Small breweries and brewpubs can triple the amount of beer and distilleries can double the alcohol they can sell daily to a customer for off-premise consumption, starting Aug. 1, under Act No. 2021-454.
Gov. Kay Ivey signed the legislation May 17 boosting the daily caps. The Alabama Senate had approved the bill by Rep. Anthony Daniels, D-Huntsville, and Sen. Bobby Singleton, D-Greensboro, on May 4. The House unanimously concurred with the Senate changes May 6.
The new law will allow a licensed brewery that produces less than 60,000 barrels of beer or a brewpub (10,000 or fewer barrels annually) to sell up to 864 ounces of beer per customer per day and a distillery to sell up to 4.5 liters of liquor per customer per day for off-premise consumption. The current caps are 288 ounces and 2.25 liters. The law also allows beer manufacturers and brewpubs to donate and deliver up to 31 gallons of beer to charitable nonprofit special events. Both of those provisions in the bill are effective Aug. 1.
“During the pandemic, breweries and craft distilleries have been struggling small businesses,” Singleton said. “This gives them more volume than they are selling now.”
The law immediately revises the definition of beer to alcohol “brewed or produced from malt, wholly or in part, or from rice, grain of any kind, bran, glucose, sugar or molasses. A beer or malt or brewed beverage may incorporate honey, fruit, fruit juice, fruit concentrate, herbs, spices or other flavorings during the fermentation process. The term does not include any product defined as liquor, table wine or wine.”
Also effective Aug. 1, the 60,000 barrel limit for beer manufacturers includes “all beer produced by the manufacturer, all beer produced by a parent, subsidiary or affiliate of the manufacturer and all beer brewed exclusively for the manufacturer.” The law also allows beer to be transferred between manufacturers under the same ownership.
Another provision authorizes the ABC board to designate in its manufacturer license the type or types of alcoholic beverage produced, whether beer, wine or liquor. The board can consider each type product manufactured as a separate operation and the license must contain a designation before that specific type of alcohol can be produced. A manufacturer currently has the ability to manufacturer all alcohol types, with the proper federal approvals. Licenses by alcohol type gives the board the opportunity to suspend operations by a specific alcohol type and not necessarily the entire entity if a tax or compliance issue arises. A license by alcohol type also helps the board know when a manufacturer begins producing a new type of alcohol.
Separate legislation dealt exclusively with the provisions related to what is included in the 60,000 barrel limit and the alcohol type on the manufacturer license, but those bills were abandoned when they became part of this law. On the final night of the session, the House carried over SB322 by Sen. Sam Givhan, R-Huntsville, while its companion HB613 by Rep. Mike Ball, R-Madison, died earlier because of a lack of action.
Another bill, SB389 by Sen. Billy Beasley, D-Clayton, dealt strictly with the daily cap for distilleries. The need for it also died with the enactment of this legislation.
DRAFT BEER
By Aug. 1, the Clanton City Council can authorize draft beer for on-premise consumption plus for off-premise consumption in growlers (64 ounces maximum), under Act No. 2021-458. Keg sales are not allowed under the law, sponsored by Rep. Van Smith, R-Billingsley, and signed into law May 17 by the governor.
On April 1, the governor signed into law legislation allowing the Elmore County Commission by resolution to authorize draft beer sales in that county and cities within the county to do the same for both on- and off-premise consumption. Act No. 2021-251 received Senate approval March 21 and House approval March 16.
ENTERTAINMENT DISTRICTS
The city of Orange Beach can go from two to three entertainment districts, under Act No. 2021-350. The governor signed the bill by Sen. Chris Elliott, R-Fairhope, into law Thursday, May 6.
The Mountain Brook City Council can establish entertainment districts in the city’s Mountain Brook, English and Crestline villages, under Act No. 2021-214 by Rep. David Faulkner, R-Birmingham, which became effective April 15.
Another entertainment district bill, SB88 by Sen. Rodger M. Smitherman, D-Birmingham, was in line for final approval in the Alabama House, but was not acted on by the full House on the final day. SB88 would have tripled the number of entertainment districts allowed in the city of Birmingham. Currently, only five such districts are allowed. Smitherman’s bill would authorize 15. The Alabama Senate had approved the legislation Feb. 25.
DRIVE-THRU OR WALK-UP BEER AND WINE
Legislation died in the 2021 session that would have allowed any licensed alcohol retailer to sell beer and wine for off-premises consumption at a drive-thru or walk-up window. The House approved HB560 by Rep. Gil Isbell, R-Gadsden, on April 20. The next day, the Senate Tourism Committee approved it, but the full Senate never debated the bill. On May 4, the Senate indefinitely postponed the companion bill, SB334 by Sen. Tom Whatley, R-Auburn.
PHASE OUT STATE ABC STORES
The Alabama Senate also never considered legislation that would have phased out retail alcohol sales at the Alabama Alcoholic Beverage Control Board’s 170 state stores by Sept. 30, 2026.
On a voice vote March 4, the Senate Tourism Committee had approved SB287 by Sen. Arthur Orr, R-Decatur, who described the bill as a “skinny” version of legislation he has introduced for several years. His latest bill would have left intact the state’s wholesale distribution of alcohol and enforcement functions. “The state should be out of the retail sales of alcohol,” Orr said.
Previous attempts to get the state out of retail liquor sales also have failed to gain legislative approval.
OTHER ALCOHOL RELATED LEGISLATION
Home delivery of sealed beer, wine and liquor possible by Oct. 1
Wineries can ship their product directly to Alabama consumers as of Aug. 1
Small wineries can distribute their wines and sell directly to consumers
This article is part of the Alabama Retail Report, a communication for Alabama Retail Association members. Not a member? Join us!
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