Virginia Retailers Could Be Required to Keep NA Beverages and Alcoholic Versions Separate
Virginia state lawmakers are considering a pair of bills that would require retailers to keep alcoholic versions of non-alcoholic beverages, such as Hard MTN Dew, Fresca Mixed, Simply Spiked and Topo Chico Hard Seltzer, separate from their counterparts, according to Pluribus News.
The proposed legislation (S.B. 809 and H.B 1979) would prevent stores from placing non-alc and alcoholic products that share similar names, branding, logos, and packaging from being placed “immediately adjacent” to one another, and alcoholic products placed outside of the beer, wine and liquor sections of stores would need to be accompanied by special signage, Pluribus News reported.
“The intent is to make sure that consumers completely understand that the yellow can that has alcohol in it is labeled and the yellow can that does not have alcohol in it that might look similar is apart from that that has the alcohol in it,” bill sponsor state Sen. Barbara Favola told Pluribus.
The legislation is a byproduct of major soft drink and energy drink makers such as Coca-Cola, PepsiCo and Monster licensing or producing alcoholic versions of popular brands.
Supporters of the legislation include Anheuser-Busch InBev, Molson Coors and the Virginia Beer Wholesalers Association. The National Beer Wholesalers Association has been critical of how products such as Hard MTN Dew are merchandised outside of the liquor aisle in some stores.
Grocery store advocacy group the Virginia Food Industry Association has pushed back on the signage requirement, calling ID checks at checkout the best way to stop children from purchasing these offerings. However, supporters have argued that the products have created consumer confusion.
‘Beer to You’ DTC Bills Filed in Texas
Companion bills were introduced in the Texas Legislature this week that would allow direct-to-consumer (DTC) delivery and shipping from Lone Star State breweries and brewpubs.
Texas state Sen. Pete Flores and state Rep. Shelby Slawson filed S.B. 752 and H.B. 2003 in their respective chambers under the moniker “Beer to You,” giving a nod to the successful “Beer to Go” campaign in 2019 that legalized take-home sales from breweries.
Texas breweries and brewpubs are prohibited from taking part in home delivery, shipping and working with third-party delivery providers (DoorDash, Grubhub, etc.), the Texas Craft Brewers Guild said in a press release. The guild added that the bills aim to “level the playing field” with the state’s wineries, grocery stores, liquor stores and restaurants, which enjoy DTC privileges.
“With Beer To You, the Texas Legislature has an opportunity to support the growth of beer tourism in Texas as brewery visitors send products home, join beer clubs, and support their favorite small beverage producers regardless of proximity,” Texas Craft Brewers Guild executive director Caroline Wallace said in the release.
“In an era where consumers can have virtually anything delivered to them with a swipe of a finger, convenience is paramount in the retail market and your license type shouldn’t be the barrier between your product and the customers that want it,” Jon Lamb, Red Horn Coffee House and Brewing Co. owner and Texas guild government affairs chair, said in the release. “Unfortunately, that’s how the current laws in Texas are written. You can have wine shipped directly to your doorstep from a Texas winery, a 6-pack of beer added to your grocery delivery, or a margarita added to your taco and queso order. It’s time to end the prohibition on breweries and brewpubs reaching their customers in this same way.”
Wallace recently discussed DTC sales on the Brewbound Podcast. Follow the link to listen.
Illinois Senate Introduces DTC Bill and Omnibus Package with Expanded Privileges
Illinois craft breweries could be one step closer to gaining DTC shipping privileges as part of a pair of bills that were introduced today in the state Senate.
Senate Bill 2193 proposes the creation of a brewer shipper’s license similar to the license offered to Illinois winemakers, which has been in effect since 2007. Brewers holding the license would be allowed to ship to LDA consumers in both Illinois and other states where the practice is legal using carriers such as UPS, FedEx and DHL.
“Our 2023 legislative agenda is one of the most progressive and forward-thinking in the nation,” Illinois Craft Brewers Guild executive director Ray Stout said in a press release. “Direct-to-consumer shipping is a big part of that, and we very much believe it’s a fight worth having. There’s no denying that existing alcohol regulations have left the state’s 297 craft breweries behind during tremendously challenging times.”
The Beer Omnibus Bill (Senate Bill 2216) “seeks to formalize and clarify a handful of consumer engagement programs while simultaneously making it easier for Illinois breweries to operate, modernize, and grow,” according to the release. It would legalize reward programs and mug clubs, as well as donations of product to non-profit organizations for events and fundraisers. Both are currently practiced, but state law “is unclear” and lacks “definitive guidance” for breweries, the release said.
The bill would also repeal an initiative established in 2021 that requires breweries to report water requirements to ensure production volume remained within the limits of their licenses, which “has proven cumbersome and ineffective,” according to the guild.
Also included are provisions to expand Class 3 breweries’ ability to sell beer at farmers’ markets and community festivals, allow Class 3 breweries to self-distribute up to 2,500 barrels, and allow Class 2 breweries to transfer up to 4,500 barrels between owned locations annually.
“We’re prepared to work with all legislators and industry stakeholders to ensure parity within the industry and to make sure our brewers have the resources to compete and win in this economy,” Stout said.
Arizona House Introduces Bill to Reduce Spirits-Based RTD Tax
Arizona legislators introduced a bill into the state’s House of Representatives this week, which would cut the state’s excise tax on spirits-based ready-to-drink cocktails (RTDs) more than in half.
H.B. 2769 would separate RTDs from spirits, which are taxed at $3 per gallon, and reduce the RTD tax rate to $1.25 per gallon.
The bill defines RTDs as “distilled spirits mixed with other beverages that may contain flavoring or coloring materials and other ingredients, that do not exceed 12% alcohol by volume, that are sealed in an original container of not more than 24 oz. and that are sold in the manufacturer’s original packaging.”
The rate is still significantly above the state’s excise tax on beer, including malt-based RTDs, which is $0.16 per gallon. Wine is taxed at $0.84 per gallon.
The Distilled Spirits Council of the United States (DISCUS) celebrated the bill that would “modernize Arizona’s tax laws” and “provide fairer treatment” for spirits-based RTDs.
“Despite growing consumer demand for spirits RTDs, our research shows that unequal tax rates have posed a significant hurdle for craft distillers looking to enter the market,” Adam Smith, DISCUS VP of state government relations, said in a press release. “H.B. 2769 would lift the burden of unfairly high taxes, allowing a growing local industry to continue to flourish.”
The lower tax rate “could also generate as much as $25 million” in additional tax revenue for Arizona, “because lowering the tax rate will result in more sales, generating more tax revenue and more economic activity,” DISCUS claimed in the release.
Utah Liquor Bill Would Add Bar Licenses
Utah’s annual liquor omnibus bill (S.B. 173) would increase the number of bar licenses by around 40, according to the Salt Lake Tribune. The state caps the number of bar licenses by population, at one license for every 10,200 residents. The legislation would exempt bars operated by fraternal groups and country clubs from the quota, opening up additional licenses.
The legislation would also allow consumers to carry their own drink from a bar to their table. Existing Utah law requires waitstaff to transport drinks from the bar to customers.
Wyoming ‘Beer Freedom Act’ Not Considered For Introduction
Less than a week after a Wyoming lawmaker introduced the “Beer Freedom Act,” which would repeal the state’s excise tax on malt beverages, the House of Representatives did not take up the bill under consideration for introduction.
The Beer Freedom Act would have eliminated the one-half cent ($.005) per liter excise tax on malt beverages. Wyoming collected $257,055 in excise taxes on malt beverages in fiscal year 2022, according to a fiscal note attached to the bill. Estimates by the state Department of Revenue’s Liquor Division suggested the state would have lost $256,284 in FY 2024, $255,900 in FY 2025, and $255,516 in FY 2026.