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Current state law severely restricts the options brewers have to distribute their beer. Only breweries that produce less than 50,000 barrels of beer per year are allowed to sell their beer directly to retailers. All others must contract with wholesalers for distribution.
Worried that perhaps microbrewers were operating in too free a market, legislative Republicans have proposed even more restrictions on the beer distribution business. Although the motion approved by JFC will now allow microbrewers to distribute their own beer to retailers, but it will forbid them from holding wholesalers licenses, which, as some articles have indicated, means microbrewers will not be able to band together to distribute beer.*
And what would Walker-era legislation be if it didn't offer more power to state government? The legislation also takes the power of licensing of wholesalers away from municipalities and puts them under the control of the state Department of Revenue.
Brandon Scholz, president of the Wisconsin Grocers Association, says the legislation is a needed protection against large companies like Anheuser-Busch from buying up distributors that they would use to only distribute their own beer.
However, he argued, beer companies that take over the distribution business will have no incentive, however, to sell microbrews to retailers.
If the intent of this bill is really to protect Wisconsin retailers from big, bad Busch, then why not just prohibit large brewers from buying distributors? Instead, even microbreweries whose entire distribution might amount to a few truckloads of beer are dependent on large wholesalers buying and selling their product.
But why forbid brewers from operating pubs and restaurants? In fact, the legislation specifies that brewers can operate no more than two restaurants, and that any others it has an interest in may not get more than 60 percent of its revenue from alcohol, and that the restaurant may not sell any of that brewer's beer.
It seems a rather blatant attempt to appease the Tavern League, which supported the legislation, and hopes that brewpubs don't threaten their businesses.