Rauner signs bill lifting restrictions on craft breweries

Rauner signs bill lifting restrictions on craft breweries

Laws barring taprooms from serving hard cider – and craft beer produced by other breweries – are among the regulations bounced by House Bill 4897.

Craft beer aficionados in Illinois may soon be perusing thicker beer menus, as a new law has overturned regulations restricting the variety of alcoholic beverages taprooms are permitted to serve.

On Aug. 13, Gov. Bruce Rauner signed into law House Bill 4897, which amends the Liquor Control Act of 1934 by lifting longstanding regulations that banned taprooms from purchasing and serving beer produced by outside breweries. Under state law a brewery’s beer selection has long been confined to its own production capacities. But HB 4897 will bring the possibility for taprooms to feature guest beers from competing breweries – locally and nationally.

With these barriers lifted, small craft breweries stand to benefit by accessing markets they might not have otherwise had the resources to reach. For breweries with smaller production capabilities, the choice to purchase and sell a neighboring brewery’s product will allow them to enrich their offerings.

The bill also creates the Brewer Warehouse Permit, which allows breweries to transfer and store a fixed amount of beer – depending on the class of brewer license – at an offsite warehouse. Previously, storing beer offsite meant going through a wholesaler, in accordance with the “three-tier” liquor distribution system mandated by state law. To bypass the middleman, brewers either had to open an additional brewery location or expand their existing facility, posing challenges to the growth of smaller breweries.

Beyond beer, HB 4897 also eliminates longstanding restrictions that prohibit taprooms from purchasing and serving hard cider.

State Sen. Jason Barickman, R-Bloomington, a sponsor of HB 4897, praised the bill ahead of the governor’s signature, underscoring its potential economic benefits and the opportunities it presents for entrepreneurs. “This law is a step toward a stronger free market economy,” Barickman said, “[HB 4897] makes it easier for Illinois’ craft brewers to market their products and do business in Illinois.”

At the signing ceremony at DESTIHL brewery in Normal, Illinois, Rauner declared the law “removes antiquated regulatory barriers that have stifled the growth of smaller craft brewers and limited beverage choices for consumers.”

The signing of HB 4897 follows another sensible change to the state’s liquor law – Senate Bill 2436 – which Rauner signed into law Aug. 2. Prior to SB 2436, the Liquor Control Act prohibited businesses located within 100 feet of a school, church or hospital from obtaining liquor licensure. Businesses could bypass this law – but only by getting a bill exempting them from the law through the General Assembly. SB 2436 transferred this exemption authority from the Statehouse to local governments.

Regulations that narrow breweries’ beer and cider variety serve no conceivable purpose in regard to public health and consumer safety – nor do those rules designed to enforce the distribution chain of liquor. Instead, these laws protect established industry incumbents from competition posed by newcomers at the expense of consumers. The craft beer industry, and craft-beer-loving Illinoisans, are far better off without them.

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