The Montana House of Representatives’ Business and Labor Committee tabled further action on HB 326 and HB 336 this morning, likely spelling the end of both bills during the 2015 Montana Legislative Session.

HB 326 would have allowed breweries to directly purchase a retail license (from the open market in most areas), permitting them to have all the privileges of a regular bar, but also gave retail locations (i.e. bars) the ability to obtain a brewery license (from the State). It would have raised the “small brewery” cap for on-premise sales/consumption from 10,000 and 60,000 barrels, but only if such sales did not exceed 500 bbls per year. .

In contrast, HB 336 would have increased the “small brewery” cap for on-premise sales from 10,000 barrels to 60,000 barrels without limiting the maximum yearly amount which could be sold for on-premise consumption.

The bills were supported by competing factions of the beer industry.  The Montana Tavern Association and Montana Brewers Association joined forces to craft HB 326, which they dubbed the “Montana Brewery Act.”  In response, the Montana Beer and Wine Distributors Association joined forces with a number of Montana breweries to support HB 336, calling it the “Pro-Beer Act”

As expected, discussion on HB 326 began with an amendment offered by Rep. Ryan Lynch to add a provision to lower the amount a brewery can self distribute from 10,000 to 6,000 bbl per year.  The amendment passed by a 15-4 vote.

During discussion on the bill, Rep. Chuck Hunter noted the Committee had been presented with a good faith effort by industry members to reach compromise, but felt as though a compromise had not been reached. Hunter expressed a preference to bring the topics into an interim study to review all of the issues underlying the problems.

Rep. Jeffrey Wellborn said he’s sat on the committee for a long time, has heard many discussions about this issue and remembers a time when you couldn’t get industry members in the same room.  While Wellborn acknowledged the lack of support from the distributors, he believed the good faith effort put into it by the others is enough to support it.

Rep. Daniel Salomon and Rep. Christopher Pope expressed similar sentiments, each noting that upon passage the bill would continue through the legislative process where the parties would have an opportunity to make changes.

“The industry has brought an imperfect set of choices which I regret,” Pope said in advance of the vote. “I hopefully don’t regret it moving forward.”

Rep.Steve Fitzpatrick said he believes HB 326 protects both the property interests of the tavern owners while giving the brewers the ability to grow their businesses.

Rep. Willis Curdy had a different take. “Imperfection breeds continuous imperfection,” said Curdy. “There are serious winners and losers with this bill and I personally have a problem with that.”

Reflecting on the unlimited brewery licenses, but limited retail licenses, Rep. Vince Ricci noted “it is dangerous to mix quota licenses with non-quota licenses.”

The motion to send the bill out of Committee with a “do pass” recommendation failed on a 9-10 vote.  A follow up motion to table the bill passed on a voice vote.

The Committee next considered HB 336, to raise the “small brewery” cap for on-premise sales from 10,000 to 60,000 bbls. Representative Mike Lang presented an amendment to the bill to change the proposed definition of “affiliated companies” with respect to calculating the 60,000 bbl production limit.  The amendment passed on a voice vote.

There was no discussion on the bill itself which similarly failed to garner enough votes to pass out of committee (9-10 vote). It, too, was subsequently tabled on a voice vote.

Bills which are tabled in committee can be revived for further action, though it is a very rare occurrence.  Thus, tabled bills are generally categorized as “likely dead.”

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