Posted On July 10, 2017
Brewers Celebrate New Law Raising the Production Limit
MISSOULA – Governor Steve Bullock was at Bayern Brewing today for a ceremonial signing of HB 541, the bill that raises the production limit for Montana breweries.
“Even more than taps and great beers, our breweries employ our fellow Montanans, buy products from our farmers, and help grow Main Street Montana,” said Governor Bullock. “This legislation is a good thing for the industry and for our economy, as well as for Montana craft beer lovers like myself.”
Bullock was joined by HB 541 co-sponsors Rep. Adam Hertz (R – Missoula) and Rep. Ellie Hill (D – Missoula), members of Montana’s craft brewing community and industry partners in Bayern’s Edelweiss Bistro to celebrate the bill being signed into law.
“Economic growth and innovation are unlimited when we allow free markets to thrive,” said Hertz, primary sponsor of HB 541. “I’m thrilled to be a part of this bi-partisan regulatory reform that will position Montana’s craft brewing industry to be a bigger player in the regional market and create hundreds of new jobs.”
Montana’s brewing industry has grown tremendously in recent years, doubling beer production between 2010 and 2017. According to a 2016 economic study conducted by the Bureau of Business and Economic Research at the University of Montana, Montana’s craft brewing industry was responsible for $103.2 million in economic output, employed 702 people and created a total of 1,044 jobs in 2015.
Still, the economic potential could be much greater. Montana brewers have long seen the 10,000 barrel limit as an obstacle to growth that discourages Montana breweries from growing, punishes success and puts Montana breweries at a competitive disadvantage to breweries from other states.
“This bill removes a barrier that has hindered our growth and limited our ability to meet demand for our beer in Montana and beyond,” said Jürgen Knöller, owner of Bayern Brewing. “After waiting for this legislation for nearly two decades, we’re excited that this day has finally arrived.”
Bayern’s production grew steadily for 27 years, but plateaued around 9,900 barrels for the past three years. Under the old 10,000 barrel production limit, Bayern would actually lose money if they grew beyond the limit without making a significant leap in production. But Bayern, Montana’s oldest brewery and celebrating its 30th anniversary this year, has a lot to celebrate in 2017. Thanks to HB 541, this is the first year Bayern will be able to brew more than 10,000 barrels without being penalized with the loss of taproom sales.
Two other Missoula breweries will see direct benefits from HB 541. The new law will allow KettleHouse Brewing to have a taproom at the new Bonner brewery, their largest production facility and the site of the new KettleHouse Amphitheater. Big Sky Brewing has never been able to sell beer in their taproom, since their production already exceeded 10,000 barrels when the original bill passed in 1999, but that will all change when HB 541 takes effect.
“Montana is beer country and Missoula is the heart of beer country,” said Smith, co-sponsor of the legislation. “Rep. Hertz and I may come from different political parties but we both saw the need to do this for our community and the state as a whole. I’m pleased that Democrats and Republicans came together during the session to do what’s right for Montana craft brewers, barley farmers and craft beer lovers.”
HB 541 enjoyed strong bipartisan support in its journey to the governor’s desk. It passed the House on an 85-14 vote and the Senate on a 40-9 vote. The new law will take effect on October 1.
Posted On April 13, 2017
HB 541 Clears Final Hurdle on 94-6 Vote
HELENA – This morning, the Montana House concurred with Senate amendments on HB 541 with a vote of 94-6. The bill allows
Montana breweries to grow past 10,000 barrels of annual production without losing their taproom by raising the production cap to 60,000 barrels.
“HB 541 is the most important legislation we’ve seen for Montana’s craft brewing industry in 18 years. The Legislature has signaled a green light for Montana breweries to grow, giving breweries the confidence to make investments to expand their production. That means more jobs, increased demand for Montana-grown barley and greater access to Montana craft beer,” said Matt Leow, executive director of the Montana Brewers Association.
HB 541 is sponsored by Rep. Adam Hertz (R-Missoula) and co-sponsored by Rep. Ellie Hill (D-Missoula) and Rep. Greg Hertz (R-Polson). The bill faced a tough road in the Senate where it was amended in committee to set the production cap at 12,000 barrels and include a tax increase for breweries producing between 10,000 and 20,000 barrels annually. The 60,000 barrel limit was restored on the Senate floor along with new regulations for taprooms, limiting breweries to no more than three taprooms and a total of 2,000 barrels of on premises sales. The Montana Tavern Association withdrew their opposition to the bill with the inclusion of the taproom limitations.
“Rep. Hertz brought a great bill that was turned on its head in the Senate Business and Labor committee. We are pleased that the Senate restored the bill to 60,000 barrels. While we would prefer a clean bill without the new taproom limitations, the limits are set high enough that they will not impact what any breweries are currently doing,” said Leow.
Senate committee amendments sparked controversy last week when KettleHouse Brewing realized the changes, if they became law, would force the Missoula brewery to close its popular Northside taproom. The Senate resolved that issue with the amendment to restore the bill to 60,000 barrels.
“It’s been a rollercoaster ride for HB 541 over the past week, but we ended up in a good place. Raising the production cap to 60,000 barrels clears the way for Montana breweries to compete in the regional marketplace. Montana is known for producing high quality beer, with our brewers winning national awards. This legislation will enable Montana brewers to pursue export opportunities and provide beer lovers in other states a taste of Montana,” said Leow.
With the House vote approving the Senate amendments, HB 541 is now heading to Governor Bullock’s desk to be signed into law.