New York loosens brewery regulations

Gov. Andrew Cuomo and legislative leaders today announced an agreement to exempt small breweries from paying the annual state Liquor Authority fee and to allow farm breweries to more easily expand operations.

Craft brewers, such as Elmsford”™s Captain Lawrence Brewing Co., have grown exponentially over the past several years in New York state, but were hurt by a March court ruling that disallowed a state tax exemption for in-state brewers on the first 6.2 million gallons of beer sold in New York in a given year.

The new legislation, announced by state Senate Majority Leader Dean Skelos and Assembly Speaker Sheldon Silver along with Cuomo, is designed to support the state”™s breweries and wineries and to create economic development opportunities.

“New York”™s craft breweries are not just creating great beer that is consumed across the world, they are creating jobs, supporting farmers and our hops growers, and bringing in tourism dollars all across the state,” Cuomo said in a statement. “This is a big victory for our craft brewers and will help New York”™s already vibrant beer industry continue to grow.”

Under the agreement, any brewery that produces 60 million or fewer gallons of beer in New York would be eligible for a refundable tax credit applied against state personal income and business taxes.

The credit amounts would be $0.14 per gallon for the first half-million gallons brewed in New York, and $0.045 per gallon for the next 15 million gallons produced in New York.

The legislation will also exempt breweries that produce brands of 1,500 barrels or less annually from the $150 annual brand label fee. The exemption will be eligible to brewers located both in and outside the state.

The bill also authorizes the creation of a “Farm Brewery” license that would allow craft brewers that use products grown in New York state to increase retail outlets for products produced in-state, open restaurants, increase tastings and sell related beer-making equipment and supplies and other products.

In order to qualify for a farm brewery license, between now and through the end of 2017, at least 20 percent of the hops and 20 percent of all other ingredients must be grown or produced in-state to qualify for a farm brewery license. Those percentages rise to 60 percent for beer produced between Jan. 1, 2018, and Dec. 31, 2023, and to 90 percent after Jan. 1, 2024.