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Delmarva Farmer Columnists
Farm breweries: New Opportunity for Md. farmers (Nov. 24, 2015)
By Mayhah Suri, Research Associate, Ag Law Education Initiative, CANR Agricultural and Resource Economics
Along with the national craze for small-scale, locally-made produce, interest in local beer has exploded.
In just 10 years, the number of microbreweries in the United States has increased 400 percent, according to the National Brewer’s Association.
To help farmers capitalize on this growing industry, the State of Maryland has created the Class 8 Farm Brewery License. This farmers-only license allows you to serve your beer on-site, not just sell it like other brewery licenses. With a Class 8 license, you may sell and deliver beer to a wholesale company or individual consumers. You may sell, bottle, and/or contract for up to 15,000 barrels of beer in a calendar year, and may also sell the ingredients you grow, such as hops or grain, to other producers. The license has an annual fee of $200 and the application can be found online.
The tricky part about getting the farm brewery license is that you must also comply with Federal regulations and local laws. U.S. alcoholic beverage laws are complicated because there are Federal, state, and local (including county) laws and each layer of the law has specific requirements. Anyone who wants to sell and/or serve alcohol needs Federal approval, granted by the Alcohol and Tobacco Tax and Trade Bureau. The application process for a Federal Brewer’s Notice is completely online through the TTB website.
Before submitting Federal applications, it is critical to make sure your operation is compliant with your county’s laws. The best place to start is with your local agriculture marketing professional to get more information about local alcohol laws. As of now, the license allows you to sell and serve beer regardless of local alcohol laws, except in Garrett County, where you may operate on Sundays only where voters have approved Sunday alcohol sales. Although the letter of the farm brewery law allows you to disregard local laws restricting the sale and service of alcohol, it is prudent to stay within the confines of local ordinances. Since this law is relatively new, some portions of it may change as more farmers venture into this opportunity. Respecting the local laws can help prevent issues in the future.
Zoning codes must also be kept in mind. Your agricultural marketing professional can help you find the right people to talk to about zoning permits. Once you have met those requirements, you can move on to the Federal Brewer’s Notice and the requirements of the Class 8 license.
The Class 8 Farm Brewery license requires that the beer you sell and serve contains at least one ingredient grown on your farm. While the license is granted to a farm address, the brewing facility may be located elsewhere, though brewing onsite may be easier. With a Class 8 license, farmers may serve their beer for consumption on the premises as long as each sample is less than six ounces.
You may offer the six ounce “samples” for free or charge per glass, and serve beer on-site and sell for offsite consumption from 10 am to 10 pm seven days a week. The beer you sell to be taken home must be in sealed containers like cans or bottles, or re-sealable containers like a growler. Again, although this law allows you to sell at these times regardless of local laws, it may be wiser in the long run to respect local regulations.
A big difference between the Class B license and other liquor licenses is that farm breweries are allowed to serve certain types of prepared foods, including chili, cheese, and fruits. Most other liquor licenses require a separate permit in order to serve food. Remember that having this farm brewery license does not exempt you from health and safety guidelines.
As with any new business opportunity, it is important to be well-informed before starting a farm brewery. Good resources include your local agricultural marketing professional, the TTB website, and your local zoning board. Despite challenges that may come with your new venture, the explosion in demand for local, small-scale breweries coupled with this farm brewing license is an exciting opportunity for farmers interested in expanding or diversifying their business.
For the full guide, please visit www.umaglaw.org/publications-library.html.
Protecting the Bottom Line (Nov. 24, 2015)