Beer Regulation Reform Bill on Tap in Maryland

Published January 9, 2018

Maryland lawmakers are considering a bill by Comptroller Peter Franchot that would repeal some of the state’s regulations on craft beer breweries.

In November 2017, Franchot proposed the Reform on Tap Act of 2018, a bill to relieve regulatory burdens on craft beer production and sales.

Franchot’s bill would remove the state’s limits on how much beer breweries are allowed to sell on-site. It would also allow breweries to sell directly to retailers instead of requiring them to make franchising agreements with distribution companies.

Currently, Maryland craft breweries are allowed to sell up to 3,000 barrels of beer, or about 500,000 pints, directly to consumers each year.

‘Really Ridiculous Rules’

Nick Zaiac, a policy analyst with the Maryland Public Policy Institute, says the current regulations are chilling the state’s beer industry.

“They have a lot of really ridiculous rules out here,” Zaiac said. “Maryland is one of worst states for beer regulations, especially for micro-brewing.”

The state’s restrictions on direct-to-consumer sales keep brewers small, Zaiac says.

“The biggest thing that brewers in this state have struggled with are the artificially low caps on the total amount of beer they could sell,” Zaiac said. “Maryland brewers faced restrictions on the quantity they could produce. That really put a damper on business.”

Brewing up More Flexibility

C. Jarrett Dieterle, a governance project fellow with the R Street Institute, says more flexibility for brewing companies could give shoppers more choices.

 “Giving brewers more flexibility to sell directly to the retail stores and the public certainly could lead to, and I would not be surprised if it did lead to, more diversity of choice in beer,” Dieterle said.

Tapping the Beer Economy

The Reform on Tap Act would have Maryland business owners saying “cheers,” Dieterle says.

“Getting rid of the self-distribution limits and franchise limits, and opening up taproom sales, those three things alone would be a game-changer for Maryland,” Dieterle said. “As it stands now, I think it’s really a comprehensive, legitimate reform. I think it would make Maryland one of the more ‘open for business’ states in terms of beer, in the country, actually.”