10 Barrel Boise photo credit: Lizzy Duffy / OPB
10 Barrel Brewing’s Boise brewpub can’t seem to catch a break with Idaho state law or the liquor commission. Since being purchased by Anheuser-Busch/InBev, the company has now become the target of Idaho Beer and Wine Distributors Association, which represents 18 distributors that say state law prevents any brewery making more than 30,000 barrels of beer a year from operating a brewpub/retail outlet.
The rule exists as part of the Three Tier System meant to prevent a brewery, wholesaler or retailer having too much power or control by operating in more than one of those three tiers. Each state has its own variations and exceptions, and in Idaho it’s for craft brewers producing under 30,000 barrels in Idaho, which would exempt the 10 Barrel brewpub, is it does not produce anywhere near that amount. However, Association Executive Director Jeremy Pisca, the group’s lawyer and lobbyist, says that the Alcohol Beverage Commission should include total barrels company-wide to keep any large brewer from gaining small brewer exemptions by brewing as little as a gallon in Idaho.
10 Barrel already got into trouble with the Idaho Alcohol Beverage Commission before the Boise brewpub even opened; in August of 2012, 10 Barrel’s plans to self-distribute its own beer from the Bend brewery to the Boise location fell through. In that instance, 10 Barrel was also running afoul of the Three Tier System by running a brewpub retail location and also operating as its own wholesaler, distributing beer from its own location out of state. 10 Barrel was able to work with the commission, but still was forced to sell its distribution rights rather than operate as its own wholesaler. It seems Idaho distributors and regulators are not a big fan of 10 Barrel.
Will 10 Barrel/A-B be able to negotiate an update to Idaho’s strict Three Tier System rules? I do not know how sentiment in Idaho is over the company’s recent sale, but it’s possible local brewers and distributors are not appreciating the out of state competition. Or the state could have a lot to gain by making state laws more big business friendly and bringing in more local jobs.
It will be interesting to see how far Anheuser-Busch would fight a ruling that does not end in its favor. A-B has never been interested in operating restaurants or pubs; the company is in the business of selling beer, so it was even a little strange to see it take the pubs at all in the 10 Barrel purchase. One possible scenario is that A-B may sell the 10 Barrel Brewpub and license the brand, almost like a franchised location with separate ownership.