The Rally for Texas Beer Freedom at San Antonio’s Main Plaza last week was no Boston Tea Party, but it did have a revolutionary implication.
Instead of dumping beverages into a harbor, craft beer lovers and curious onlookers lined up for free samples of local brews and paid for some Texas microbrewery favorites. The most striking difference though is that the brewpubs are begging their representation for taxation through House Bill 660, the reason for the rally. All they ask in return is that they be allowed the opportunity to have brewpub-made beers distributed outside the confines of their establishments for greater revenue.
Rep. Mike Villarreal of San Antonio says the current law is anticompetitive because brewpubs in states with more progressive laws can also function as microbreweries. That means they can find distributors in Texas to sell their beer in, say, a downtown San Antonio hotel restaurant or bar where a tourist might be better served with a local brew.
“This is going to be a fight between the little guy and the big corporate interests that don’t want them to sell their beer,” Villarreal told about 300 people assembled at the rally. “We have to take the energy here today and take this to Austin.”
Scott Metzger, an economist and owner of Freetail Brewing Co. (which would benefit greatly from passage of the bill), said the Texas wine industry grew to $1.35 billion a year in revenue and now employs about 9,000 people thanks to a tweak in the law that allowed winery visitors to buy a bottle or two to take home.
The champion of that bill, the late San Antonio Senator Frank Madla, spent five sessions and 10 years working to get it through a resistant legislature.
With state budget shortfalls compromising education funding, proponents of HB 660 think the promise of $57 million a year in new tax revenue and new jobs will get it passed on the first go-round. It was an economic argument that got legalized gambling in the form of Texas Lotto passed.
There are two wholesale beer distributor associates opposing the proposal. The larger of the two groups has apparently agreed to support the bill if the language allowing for self-distribution by brewpubs up to 10,000 barrels is removed.
That means brewpubs like Blue Star and Freetail would have to hire a distributor to sell a single keg off premises. On one hand, this is a major problem because big distributors won’t chance an unproven brand. On the other hand, this could create additional small businesses in the form of distributors who specialize in brewpub beers.
There is, however, an unintended consequence to the compromise. You can read more about it on the Bottle & Tap blog at blogs.sacurrent.com.
Travis E. Poling writes about beer weekly for the Current and is author of Beer Across Texas: A Guide to Brews and Brewmasters of the Lone Star State. You can reach him at [email protected]