Gov. Roy Cooper has signed into law a bipartisan House bill that raises the self-distribution cap for craft brewers in North Carolina.

The Senate voted 38-3 on May 20 to approve House Bill 363, titled “Craft Beer Distribution & Modernization Act.” The House passed the bill by a 104-8 vote April 16. The law went into effect May 30.

The key elements of the bill are:

  • Allowing a craft brewery to obtain a malt beverage wholesaler permit to annually sell, deliver and ship at wholesale up to 50,000 barrels that it makes to unaffiliated retail permit holders.
  • Raising from 25,000 to 100,000 the number of barrels of malt beverages per year that a craft brewery can produce and sell to consumers at the brewery and to wholesalers, retailers and exporters without having to go through a distribution contract with a wholesaler.

The 25,000 barrel cap currently represents the maximum production level before craft brewers must enter the distribution contract.

Tim Kent, executive director of N.C. Beer & Wine Wholesalers Association, said in May that the bill represents “a win-win for all parties concerned.”

“This bill represents finding common ground” between the craft beer breweries and the state’s beer wholesalers, Rep. David Lewis, R-Harnett, and the bill’s author, said during a Senate committee meeting.

“This resolves issues that the General Assembly has been wrestling with for at least a dozen years.”

Several Senate supporters praised the compromise as pro-consumer, pro-business and pro-local economy.

Yaël Ossowski, deputy director of Charlotte-based Consumer Choice Center, said the bill represents just one step toward “true alcohol reform in North Carolina.”

“Bringing North Carolina into the 21st century when it comes to alcohol policy should be a priority for state legislators, and the latest moves coming out of Raleigh are a welcome sign.

“There are bills in both the House and Senate that would green-light liquor tastings on site, finally allowing people to purchase their alcohol online, and remove the cap on how much distillers are able to sell to consumers,” Ossowski said.

Senate Bill 11, titled “ABC regulation and reform,” cleared the Senate by a 48-0 vote on Feb. 19, but wasn’t heard in a House committee until being recommended in Finance on Wednesday and sent to Rules and Operations.

House Bill 971, titled “Modern licensure model for alcohol control,” has not been heard in committee since it was introduced April 25.

Distillery regulation reform bills introduced in both chambers have not been heard in committee.

“Another big priority should be ending the state monopoly on liquor sales and the outdated ABC system, which raises costs for consumers, misallocates capital better used by private enterprise, and gives too much authority to politicians and administrators as economic planners rather than regulators,” Ossowski said.

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