Gov. Mark Dayton wasted no time in approving the omnibus liquor bill, signing it just days after it was passed by the Legislature.
And while the bill didn’t contain the all-talk, no-action liquor store section, which would have allowed the stores to be open on Sundays, it did contain a couple of items from the same wish list. Craft breweries that are already licensed to sell growlers for off-premises consumption will be permitted to sell the same products on Sundays. And the small-but-growing list of craft distilleries got the go-ahead to sell their customers bottles of their goods on the way out the door.
Yet two questions remain: how and when?
As in, how will cities process the changes to local ordinances to allow for Sunday growler sales and off-sale of craft spirits; and when will customers be able to take advantage of the new options? The answer to the first question will determine the answer to the second.
Growler sales: coming soon
Sunday growler sales seems an easier process. The statute says local jurisdictions have the option of approving Sunday sales as well as establishing hours of sales. It appears a city or county could do so with a single ordinance authorizing any brewery with an existing off-sale license to expand to Sundays.
In Minneapolis, Council Member Kevin Reich served official notice Friday that he would introduce an ordinance in two weeks authorizing Sunday sales, which will then go to the Community Development and Regulatory Services Committee. A public hearing is set for May 19, and full council action could take place as early as June 5. Any ordinance would take effect after being signed by the mayor and published in the city’s legal notices.
Reich said his 1st Ward, in Northeast Minneapolis, has 10 small brewers and distillers, a number he expects to grow. He said he wants the city to move quickly so that “people can make preparations with confidence.”
In St. Paul, Council President Russ Stark said that he is working with city regulators and expects to have an ordinance ready soon but did not yet have a more-precise date.
Will Dhonau, the taproom manager at LynLake Brewery in Minneapolis, said word has already gotten out among customers.
“We had people asking about it Sunday. They said, ‘Hey, can we get a growler?’ and we had to say, not quite yet,” Dhonau said. LynLake is only six months old and hasn’t built its growlers sales to where they want it to be. They sell 50 to 100 a week while places like Town Hall Brewery on the West Bank sell around 1,000. And Dangerous Man in Northeast Minneapolis is expanding partly to accommodate more growler sales. Still, Dhonau described the brewery’s founders as “ecstatic.”
Off-sales at distilleries more complicated
The language allowing off-sales at craft distilleries is a bit different. It too gives local jurisdictions the discretion to allow it or not. But it also says that those jurisdictions that decide to allow such sales must issue licenses. This is an extension of a provision in last year’s liquor bill to let craft distilleries create cocktail rooms similar to taprooms. Only a handful of such licenses exist in the state. Vikre in Duluth was the first to open a cocktail room followed by Du Nord in Minneapolis in January. The cocktail room at the Eleven Wells distillery in St. Paul’s historic Hamm’s Brewery complex is expected to open in late spring or early summer.
It appears that the distillers that have already opened a cocktail room will have to get an additional license for off-sale. Those who haven’t opened a cocktail room or simply want to sell bottles to people who come in for a tour will likely be able to apply for all required local licenses at the same time.
While the new law gives distilleries something they have wanted — the ability to sell to customers who visit — the statute also limits what they can sell. First, the statute says a distillery can sell “one 375 milliliter bottle per customer per day of product manufactured on-site.” That’s a smaller bottle than all but one state craft distillery uses — closer to a pint bottle than a fifth.
Distilleries will also not be allowed to have off-sales on Sunday. The new law also has a provision that would prevent distilleries from selling products that are not also available to distributors and retailers.
Bob McManus, the founder and president of Eleven Wells, said the language in the bill was a compromise, but one that got “jammed down our throats.”
“It’s an inconvenience from what customers want. It’s an anti-competitive provision by the liquor lobby to keep their position,” McManus said. “It’s something, but it’s a baby step.”
The new law does two things positive for the fledgling craft distillery industry: it gives a customer who visits a distillery the ability to take a bottle home, and its helps distillers make a little extra money. Currently, they can sell only through the traditional distribution and retailing outlets. Selling some of their products without sharing profits with distributors and retailers helps with cash flow and profitability.
Bill also bans powdered alcohol
For both growler sales and off-sales at craft distilleries, the hours of sale can be no-longer than the hours allowed for existing liquor stores.
The omnibus liquor bill — Senate File 1238 — also contains another provision that received some coverage during the session. It bans the sale of powdered alcohol until at least June 1, 2016 and directs the Division of Alcohol and Gambling Enforcement and the Commissioner of Health to report to the Legislature by years end on whether current laws are adequate to regulate the product and what the health impacts would be. Both are asked to recommend law changes for the 2016 legislative session.
Correction: The original version of this article misstated the expected dates of the public hearing and final council action. They are May 19 and June 5.