Tuesday, October 16, 2018

Let's talk New Jersey just a bit

This is a blog about Pennsylvania's drinking problem -- the PLCB. But sometimes we look at how other states do it, either to see how it's done right, or how it's done wrong. Today, "done wrong" is the New Jersey Division of Alcoholic Beverage Control, and their recent "crackdown" on limited brewery licenses...which was followed by an amusing 180 when they were brought to heel.

Let me explain. A limited brewery license is a relatively new thing, an adjustment to the NJ Booze Code that was just passed in the Garden State in 2012. I'll save you the trouble of looking at it: it's a license for breweries that produce under 300,000 barrels a year, and allows them to sell to wholesalers or direct to retailers, sell directly to consumers on their premises (by the drink, or in quantities up to a half-keg at a time for off-premise), and give limited amounts of free samples. The license is an annual fee, between $1,250 and $7,500, depending on the size of the brewery.

There are two restrictions in the law. On-premise sales must be "in connection with a tour of the brewery" (which has been interpreted to be as simple as signs on the brewing equipment or a three-minute instructional video). And "The holder of this license shall not sell food or operate a restaurant on the licensed premises." And that's it. 

And yet...last month, David Rible, the director of the NJ Division of Alcoholic Beverage Control (ABC, and why does it say "control" if they don't have state-run stores?) took it upon himself to arbitrarily issue a restrictive ruling that suddenly limited that "limited license" with a load of restrictions that seem to go way beyond the NJ legislature's original intent of "in connection with a tour" and "shall not sell food." 

Rible's ruling on consumer freedom
According to Rible's ruling, the limited license holder was now restricted to 25 "events" per year; "Trivia night" is given as an example of an "event," but so are "live" television display of sporting events, and each event must be approved by the ABC. The license holder may only do 12 off-premise events in a year; beer festivals are not included, but events in the brewery parking lot are. They are allowed to host up to 52 "private events," but only in a walled-off area. These "rulings" make things a lot less fun, but then Rible just got stupid. Yeah: David Rible got stupid. PLCB-level arbitrarily stupid.

The food thing got crazy. No food trucks are allowed, which...how? Why can't a food truck park in the lot? Then this one is just a killer: "No restaurant menus of any kind shall be placed or maintained on the licensed premises of a Limited Brewery." Which, one, in the era of GrubHub and Yelp is just stupid and pointless, and two, would seem to violate all kinds of commercial free speech.

Then there's this one, which is just weird: "A Limited Brewery licensee shall not allow, permit or suffer other mercantile business, such as "pop up' shops, bazaars or craft shows, to occur on the licensed premises." Sounds like Rible doesn't like hippies.

Upshot: there was a huge uproar from consumers, breweries (and I suspect the legislature), and within about a week, Rible was back-pedaling like mad. The whole thing was suspended, and now the Legislature is going to revisit the limited license. (And some brewers are pleased with this! Be careful what you wish for...)

Sigh. This is exactly the kind of crazed arbitrary rulings the PLCB loves to make, regardless of consequences. Rible is not a judge, he's not a legislator, he's certainly not the governor. But he took a law, and simply rewrote it. He presumed to know what the legislators really meant when they said "in connection with a tour" and "shall not sell food," and that was "don't take business away from complacent tavern owners." 

Rible's Library of Arbitrary Decisions and Policy Mistakes
Whoops. Did I say that out loud? Yeah, it sure looks like he did this to please tavern owners, who felt they were being gored by this limited brewery license. After all, because New Jersey has the same stupid limits on licenses that Pennsylvania does -- only worse! -- they had to pay a LOT more for their license, often over a million dollars. And that doesn't seem fair. 

Well, it isn't. But it's not the brewers' fault, and they shouldn't be punished for simply following the law. There wasn't any news of breweries selling food, and every New Jersey brewery I've ever been to (a lot of them), has offered some kind of "tour". 

No, the real problem here is that the licensing system is broken, and no one who currently has a license wants it fixed. Sound familiar? 

I'll spell it out for you. The arbitrary decision by the PLCB to allow grocery stores to sell beer because they have purchased a restaurant license (and maintain a "cafe" area separated from the rest of the store) is a bad idea, and it is only making the broken licensing system worse. And in the future, if the Legislature wants to fix that by creating a new, reasonably-fee'd store license, guess who's going to be spending a lot of money to convince them that's a bad idea? The grocery chains who spent millions buying restaurant licenses, that's who. 

Leave it to the Legislature. They answer to us. Bureaucrats like Rible, and the PLCB, rarely answer to anyone. Though I do have to admire the brewers of New Jersey for standing up to this bullshit. Well done! Hold onto those menus!

New Jersey's example is clear. As long as the PLCB has this kind of arbitrary regulatory power...mistakes will be made. The solution? It's at the top of the screen, as always: Abolish the PLCB. Rewrite the Code. 

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