News: CJ Exclusives

Bill allowing more sales at craft distilleries passes Senate committee

Measure allows each customer at distilleries to buy five bottles per year, starts retail and restaurant alcohol sales at 10 a.m. Sundays

Call Family Distillers in Wilkesboro is one of the North Carolina-based craft distillers that would benefit from increased sales at the distillery allowed by Senate Bill 155 if it passes. (Photo provided by Call Family Distillers.)
Call Family Distillers in Wilkesboro is one of the North Carolina-based craft distillers that would benefit from increased sales at the distillery allowed by Senate Bill 155 if it passes. (Photo provided by Call Family Distillers.)

Senate Bill 155 slid through the Senate Finance Committee on Wednesday and, slowed by only the usual dissenters, advanced to the Rules Committee with nary a soft grimace nor a lingering burn.

The original bill was replaced during the hearing by a Proposed Committee Substitute. The current version would allow restaurants to sell alcohol starting at 10 a.m. Sundays, according to local rules and dependent on local approval. It also aims to loosen laws on North Carolina distilleries by increasing purchase limits at distilleries from one bottle to five bottles per customer per year.

But stop focusing on the alcohol, says Scott Maitland.

Look instead, he says, at the potential for North Carolina in terms of economic growth and the chance to play without a handicap against neighboring states, such as Virginia and Tennessee.

Maitland founded the popular Top of the Hill Restaurant in Chapel Hill. He’s also proprietor of the TOPO distillery just down the street and president of the N.C. Distillers Association.

“When we look at it from a state economic impact, it’s not simply limited only to the alcohol sold during those two hours,” he said. “It’s really about the fact that Sunday brunch — which is historically the third- or fourth-biggest selling time period [for restaurants] across the country — suddenly becomes a player in North Carolina.

“From a TOPO perspective, I would expect to sell $4,000 or $5,000 for those two hours that we’re open. Let’s call it 50 weekends a year. I’m looking at another quarter of a million dollars. That’s obviously not all alcohol but mainly food. But we’re talking about a lot of sales tax, were talking about, again, more jobs, we’re talking about excise tax, we’re talking about all kinds of things.”

S.B. 155 would allow the creation of a $200 special permit allowing distilleries, supplier representatives, and broker representatives to offer free tastings at events, such as trade shows, conventions, and street festivals.

It also establishes a $750 special auction permit, obtainable by licensed auctioneers or auction firms and valid for one auction, to allow for the sale of wine, “decorative decanters of spirituous liquor, or antique spirituous liquor at auction.”

Concerns from lawmakers about the bill centered mostly on worries about giving minors added access to alcohol, controlling the amount at alcohol served during tastings, and whether any of the money from fees would go toward battling problems with substance abuse. They would not.

Sen. Rick Gunn, R-Alamance, a primary sponsor of the bill, said the bill offers distilleries some much-needed parity with sellers of beer and wine.

“This is limited to one ounce,” he said. “Beer and wine is not limited at tastings.

“I do not think we would treat a distillery any differently than we would treat a [brewery] or a winery,” he said. “I think the enforcement would be consistent with what we have on the books now.”

Jon Carr, lawyer and lobbyist for the Association of N.C. ABC Boards, spoke specifically against increasing allowable distillery sales to five bottles.

“It’s not inconvenient for the consumer to go to the ABC store,” Carr said. “Where does this end?”

Here’s the flaw in Carr’s reasoning, Maitland said: In North Carolina, nearly 50 distilleries have products on shelves in ABC store shelves, and things tend to get crowded. Many distilleries make several products, and all aren’t available in all ABC stores.

“It’s just not going to be able to happen. That’s just from a space perspective. I would love if North Carolina stores made sure they carried every distillery. But they don’t, they won’t and, consequently, we need to be able to allow folks to be able to reach the market,” Maitland said.

Rev. Mark Creech of the Christian Action League routinely speaks out against bills involving alcohol, giving virtual sermons. He said the brunch provision is nothing more than pursuit of illicit profit.

In turn, Sen. Bill Rabon, R-Brunswick, chairman of the Rules Committee, criticized the decision to allow Creech to address issues that don’t relate to financial aspects of S.B. 155.