Calhoun: Wake-Up Call

How liquor stores support Colorado craft breweries

Aside from skiing and John Denver, Colorado is probably best known around the nation for its beer — and not just because of Coors. There are currently 126 craft breweries in the state, according to the Colorado Brewers Guild, with more on the way.

And right now, this signature industry is feeling threatened by proposals that would allow supermarkets and convenience stores, or maybe just convenience stores, to sell full-strength brew.

"It's a fall-on-your-sword type of issue," says Eric Wallace, the Guild president and co-founder of Longmont's Left Hand Brewing.

The crux of his argument is this: If the chains are allowed to sell beer, as they are in many other states, it will put dozens, if not hundreds, of liquor stores out of business in Colorado, and the fewer liquor stores there are, the fewer places there will be to sell craft beer. Although sales in grocery and/or convenience stores would certainly make up for some of that lost business, those stores would likely not stock the depth and breadth of craft-beer selection — think seasonals, bomber bottles and limited releases — that the independent liquor stores do.

Also see: Free 3.2 beer! It's time to issue a last call for the archaic contrivance of low-alcohol beer

"Access to market is fundamental to the survival of breweries," says Wallace, whose brewery is one of several that have grown by 30 percent or more in the past year. "This is not some kind of fundamental opposition to chain stores. We shop at chain stores. It's a fundamental recognition of the fact that our system is so much better than the systems in other states. This is why Colorado has such an extremely high density of breweries per capita. Our access to the market is superlative."

Is there anything the state's legislators could do to make up for lost craft-beer sales if the law does change? Well, for starters, Wallace doesn't believe either proposal will pass, not with a former brewer in the governor's office. In fact, he thinks that John Hickenlooper, co-founder of the Wynkoop Brewing Co., would veto the legislation, especially after Representative Larry Liston, sponsor of the grocery bill, held a special hearing to investigate a recent rule change for craft brewers that came out of the Hickenlooper administration.

"They rubbed his nose in it like a puppy who makes a mess on the rug," Wallace says. "To think that he would forget about that, you are hiding from reality."

Rather than hide from reality, Westword decided to suggest a few ways for the state to deal with the very real possibility that the laws might someday change, and still keep the craft-brewing industry vibrant:

1) Support proposed federal legislation (the Brewer's Employment and Excise Relief Act) that would halve the excise and production taxes on a brewer's first 60,000 barrels of beer, and consider cutting state taxes for small breweries as well.

2) The Glendale King Soopers — the only one in the state with a liquor store, and the site where Liston held a press conference to announce his bill — carries 47 varieties (known as SKUs) of Colorado-produced craft beer; that's a much larger number than most supermarkets would be likely to carry if his proposal passes. But the state could encourage both liquor stores and groceries to carry more craft beer by offering heavy tax incentives for any location that offers 47 or more SKUs of Colorado craft beer.

3) The same goes for bars and restaurants: If 85 percent of more of the beer they sell is produced in Colorado, why not let them apply for tax breaks?

4) Change the liquor laws to allow for "bottle shop pubs," a concept popular in Oregon, so that these retail outlets can sell packaged beer like a liquor store, as well as serve it on tap like a bar. Or go one step further and allow bars to fill growlers of Colorado craft beer to go.

5) Require that Colorado craft beer be served at every legislative committee meeting.

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Jonathan Shikes is a Denver native who writes about business and beer for Westword.
Contact: Jonathan Shikes