SF 2326

as introduced - 85th Legislature (2007 - 2008) Posted on 12/15/2009 12:00am

A bill for an act
relating to liquor; eliminating distinctions between brewpubs and other small
brewers in law; allowing brewpubs and other small brewers to make on-sales
and off-sales of their products and sell the products at wholesale; amending
Minnesota Statutes 2006, section 340A.301, subdivisions 1, 6, 7.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2006, section 340A.301, subdivision 1, is amended to
read:

Subdivision 1.

Licenses required.

No person may directly or indirectly manufacture
or sell at wholesale intoxicating liquor, or 3.2 percent malt liquor without obtaining an
appropriate license from the commissioner, except where otherwise provided in this
chapter. A manufacturer's license includes the right to import. new text begin Except as provided in
subdivision 7, paragraph (b), new text end a licensed brewer may sell the brewer's products at wholesale
only if the brewer has been issued a wholesaler's license. The commissioner shall issue
a wholesaler's license to a brewer only if (1) the commissioner determines that the
brewer was selling the brewer's own products at wholesale in Minnesota on January 1,
1991, or (2) the brewer has acquired a wholesaler's business or assets under subdivision
7a, paragraph (c) or (d). A licensed wholesaler of intoxicating malt liquor may sell 3.2
percent malt liquor at wholesale without an additional license.

Sec. 2.

Minnesota Statutes 2006, section 340A.301, subdivision 6, is amended to read:

Subd. 6.

Fees.

The annual fees for licenses under this section are as follows:

(a)	Manufacturers (except as provided in clauses (b) and (c))	$	30,000
	Duplicates	$	3,000
(b)	Manufacturers of wines of not more than 25 percent alcohol by volume	$	500
(c)	Brewers who manufacture more than 3,500 barrels of malt liquor in a year	$	4,000
(d)	Brewers who deleted text begin also hold one or more retail on-sale licenses and who deleted text end manufacture deleted text begin fewer than deleted text end 3,500 new text begin or fewer new text end barrels of malt liquor in a year deleted text begin , at any one licensed premises, the entire production of which is solely for consumption on tap on any licensed premises owned by the brewer, or for off-sale from those licensed premises as permitted in subdivision 7 deleted text end . A brewer licensed under this clause must obtain a separate license for each licensed premises where the brewer brews malt liquor. A brewer licensed under this clause may not be licensed as an importer under this chapter	$	500
(e)	Wholesalers (except as provided in clauses (f), (g), and (h))	$	15,000
	Duplicates	$	3,000
(f)	Wholesalers of wines of not more than 25 percent alcohol by volume	$	3,750
(g)	Wholesalers of intoxicating malt liquor	$	1,000
	Duplicates	$	25
(h)	Wholesalers of 3.2 percent malt liquor	$	10
deleted text begin (i) deleted text end	deleted text begin Brewers who manufacture fewer than 2,000 deleted text end deleted text begin barrels of malt liquor in a year deleted text end	deleted text begin $ deleted text end	deleted text begin 150 deleted text end
deleted text begin (j) deleted text end	deleted text begin Brewers who manufacture 2,000 to 3,500 barrels of malt liquor in a year deleted text end	deleted text begin $ deleted text end	deleted text begin 500 deleted text end

If a business licensed under this section is destroyed, or damaged to the extent that
it cannot be carried on, or if it ceases because of the death or illness of the licensee, the
commissioner may refund the license fee for the balance of the license period to the
licensee or to the licensee's estate.

Sec. 3.

Minnesota Statutes 2006, section 340A.301, subdivision 7, is amended to read:

Subd. 7.

Interest in other business.

(a) Except as provided in this subdivision,
a holder of a license as a manufacturer, brewer, importer, or wholesaler may not have
any ownership, in whole or in part, in a business holding a retail intoxicating liquor or
3.2 percent malt liquor license. The commissioner may not issue a license under this
section to a manufacturer, brewer, importer, or wholesaler if a retailer of intoxicating
liquor has a direct or indirect interest in the manufacturer, brewer, importer, or wholesaler.
A manufacturer or wholesaler of intoxicating liquor may use or have property rented
for retail intoxicating liquor sales only if the manufacturer or wholesaler has owned the
property continuously since November 1, 1933. A retailer of intoxicating liquor may not
use or have property rented for the manufacture or wholesaling of intoxicating liquor.

(b) A brewer licensed under subdivision 6, clause (d), may be issued an on-sale
intoxicating liquor or 3.2 percent malt liquor license by a municipality for a restaurant
operated in the place of manufacture. Notwithstanding section 340A.405, a brewer
deleted text begin who holds an on-sale license issued pursuant to this paragraph or a brewer who
manufactures fewer than 3,500 barrels of malt liquor in a year may, with the approval of
the commissioner, deleted text end new text begin licensed under subdivision 6, clause (d), may new text end be issued a license by a
municipality for off-sale of malt liquor produced and packaged on the licensed premises.
Off-sale of malt liquor shall be limited to the legal hours for off-sale at exclusive liquor
stores in the jurisdiction in which the brewer is located, and the malt liquor sold off-sale
must be removed from the premises before the applicable off-sale closing time at exclusive
liquor stores. deleted text begin The malt liquor shall be packaged in 64-ounce containers commonly known
as "growlers." The containers shall bear a twist-type closure, cork, stopper, or plug. At the
time of the sale, a paper or plastic adhesive band, strip, or sleeve shall be applied to the
container and extend over the top of the twist-type closure, cork, stopper, or plug forming
a seal that must be broken upon opening of the container. The adhesive band, strip, or
sleeve shall bear the name and address of the brewer. The containers shall be identified as
malt liquor, contain the name of the malt liquor, bear the name and address of the brewer
selling the malt liquor, and shall be considered intoxicating liquor unless the alcoholic
content is labeled as otherwise in accordance with the provisions of Minnesota Rules,
part 7515.1100. A brewer's total retail sales at on- or off-sale under this paragraph may
not exceed 3,500 barrels per year, provided that off-sales may not total more than 500
barrels. deleted text end new text begin A brewer licensed under subdivision 6, clause (d), may sell its own products at
wholesale without a wholesaler's license. new text end A brewer licensed under subdivision 6, clause
(d), may hold or have an interest in other retail on-sale licenses, but may not have an
ownership interest in whole or in part, or be an officer, director, agent, or employee of,
any other manufacturer, brewer, importer, or wholesaler, or be an affiliate thereof whether
the affiliation is corporate or by management, direction, or control. Notwithstanding
this prohibition, a brewer licensed under subdivision 6, clause (d), may be an affiliate
or subsidiary company of a brewer licensed in Minnesota or elsewhere if that brewer's
only manufacture of malt liquor is:

(i) manufacture licensed under subdivision 6, clause (d);

(ii) manufacture in another state for consumption exclusively in a restaurant located
in the place of manufacture; or

(iii) manufacture in another state for consumption primarily in a restaurant located
in or immediately adjacent to the place of manufacture if the brewer was licensed under
subdivision 6, clause (d), on January 1, 1995.

(c) Except as provided in subdivision 7a, no brewer as defined in subdivision 7a or
importer may have any interest, in whole or in part, directly or indirectly, in the license,
business, assets, or corporate stock of a licensed malt liquor wholesaler.