Saturday, December 7, 2013

Montana Proposes To Separate Makers From Fakers, At Least In The Distillery's Sample Room

To start a distillery, micro or macro, you need a license from the federal government. You also need one from the state in which your distillery will be located. As they do with regard to all things alcohol, the laws vary widely from state to state. States may not be the 'laboratories of democracy' that some envision, but they are the laboratories of alcohol regulation, because there is much variety and anyone who cares to look can see what works and what doesn't.

Under Montana's distillery licensing laws, craft distillers may have a sample room, give free sample tastes, and sell their products directly to the public. This is believed to be essential if you want your state's microdistilleries to prosper. One Montana micro-distillery reported that such sales represented half of their revenue in their first year.

Although Montana's micro-distilleries can sell their own products to the public, they can't sell Bud Light. The law says they may only sell alcoholic beverage that they themselves produced on site. But the current Montana law, enacted in 2005, doesn't define 'produced.' Conveniently, the relevant federal rules do and they say you 'produce' a product even if you merely bottle it. Under that interpretation, a Montana micro-distillery could bring in any type of alcoholic beverage in bulk, bottle it at the distillery, and sell it in the sample room.

As part of a major updating of the 2005 rules, Montana now proposes to restrict sample room sales to products distilled on the premises. So there can be no doubt, the new text even defines distillation as "the process of vaporization and subsequent condensation of a beverage containing ethyl alcohol."

The new rules would still allow micro-distillers to be micro-rectifiers too, but they would not be able to sell their made-elsewhere products at the distillery.


merd said...

Haven't been out to visit Anchor in CA... but do the get to allow sampling and selling of both spirits and beer they make? Wondering how that works recognizing that it is a different state from Montana..

Unknown said...

How would the Montana law treat redistillers like A. Smith Bowman?

Chuck Cowdery said...

I don't know about California but I suspect the law is liberal, because of the state's winery experience. Bowman would probably be okay, since they do distill. There is nothing in the law about 'grain to glass.'

Anonymous said...

Chuck, Indiana just passed a craft distillers law. The on site sales portion requires that at least 60% of the distillate in the bottle be distilled on site. So they can blend but most of the blend has to be made in house to sell on premise.

Unknown said...

Sounds like someone is targeting Neversweat.