Would Facilitate Growth of Craft-Distillery Industry and Create New Jobs
TRENTON – A Senate Committee today advanced a bill to modernize New Jersey’s liquor laws by creating a craft distillery license, which would allow small-scale producers who currently are priced out of the industry by the state’s high liquor license fees to do business in the state. Sponsored by Senator Donald Norcross, Shirley K. Turner and Jim Whelan, the bill seeks to expand micro-distilleries in New Jersey as tourist destinations as well as job-creators.
“New Jersey’s current laws make it incredibly difficult for small-scale distillers to do business in the state. With several distillers prepared to open facilities, it’s well past time that we took steps to update our antiquated laws,” said Senator Norcross (D-Camden/Gloucester). “This will help to facilitate growth of the craft-distillery industry while supporting our agricultural community and creating new jobs.”
A number of distillers have expressed interest in expanding or opening a distilling operation, including Yoakum’s Cooper River distillers in Camden, the former Princeton Township mayor and Alba Vineyard and Winery in Milford, which is interested in producing spirits with fruit grown on the farm, according to published reports. However they have been prevented from doing so due to the cost of doing business under current laws. A plenary distillery license costs $12,500 per year in New Jersey and has no production limits.
The senators’ legislation (SCS for S2286/S463) would create a new Craft Distillery License that would permit the licensee to manufacture up to 20,000 gallons of distilled alcoholic beverages (hard liquor). The fee for this license would be $938. The bill would also permit a license holder who certifies that at least 51% of the raw materials used in production of distilled alcoholic beverages are grown or purchased from providers in New Jersey to label these beverages as “New Jersey Distilled.”
“Small-scale distilleries are cropping up in states throughout the country, creating much-needed jobs and tourism destinations. By establishing a new license that caters to these niche businesses, we can get these small businesses off the ground here in New Jersey too,” said Senator Turner (D-Mercer). “This will mean new jobs, added tourism, and additional economic activity for our state.”
Under the bill, a license holder would be permitted to sell the distillery’s products for consumption on the premises to consumers who have toured the distillery, as well as to offer consumers up to three samples. A consumer who has toured the distillery would be permitted to buy up to five liters of the distillery’s products for consumption off the premises. Licensees could also sell and distribute their products to wholesalers and retailers licensed under State law. In addition, licensees who also hold a plenary or farm winery license could utilize the same equipment, production facilities and tasting rooms for their products, creating a more cost-effective way to do business.
“The high cost of licenses required to sell liquor in New Jersey has priced out small producers looking to open a business in New Jersey,” said Senator Whelan. “This will make it easier for these small operations to break into this cottage industry, which has shown promise in other areas of the country. It will also promote and support farmers who are an important part of our state economy.”
The craft distilling or micro distiller industry is rapidly growing throughout the United States, especially in New York, California, Oregon, and Washington. The micro distillery trend cropped up as the next step after the proliferation of craft breweries and wineries. In 2010, New York created a new class of alcoholic beverage license for “farm distillers.” Since its passage in 2010, the new license has spurred 30 micro distilleries to open in New York State. Washington created a micro distillery license four years ago.
The Senate Budget and Appropriations Committee approved the bill by a vote of 12-0. It now heads to the full Senate for consideration.