Few back bill altering beer sales

February 25, 1991|By Jon Morgan | Jon Morgan,Evening Sun Staff

A small Baltimore brewer is raising a froth with the state's beverage wholesalers by seeking permission to sell his beer directly to other pubs.

The Baltimore Brewing Co., which brews beer and sells it at a tavern/restaurant at 104 Albemarle St., is seeking a change in the state's liquor laws to allow it to act as its own wholesaler. Brewmaster Theo de Groen said he wants to be able to sell kegs to other taverns but cannot do so through a wholesaler because the mark-up would drive the price too high.

Opponents, chiefly the Maryland Beverage Wholesalers Association, say the bill would change long-standing rules that were established to protect consumers and law enforcement interests.

"The system was set up years ago and has a balance to it and as soon as you begin to alter that balance you can end up hurting the consumer," said George N. Manis, a lobbyist representing the Wholesalers Association.

William R. Pyle, director of the Alcohol & Tobacco Tax Division of the comptroller's office, also opposes the bill, saying it would set a bad precedent.

"We think it's going to open the door to allow any brewer to set up a retail operation," Pyle said. Maryland law generally separates the brewing, wholesaling and retailing of beers.

But de Groen said the existing restrictions are aimed at high-volume brewers who could influence prices. The 20,000 keg-a-year limit in his license prevents that, he said.

"This is not a grand-scale operation. This is a 'give me a break as a small businessman,' " de Groen said. "I don't see this as giving them [wholesalers] a hard time."

Maryland laws recognize three classes of brewers:

* Brewers that can make as much beer as they want but cannot retail it themselves. Holders of these licenses include G. Heileman's plant in Halethorpe, British Brewing Co. in Glen Burnie and Wild Goose on the Eastern Shore. These brewers can act as their own wholesalers, but the comptroller's office frowns on it and only British Brewing does it.

* Pub breweries that can brew only up to 4,000 kegs for sale through a restaurant or pub and limited "to go" sales. Sisson's in Federal Hill has one of these.

* Micro brewery, a classification created when Baltimore was trying to lure a brewer to the Power Plant entertainment complex in the Inner Harbor. Baltimore Brewing Co. is the only holder of this license.

Steven M. Lebowitz, a lobbyist hired by de Groen, said the brewery faces an uphill struggle against "one of the most powerful" special interests in Annapolis: the wholesalers.

Hearings and votes have already been delayed while he tries to round up support. The effort suffered a setback last week when the city's Senate delegation weakened the bill by amending it to allow limited "to go" sales -- such as those now permitted at Sisson's -- but prohibit de Groen from acting as his own wholesaler.

On bills that are of purely local interest, the General Assembly generally heeds the recommendations of local delegations.

"I didn't have the votes. You have to know when to hold up and when to fold," said Sen. Larry Young, D-City, sponsor of the bill. He said the wholesalers "came after it and did a hard job."

Sen. American Joe Miedusiewski, D-City, said "If you want to be a brewery, be a brewery. If you want to be a restaurant, be a restaurant."

Lebowitz intends to pursue his case in the House of Delegates, where a hearing is scheduled for March 14 before the Economic Matters Committee. The House is considering the original version of the bill, sponsored by Delegates Ruth M. Kirk, John D. Jefferies, Elijah E. Cummings, Hattie N. Harrison -- all Democrats from the city.

If the House approves the bill, it could come back to the Senate delegation for reconsideration. But Young said he is not optimistic, even though he had four of the five votes he needed.

Lebowitz said "I think they [the wholesalers] are flexing their muscles without looking at what the impact will be."

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