Alaska House approves major update to liquor laws, including changes for breweries

Senate Speaker Peter Micciche, R-Soldotna, laughs and smiles Sunday, May 15, 2022, after the Alaska House approved Senate Bill 9, a sweeping update to state laws on the alcohol. Micciche has been trying to get the bill through the legislature for 10 years. To Micciche’s left is Lee Ellis, president of the Alaska Brewers Guild; to his right is Sarah Oates, head of the Alaska CHARR, the state liquor trade organization. (Photo by James Brooks/Alaska Beacon)

The president of the Alaska Brewers Guild held his head in his hands, the Senate speaker laughed and smiled, and the head of Alaska’s largest liquor trade organization exchanged high-fives with lawmakers as the Alaska House put a definitive end to a 10-year struggle by passing a sweeping reform of the state’s liquor laws.

“I think we’re all ready to move on,” said Rep. James Kaufman, R-Anchorage, who brought the bill to the House.

Senate Bill 9, approved 35-2 by the House on Sunday night, fundamentally changes how Alaska regulates liquor service businesses and punishes them if things go wrong.

Customers of Alaska’s bars, breweries, distilleries and liquor stores will see little immediate change, but those involved in the liquor industry – including the people who regulate it and the public health organizations that deal with its problems – say that it will modernize the state industry.

Potential end to ‘bar wars’

It can also permanently end a conflict between established bars and newcomer breweries and distilleries, sometimes referred to as “bar wars”.

Alaska regulates the number of alcohol-related businesses based on the population of a city, town, or borough, and most cities have reached or exceeded their limit on alcohol-related businesses. bars and liquor stores.

This has created a high-cost market for used licenses, which can cost hundreds of thousands of dollars. Brewery and distillery licenses are available cheaply over the state counter, and bars are worried about competition that could devalue their licenses.

“For some people, it’s their retirement,” said Rep. Adam Wool, D-Fairbanks.

The dispute between these segments of the alcohol industry has killed previous legislative reform efforts.

Prior to the 2020 legislative session, industry officials brokered an armistice in the Bar Wars, but COVID-19 ended the session and the legislation never passed.

The Senate passed a revised version of the bill in 2021, and now the House has followed suit.

“Much of the controversy…has been resolved,” said Wool, a former bar owner whose opposition had been a significant obstacle to passage.

Fewer new taprooms under the revised limit

To address the concerns of existing licensees, new consumption room licenses will be limited to 1 per 9,000 residents in a town or city. Other licenses are available on a 1 per 3,000 people basis, and the number of breweries and distilleries has no limit – they simply cannot open a tavern.

Existing taprooms can stay open, even if their city exceeds the new limit. The taprooms may also be open from 9:00 a.m. to 9:00 p.m. Current law requires them to close at 8:00 p.m.

Taprooms are currently not permitted to hold live music events, but will be permitted to hold a limited number of events per year.

Other restrictions remain in place: no televisions, no chairs or stools at the dining room bar, and limited portions.

In Alaska, taprooms were used by small breweries to make money and create a market for their beer before they began distributing it on a large scale.

The limit on the number of new taprooms has been extremely controversial, and on Sunday Rep. Jonathan Kreiss-Tomkins, D-Sitka, tried unsuccessfully to lower the limit.

“This greatly restricts competition and limits the creation of businesses in this industry,” he said.

His amendment failed 15-22, with opponents saying they did not want to upset a delicately balanced compromise between different parts of the alcohol industry.

A follow-up amendment, allowing more taprooms after the year 2030, passed 20-17.

“Maybe it’s time to stop messing around with this…let’s go and get this thing over with,” said rep Kevin McCabe, R-Big Lake.

Among the effects of the bill:

  • The state will begin licensing businesses that ship alcohol through the mail, taxing those businesses for the first time. The licenses will help police crack down on contraband in the state’s “dry” communities, supporters say.
  • Beer kegs must be registered, allowing the police to know who bought the alcohol for a night out with minors.
  • Local governments, including Alaska Native tribes, can now purchase liquor licenses.
  • Because the Alaska Department of Justice rarely prosecutes misdemeanors, many low-level alcohol-related crimes will become citations instead of misdemeanors. Proponents said companies that operate improperly escape punishment due to the state’s low prosecution rate.
  • It’s easier to serve beer and wine at a music festival, outdoor concert, or non-profit event using a restaurant’s liquor license, even if the event takes place outside the restaurant.
  • The bill makes most types of licenses more expensive, but licensees will get additional privileges. Liquor stores will be able to host events where they can serve samples. They can also deliver alcohol to your home. A bar may serve alcohol at multiple outlets under a single license.

On Monday morning, hours after the House passed SB 9, the Senate voted 17 to 1 to accept the House changes and send them to Gov. Mike Dunleavy, who lawmakers say will sign it.

Alaska Beacon is part of States Newsroom, a grant-supported network of news outlets and a coalition of donors as a 501c(3) public charity. Alaska Beacon maintains editorial independence. Contact editor Andrew Kitchenman with any questions: [email protected] Follow Alaska Beacon on Facebook and Twitter.

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