Craft Beverages Given More Support in State Law

The craft beverage industry is among the fastest-growing industries in New York with nearly 900 licensed manufacturers in the state. Part of this growth has to do with the state’s focus in recent years on trying to make it easier for craft-beverage producers such as beer, cider, and liquor producers to do business in New York. Many of the changes focused on easing financial and regulatory pressures in an effort to help craft-beverage producers enjoy the same benefits that wineries do.

This year, the state legislature built on this progress and passed legislation that would exempt from sales tax tastings at licensed beer, cider, and liquor producers. Under current law, only wineries are eligible to receive the sales-tax exemption. This legislation would help craft-beverage producers to market their products without consumers having to pay New York State the additional tax.

In 2013, New York put into effect the Farm Brewery Law. The law created a farm-brewery license, which enables craft breweries to operate similarly to wineries. The law was modeled after the 1976 Farm Winery Act, which spurred the growth of wine production in this state and helped create the Finger Lakes Wine Trails and other small wine trails throughout the state which bolstered tourism. The increase in tourists also benefits surrounding businesses such as hotels and restaurants.

Like with the Farm Winery Act, with the farm-brewery license, brewers do not need an additional permit to serve beer by the glass. The license also permits farm brewers to make cider to be served by the glass. Brewers may sell their products at restaurants, conference centers, inns, bed and breakfasts, or hotels the brewer owns in addition to tasting rooms and farmers’ markets. Selling related products such as beer-making equipment, souvenir items and food at breweries is also permitted under the new law. The law also provides tax breaks and relaxes some regulations and fees for breweries.

While the law was designed to increase demand and promote locally produced beverages, it was also created to support farmers. To receive the farm-brewery license, brewers must use locally grown produce in their beverages. By 2018, at least 20 percent of the hops used to make beverages and 20 percent of all other ingredients used in the product must be grown or produced in New York. By 2024, no less than 90 percent of the hops and 90 percent of all other ingredients must be grown or produced in the state in order for breweries to maintain their license. Not only will this policy help support local agriculture, but it will also help New York create and market a distinctive flavor. Interestingly, Volney is home to the largest barley-malting operation in the eastern U.S. — an ingredient required in beer. The 1886 Malt House is located at the former Miller Brewery plant and is on track to supply more than 2,000 tons of barley malt each year.            

William (Will) A. Barclay is the Republican representative of the 120th New York Assembly District, which encompasses most of Oswego County, including the cities of Oswego and Fulton, as well as the town of Lysander in Onondaga County and town of Ellisburg in Jefferson County. Contact him at barclaw@assembly.state.ny.us, or (315) 598-5185.