The state Assembly deliberated over beer distribution in Wisconsin Wednesday, passing legislation that could cause an increase in prices at the bar and hurt local breweries in the Madison area.
Under current law, beer manufacturers are not required to go through a wholesaler before selling their products to retailers.
However, under Assembly Bill 787, manufacturers producing over 100,000 barrels of beer a year and direct shipping more than 30,000 barrels would have to comply with mandatory wholesalers.
Deb Carey, president of New Glarus Brewing Company, stated passage of the bill would be detrimental to her business.
'They are forcing us to declare exclusive territory for wholesalers. In order to keep our wholesaler license, and we need our wholesaler license for things like when there's special events, quite often the brewery is bringing the beer,' Carey said. 'We need a wholesaler license in order to transport beer.'
Carey also said this legislation 'will for sure increase beer prices at the bars' because of compensation needed to run extra warehouses, taxes and heating if AB 787 passes.
State Rep. Jim Fitzgerald, R-Horicon, and co-author of the bill, said the adoption of AB 787 would not hurt smaller breweries but rather 'prevent a vertical monopoly that really created a lot of problems in the early 1900s.'
Additionally, Fitzgerald said under AB 787 smaller breweries would be granted generous exemptions if they produce under 100,000 barrels of beer a year and do not direct ship more than 30,000 barrels to retailers in one calendar year.
'Right now the largest brewer of the Small Guild Brewers is Deb Carey's New Glarus. She makes about 44,000 so we set the cap at 100,000, which is what the small brewers requested,' Fitzgerald said.
Fitzgerald also stated the majority of breweries do not direct ship any barrels now and for those that do, direct shipping is currently at 1,500 barrels.
State Rep. Joe Parisi, D-Madison, voted against the bill.
'My no vote was because I want to make sure and make it possible for small brewers to compete, and I don't want to put any undue burdens on them,' Parisi said.
Likewise, Carey disagreed with the legislation due to 'gross misrepresentations of our industry.'
'I need the ability to ship, so I need the wholesaler license,' Carey said.
