Georgia Beer Bill SB219 Could Help Big Breweries Thrive With Multiple Locations But Omits Daily To-Go Cap and Self-Distribution for Small Breweries

Senate Bill 219, which is making its way through the Georgia General Assembly, would allow the state’s breweries to transfer beer between locations and increase the amount of beer per year breweries can sell directly to customers. These changes to the current law will ultimately affect only a small number of Georgia breweries. But those beer makers with the resources and capital to open multiple locations — a trend already in motion at breweries like Monday Night Brewing, New Realm Brewing, and Three Taverns Craft Brewery — will be given greater flexibility to move product around the state and the potential for increased revenue through additional locations. Meanwhile, the needs of Georgia’s smaller breweries and brewpubs aren’t being addressed.

Georgia alcohol laws have slowly become more progressive over the last two decades. Until 2004, Georgia didn’t allow for the production or purchase of beer containing more than six percent alcohol by volume (ABV). Growlers only became legal in 2010. Retailers weren’t allowed to sell alcohol on Sundays until 2011. Finally, in 2017, Georgia became the 50th (and final state) to allow some direct sales for its breweries and distilleries.

Each victory has been followed by years of little legal progress. But Joseph Cortes, the new executive director of the Georgia Craft Brewers Guild, hopes to change this by mobilizing the largest coalition of brewers in the state’s history. Of Georgia’s 100-plus beer makers, more than 60 breweries and brewpubs across the state are members of the guild.

The initial bill introduced into the Georgia House of Representatives in early February provided some indication of how Cortes hopes to bring this group of brewers together to impact state law. House Bill 278 included a number of requested changes for Georgia breweries and brewpubs, but Cortes says the house bill “lacked the support of other stakeholders in the industry (distributors)” as well as “key legislators.”

Then came SB 219. The new, proposed piece of legislation emerged in March and would allow for two things:

Transfer of beer between multiple brewery or brewpub locations so long as the new location is making as much beer as is being transferred to it
An increase in annual production cap for direct-to-consumer brewery sales from 3,000 barrels to 6,000 barrels, or BBLs (one barrel of beer is equal to approximately 31 gallons)

Increasing the amount of beer breweries can sell directly to customers each year might seem like a no-brainer, but there are actually very few breweries in Georgia getting close to selling 3,000 BBLs directly to consumers.

Monday Night Garage brewing facility in West End

“In 2019, average onsite sales were about 500 barrels,” says Bart Watson, chief economist of the national trade organization the Brewers Association. “Between one to two percent of breweries that gave us data were above 3,000. My understanding is that the daily cap is more of a hindrance right now in many cases.”

A hindrance, indeed. A recent survey of roughly 10 percent of Georgia’s breweries indicates most would rather remove the state’s 288-ounce daily to-go cap on direct sales to consumers instead of raising the annual direct sales cap. Removing the daily to-go cap from state law was previously included in HB 278, but stripped from the current senate bill by request of the distributors.

“I’d be really happy to see the 288-ounce cap go,” Orpheus Brewing CEO and brewmaster Jason Pellett explains of the need to remove the daily cap. “I’ve always wished I could sell kegs, and it’s ridiculous that the limit [doesn’t] even allow full cases of 16-ounce cans or 375-milliliter bottles — the formats we sell the most of on-site. This won’t really lead to massively larger sales in general, but not having to worry about and explain an unjustifiable limit [to customers] will make life easier.”

Barrier to additional taprooms

Then there’s transfer of product. Georgia law states when breweries open additional taprooms these locations can only sell beer made there. Which is to say: Breweries are not allowed to transport beer between locations. When Creature Comforts announced last August the Athens-based brewery would open a location in Los Angeles instead of Atlanta, CEO Chris Herron wrote: “For Creature, the largest barrier to investing in another Georgia brewery is that current interpretation of the law says a brewery cannot sell beer directly to a consumer at one brewery taproom if that beer was produced at one of the brewery’s other taproom locations. Making Tropicalia at locations 60 miles apart is both inefficient and less sustainable.”

In 2020, Creature Comforts worked with other Georgia breweries to craft language that would legalize the transferral of beer between breweries of common ownership. But when COVID-19 hit last spring, legislative attention shifted toward helping retailers with to-go alcohol sales. The beer transfer language issue was sidelined and a new bill regarding home delivery of alcohol was introduced and passed. That bill excluded Georgia breweries and distilleries.

While SB 219 will certainly help Georgia’s biggest craft producers, it provides little for the state’s smaller breweries. Jeffrey Oparnica recently opened Sabbath Brewing in East Atlanta Village (EAV) after facing years of red tape. He says requiring a brewery to produce the same amount of beer at a new location as it’s transferring from an existing locations is “exceedingly limiting.” Oparnica hopes to eventually open a production facility in an industrial area to provide beer to his EAV taproom, which he describes as “a nano-brewery” that won’t keep up with demand.

Two people walking by Halfway Crooks Beer on Georgia Avenue in Summerhill Atlanta on March 21 amid COVID-19 — Halfway Crooks Beer in Summerhill

“I’d like to open small satellite locations with experimental brews produced on-site that are supplemented by the production facility,” Oparnica tells Eater. “If I need to produce on-site as much as I transfer in, I then think to myself, ‘What’s the point of opening a production facility?’ [SB 219] stymies business growth in Georgia with unnecessary limitations, which are not common requirements in other states and has me considering if expanding my brand might be better sought somewhere else.”

And it’s not just breweries talking about issues with the bill. There’s a growing point of contention amidst beer enthusiasts online and beyond concerning why Georgia can’t seem to institute the same brewing and distribution laws as other states around the country. On the ATLbeer subreddit in February, brewers, armchair politicians, and beer aficionados debated the merits of the new legislation. Some commenters asked why Georgia’s 14 percent ABV cap wasn’t being addressed, others argued the technicalities and loopholes of transferring product between locations. But the possibility of self-distribution loomed heavily over the conversation, as it’s a privilege nearly 40 states currently enjoy.

“Maybe I’m missing something here, but this [bill] seems like a whole bunch of nothing. Why are we wasting time trying to get any bill passed that doesn’t include self-distro,” Southern Beer Tours co-founder Justin Hall posted to Reddit. “I don’t get why we aren’t trying to get the one thing that will make the biggest difference to our industry.”

The distributor problem

Cortes says the Georgia Craft Brewers Guild approached distributors and asked for feedback and input on the original house bill. “We met with the wholesalers association in good faith and only received a response that there wasn’t any willingness to support or work with us on anything,” he explains.

Cortes says the fact the new senate bill is narrower in focus helped distributors join the conversation. The bill also “dealt with a lingering issue that stakeholders in the industry have been discussing a path forward on for almost two years,” he adds, referring to the transfer of beer between facilities.

Eater contacted a half dozen of Georgia’s largest distributors to ask about the new proposed legislation. As of publication, none have returned repeated requests for comment. Martin Smith, executive director of distributor nonprofit trade group Georgia Beer Wholesalers Association, also did not respond to Eater’s request for comment.

While some smaller, independent distributors like Modern Hops and Liberator Distributing tell Eater they’re unopposed to progressive beer legislation, these distributors don’t wield the money or enough political sway in Georgia right now to significantly impact the laws here. And with most Georgia breweries still beholden to major distributors, the road to more progressive beer laws in the state remains riddled with potholes.

The shape of Georgia beer to come

While the provisions introduced in SB 219 appear to be common sense, the question remains if these changes are currently the most necessary. Cortes and the Georgia Craft Brewers Guild are in an unenviable position. Both are up against better-funded and well-organized distributors, while also trying to align and organize dozens of Georgia breweries in pursuit of impactful changes to the alcohol distribution laws.

“Updating our alcohol laws to better reflect the needs of consumers and small brewers isn’t easy,” Cortes says. “We must be more consistent and organized about telling the story of Georgia’s small brewers and craft beer to anyone who will listen, including elected officials. While we’ve made progress in past years and the industry has experienced growth, there are still barriers to that growth and opportunity which must be shared with policymakers, which only then leads to a meaningful conversation about needed changes.”

The downstairs bar at Three Taverns Imaginarium with six hightop tables and wooden chairs and blue wall with large window overlooking the brewing room behind a blue wall with paned windows

Top left: Orpheus Brewing in Morningside; top right: Steady Hand Beer in Blandtown; bottom: Three Taverns Imaginarium in Reynoldstown

Removing the 288-ounce daily cap and adding self-distribution seem to be the main issues for most Georgia beer makers. While it would be a positive step forward for Georgia’s beer laws, SB 219 fails to address the two issues most important to the majority of the state’s small breweries.

Self-distribution would allow breweries to make more money by avoiding a distributor’s cut, and would allow them to better serve retail partners. “It doesn’t need to be the whole state, but at least a three- to five-mile radius to start,” one brewery co-founder suggested recently. “Just something to service our local bars and get them beer fresher and faster. And it would allow for breweries to grow into needing a distributor. Distribution should be viewed as a benefit for both parties, not a necessary evil.”

A lot of Georgia’s smallest beer makers agree with this sentiment. While the proposed changes should be rectified, more beneficial changes aren’t even being considered. “The things I wish were included would absolutely be self-distribution and to be able to open another location, with it only being a taproom, where I could legally move cans and draft,” Good Word Brewing Public House owner Todd DiMatteo says. His Duluth-based brewpub won’t be taking advantage of any of the new regulations once passed. Good Word simply doesn’t make that much beer.

“Self-distribution would help small brewers thrive, and it’s a very attractive model,” DiMatteo continues. “This could help the Georgia beer scene take off in a really great way by making the economics so appealing.”

Austin L. Ray is an award-winning journalist who has written for Rolling Stone, Good Beer Hunting, Creative Loafing (RIP), The Outline, the A.V. Club, Atlanta magazine, Vulture, Oxford American, First We Feast, more than a few places he’s forgotten over the years, and one terrible gas station periodical. He loves gardening, making people laugh, listening to rap music, hoodie weather, and Twitter. Zach Galifianakis once screamed in his face.