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Report recommends putting state, outside brewery sales on equal footing

By , - Last modified: January 28, 2013 at 9:43 AM

Potential advantages in-state breweries might have to sell beer in Pennsylvania could end under a recommendation in a state legislative committee's report.

And one of the considered approaches for equality would let all beer makers bypass the decades-old layer of wholesale distributors in the commonwealth to get their products to retailers.

It would be a huge shift in how beer is sold, but the report also points out that legal precedent could demand some kind of action.

The study by the state Legislative Budget and Finance Committee came from a state Senate resolution to take a look at Pennsylvania's growing brewery industry.

From 2001 to 2011, the number of active breweries in Pennsylvania about doubled, according to the report.

Nationally, the craft beer category represents about 5 to 7 percent of the beer market, the report stated. But the study puts its share of the market in Pennsylvania at about 20 percent.

Under state rules dating to after Prohibition, beer makers generally must sell in the commonwealth to distributors, according to the report.

These wholesalers then sell products to taverns, restaurants and other licensed retailers where consumers are allowed to buy them.

But in-state breweries can be allowed to make sales and direct deliveries of their products to retailers, according to the report.

The U.S. Supreme Court case Granholm v. Heald said that if an in-state winery could ship directly to consumers in its state, an out-of-state winery has the right to sell in the same manner to the same customers.

So one of the report's recommendations is for lawmakers to address the Granholm v. Heald ruling.

Considered approaches include letting all malt beverage manufactures self-distribute or making them all go through the distributor system, according to the report.

A third is allowing self-distribution of a certain percentage of a beer maker's products, the report stated.

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