Beer update
Back last month, I wrote about the brewing battle over beer distribution laws. Short version: Guilford County's Red Oak is asking the General Assembly to raise to 60,000 barrels the amount of beer a brewer can distribute itself. Currently, if a brewer makes 20,000 barrels or more of beer, they have to sell through a distributor.
Beer distributors and even some alcohol control advocates have pushed back against that effort, saying that it would throw the three-tiered alcohol control system out of whack. Executives at Red Oak say they just want to be able to make sure their product gets to market in a proper manner.
Since that story ran, bills have been filed in the House and Senate to raise the self-distribution cap:
- * Greensboro Rep. Pricey Harrison is among the primary sponsors on H 1017. Rep. Maggie Jeffus of Greensboro has signed on as a co-sponsor. The bill has been assigned to the House ABC committee and then Commerce.
- * Sen. Katie Dorsett filed S 918, which has been referred to the Senate Commerce Committee.
As those bills were being filed (heck, as I was writing my story on the topic) Red Oak owner Bill Sherrill sent a letter to legislators advocating for his bill. In that letter, Sherrill took aim at the beer distributors, claiming that due to consolidation there were only two that served the Triad. And to support claims of big money in the beer distribution business, he said Greensboro-based R.H. Barringer paid $100 million to buy another distributor.
The Beer wholesalers fired back a letter of their own, asking Sherrill to retract his claims and, essentially, saying he was full of you-know-what.
You can download a PDF with that exchange by clicking right here. (It's a PDF. The packet was distributed by the wholesalers and is worth the read if only to appreciate the fine art of how lobbyists knock down legislation they don't like.)
When I had occasion to ask Sherrill about how he got the $100 million, he didn't produce any documents but said he had asked Barringer CEO Mark Craig about the purchase.
Did he get an answer? I asked.
Not really. "He just kind of smiled at me," Sherrill said.
So since the battle is joined down here at the legislature, it's fair to ask if the bills are going anywhere. My guess is the Senate Commerce Committee will have other fish to fry unless the bill crosses over from the House.
In the House, the ABC Committee will be a tough test. They'll hear from interests that they have seen fight some pretty fierce battles (brewers and distributors versus the Christian Action League and other control advocates) line up against the same bill. That sort of unified front usually gets a committee's attention and makes the job of the people pushing the bill that much harder.
Also worth noting: Greensboro Sen. Don Vaughan did not sign on to the bills, nor did Greensboro Reps. Earl Jones or Alma Adams. However, you will see some names from out in the western part of the state (where they have some pretty good microbrewers) as well as some Alamance County honorables. Although Red Oak started as a brew pub in Greensboro, its new factory is out toward the Guilford-Alamance line. I've had at least one member of the Guilford delegation express some parochial reserve about the brewery limit bill because Barringer is located in the city and Red Oak is almost in the next county over. (Essentially, they want to support the position of the business that still the home town business rather than one that could be drawing on Burlington's water supply.)
Comments (3)
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Just how much did R.H. Barringer pay for American Premium Beverage?
Can they also prove this as well in letter"Red Oak seeks passage of this legislation so that it can obtain a more
favorable loan to construct a development that includes an ice cream parlor, a bank and an inn - businesses that have
nothing to do with our industry."
Has this been proven as fact?
Also this was said, "1. That the Triad has two large beer dishibutors; whereas, in point. of fact,
there are six.
If there are six please name them and the percentage of market share each distributor has in the triad market.
I am very intriqued with this battle but side with Red Oak on letting them distribute as much as they want to under their own distribution terms and agreements.
Hope it passesfor more barrels for Red Oak
Posted on April 14, 2009 5:15 PM
With regard to Red Oak wanting the distribution cap raised to help subsidize their "Red Oak Village," yes, they've said as much. They've also said that they are about to install a bottling line so their production is about to shoot up.
Posted on April 14, 2009 5:19 PM
Thanks Mark, it would be interesting to see if the Red Oak lawyer will send back a rebuttal letter as to what they want Bill Sherrill to do in his letter to Red Oak.
Posted on April 14, 2009 6:46 PM