Tuesday, May 22, 2018
Business

Size matters: Craft brewers challenge Florida's beer container laws

Growlers, an old-fashioned way of enjoying freshly brewed draft beer at home, are all the rage around the country. "Hundreds of brewpubs, breweries and even grocery stores are cashing in on the growing popularity of growlers," USA Today reported recently.

Except in Florida.

The Sunshine State allows only breweries to sell growlers — large, reusable glass bottles that keep beer from going flat until they are opened. Which means you can't take a growler home from your favorite brewpub or find it at a grocery store. And the industry standard 64-ounce growler? It's illegal. Florida restricts growlers to a quart (32 ounces) or gallon (128 ounces).

So you can buy two quarts, in separate containers. Or a gallon, but that's a lot of beer that needs to be drunk quickly since it will soon go flat after opening.

The restrictions chafe Florida craft brewers, who would like to cash in on the growing popularity of growlers, which consumers can refill and, in some cases, collect.

The growler rules are just one example of the byzantine nature of Florida beer laws:

• Even the tiniest breweries must use middlemen to distribute their products, which increases the cost.

• Breweries can sell directly to customers only by claiming they are promoting tourism, the result of a loophole written for Busch Gardens when it was owned by Anheuser-Busch.

• Brewpubs can sell to patrons but cannot sell beer to go or even to a distributor for retail sale.

A sign behind the bar of the tasting room at Tampa's highly regarded Cigar City Brewing sums up the craft beer community's frustration with Florida's growler law:

"We sell growlers in two sizes: 32 oz. and 128 oz. The industry standard in most states is the 64 oz. (1/2 gallon) growler but Florida law has a wacky, nonsensical law that prohibits us from selling them. Ridiculous, isn't it?"

Florida's craft brewers would like to see many changes to beer sales regulations, hoping to lower costs and boost business. They would like Florida to be as beer-friendly as North Carolina, where Sierra Nevada plans to open its second brewery and where Asheville has so many breweries it promotes itself as a beer tourist destination.

But they are starting with the seemingly simple goal of legalizing 64-ounce growlers.

Before six-packs were common, most beer was consumed at bars. If you wanted to drink beer at home, you bought a growler, usually a small pail. "Rumor has it that when the beer sloshed around the pail," according to beeradvocate.com, "it created a rumbling sound as the CO2 escaped through the lid. Thus the term 'growler' was coined."

Growlers barely existed in Florida when Sen. Tom Lee changed the container law, and even a seemingly small change like allowing 64-ounce growlers stirs controversy. A bill aimed at doing just that was killed three years ago. The latest attempt is drawing a bit more support, proving again that making even small changes to beer laws is a big challenge.

It took Lee years as a state senator to change a Florida law that strictly regulated the size of beer containers.

For decades, packaged beer in Florida came in just three sizes — 12 ounces, 16 ounces or 32 ounces. That effectively kept Floridians from enjoying hundreds of imports, which come in metric sizes, and American craft beer in 22-ounce "bombers," or 750-milliliter bottles.

When the law changed in 2001, store shelves around the state could suddenly support a mind-boggling selection of beers from around the United States and the world.

"It's remarkable the explosion of craft beer that's taken place and where we'd be today without this law," Lee said recently.

But Lee's law had an unintended consequence: It allowed beer to be sold in any container size up to a quart, or a gallon or more — but not in between.

"The cap is for a reason you might expect," Lee said, "and that's moderation." Larger beer sizes, especially for high-alcohol beers, could lead to overconsumption and impaired drivers, Lee said.

But craft brewers say allowing gallon growlers undermines that argument. Since the beer will go flat soon after opening, a gallon growler actually encourages excessive drinking, they say.

"We really want to be able to get 64-ounce growlers," said lobbyist Josh Aubuchon. That would reduce costs, increase sales and create jobs, he says, though there are no firm numbers to support that.

Rise of the middleman

Florida's beer laws are rooted in Prohibition. When Prohibition ended its 13-year run in 1933, it was replaced by a patchwork of state and federal laws based on the so-called three-tier system: manufacturers, distributors and merchants.

The system was intended to prevent vertical integration, in which a single company controls all aspects of a product from manufacture to sale.

Florida brewers must use a distributor to get their product to consumers. So a keg of beer from Cigar City Brewing destined for a sports bar down the street must first go to a distributor's warehouse across town before getting to the bar.

Cutting out that middleman would likely mean cheaper beer for consumers. That would make beer drinkers happy, but critics say it could lead to increased consumption, raising public health and safety concerns.

The three-tier system was intended to moderate drinking by preventing brewers from owning bars and selling a lot of beer for very low prices. "That's what largely led to Prohibition,'' said Mitch Rubin, a lobbyist for the Florida Beer Wholesalers Association, an influential group of beer distributors. The system keeps beer prices higher — and keeps distributors in business.

Distributors jealously guard their special status and have allies in groups like Mothers Against Drunk Driving.

"It's not strictly about business," Rubin said. "It's a regulated industry with public health concerns."

That means a lobbyist for craft brewers like Aubochon must deal not only with a lobbyist for distributors like Rubin but advocates like Ellen Snelling of the Tampa Alcohol Coalition, which is concerned about underage drinking and impaired driving.

While she understands the frustration among craft beer enthusiasts, Snelling said she would be concerned about loosening Florida laws to allow large containers of high-alcohol beer that could quickly leave someone impaired.

Even Lee, who saw the change in state law in 2001 as "an opportunity for less government," advises caution before lifting the cap on containers. "There comes a point at which you can create a public safety issue," he said.

It can seem arbitrary. After all, three 12-ounce cans nearly equals one 40-ouncer. But "a lot of life is arbitrary," Rubin said, and a line has to be drawn somewhere. In his view, a quart growler seems sufficient. A gallon was never intended as a growler but as a small keg, he said.

Still, sometimes alcohol laws had aims other than public safety. The law Lee changed had been passed in 1965 as a way to punish Miller Brewing for building a plant in Georgia instead of Florida by effectively outlawing popular 7-ounce pony bottles, Lee said.

A thirst for tastings

Florida craft brewers would like to change other aspects of Florida beer laws, such as allowing more retailers to hold beer tastings — the rules allowing wine and spirits tastings are not the same for beer — and brewpubs to sell off site through distributors. But given the sensitivity to any change in alcohol regulations, Aubuchon is narrowing this battle to growler size and expanded beer tastings.

He fought this battle three years ago and lost, thanks partly to opposition from Rubin, who has renewed his opposition this year. Aubuchon is a little more optimistic this time, partly because the Beer Industry of Florida, another beer distributors lobby, seems willing to go along or at least not fight him.

"To their credit, they are starting to come around," he said. "They're good folks and they want to seek a compromise."

Eric Criss, a lobbyist for the Beer Industry of Florida, approaches the issue with characteristic caution. "We don't want to do things that will create a brouhaha in the public health community," he explained.

Still, his members distribute craft beer and want to do what they can to help. "We hope to be able to find some common ground," he said. "We love these guys. They're our suppliers."

Tom Scherberger can be reached at (727) 580-0890 or [email protected]

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