain is occasionally parted by unsavory practices, at least it was there in the first place. Bringing it down now will only serve to move us closer to the end of the second act, by which I mean the rise of craft beer. Because anyone paying real attention to what’s been going on has to conclude that A-B — and perhaps all the big players — are doing their level best to eradicate craft beer and especially the regional breweries, as they did before several decades ago.
If you live in California, please consider contacting your elected officials and asking them to oppose SB 1548. It may sound alarmist, but the very future of craft beer may depend on it. Because if this passes, it will be the first of many legislative changes that will take us down a slippery slope back to the time when good beer was almost impossible to find. And I for one, don’t want to see that world ever again.
Here’s the current language of the bill:
25503.55. (a) A beer manufacturer, a licensed beer and wine importer general or a licensed beer and wine wholesaler may instruct consumers or conduct courses of instruction for consumers, on the subject of beer, including but not limited to, the history, nature, values, and characteristics of beer, and the methods of presenting and serving beer. A beer manufacturer, a beer importer general licensee or a licensed beer and wine wholesaler may conduct such instructions at the premises of a retail on-sale licensee authorized to sell beer.
(b) The instruction of consumers regarding beer may include the furnishing of tastes of beer to an individual of legal drinking age. Beer tastes at any individual course of instruction shall not exceed 8 ounces of beer per person per day. The tasting portion of a course of instruction shall not exceed one hour at any individual licensed retail premises. Tastes of beer may not be served to a consumer in their original container but must be served in an individual glass or cup.
(c) All tastes of beer served to a consumer as authorized in subdivision (b) shall be served only as part of the course of instruction and shall be served to the consumer by an employee of the on-sale retail licensee.
(d) A beer manufacturer, licensed beer and wine importer general or a licensed beer and wine wholesaler may not hold more than 6 courses of instruction per calendar year at any individual on-sale retail licensed premises if the course of instructions includes consumer tastes of beer.
(e) A representative of a beer manufacturer, licensed beer and wine importer general and/or a licensed beer and wine wholesaler must be present and authorize any tastes of beer conducted at an on-sale retail licensed premises pursuant to this section. The representative shall be responsible for paying the retailer for the tastes of beer served at any course of instruction. Such payment shall not exceed the retail price of the beer. For purposes of this section, a licensed beer and wine wholesaler cannot be the representative of a beer manufacturer or a licensed beer and wine importer general.
(f) No on-sale retail licensee shall require one or more courses of instruction pursuant to this section as a requirement to carry a brand or brands of any beer manufacturer or beer and wine wholesaler.
(g) No premium, gift, free goods, or other thing of value may be given away in connection with an authorized course of instruction which includes beer tastes except as authorized by this division. Failure to comply with the provisions of this section shall be presumed to be a violation of section 25500.
(h) A retail licensee may advertise the instructional tasting event using interior signs visible inside the establishment.
(i) A beer manufacturer, a licensed beer and wine importer general and a beer and wine wholesaler shall maintain an individual record of each course of instruction involving tastes of beer for three years. Records shall include the date of the tasting, the name and address of the retail licensee, and the brand, quantity and payments made for beer furnished by the beer manufacturer, the licensed beer and wine importer general or a licensed beer and wine wholesaler.