BUSINESS & ECONOMY

Back to the drawing board on regulating NJ’s microbreweries

BY Brenda Flanagan, Senior Correspondent |

Brewers tended the latest batch of beer at Departed Soles, a Jersey City microbrewery that depends on special events at its tasting room to keep taps and revenue flowing strong. Signs advertise beer yoga classes, live music, and holiday parties. A drop-down screen offers football games. All those activities would’ve been restricted under a new set of rules the state imposed Sept. 21. Business immediately started to go flat, owner Brian Kulbacki said.

“We stand to be impacted almost financially an employee’s salary throughout the year, and when you’re a small business like this, in a small town like this, that’s devastating,” Kulbacki said. “I don’t know if we would’ve been able to continue to employ them.”

The special ruling from New Jersey’s Division of Alcoholic Beverage Control limited breweries to 25 on-site events, 52 private parties and 12 off-site events per year. But the state suspended the new rules Tuesday, much to Kulbacki’s relief, after an outcry from New Jersey’s 89 microbreweries and complaints from Gov. Phil Murphy and legislators on both sides of the aisle.

“What ABC tried to do was send regulations out that would stifle the growth in one of the most innovative and growing industries in the state of New Jersey. And it would’ve sent a very difficult signal to other entrepreneurs in the state, in other industries, about coming to New Jersey and growing,” Sen. Tom Kean Jr. said.

ABC compiled the rules after bitter complaints of unfair competition from Jersey bars and restaurants, which can fork over from $30,000 to a $1 million for highly coveted liquor licenses. By contrast, microbreweries pay only a few thousand dollars for a limited license, which only allows them to brew, wholesale and retail their beer. But they’ve been doing more than that.

“They are hosting weddings, banquets, allowing outside alcohol to come in, live entertainment, and that’s outside the intent of the original legislation that was back in 2012,” Marilou Halvorsen, president of the New Jersey Restaurant and Hospitality Association, said. “We have a lot of liquor license establishments that are in those towns that paid a lot of money for their license and now they’re competing with these breweries for the same business.”

But craft breweries claim there’s plenty of business to go around and they want a compromise: to sponsor perhaps a couple on-site events per week. Kulbacki says TV should be part of the package, arguing they’re not a sports bar. As for food?

“Everyone’s still going to go on their phone and look up delivery.com or whatever and get food. And it’s the smart thing to do; you shouldn’t drink on an empty stomach,” he said.

So now everybody goes back to the table to brew up a new batch of rules that hopefully will be satisfying to everyone.