All posts by Andrew Schmitt

Andrew is just a guy that likes beer. You can usually find him on the twitters or spending time with his family.

House Passes Omnibus Tax Bill

The House of Representatives passed their version of the Tax Omnibus Bill HF 677. Included in the bill is a substantial excise tax increase that has been largely opposed by Minnesota breweries, wineries, distilleries, wholesalers, distributors, restaurants, pubs, bars, and consumers.

Below is a record how Representatives in the House voted and the contested language.
You can find an official voting record here. And the contested bill here.

Those who voted for the increase:

Allen Anzelc Atkins Benson, J. Bernardy
Bly Brynaert Carlson Clark Davnie
Dehn, R. Dill Dorholt Erhardt Erickson, R.
Falk Faust Fischer Freiberg Fritz
Hansen Hausman Hilstrom Hornstein Hortman
Huntley Isaacson Johnson, C. Johnson, S. Kahn
Laine Lenczewski Lesch Liebling Lien
Lillie Loeffler Mahoney Mariani Marquart
Masin McNamar Melin Metsa Moran
Morgan Mullery Murphy, E. Murphy, M. Nelson
Newton Norton Paymar Pelowski Persell
Poppe Savick Sawatzky Schoen Simon
Simonson Slocum Sundin Thissen Wagenius
Ward, J.A. Ward, J.E. Winkler Yarusso

Those who voted in the against the increase:

Abeler Albright Anderson, M. Anderson, P. Anderson, S.
Barrett Beard Benson, M. Cornish Daudt
Davids Dettmer Drazkowski Erickson, S. Fabian
FitzSimmons Franson Garofalo Green Gruenhagen
Gunther Hackbarth Halverson Hamilton Hertaus
Holberg Hoppe Howe Johnson, B. Kelly
Kieffer Kiel Kresha Leidiger Lohmer
Loon Mack McDonald McNamara Myhra
Newberger Nornes O’Driscoll O’Neill Peppin
Petersburg Pugh Quam Radinovich Rosenthal
Runbeck Sanders Schomacker Scott Selcer
Swedzinski Theis Torkelson Uglem Urdahl
Wills Woodard Zellers Zerwas

 

59.32    Sec. 12. Minnesota Statutes 2012, section 297G.03, subdivision 1, is amended to read:
59.33    Subdivision 1. General rate; distilled spirits and wine. The following excise tax is
59.34imposed on all distilled spirits and wine manufactured, imported, sold, or possessed in
59.35this state:

60.1 Standard Metric
60.2
60.3
60.4
(a) Distilled spirits, liqueurs, cordials,
and specialties regardless of alcohol
content (excluding ethyl alcohol)
$ 5.03
11.02per gallon
$ 1.33
2.91per liter
60.5
60.6
60.7
60.8
(b) Wine containing 14 percent or less
alcohol by volume (except cider as
defined in section<statute_ref>297G.01, subdivision
3a )
$ .30
2.08 per gallon
$ .08
.55per liter
60.9
60.10
60.11
(c) Wine containing more than 14
percent but not more than 21 percent
alcohol by volume
$ .95
2.73 per gallon
$ .25
.72per liter
60.12
60.13
60.14
(d) Wine containing more than 21
percent but not more than 24 percent
alcohol by volume
$ 1.82
3.64 per gallon
$ .48
.97per liter
60.15
60.16
(e) Wine containing more than 24
percent alcohol by volume
$ 3.52
5.34 per gallon
$ .93
1.42per liter
60.17
60.18
(f) Natural and artificial sparkling wines
containing alcohol
$ 1.82
3.60 per gallon
$ .48
.95per liter
60.19
60.20
(g) Cider as defined in section<statute_ref>297G.01,
subdivision 3a
$ .15
1.93 per gallon
$ .04
.51per liter
60.21
60.22
(h) Low-alcohol dairy cocktails $ .08
1.36 per gallon
$ .02
.36per liter

60.23In computing the tax on a package of distilled spirits or wine, a proportional tax at a
60.24like rate on all fractional parts of a gallon or liter must be paid, except that the tax on a
60.25fractional part of a gallon less than 1/16 of a gallon is the same as for 1/16 of a gallon.
60.26EFFECTIVE DATE.This section is effective July 1, 2013.

60.27    Sec. 13. Minnesota Statutes 2012, section 297G.03, is amended by adding a
60.28subdivision to read:
60.29    Subd. 5. Small winery credit. (a) A qualified winery is entitled to a tax credit of 
60.30$2.08 per gallon on 50,000 gallons sold in any fiscal year beginning July 1. Qualified 
60.31wineries may take the credit on the 18th day of each month, but the total credit allowed 
60.32may not exceed in any fiscal year the lesser of:
60.33(1) the liability for tax; or
60.34(2) $104,000.
60.35(b) For purposes of this subdivision, a “qualified winery” means a winery, whether 
60.36or not located in this state, producing less than 100,000 gallons of wine in the calendar 
60.37year immediately preceding the calendar year for which the credit under this subdivision 
60.38is claimed. In determining the number of gallons, all brands or labels of a winery must 
60.39be combined. All facilities for the production of wine owned or controlled by the same 
60.40person, corporation, or other entity must be treated as a single winery.
61.1EFFECTIVE DATE.This section is effective July 1, 2013.

61.2    Sec. 14. Minnesota Statutes 2012, section 297G.04, is amended to read:
61.3297G.04 FERMENTED MALT BEVERAGES; RATE OF TAX.
61.4    Subdivision 1. Tax imposed. The following excise tax is imposed on all fermented
61.5malt beverages that are imported, directly or indirectly sold, or possessed in this state:
61.6(1) on fermented malt beverages containing not more than 3.2 percent alcohol by
61.7weight, $2.40 $25.55 per 31-gallon barrel; and
61.8(2) on fermented malt beverages containing more than 3.2 percent alcohol by
61.9weight, $4.60 $27.75 per 31-gallon barrel.
61.10For fractions of a 31-gallon barrel, the tax rate is calculated proportionally.
61.11    Subd. 2. Tax credit. A qualified brewer producing fermented malt beverages is
61.12entitled to a tax credit of $4.60 $27.75 per barrel on 25,000 50,000 barrels sold in any
61.13fiscal year beginning July 1, regardless of the alcohol content of the product. Qualified
61.14brewers may take the credit on the 18th day of each month, but the total credit allowed
61.15may not exceed in any fiscal year the lesser of:
61.16(1) the liability for tax; or
61.17(2) $115,000 $1,387,500.
61.18For purposes of this subdivision, a “qualified brewer” means a brewer, whether or
61.19not located in this state, manufacturing less than 100,000 200,000 barrels of fermented
61.20malt beverages in the calendar year immediately preceding the calendar year for which
61.21the credit under this subdivision is claimed. In determining the number of barrels, all
61.22brands or labels of a brewer must be combined. All facilities for the manufacture of
61.23fermented malt beverages owned or controlled by the same person, corporation, or other
61.24entity must be treated as a single brewer.
61.25EFFECTIVE DATE.This section is effective July 1, 2013.

As time allows voting records will be updated with contact links and party affiliation.

Grain Belt – Putting the American in American Lager

The August Schell Brewing Co. has launched a new Grain Belt marketing campaign featuring the phrase, “We are the American in American Lager.” The goal for the new campaign is to evoke the pride and spirit of loyal Grain Belt drinkers.
color_letterhead1Schell’s has invited Grain Belt Facebook fans to share pictures and stories of themselves enjoying the hobbies, passions and experiences that make them proud to be American. To enter the contest you need to share your distinctly American experience (with a Grain Belt beer, of course) to the contest event on the Grain Belt Facebook page.

A new topic will be highlight each month. April’s theme is American restoration. Think of of something like your head under the hood of your ’55 Chevy and a cold Grain Belt on the fender.

At the end of every month a winner will be chosen, and featured in a Grain Belt ad along with their project. A Grain Belt product, your name ,and hometown will also be used in the winning advertisement. The winner will receive a large commemorative Marti family signed printed version of the ad.
GBOutdoorsmenAd.1

Better Beer Society / Homebrew Chef Educational Beer Dinner

The Better Beer Society proudly presents a very special beer dinner with famed beer chef Sean Z. Paxton (aka – The Homebrew Chef).
BBS Beer DinnerChef Paxton hails from San Francisco is arguably the most famous beer chef in the world, creating beer dinners for some of the best craft breweries in the nation, as well as for Brewers Association events such as the Craft Brewers Conference and the Great American Beer Festival. In addition, he is a respected author and hosts a monthly podcast on The Brewing Network.

Better Beer Society is a Twin Cities based educational organization dedicated to the growth and awareness of craft beer in Minnesota. BBS provides education through staff training at the retail level, as well as on the consumer level with its highly attended Better Beer Society University program.

The Homebrew Chef has recently partnered with the Better Beer Society on a collaboration dinner showcasing 5 of Minnesota’s craft breweries. Together we’re bringing education to the table as we present the concept and technique of cooking with beer and beer ingredients, as well as the presenting the principles of pairing beer with food.

Join BBS on Friday April 26th at Republic in Uptown, as they present what is sure to be a beer dinner unlike any other you’ve experienced. You will also be joined by Brewmasters and owners of the following brewing companies: Surly, Schell’s, Indeed, Summit, and Steel Toe.

Tickets are $90 (not including tip + gratuity), and reservations are being taken by phone. Please contact 612.886.2309 to reserve your seat(s), as space is limited and this event will sell out fast. Social hour @ 6pm / Dinner @ 7pm.

For more information on Better Beer Society or this event, please contact Rob Shellman directly at rob@betterbeersociety.com or 612.226.7622

What: Better Beer Society / Homebrew Chef Educational Beer Dinner
When: Friday April 26th / 6pm
Where: Republic Calhoun Square
902986_10151589167271488_1556680486_o

Death and Taxes

Taxes

It has been a while since the liquor excise tax has increased in Minnesota, and there is a movement afoot at the Capitol to change that.

The House Tax Omnibus HF 677, will increase the tax on liquor, wine, and beer in Minnesota by substantial amounts, as will the Senate version.  There are a few differences between the bills.  Both have massive increases, but the senate version creates an impact fund to go toward nonprofit entities that run substance abuse programs.

The tax increase is being sold as a mere pennies-per-pint increase, a notion that is entirely false.  In actuality, the tax increase is far more than a few pennies per pint.  The proposed state excise tax has an increase from $4.60 to $27.75 per 31-gallon barrel.  This is a 6-fold increase to one of the few industries showing growth in Minnesota.

Here is the terrible part about the tax increase; it gets passed to you, the consumer.  Brewers aren’t just going to pay the extra cost to the state and be done with it.  To cover the increase, brewers will increase the price that wholesalers pay, then wholesalers will pass that increase to retailers, and retailers will pass it to you.  Say what you want about the 3-tier system, but this is the system we have and it isn’t going away soon.

Follow along for some math fun!

Under the current tax structure:
Local brewery sells keg for $200
Wholesaler sells keg for $260 (30% increase)
Bar/store sells keg for $338 (30% increase)

Under the proposed tax structure:
Local brewery sells keg for $227
Wholesaler sells keg for $295 (same 30% increase)
Bar/store sells keg for $384 (same 30% increase)

See how a $27 tax can quickly become a $46 per Bbls increase? Include the federal excise tax, state sales tax, state alcohol tax, and local taxes, it is obvious that the government likes to dip its beak into your beer and drink heartily.

I think it is a really, really bad thing.

– Jacquie Berglund, Founder and CEO of FINNEGANS Inc.

But, not all governments are created equal. Of the surrounding states, Minnesota is currently in the middle of the pack when it comes to excise tax. South Dakota has a higher state excise tax at $8.50 a Bbls, and Wisconsin only taxes $2.40 a Bbls.  It is worth noting that South Dakota is the only other state in the region that also has a special Alcohol Tax.  The South Dakota special alcohol tax is 2%, and we beat them at 2.5% on gross receipts.

Death

Proponents of the tax increase claim that the extra tax revenue will offset the cost counties pay to run addiction centers and other alcohol-related medical expenses. If the idea is to offset the county costs, why is the tax revenue going into the state general fund? If counties like Hennepin are interested in offsetting the cost alcohol has on society, they should tax it at the county level. In fact, there are already numerous special taxes in downtown Minneapolis as they tax everything from dancing to liquor.

Breweries in Minnesota are doing their best to catch up to the rest on the country.  You will read all kinds news about the craft brewery explosion in Minnesota, but there are over 2,500 breweries in the country and we have less than 50.  We are a good deal behind the rest of the nation when it comes to enjoying local craft beer.  Increasing the cost to operate a brewery will only hinder the growth we’ve begun to see.

The only silver lining in the proposed tax increase is a provision that gives a credit to brewers on the first 50,000 Bbls brewed in a year.  The tax credit is nice, but it leaves breweries like Summit, Schell’s, and Cold Spring to pay a substantial amount of the tax.  The 50,000 ceiling is puzzling.  Nationally, brewers that produce less than 6 Mil Bbls a year are considered small.  A tax credit on 50,000 Bbls a year doesn’t do much to soften the blow of the proposed tax increase.

Unlike local wine and beer producers, there is no protection for local craft distillers in the proposed tax increase. Local distilling is an even smaller industry than brewing and wineries. Small distilleries are only beginning to have a presence here in Minnesota. Is the idea to collect more taxes from distillers, or make sure there are none here to pay the tax?

Minnesota is the home of prohibition and Andrew Volstead, but that doesn’t have to be our legacy. Prohibition is dead. Volstead is dead. This tax increase needs to die, too.

Surly Brewing Makes Minneapolis Destination Brewery Official

Brooklyn Center based Surly Brewing has been taking all the proper steps to to make Minneapolis the home of their new $20M brewery.

Surly Brewery Site
Photo by Bryce Larson

In recent months the brewery has taken numerous steps to clear the way. They received several federal grants to aid in the environmental remediation, named an architect, and applied for a loan from local government.

With the announcement of the site purchase today it would be tough to turn back now! Minneapolis beer lovers are surely happy to be the future home to another great Minnesota brewery. Even Mayor RT Rybak tweeted his support.

 

Sources: Star Tribune, Twin Cities Business

All Pints North Summer Brew Fest Tickets Go On-Sale

The Minnesota Craft Brewer’s Guild All Pints North tickets go on-sale at noon this coming Monday, April 15.

In addition to the regular All Pints North ticket on-sale at noon, there will be an early pre-sale at 10am Monday for ticket 2-packs to All Pints North and Autumn Brew Review. This means you’ll get early access to ABR tickets that generally sell out in seconds, and don’t go on sale until July.

This a nice surprise for those might have missed out on the MNCBG FESTIVAL 6-PACK, or balked at the financial and time commitment when the full pack originally went on sale.

all pints pano

The All Pints North Festival rivals every other guild fest.  The music stage and view alone make this festival worth the price of admission.  It is worth noting that if buy tickets you should book your hotel room at the same time.  Hotel rooms, and even campsites, will fill up quickly.  With all the great places brewing beer in Duluth you should definitely make a weekend out of it.

Minnesota Craft Brewers Guild All Pints North Summer Brew Fest
Saturday, July 13, 2013
3-7 p.m.
Bayfront Festival Park | Duluth, MN

Approx. 2,500 attendees
$30 in Advance (Limit 6) | $40 at the door (if available) | $10 Sober Driver Ticket
APN tickets on sale Monday, April 15 @ Noon
For tickets visit tempotickets.com/apn

APN/ABR ticket packs on sale Monday, April 15 @10am
For tickets visit

Sunday Liquor Sales Hearing in House Committee

HF 521, a bill to legalize Sunday liquor sales will be heard in the House Commerce Committee today at 4 p.m. in the Basement Hearing Room of the State Office Building.

Please, call/email house committee members and tell them to legalize Sunday sales.

There are dozens of stores in the metro supporting this reform.  Polls show immense consumer support for legalizing Sunday sales.

Share this will your beer and freedom loving friends!

Representative Joe Atkins Committee ChairJoe Atkins (DFL)
583 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
St Paul, MN 55155
651-296-4192
E-mail: rep.joe.atkins@house.mn
Representative Patti Fritz Vice ChairPatti Fritz (DFL)
437 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
St Paul, MN 55155
651-296-8237
E-mail: rep.patti.fritz@house.mn
Representative Joe Hoppe Republican LeadJoe Hoppe (R)
343 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
St Paul, MN 55155
651-296-5066
E-mail: rep.joe.hoppe@house.mn
Representative Sarah Anderson
Sarah Anderson (R)

237 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
St Paul, MN 55155
651-296-5511
E-mail: rep.sarah.anderson@house.mn
Representative Tom Anzelc
Tom Anzelc (DFL)

517 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
St Paul, MN 55155
651-296-4936
E-mail: rep.tom.anzelc@house.mn
Representative Greg Davids
Greg Davids (R)

283 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
St Paul, MN 55155
651-296-9278
E-mail: rep.greg.davids@house.mn
Representative Raymond Dehn
Raymond Dehn (DFL)

423 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
St Paul, MN 55155
651-296-8659
E-mail: rep.raymond.dehn@house.mn
Representative Andrew Falk
Andrew Falk (DFL)

439 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
St Paul, MN 55155
651-296-4228
E-mail: rep.andrew.falk@house.mn
Representative Laurie Halverson
Laurie Halverson (DFL)

407 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
St Paul, MN 55155
651-296-4128
E-mail: rep.laurie.halverson@house.mn
Representative Debra Hilstrom
Debra Hilstrom (DFL)

379 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
St Paul, MN 55155
651-296-3709
E-mail: rep.debra.hilstrom@house.mn
Representative Melissa Hortman
Melissa Hortman (DFL)

377 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
St Paul, MN 55155
651-296-4280
E-mail: rep.melissa.hortman@house.mn
Representative Sheldon Johnson
Sheldon Johnson (DFL)

549 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
St Paul, MN 55155
651-296-4201
E-mail: rep.sheldon.johnson@house.mn
Representative Leon Lillie
Leon Lillie (DFL)

371 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
St Paul, MN 55155
651-296-1188
E-mail: rep.leon.lillie@house.mn
Representative Jenifer Loon
Jenifer Loon (R)

261 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
St Paul, MN 55155
651-296-7449
E-mail: rep.jenifer.loon@house.mn
Representative Tim Sanders
Tim Sanders (R)

259 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
St Paul, MN 55155
651-296-4226
E-mail: rep.tim.sanders@house.mn
Representative Dan Schoen
Dan Schoen (DFL)

533 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
St Paul, MN 55155
651-296-4342
E-mail: rep.dan.schoen@house.mn
Representative Linda Slocum
Linda Slocum (DFL)

415 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
St Paul, MN 55155
651-296-7158
E-mail: rep.linda.slocum@house.mn
Representative Mike Sundin
Mike Sundin (DFL)

411 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
St Paul, MN 55155
651-296-4308
E-mail: rep.mike.sundin@house.mn
Representative Chris Swedzinski
Chris Swedzinski (R)

251 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
St Paul, MN 55155
651-296-5374
E-mail: rep.chris.swedzinski@house.mn
Representative Tama Theis
Tama Theis (R)

223 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
St Paul, MN 55155
651-296-6316
E-mail: rep.tama.theis@house.mn
Representative Kelby Woodard
Kelby Woodard (R)

221 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
St Paul, MN 55155
651-296-7065
E-mail: rep.kelby.woodard@house.mn
Representative Kurt Zellers
Kurt Zellers (R)

351 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
St Paul, MN 55155
651-296-5502
E-mail: rep.kurt.zellers@house.mn
Representative Lyndon Carlson Sr. ex-officio Lyndon Carlson Sr. (DFL)
479 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
St Paul, MN 55155
651-296-4255
E-mail: rep.lyndon.carlson@house.mn