Bartender Kristin Dunn pours a beer in the taproom of Kenai River Brewing Company in Soldotna Wednesday. An amendment to legislation overhauling state alcohol regulations would reduce the amount of alcohol that can be legally served at breweries and distilleries by 12 ounces. (Photo by Erin Thompson/Peninsula Clarion)

Bartender Kristin Dunn pours a beer in the taproom of Kenai River Brewing Company in Soldotna Wednesday. An amendment to legislation overhauling state alcohol regulations would reduce the amount of alcohol that can be legally served at breweries and distilleries by 12 ounces. (Photo by Erin Thompson/Peninsula Clarion)

Sponsor to pull alcohol bill if brewery serving size cuts stay

The sponsor of a bill revising state alcohol laws will quash the legislation if a recently introduced amendment lowering the amount of alcohol breweries and distilleries are allowed to sell onsite stays.

On Friday, the House Labor and Commerce Committee passed an amendment introduced by Rep. Louise Stutes, R-Kodiak, lowering the amount of beer breweries can serve on tap from 36 ounces to 24 ounces. The amendment also limits distilleries to serving two ounces of spirits from the proposed three ounces.

“If the amendment remains, I will kill the bill and work on it over the interim to ensure we can take a final bill across the finish line that will have the same spirit and support of local Alaska businesses,” Sen. Peter Micciche, R-Soldotna, said.

Micciche introduced Senate Bill 76 to address what he called the “hodgepodge” of regulations governing the alcohol industry in Alaska. The bill reorganizes Title 4 of Alaska Statute and includes revisions to the state’s licensing structure, penalties, fees and Alcohol Beverage Control Board petitioning process, and attempts to address public safety concerns such as youth access to alcohol.

Micciche said the 113-page bill was the product of a six-year process involving a 100-person stakeholder group to revise Alaska’s 35-year-old alcohol statutes.

While the bill remixes licensing standards and changes fees for businesses that serve alcohol, it largely leaves aside some of the larger questions plaguing the state’s alcohol industry — mainly how to reconcile the limited availability of bar licenses with the growing number of manufacturers serving alcohol.

“Things are changing in the industry, and that’s something that all sides are going to come to grips with,” Micciche said. “Our bill did not undertake that effort because the two sides are so far apart. This was a consensus bill.”

With the addition of tasting rooms at wineries, breweries and distilleries, the line between bars and manufacturers has blurred in recent years, causing outcry from bar owners who see unfair competition from businesses that serve alcohol but don’t have to pay hefty market prices for a retail license.

Under current law, Alaska’s liquor license system classifies entities that sell alcohol to the public as manufacturers, distributors or retailers, and limits the number of retail licenses — those available to bars — based on population in a given area.

SB 76 would create a stripped-down manufacturing license for breweries, wineries and distilleries, with no limit on licenses based on population. The new license would have a biennial fee of $1,500. Currently, breweries and distilleries pay $1,000 for their licenses, and wineries pay $500. There are no population-based limits on manufacturer licenses.

Under the proposed law, currently operating manufacturers with tasting rooms would additionally have to purchase a separate biennial retail license for $1,250. Those with the new retail licenses, however, would continue to face restrictions on hours of operation, allowable seating and entertainment, as well as the amount of alcohol they can serve per customer.

For local brewers, the proposed increased restrictions on alcohol servings are a non-starter.

Doug Hogue, owner of Soldotna-based Kenai River Brewing Company, launched an online campaign opposing the amendment, which he said would cut into his brewery’s business.

“If you lose 12 ounces per day, per customer, that’s a big hit,” Hogue said. “It would impact our bottom line.”

Hogue, who’s been in business for 12 years, pushed for “getting fair and equitable licensing for all players in the game” during the development of the legislation. He said the amendment would undermine those efforts by raising the cost of licenses for manufacturers while reducing what they can serve.

“They’re paying more to do less,” Hogue said. “And obviously that makes no sense.”

Expensive equipment and higher overhead costs can put manufacturers at a disadvantage, said Frank Kassik, owner of Nikiski’s Kassik’s Brewery.

“We have over $1 million worth of equipment,” said Kassik. “We pay out $100,00 a year for shipping.”

Alaska’s distance from wholesale products makes the cost of local manufacturing nearly prohibitive, he said.

“We need that revenue to, once again, just to make ends meet,” Kassik said. “We pay huge amounts just in shipping alone, to bring raw product in to produce this.”

A taproom helps the brewery keep its head above water, he said.

”If I was to do nothing more than be a production facility, I might as well head south, or go to another state, where I can afford to make that living,” he said.

As the Legislature focuses on budget talks, Micciche said that he would work to excise the amendment but would pull the bill if it isn’t removed.

“Our goal is to either facilitate that removal or wait until next year,” Micciche said.

Hogue said he hopes it doesn’t come to that.

“We don’t want to see this bill die,” Hogue said. “We’ve been working on it for six years — countless hours. It seems ridiculous that it would die for something so arbitrary.”

Reach Erin Thompson at ethompson@peninsulaclarion.com.

More in News

Snow coats an eroding bluff near the mouth of the Kenai River on Friday, March 3, 2023, in Kenai, Alaska. (Ashlyn O’Hara/Peninsula Clarion)
Kenai accepting bids on bluff stabilization project

The announcement means that contractors can start submitting their proposals for how they’d complete the work and how much it would cost to do so

A stack of the Seward Journal is pictured. The town’s only daily newspaper published its last edition Nov. 27. (Photo via Seward Journal Facebook page)
‘A thing of the past’

Seward Journal calls it quits after struggle to keep newspaper afloat

Tim Navarre and Dana Cannava discuss a preliminary Soldotna route for the Kahtnu Area Transit with Planner Bryant Wright at the Challenger Learning Center of Alaska in Kenai, Alaska, on Wednesday, Nov. 29, 2023. (Jake Dye/Peninsula Clarion)
Getting people where they need to go

Plans for Kenaitze Indian Tribe’s Kahtnu Area Transit move forward

A state plow truck clears snow from the Kenai Spur Highway on Wednesday, Nov. 2, 2022, in Kenai, Alaska. (Jake Dye/Peninsula Clarion)
DOT identifies roads included in brine reduction plan

The department said its goal is to reduce brine use overall in the region by 40%

Soldotna High School senior Josiah Burton testifies in opposition to the proposed cut of Kenai Peninsula Borough School District theater technicians while audience members look on during a board of education meeting on Monday, March 6, 2023 in Soldotna, Alaska. (Ashlyn O’Hara/Peninsula Clarion)
School board finance group reviews expenditures ahead of upcoming budget cycle

As the Kenai Peninsula Borough School District prepares to grapple with another… Continue reading

Members of the Kenai/Soldotna Fish and Game Advisory Committee raise hands to vote in favor of a proposal during a meeting at Cook Inlet Aquaculture Association in Kenai, Alaska, on Monday, Nov. 20, 2023. (Jake Dye/Peninsula Clarion)
Silver salmon, personal use fishing discussed by advisory committee

The group set their recommendations on a variety of proposals to the State Board of Fisheries

Hoses pump water along Patrick Drive to help mitigate flooding near Kalifornsky Beach Road on Friday, July 21, 2023, near Kenai, Alaska. (Ashlyn O’Hara/Peninsula Clarion)
Borough spent almost $78k responding to flood events during disaster declaration

Most of the funds were spend in the northwest area of Kalifornsky Beach Road

The National Weather Service’s map shows a winter weather advisory, in orange, effective for much of the eastern Kenai Peninsula. (Screenshot)
Heavy snow, blowing winds forecast for Turnagain Pass on Wednesday

Snow accumulations of up to 16 inches are expected

The Kenai Courthouse is seen on Monday, July 3, 2023, in Kenai, Alaska. (Ashlyn O’Hara/Peninsula Clarion)
Grand jury adds charges in October killing of Homer woman

The indictment was delivered on Nov. 8

Most Read