Save the Craft: The ABDI Strikes Back, and an SB88 Update

In Beer Politics by Karl

When it comes to Saving the Craft, we’ve spent a lot of time telling you about what could happen, and what we’d love to see happen, but we haven’t shown you the other side of the argument.  While we’re not aligned with any particular group at the table and this is purely a grass-roots movement, we are supporting the efforts of the Craft Brewer’s Guild, but the Associated Beer Distributors of Illinois (ABDI) have their own arguments to make.

We’ve recently received a copy of a document that ABDI has been distributing.  It makes their arguments about the legislation currently making its way through Springfield.  (If you’re new to the Save the Craft coverage, you can find our discussion of those laws in our original post.  Oh, and then you can call your respective legislators accordingly.)  Rather than post the full letter and pick it apart, we’re highlighting this section as it goes right to the heart of their argument and pretty well defines the differences between the two camps.

Subject: Please Oppose the deregulation of alcoholic beverages found in SB88 and HB205

The ICBG initiated SB 88 and HB 205 to not only address the concern that two Illinois brewers would lose their ability to distribute, but they saw this as an opportunity to give brew pubs a new, presently unauthorized, ability to self distribute their beer. These brew pubs are riding the coat tails of the court decision. If this proposal had merit, the brew pubs would put in a free standing bill. Adding brew pubs to the legislation is an attempt by the ICBG to add confusion by inferring that the court addressed the brew pub issue. Brew pubs were never a part of the Anheuser-Busch v Schnorf case and should be dropped from this legislative proposal.

Furthermore, the ICBG claims that the brewers need self distribution to get their beer to market, yet the ICBG cannot cite one example of a small brewer or brew pub being denied distribution by any Illinois beer distributor. The truth is ABDI members want these brands and will distribute every ounce of these brewers’ brands within the State’s already proven regulatory system known as the Three-Tier Regulatory System.

We will continue to work with the small brewers. However, at this time we respectfully request that you say no to these ridiculous amounts requested and oppose SB 88 and HB 205 in their current form.

A few quick points:

1)  “Deregulation” sounds ominous, doesn’t it?  (Ask us about deregulation of the radio business in the mid-90s sometime if you have a couple hours to listen to us rave.)  We’d argue that the term “re-regulation” is a little more accurate, and “clarifying of regulation” even better.  No one is arguing that craft brewers be allowed to do anything they please, just to continue to be allowed to bring their product to market without an unnecessary middle man.

2)  Brewpubs may indeed have not been part of the initial lawsuit and injunction.  However, our personal view is this: as long as it’s been required by the courts to go back and figure this stuff out, why not define the limits on brewpubs while all parties are at the table?  Doesn’t that make more sense, as opposed to making it a separate issue requiring more time, effort, and most importantly, money?  The language involving the brewpubs, in our eyes, is simply a consideration of the future and making sure that the i’s are dotted and the t’s are crossed.  No one wants to make extra work for themselves.  (Unless, perhaps, you’re a lobbyist.)

3)  Finally, there’s this line: “Furthermore, the ICBG claims that the brewers need self distribution to get their beer to market, yet the ICBG cannot cite one example of a small brewer or brew pub being denied distribution by any Illinois beer distributor.”  It’s not just a “claim.”  We’ve documented just yesterday how Argus Brewing wouldn’t have been able to make it without the current self-distribution rules.  And the more small breweries there are that have the option to start up without the added costs of a distributor, the more likely there will be more breweries that can grow into needing a distributor.  In a way, the ABDI is arguing against its own interests, cutting off its craft brewer nose to spite its face.

The part about small brewers having never been denied access to a distributor is a bit of a straw man, a bit of misdirection.  Perhaps no one can say they’ve been denied access to a distributor, but consider the converse: How many places may not start up because a need for a distributor might preclude a workable business plan?  How many homebrewers with a dream to open their own small brewpub might forget their plans entirely if the laws were changed to add more unnecessary requirements to open their own place?

As we talked about yesterday, Argus does use a distributor for their retail business, but they wouldn’t have gotten to that level without self-distributing first.  Shouldn’t we be using that as a model?

– – – – – – – – – –

Save The Craft is not just about the way things are now, but the way things could be down the road and in the future for people who might want to make their craft-brew dreams come true.  Over the next few days and weeks as we continue to watch this unfold, we’ll bring you at least one story of someone who wants to bring their product to market, and how this legislation might affect them directly.

As for the existing legislation itself:

We’re hearing that SB88 will NOT make it to the floor without an Amendment.  The votes just aren’t there.  We at GuysDrinkingBeer understand that sometimes changes will need to be made, and if, for instance, the numbers have to be adjusted, we’re ready to accept some form of compromise as long as the majority of craft-brewer freedoms remain.

We’re learning more about the amounts of beer being brewed at some of our favorite places around the state and around the midwest, and in our own humble opinion, would love to see the parties at the table reach an agreement that works best for all involved, even if that requires a reduction of the current cap of 60k barrels per brewer.

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About the Author

Karl

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Karl has written about food, travel and beer for Chicago Magazine, Draft Magazine, Thrillist, Time Out Chicago and more. His book, Beer Lovers Chicago, comes out in early 2017, and if you're buying, he's likely having a porter or a pale ale.