Grandma's House Brewery Sorts Through Regulatory Issue With the State

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With hundreds of craft breweries already pouring beer in Colorado and dozens of new operations planning to open, it’s important for each one to find a way to stand out. “Everybody is always trying to do something different,” says attorney Robert Runco, who specializes in liquor laws. But “something different” can also put a new brewery directly in front of the overworked but ever-watchful state Liquor and Tobacco Enforcement Division, a part of the Colorado Department of Revenue.

For the past few months, Grandma’s House, which opened last October on South Broadway, has been dancing carefully with the enforcement division, which has questioned its unique business and marketing model.

Founder Matthew Fuerst calls Grandma’s House a “collective brewery” because he gives would-be brewery owners and breweries-in-planning a chance to try out their recipes on his brewing system and then have the beers they create served there on tap. Several of these in-house “grandkids,” as he calls them, have poured their creations in the past six months, including Broken Spine Brewing, Two Creeks Brewing, Gunbarrel Brewing and 53 Peaks.

The problem is that breweries-in-planning aren’t allowed to represent themselves as breweries since they don’t yet have liquor licenses, says Runco, who represents Grandma’s House. Furthermore, if they did have liquor licenses, they wouldn’t be able to brew or serve beer at Grandma’s House without prior approval from the state. And finally, Grandma’s House and its employees have to be in charge of brewing the beer.

A couple of months ago, an investigator with the enforcement division came calling on Fuerst after seeing social media posts from the would-be brewers advertising their beers on tap. Since then, Grandma's House and the division have been discussing it.

“The issue was that some of these businesses were holding themselves out or giving the appearance of being breweries when they are not,” Runco explains. Their public messaging also made it seem like the beer belonged to them when it legally doesn’t. “It belongs to the licensee — Grandma’s House — from the first step...all the way through to the customers.”

As a result, Fuerst says, most of his original grandkids, including Two Creeks and Broken Spine, have left. But he plans to continue operating as a collective brewery by signing up new grandkids shortly. In the future, however, both he and they will have to be “very careful with saying or doing things that lead the public to believe that these are licensed breweries,” he notes. 

"The frustrating thing is that what we are doing isn't technically illegal. It's the representation of it that they had a problem with," Fuerst explains. Although both he and Runco both say the enforcement division has been reasonable and willing to negotiate.

The Liquor Enforcement Division understands that craft beer is a great industry for Colorado and they have been great about working with businesses who are trying to come up with new concepts and still work within the confines within the liquor code," Runco says. "I think we have come to a resolution with the state where they are comfortable with how he is doing his marketing."

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