Senate President pro tem David Shafer has become the second ranking lawmaker to urge the state Department of Revenue to back off a regulation imposed this fall that craft beer enthusiasts say undercuts legislation to loosen on-site brewery sales.
The regulation, issued in a “bulletin” in September, prevents craft brewers from offering different levels of tours at prices based on the value of the beer. The brewers had previously been told, following passage of Senate Bill 63, that they could create different tour packages at different price levels.
“To the extent that the regulations you have already promulgated require clarification, I believe that it would be more appropriate for you to do so through the formal rule-making process, with public notice of any proposed new regulations and opportunity for public comment and legislative oversight,” Shafer wrote in a Dec. 23 letter. “Accordingly, I would urge you to withdraw the Bulletin.”
Earlier this month, House Speaker David Ralston said the Department of Revenue had exceeded the authority the General Assembly granted and that lawmakers would act when they convene in January if the agency doesn’t.
The letter from Shafer, the No. 2 leader in the Senate, may be more significant. In the past, the Duluth lawmaker has often allied himself with liquor wholesalers and others who want to preserve the status quo when it comes to the retailing of alcohol, including the state’s three-tiered distribution system.
The letter from Shafer was addressed to state Revenue Commissioner Lynne Riley, but a copy was also sent to state Sen. Hunter Hill, R-Atlanta, the lead author of SB 63, which passed the Legislature earlier this year.
The state’s three-tiered system of alcohol sales requires a middle man to stand between the manufacturer of beer, wine and spirits and the product’s final retailer.
SB 63 gave craft brewers the ability to sell facility tours and give away their product afterward — a kind of backdoor way to actually sell their beer directly to customers, something brewers have long sought.
After Gov. Nathan Deal signed the bill into the law, the state Revenue Department enacted rules governing the tours. Those regulations allowed brewers to create different tour packages at different price levels.
But months later, on Sept. 25, the department issued its bulletin saying that while brewers can offer different levels of tours, the price differences cannot be based on the value of the beer. Many breweries, however, had already begun doing just that, based on the original rules the department issued in late June and on their understanding of lawmakers’ intentions.
Before issuing that bulletin, Department of Revenue records show, the agency met and spoke repeatedly with representatives of Georgia’s beer and liquor wholesalers, who wanted to block the brewers from selling tours based on the beer offered. At the same time, agency officials refused to meet with the brewers or their representatives.
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