The California Craft Brewers Association (CCBA) has sponsored two bills this legislative session: one that would allow members to produce cider and perry with existing licenses, and another that would restore transparency in beer production data reporting.
CCBA executive director Lori Ajax and lobbyist Chris Walker highlighted the organization’s legislative priorities for the new session and reviewed wins from the previous one with members during the guild’s California Craft Beer Summit, its first since 2019, in Sacramento last week.
“We do enjoy some of the best craft beer laws that you would find right here in California,” Ajax said to kick off the seminar. “It can seem frustrating and complicated – talk about tied house [laws] and people want to run for the door. But for the most part, tied house is the reason that the craft brew industry is successful, really having a level playing field so that you can compete with the big guys, because they aren’t allowed to do big giveaways.
“They have huge marketing budgets, but they can’t use them because they have the same restrictions as you when it comes to pay-to-play,” she continued.’’
For 2023, the CCBA has sponsored Senate Bill 388, which is slated to be read April 12. The “noncontroversial” bill “would make data and production numbers more transparent” after a 2019 measure anonymized production data in favor of privacy, Walker said. Previously, data was used by breweries, trade organizations and trade media, he added.
“In 2019 the state government adopted wholesale across multiple agencies very, very rigorous privacy protections, and what they did is they anonymized the information,” he said. “All of a sudden that data that was apples-to-apples, year-to-year went from apples to bananas. We didn’t have anything.”
The state Legislature passed a similar bill put forward by the wine industry last year without “a single no vote against it,” Walker said.
CCBA has also sponsored S.B. 788, which would extend cider- and perry-making privileges to smaller breweries. Anheuser-Busch InBev sponsored a similar law in 2015 that only applied to breweries producing more than 60,000 barrels of beer per year. S.B. 788, which is slated for a hearing on March 28, would remove that cap.
“The distinction that’s important is it just has to do with the production,” Walker said. “Your other privileges that you’re used to with beer – whether it’s selling directly to the consumer, or tasting in your brewery – you will not be able to do that with cider [or] perry. You have to produce and then sell directly to a distributor. That’s something we could talk about changing in the future, but we were just simply trying to streamline the existing law.”
The state Senate is also considering S.B. 277, which would allow off-premise retailers licensed for beer and wine to sell spirits-based, ready-to-drink (RTD) canned cocktails under 10% ABV. Similar bills have been introduced in other states to expand market access for spirits-based RTDs with mixed results. They are often met with pushback from beer industry trade groups, and this bill is no exception, as the CCBA “is not a big fan of it,” Walker said.
“This opens up a can of worms – you’re crossing product categories into different licenses,” he said. “You’re also establishing in statute for the first time ABV as part of a threshold for policy. I think that’s fraught with danger on all sorts of different levels. And I don’t think it’s favored by anybody but its sponsor, and sponsor is of course the Distilled Spirits Council of the United States.”
S.B. 277 was referred to the Senate Governmental Organization Committee in early February, but has yet to advance.
This year is a transitional one for Golden State government. In the 2023-2024 Legislature, 32 of the 120 members are newly elected, a “substantial changeover,” Walker said.
“That’s a 25% change of new faces, new people, people that are brand new to Sacramento that don’t know any of the issues, much less the craft beer world,” he said. “We’re losing a lot of institutional memory. We’re losing a lot of friends that understood your business, understood the industry and helped us. We lost a couple, maybe, that didn’t, so it’s both good and bad. But it presents an opportunity to take advantage of.”
Leaders of 40 breweries visited the Capitol last Monday before the summit officially kicked off to speak with representatives and their staff. Ajax encouraged attendees to continue building relationships with their assembly people and senators, regardless of party affiliation. She suggested private brewery tours for representatives and staffers for breweries who are concerned about being seen as supporting one party over another, or who are uncomfortable discussing legislation.
“You don’t need to push anything on them,” she said. “Just talk about you. Your story is our secret power.”