New Jersey Cracks Down On Events Hosted By Microbreweries

When lawmakers passed a law six years ago allowing microbreweries to serve their products in-house and sell more beer to go, they hoped to give New Jersey’s fledgling craft beer industry a boost.

But microbreweries in the state have now become too active in the eyes of some, prompting the state to crack down on the number of events they can host each year.

Under a “special ruling” signed Friday by the director of the Division of Alcoholic Beverage Control, David Rible, New Jersey’s microbreweries are limited to holding 25 on-site activities annually, such as trivia nights and live performances.

They also cannot provide take-out menus from area restaurants, host more than 52 private parties a year or show sports on TV unless it counts as one of their 25 special events.

In his ruling, Rible said he was trying to clarify “significant confusion” over what microbreweries can do under a 2012 law that gave them more latitude to serve their products on-site and increased the volume of beer customers could buy for consumption elsewhere.

Rible said that law was meant to create a demand for craft beer that would translate into greater retail sales at liquor stores, bars and restaurants — not to establish a new “consumption venue” at the brewery with the same privileges as a sports bar or restaurant.

"I cannot overlook the fact that the primary purpose of a Limited Brewery Iicense is the manufacture of malt alcoholic beverages and the distribution of these products" through the normal supply chain, he wrote, "not the operation of a retail outlet for its products."

A limited brewery license costs a few thousand dollars, while bars and restaurants often must spend $1 million or more for the type of license they need to sell alcohol.

The new rules do authorize microbreweries to hold up to 12 off-premise events such as arts festivals or athletic events, potentially opening the door to new business.

But many brewery owners still reacted with disappointment Monday.

“This could gut a lot of our efforts to be a really valuable part of this community,” said Sean Galie, co-owner and head brewer of Lower Forge Brewery in Medford. “It feels like what the state wants is ‘Come in, get beer and get out.’ That’s not what the craft brewery community is all about.”

The new rules take effect immediately and cover the 88 small businesses that currently hold limited brewery licenses in New Jersey.

Lisa Coryell, a spokeswoman for the Division of Alcoholic Beverage Control, said rules are actually a “precursor” to regulations to be made through the state’s regular rule-making process and will be implemented on a “temporary pilot basis” while the division monitors how they work.

Both the special ruling and the future regulations, she said, are meant to address “an absence of guidance” in the craft brew industry about permissible activities and what constitutes a tour. Under the 2012 law, microbreweries can only serve beer on-site in connection with a tour. They cannot serve food.

Jamie Queli, president of the New Jersey Brewers Association and owner of Forgotten Boardwalk Brewing in Cherry Hill, said the new rules mix “some really good meat” with less beneficial aspects.

Microbreweries could see new revenue from the dozen off-site events they can now host for functions such as festivals and 5K races, she said.

“We can move, sort of, our tasting room to like another off-site, nowhere near Forgotten Boardwalk’s actual facility and make retail revenue off of those events,” she said.

But the limit on in-house events could sting elsewhere, including in Asbury Park’s music community. The Asbury Park Brewery has been regularly hosting concerts by up-and-coming punk bands since May 2017.

Jeff Plate, the brewery’s founder, said he would work with the state to make sure the brewery adheres to the new guidelines while continuing to be a “place for young bands to cut their teeth.”

“That is what we have always been about, and I don’t see a reason why that would stop,” he said.

Other brewery owners worried that new rules would force them to cancel charity or networking events that aren’t big money-makers but play an important civic role.

Icarus Brewing in Lakewood, for example, typically hosts monthly charity events to benefit organizations such as Police Unity Tour and Lakewood Educators. 

Those events “would all count against us under the new ruling,” Icarus owner Jason Goldstein said. 

Torie Fisher, owner of Backward Flag Brewing Co. in Forked River, expressed a similar concern about her monthly “Business and Brews” community networking event.

“With that ruling, it’s likely that we’re going to have to make that go away,” she said. “I have to weigh that out and I have say, ‘Well, do I host this community networking event that doesn’t make me any money, or do I use one of my essentially two [events] a month to host something that’s a bigger money maker?’”

Goldstein added that he’s worried the new rules would make New Jersey microbreweries less competitive with those in neighboring New York and Pennsylvania and hurt related enterprises, like food trucks that cater to customers at brewery tasting rooms.

Coryell said the special ruling was created with “significant input” from the New Jersey Brewers Association and Brewers Guild of New Jersey.

Original Article