ST. PAUL, Minn. (FOX 9) - The Minnesota House on Wednesday approved what would be the biggest changes in the state's liquor laws since Sunday alcohol sales became legal five years ago.
The measure, which passed 85-48, allows smaller brewers to sell six-packs and lets distillers open taprooms that sell larger bottles. Large brewers could sell 64-ounce growlers. Under current law, taproom sales are significantly limited once beer production reaches a cap.
"This bill gives them a lot more flexibility that I think will enable them to grow and thrive, and I’m really excited about that," said state Rep. Zack Stephenson, DFL-Coon Rapids and the bill's author.
The legislation is the result of an agreement between producers, distributors, and retailers - known as the three-tier system - that settles a years-long dispute between the industry players. Lawmakers had refused to get involved until the industry sorted itself out. But even now, key Senators have been noncommittal about whether that chamber will approve the legislation.
"Those conversations are ongoing," Senate Majority Leader Jeremy Miller, R-Winona, told reporters Tuesday. "There might be some opportunity there to find some common ground."
The Senate's next step is unclear once the bill comes back over from the House. The Senate could pass it, approve a different version and trigger a conference committee with the House, or send the bill to committee where it would likely sit until the session ends May 23.
Lifting the growler cap
Craft brewers, who have been the loudest voices for changes within the industry over the past several years, said the Legislature needs to act this session. Most other states have more friendly liquor laws, they said.
"I think there's a very good chance this year. It's looking better than it ever has," Dan Schwarz, chief executive of Lift Bridge Brewing in Stillwater, said in an interview.
Lift Bridge was nearing the state's production cap of 20,000 barrels in 2019. The next year, the COVID-19 pandemic hit, delaying Lift Bridge from hitting the cap and being prohibited from selling growlers and large cans known as crowlers in its tap room. But business has rebounded, and the 20,000 mark is in sight again.
Growlers and crowlers allow the brewery to test market new beers on its taproom customers before rolling them out to the retail market, Schwarz said.
Who's left out?
One group is unhappy about being left out of the deal: grocers and convenience stores. State law only allows them to sell low alcohol content beer of 3.2 percent by weight and 4 percent by volume.
Minnesota is the only state in the country with such a restriction. Convenience store owners have said they're finding it more difficult to stock low-alcohol beer because fewer producers are making it.
"This all used to be full of beer," said Steve Anderson, founder of Bobby and Steve's Auto World, pointing at the mostly empty beer cooler in his Bloomington store, which he's now filling with packs of soda. "That's a terrible selection, isn't it? Selection means you have choices, and we don't have any choices left on 3.2 beer anymore."
As for getting left out of the industry agreement - which is dubbed "peace in the valley" by supporters - Anderson said, "It's a really bad name because it's not really peace."
The House legislation would create a 12-member industry council to broker future agreements among the three tiers.
Grocers and convenience stores would play a minimal role on the industry council, getting only a single vote. Four members apiece would come from retailers, wholesalers, and manufacturers.
The system would allow lawmakers to stay out of refereeing industry disputes. It would set up a more formal process than the behind-the-scenes talks that led to the current legislative debate.
"People are tired of waiting," Stephenson said. "It's time to do something on this issue. We found the compromise, we did the hard work. It's time for it to happen."