Malloy's proposals - Feb 28 Hearing

The hearing will cover the proposed bills listed below (and more). Please take a moment to skim through them, you may be surprised by some of it.

H.B. No. 5021 AN ACT CONCERNING COMPETITIVE ALCOHOLIC LIQUOR PRICING AND HOURS OF OPERATION FOR PERMITTEES.

To implement the Governor's budget recommendations.

http://www.cga.ct.gov/2012/TOB/H/2012HB-05021-R00-HB.htm

H.B. No. 5055 AN ACT AUTHORIZING THE RETAIL SALE OF SEALED BOTTLES OR CONTAINERS OF BEER BY BREW PUBS ON SUNDAY.

To permit the retail sale of sealed bottles or containers of beer by brew pubs on Sunday.

http://www.cga.ct.gov/2012/TOB/H/2012HB-05055-R00-HB.htm

S.B. No. 72 AN ACT ALLOWING A MANUFACTURER PERMIT FOR BEER PERMITTEE TO SELL AND SERVE FOOD.

http://www.cga.ct.gov/2012/TOB/S/2012SB-00072-R00-SB.htm

To authorize a manufacturer permit for beer permittee to serve and sell food on the permit premises and to allow such permittee to also hold a restaurant permit.

I want to call attention to the first proposal, Section 12, Subsection B.

This is our concern regarding pay to play. The way it is worded sounds like if we give a rebate to a wholesaler, they HAVE to pass on the savings. Which I think mitigates some of our concerns. If they don't sell at a discount because of the allowance, they don't get the allowance.

So I think what it does is it allows us to push aging product sitting in the wholesaler's warehouse by eating some of the revenue. Which isn't ideal of course, but it allows us to incentivize retailers to buy product at a lower price if we have to get it moving. Which I suppose is a better alternative than letting it get old or buying it back or throwing it out and not getting anything for it which may be the current situation.

In section 19, subsection B deals with selling below cost. The way it is worded essentially indicates it is only permitted for discontinuing a brand/size or closing out inventory. It is not for general practice. So that's good too.

As for the medallion scheme in Section 18, I think this still poses a real problem for craft brewers. I think the medallion scheme will effectively prevent in the future many potential small, locally-owned boutique wine shops from opening up in Connecticut because of the cost and difficulty of obtaining one of these medallions. As craft brewers, we then we lose part of the potential for growth in our retailer base over time as big box stores gobble up medallions from mom and pop shops. We need as many retailers as possible and especially as many small, specialized high-end retailers as possible who thrive on new products, seasonal products, limited edition stuff, etc. The medallion scheme definitely prevents growth in the specialized retail segment and I would argue, encourages its decay.

Section 18 also provides no mechanism for the state to issue more medallions if it needs to. This is another big problem. The state is basically saying there are as many package store permits in the state as there will ever be. How does that create jobs or help consumers? A lot of beer is sold in package stores and I think we need to fight to keep Connecticut free from the kind of limitations that the medallion scheme will impose.

In the second proposal, I would also like to fight for including package breweries in the off-premise Sunday exemption that is being proposed for brew pubs. Farm wineries can retail on Sundays, it is only fair that Connecticut breweries be allowed to as well for all the same reasons.

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