2014 -- H 7718

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LC003650

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2014

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A N   A C T

RELATING TO ALCOHOLIC BEVERAGES - MANUFACTURING AND WHOLESALE

LICENSES

     Introduced By: Representatives Valencia, Amore, Kennedy, Walsh, and Tanzi

     Date Introduced: February 27, 2014

     Referred To: House Corporations

     It is enacted by the General Assembly as follows:

     SECTION 1. Chapter 3-6 of the General Laws entitled "Manufacturing and Wholesale

Licenses" is hereby amended by adding thereto the following section:

     3-6-1.3. Farmer-brewer licenses - Fee. – (a) For the purpose of encouraging the

development of domestic agriculture, the department shall issue a farmer-brewer license to any

applicant of the state and to applying partnerships and to applying corporations organized under

the laws of any other state of the United States and admitted to do business in this state.

     (b) A farmer may operate a farmer’s brewery under any conditions the department may

prescribe by regulation.

     (c) A farmer-brewer may import malt, cereal grains, fermentable, sugars and hops; but

may not import malt beverages or alcohol into the state. In the first year of production, no less

than twenty-five percent (25%) of hops used by the farmer-brewer to produce malt beverages or

malt beverage products must be produced by the farmer-brewer’s on-site agricultural operation,

and no less than forty percent (40%) of hops must be produced in Rhode Island. In the second

year of production, no less than thirty percent (30%) of hops must be sourced from the farm-

brewer’s on-site agricultural operation, and no less than forty-five percent (45%) must be

produced in Rhode Island. Thereafter, no less than thirty-five percent (35%) of hops must be

sourced from the farm-brewer’s on-site agricultural operation, and no less than fifty-five percent

(55%) of hops must be produced in Rhode Island.

     (d) If a farmer suffers crop failure in a particular year to the extent that the yield from his

or her harvest that year is at least twenty-five percent (25%) below the average yield for the

previous two (2) years, the farmer-brewer may import ingredients equal to the difference between

the current year’s yield and the average for the previous two (2) years. A farmer shall not import

alcohol into the state.

     (e) A farmer-brewer may sell malt beverages or malt beverage products under his or her

label and fermented by him or her or another farmer-brewer licensed by the state. He or she may

sell beer or brewery products:

     (1) At wholesale to any person holding a valid license to manufacture alcoholic

beverages;

     (2) At wholesale to any person holding a valid wholesaler’s and importer’s license under

§§ 3-6-9 through 3-6-11;

     (3) At wholesale to any person holding a valid farmer-brewery license under this section;

     (4) At retail, by the bottle, to consumers for consumption off the farm-brewery premises;

provided, however a farm-brewery shall not sell malt beverages or malt beverage products at

retail for delivery off the site of the farm-brewery premises in Rhode Island directly to Rhode

Island residents, except in the manner provided for like sales and shipment in § 3-4-8;

     (5) At wholesale to any person in any state or territory in which the importation and sale

of beer is not prohibited by law;

     (6) At wholesale to any person in any foreign country;

     (7) At wholesale to liquor dealers holding a valid license under the provisions of title 3;

     (8) At wholesale to restaurants holding a valid license under the provisions of title 3; and

     (9) At retail by the bottle or by the glass for consumption on the farm-brewery premises.

     (f) A farmer-brewer may not sell at retail to consumers any malt beverages or malt

beverage products not fermented in the state and sold under the brand name of the farm-brewery.

     (g) A farmer-brewer may serve complimentary samples of malt beverages or malt

beverage products produced by the farm-brewery where the beer is fermented in the state and

sold under the farm-brewery brand name.

     (h) All malt beverages or malt beverage products sold by a licensee shall be sold under

any conditions and with any labels or other marks to identify the producer as the department may

prescribe.

     (i) Every applicant for a farmer-brewery license shall, at the time of filing an application,

pay a license fee based on a reasonable estimate of the amount of malt beverages or malt

beverage products to be produced during the year covered by the license. Persons holding farmer-

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brewery licenses shall report annually at the end of the year covered by the license the amount of

malt beverages or malt beverage products produced during that year. If the total amount of beer

produced during the year is less than the amount permitted by the fee already paid, the state shall

reimburse the licensee for whatever fee was paid in excess. If the total amount of beer produced

during the year exceeds the amount permitted by the fee already paid, the licensee shall pay

whatever additional fee is owing.

     SECTION 2. This act shall take effect upon passage.

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LC003650

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO ALCOHOLIC BEVERAGES - MANUFACTURING AND WHOLESALE

LICENSES

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     This act would provide a process for issuance of a farmer-brewer license.

     This act would take effect upon passage.

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LC003650

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