04/27/2001 02:00 PM House RLS

HB 152-BREWPUB LICENSES                                                                                                       
                                                                                                                                
[The tape  counter numbers  indicate the  number of  minutes that                                                               
have elapsed.]                                                                                                                  
                                                                                                                                
CHAIR KOTT announced  that the only order of  business before the                                                               
committee  would be  HOUSE  BILL  NO. 152,  "An  Act relating  to                                                               
brewpub licenses."                                                                                                              
                                                                                                                                
00.5                                                                                                                            
                                                                                                                                
REPRESENTATIVE JOULE moved to adopt  CSHB 152, 22-LS0354\O, Ford,                                                               
4/27/01, as  the working  document before  the committee.   There                                                               
being no objection, version O was before the committee.                                                                         
                                                                                                                                
00.7                                                                                                                            
                                                                                                                                
REPRESENTATIVE   ANDREW   HALCRO,   Alaska   State   Legislature,                                                               
testified  as  the sponsor  of  HB  152.   Representative  Halcro                                                               
characterized the proposed committee  substitute (CS), version O,                                                               
as a  "compromise of a compromise."   He explained that  [the CS]                                                               
attempts to  reach some middle ground  for next year in  order to                                                               
provide  some of  these operators  some time,  while a  permanent                                                               
resolution is  being worked on.   Version  O would allow  some of                                                               
those operators  that are  close to the  current cap  to continue                                                               
with  business as  usual.   Representative  Halcro announced  his                                                               
intention to hold meetings this interim.                                                                                        
                                                                                                                                
02.6                                                                                                                            
                                                                                                                                
CHAIR  KOTT  related  his  understanding  that  the  proposed  CS                                                               
doubles the  amount of gallons  to 150,000 and [that  amount will                                                               
sunset June 30, 2002].                                                                                                          
                                                                                                                                
REPRESENTATIVE HALCRO agreed with Chair Kott's understanding.                                                                   
                                                                                                                                
03.8                                                                                                                            
                                                                                                                                
REPRESENTATIVE  HALCRO,  in  response  to  Representative  Joule,                                                               
explained that  there are  a handful  of brewpub  licenses, which                                                               
allows  an establishment  to brew  its own  beer and  sell it  in                                                               
their restaurant as well as wholesale.   There is a 75,000 gallon                                                               
cap.    However,  some  of these  brewpubs  have  expanded  their                                                               
operation to a second location and  thus the 75,000 gallon cap is                                                               
problematic.  One  of these establishments is  projected to reach                                                               
the 75,000  gallon cap  at the  end of September.   At  that time                                                               
this establishment can either stop  brewing and selling their own                                                               
beer or have  someone else brew their beer, buy  it from them and                                                               
resell it  in their restaurants.   This bill would provide  a bit                                                               
of breathing room.                                                                                                              
                                                                                                                                
REPRESENTATIVE  HALCRO acknowledged  that  some  are weary  about                                                               
raising the cap.  He said,  "Certainly, they can continue to sell                                                               
beer, it's just comes  down to who's brewing it.   And I think we                                                               
all want to  keep Alaska jobs in Alaska rather  than having these                                                               
guys have to have their beer brewed in Seattle and shipped up."                                                                 
                                                                                                                                
05.5                                                                                                                            
                                                                                                                                
REPRESENTATIVE JOULE  asked if  those breweries  outside [Alaska]                                                               
are under any such limits.                                                                                                      
                                                                                                                                
REPRESENTATIVE  HALCRO  replied no  and  pointed  out that  other                                                               
[states] would not be impacted by this legislation.                                                                             
                                                                                                                                
REPRESENTATIVE KOHRING related  his belief that when  the cap was                                                               
established, it  appeared to be  somewhat of an  arbitrary limit.                                                               
Now, there  is a  successful business that  is being  impacted by                                                               
this  arbitrary limit.    Therefore,  he felt  that  it would  be                                                               
reasonable   to  pass   the  proposed   CS   out  of   committee.                                                               
Representative Kohring remarked that  he believes there shouldn't                                                               
be any cap because it should be based on the market.                                                                            
                                                                                                                                
CHAIR KOTT noted that the [Moose's Tooth's] amendment, repealing                                                                
the provision in June 2002, was included in the proposed CS.                                                                    
Chair Kott closed the public testimony.                                                                                         
                                                                                                                                
07.5                                                                                                                            
                                                                                                                                
REPRESENTATIVE PORTER moved to report CSHB 152 [version 22-                                                                     
LS0354\O,  Ford,  4/27/01]  out   of  committee  with  individual                                                               
recommendations and  the accompanying fiscal notes.   There being                                                               
no objection,  CSHB 152(RLS)  was reported  from the  House Rules                                                               
Standing Committee.