‘Stone Bill’ Passes South Carolina Conference Committee

With South Carolina one step closer to the passage of its so-called “Stone Bill,” the Palmetto State appears to be in leading position to land Stone Brewing’s new East Coast facility.

This afternoon, a conference committee made up of six South Carolina lawmakers voted unanimously in favor of the bill — known in the Senate as S. 1230 and in the House as H. 3512 — which was inspired by Stone Brewing Co., the Escondido, Calif.-based brewery looking to invest upwards of $30 million to build a new facility on the East Coast, creating up to 400 jobs in the process.

The bill, as amended, will allow brewpubs to apply for a brewery license as a means of producing an unlimited number of barrels per year, up from the the state’s current production limit of 2,000 barrels for breweries that also serve food. An earlier version of the bill sought to increase the brewpub production limit to 500,000 barrels.

The “Stone Bill” will now head to South Carolina House and Senate floors for a vote before it can be passed along and signed into law by Gov. Nikki Haley.

After the conference committee voted to pass the amended bill, reports began circulating on Twitter that State Senator Luke Rankin (R), one of the six committee members, had referred to Stone as a “steady girlfriend,” and that the bill’s passage all but secured South Carolina as the spot Stone would build its second brewery.

Nevertheless, Stone Brewing denies that it has made a decision on where it will build its East Coast facility. The country’s tenth largest craft brewery issued the following statement to Brewbound after the conference committee passed the amended bill:

“We have not made a decision as to where our East Coast brewery will be located. While we applaud the legislation in South Carolina and any like it, this necessary element is but one of many factored into our decision making laid out in our request for proposal.”

Stone has outlined its plans to build a World Bistro & Beer Garden Restaurant, which would have been illegal under current South Carolina law that prohibits brewpubs from producing more than 2,000 barrels per year. The Stone Bill would allow the company to acquire a brewery license and operate the brewpub without a production cap.

State Senator Sean Bennett (R), one of six legislators on the conference committee, told Brewbound that he believes the bill will pass and ultimately become law, adding that it could be finished as soon as tomorrow.

“At the end of the day, if everybody’s comfortable, this is a win-win for everybody involved,” he said. “It’s a win for distributors because they’re going to have more beer to distribute. It’s a win for the brewers and it’s a win for the consumers.”

Brook Bristow, a lawyer with Bradford Neal Martin & Associates who provides general counsel to the South Carolina Brewers Association, said the bill’s passage in the conference committee was due in part to a compromise brought on by the South Carolina Beer Wholesalers Association.

“We came to a compromise agreement with the wholesalers here,” he said. “They came to us with a very good agreement and the bottom line is the bill is going to pass as we all kind of hoped it would. We’re going to be ready for Stone or anyone else who wants to come to South Carolina.”

Bristow added that brewers had been generally optimistic that the bill would pass, but it wasn’t entirely without opposition.

The South Carolina Beer Wholesalers Association (SCBWA) vocalized its concern that the bill would effectively circumvent the three-tier system and prove “extremely myopic” with regards to anti-discrimination and tied house laws.

“Unlike [how] we have been portrayed, we do not base our opposition on controlling or inhibiting small brewers from expanding their business model, and we do not impede economic progress in South Carolina,” the SCBWA said in a statement. “Rather, dual licensure on the producer and retailer tiers presents unintended consequences, including the increased potential for legal challenges to South Carolina’s three-tier system.”

The organization had been worried that the language of the bill was worded in a way that left the three-tier system “open for attack,” but was comfortable with the passage of an alternate version of the bill that it submitted for consideration.

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