Following a meeting this morning with representatives of the Montana State Brewers Association (MSBA), Montana Department of Revenue (DOR) Director Dan Bucks pulled the proposed administrative rule which was due to be hotly contested tomorrow afternoon in an official public hearing.
Meeting with Bucks and his staff were Sam Hoffman, owner of Red Lodge Ales of Red Lodge, and Brian Smith and Brad Simshaw, co-owners of Blackfoot River Brewing of Helena. Hoffmann is president and Smith vice-president of MSBA.
This means tomorrow’s hearing is essentially meaningless. It will be held, but will only cover minor issues of little or no concern to brewers.
“The director apologized for the process,” Smith told NewWest.Net, “and he admitted that the dept could have looked at this closer. I think he agreed with us that this all could have been avoided if they would have talked to us prior to the notice or rule making.”
Instead of going ahead with the rule change at this time, DOR and MSBA have agreed to work together to cooperatively address any problems with enforcing the law. “We’re now sitting down with in a negotiated rule making process to make sure things are done correctly,” Smith said.
And there are points of agreement. “He (Bucks) has some concerns over enforceability of the current law,” Smith said, indicating that he believed some of these concerns were valid and that MSBA members would work with DOR to address them.
Smith said Bucks might invite other interested parties into the negotiation.
Part of the controversy created over the rule change was fueled with the belief that the Montana Tavern Association (MTA) was behind the scenes punching the buttons, but Smith said Bucks strongly disagreed and insisted the rule change was staff driven. “He was adamant that the MTA wasn’t behind the rule change.”
The rule change had created an instant furor among craft beer fans. GrizzlyGrowler.com posted a petition written by Dave Ayers of Glacier Brewing in Polson, and as this is written, 811 people have already signed it.
“They (DOR officials) were overwhelmed and surprised by the amount of interest,” Smith said, noting that besides hearing from many brewers and numerous taproom patrons, “several legislators have contacted him and the Governor’s office.”
The recent NewWest.Net commentary on the proposed rule was specifically mentioned, Smith added.
“We have had no communication with the tavern industry on this manner,” Bucks reaffirmed in a telephone interview with NewWest.Net, “Your article was completely wrong about the reasons for the department pursuing this rule change. It had nothing to do with economic competition between members of the liquor industry.”
Before writing my column earlier this week, I went out to the DOR’s Liquor Control Division and looked through the files and talked to several members of Bucks’ staff who told me there were no written complaints, only phone calls. But alas, there was one written complaint, which was a major factor in proposed the rule change. Ironically, that complaint came from the MSBA.
In February 2007, Tim O’Leary, owner of Kettlehouse Brewing of Missoula and secretary/treasurer of the MSBA, sent a formal complaint to DOR about the business practices of one of the organization’s own members, Yellowstone Valley Brewing of Billings, claiming the company allowed patrons to consume beer served from their taproom on an unlicensed patio and of violating local open container laws.
“MSBA members strive to uphold both Montana and Federal Law governing the operation of our breweries,” O’Leary wrote. “It is imperative that all Montana breweries do as well.”
“That was the problem that the rule proposed to address,” Bucks said, “but not necessarily very well.”
Keep in mind, Bucks added, that this was only a proposal for public comment. “That doesn’t mean it is what the rule would be.”
Bucks admitted that “The proposed rule did not necessarily address the underlying problem, which is assure responsible consumption on premises for public health and safety reasons.”
“After our meeting this morning, we have an understanding that there are some common issues,” Bucks said. “There are some complaints, but there is not a widespread problem within this industry. The (microbrewing) business as a whole is trying to do business in a responsible manner, and we respect that.”