Senate Bill 1078 — Contract brewing

Senate Bill 1078 — Contract brewing

by
Phil Haunschild
February 21, 2019

Bill description: SB 1078 would allow small brewers to contract with others to brew their beer in off-site facilities.

Rating: +1

Does it give government any new, additional, or expanded power to prohibit, restrict, or regulate activities in the free market? Conversely, does it eliminate or reduce government intervention in the market?

SB 1078 would allow the small brewers to contract with other companies to brew their beer. Under current law, it is not clear that a brewer can produce beer for a different company within its licensed premises. For example, a microbrewery (any brewer which produces fewer than 15,000 barrels per year) would be able to contract with another microbrewery to produce beer.

Allowing brewers to contract with other companies  would allow them to brew beer without having to invest in the substantial start-up costs and investments that go into a brewing facility. If another brewer has extra capacity that can be contracted out for another’s use, both parties would walk away better off. The company doing the brewing would get paid for allowing someone else to use its facilities, while the company paying for the brewing services would be able to create its own beer without having to invest in the substantial capital required for a brewing operation.

This is particularly beneficial in light of the explosion of microbreweries in recent years. The number of Idaho craft breweries more than doubled between 2011 and 2017.

(+1)

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