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Beer Sales Bottleneck?: Law Capping Alcohol Content is Costing State Retailers Say

Posted on: Sunday, 12 February 2006, 12:00 CST

By Joe Morris, The Charleston Gazette, W.Va.

Feb. 12--It's impossible to get drunk on Budweiser -- at least, that's what they think at the Statehouse.

According to West Virginia law, only "nonintoxicating" beer can be sold in the state. And by nonintoxicating, the statute means beer with an alcohol content at or below 6 percent.

The law may fly in the face of reality, but its real-world consequence is that it cuts off the state's bars, shops, grocers and restaurants from the growing market for gourmet or "craft" beers, which are made by specialty micro- or pub-breweries and tend to have higher alcohol contents.

At the urging of beer sellers who want to break into this market, seven House of Delegates members sponsored legislation last week to raise the beer-alcohol limit to 15 percent.

"It's about tourism," says Delegate John Doyle, D-Jefferson, main sponsor of the bill, along with Kanawha County Democrats Jon Amores, Bonnie Brown, Corey Palumbo, Danny Wells and Carrie Webster and Ohio County Republican Gil White.

The law the bill targets is a holdover from Prohibition, which has never been stricken from the state constitution. Over the years, one delicately worded amendment after another has been passed to com-promise its tenets. And one of those compromises is that you can buy beer, but for the most part only the familiar mass-market brands.

Restaurant owners and other beer sellers, especially those from Doyle's Eastern Panhandle that are close to the state border, "are at a competitive disadvantage because of this law," Doyle said.

There are no such prohibitions in any of the states that border West Virginia. In fact, there are only three other states that still limit beer alcohol content to 6 percent: Alabama, Mississippi and South Carolina.

Meanwhile, craft beer has grown into a $3.7 billion-a-year industry, where volume grew by 7.1 percent in the first half of 2005, according to the national Brewers Association.

"Living in the Panhandle, you see a big difference in what states like Maryland and Virginia are able to offer," said Greg Joyce, co-owner of the Stone Soup Bistro in Shepherdstown. "There's lots of money crossing the borders."

Joyce said every day at least one patron will request a craft beer that the law forbids.

"You have to go through the whole rigmarole of explaining the law, and usually the reaction is shock," he said. "You can travel five miles down the road and get it."

Cheryl Gallery, who's opening a wine shop in Shepherdstown this week, said people have already started putting in orders for craft beers that she won't be able to fill.

"People are very passionate about their microbrewed beer," said Gallery, whose shop will be called Grapes and Grains Gourmet. "Virginia isn't that far away, and these are people who when they want it, they go and get it."

There's a similar reaction at Bryan Ball's Snowshoe restaurants. "We see a lot of interest in the artisanal beer that we are missing," said Ball, who runs the Foxfire Grill, Red Fox and Ember restaurants. "Customers ask all the time and act surprised and confused when we tell them."

Without such offerings, it's harder to win over the upscale clientele that Snowshoe and other resort spots covet, Ball says.

"The folks that come to my restaurants are well-traveled people used to getting these kinds of products -- it's part of the whole culinary thing we are trying to do here," he said. "We have a selection of wines from around the world, but my customers can't get their favorite wheat beer."

To the bill's chief opponents, Ball, Gallery and Joyce are overstating the demand, and their customers are better off without that wheat beer anyway.

"I don't think it really hurts state business or tourism," said John Casey, lobbyist for the West Virginia Beer Wholesalers Association trade group, which is fighting Doyle's bill.

"We think alcohol should be consumed in moderation, and increasing the alcohol content is going away from moderation," Casey said. "As a society, I don't know if we want to be pushing a higher alcohol content."

One of the bill's unintended effects would be to allow more potent beer and malt liquors to be sold in beer-only taverns and shops -- in particular, at convenience stores that have been given beer-only status because they're located in high-crime

areas. The distributors worry that could lead to more alcohol-related crime.

But that hasn't happened in North Carolina, the state that most recently overturned its 6 percent limit, according to Sean Lilly Wilson, who spearheaded a grass-roots effort there to change the law.

Wilson, who does marketing for a weather services company in Chapel Hill, says he got involved not out of any financial interest but because he was a beer enthusiast tired of going out of state for his favorite brands.

Six months after legislation passed to raise North Carolina's beer alcohol cap from 6 percent to 15 percent, 250 new brands have been registered with state authorities, he said. Only three or four of those have been malt liquors; the rest are gourmet beers generally too pricey to be marketed in convenience stores.

Doyle said he wouldn't object to an amendment to the legislation blocking the sale of higher-alcohol beer in beer-only shops.

North Carolina distributors refused to support Wilson's campaign, which he carried out with a few like-minded friends, mainly because they didn't want to rock the boat, he says. The distributors "tended to be very cautious and used a lot of different excuses to hedge," he said. "They were just very happy with the way things were."

Not all distributors feel that way.

Kathy Folio of North Central Distributors in Clarksburg says the legislation is long overdue.

"We'd be able to provide more diverse products to our consumers," she said. "It would also enhance business, increase taxes for the state and show that the state is truly open for business by allowing more of these brewers to come in here."

Within the past year or so, North Central has started carrying craft beers that fall below the 6 percent limit -- and the response has been tremendous, Folio said.

Last year, for instance, North Central first ordered Harpoon brand, brewed in Massachusetts. It ended up ordering three trailers, with about 3,600 cases apiece, over the course of three months. People from the brewer told Folio they didn't expect her company to sell out of a single trailer any sooner than six months, she said.

The big purchasers were the major grocery chains, like Go-Mart and Kroger, Folio said.

Aside from the tourism and retail arguments, cap-popping proponents like Charleston bar proprietor Pierre Charbonniez contend that there's a blatant contradiction in the law that discriminates against beer drinkers.

"I don't understand why I can offer wine that's up to 15 percent [alcohol content] but I can't sell beer with 8 or 9 percent," said Charbonniez, co-owner of the Vandalia Lounge.

"To me this is about choice -- it isn't going to be a huge windfall for me and my business," he said. "What it will mean is access to the best beers in the world, and I'm open to offering my customers the best things I can get my hands on."

To contact staff writer Joe Morris, use e-mail or call 348-5179.

The 'nonintoxicating' clause

Beer sold in West Virginia must be "nonintoxicating." That means, in short, its alcohol level can't top 6 percent. Here's what the law says:

"'Nonintoxicating beer' means all cereal malt beverages or products of the brewing industry commonly referred to as beer, lager beer, ale and all other mixtures and preparations produced by the brewing industry, including malt coolers and containing at least one half of one percent alcohol by volume, but not more than four and two-tenths percent of alcohol by weight, or six percent by volume, whichever is greater, all of which are hereby declared to be nonintoxicating, and the word 'liquor' as used in chapter sixty of this code shall not be construed to include or embrace nonintoxicating beer nor any of the beverages, products, mixtures or preparations included within this definition."

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Copyright (c) 2006, The Charleston Gazette, W.Va.

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Source: The Charleston Gazette

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