It’s heady times for microbreweries
State plans summit to aid further growth
NEW YORK STATE The Van Dyck in Schenectady began brewing beer again in June 2011, and the response to the restaurant’s Mad Jack line has been positive, according to manager Mike McDonald. The McToberfest, the brewery’s fall seasonal, has proven popular.
“We can’t keep it on our shelves,” McDonald said.
Overall, “we’ve seen a dramatic increase in our beer sales,” he said. “Craft beers in general are becoming more popular. People want to see what’s different, what’s new, what’s fresh. People like the local aspect of it.”
Right now, the Van Dyck is primarily focused on its restaurant and brewery — “we’re starting off slow,” McDonald said — but a handful of local establishments, including Pinhead Susan’s and the Stockade Inn, also sell Mad Jack beer. Eventually, McDonald would like his beer to become even more widely available.
Earlier this year, Gov. Andrew Cuomo signed a package of bills that should make it easier for smaller craft breweries such as the Van Dyck to expand and distribute their product.
Included are measures restoring a tax break for craft brewers and exempting small breweries from paying an annual State Liquor Authority fee, and a provision that makes it possible for breweries to buy their way out of a distribution contract.
In addition, Cuomo plans to host a summit later this month to discuss how to boost the state’s beer, wine and distilling industries. The event will be modeled on the “yogurt summit” the governor hosted in August.
“The state has tweaked all these wonderful laws for us so that we can grow, and the question is, ‘How do we grow?’ ” said David Katleski, president of the New York State Brewers Association and owner of Empire Brewing Co. in Syracuse. “I think that’s the purpose of the summit, to have a brainstorming session about what the state can do to assist the growth of the wine, beer and distilled spirits. … The majority of the state’s smaller brewers are at capacity, and they have to expand to have growth.”
Katleski said he believes more could be done to promote New York beers through statewide marketing and tourism campaigns. Perhaps one long-gestating idea, for a New York beer trail that pointed beer-loving tourists to breweries, could finally be brought to a head.
Craft beer consumption in New York is growing, Katleski said, noting that about 8 percent of the beer sold in the state qualifies as such, up from about 3 percent about a decade ago. The number of breweries in the state has risen dramatically in that time, from 38 in 2003 to more than 100 today.
tangle of rules
Wineries will also be included at the summit.
John Martini, a member of the board of directors for the New York Wine Industry Association, said it does not want or expect a handout from the state. But it would like to see the state do more to promote New York wines, particularly those made upstate. Even something small, like encouraging politicians to feature New York wines at their fundraisers, could make a difference, he said.
Martini, who owns Anthony Road Winery in the Finger Lakes, said he travels to the Union Square Greenmarket in New York City on weekends to sell his wines. He brings a map, to show people where the Finger Lakes are, and said people respond to the idea of buying wines made in New York. Like the brewers, the wineries believe they contribute to the state’s economic growth.
“We’re seeing Finger Lakes wine sales increase in New York,” Martini said.
Tara Nimmo opened the Saratoga Winery in Saratoga Springs about three years ago. She said business has been great and that her main source of frustration has been navigating state rules — whenever she wants to make a change to the winery, she often receives confusing and contradictory answers from the state Liquor Authority on what she should do.
“It’s almost like the state needs an advocate for the wineries,” Nimmo said. “We’re paying licensing fees and we’re helping grow the economy. The state needs to be more user friendly.”
The wineries have long advocated for a change in state law that would allow them to sell their wares in grocery stores. But Martini said Cuomo doesn’t support this idea, and that it’s unlikely to go anywhere any time soon.
One of the main pieces of legislation signed by Cuomo this fall is the Small Brewers Bill, which allows brewers producing fewer than 300,000 barrels of beer each year to buy their way out of a distribution contract. These contracts are open-ended, effectively locking a brewer into a long-term relationship, and giving distributors exclusive rights to sell certain brands of beer within a specific geographic area.
For a growing brewery such as Troy-based Brown’s Brewing Co., the open-endedness of its distribution contract presented a problem. When the brewery first sought to increase its presence in local stores, it found that the smaller distribution company it had contracted with lacked the resources to get its beers widely stocked throughout the area.
Gregg Stacy, vice president and director of marketing and sales for Brown’s, said stores also worried that the company would not be able to deliver the beer consistently.
“The bigger distributors have access to 85 percent of where we want to be,” Stacy said. “If we stuck with our old distributor, we would have had the beer [to expand], but not the distribution.” Passage of the small brewers act has allowed Brown’s to contract with a distributor more suited to its needs, Stacy said.
Stacy said Brown’s wants its beer to be stocked in every Stewart’s, Hannaford and Price Chopper in the Capital Region, and to expand its footprint throughout the Northeast — “from Boston to Buffalo, from Burlington to Brooklyn.” Right now, Brown’s can be found in an 11-county area that is bounded by Lake George to the north and Columbia County to the south.
Brown’s began brewing in 1993, and at first its sales were limited to its River Street taproom and restaurant. In 2006, the brewery began bottling and selling beers. Now the brewery is building a new production facility in Hoosick Falls that will enable Brown’s to increase its production by 20,000 barrels of beer per year; right now, the brewery produces 2,800 barrels of beer.
“We’re at maximum capacity,” Stacy said.
McDonald said distribution isn’t a big problem for the Van Dyck, since the brewery only has a handful of accounts. “We’re not quite at that level,” he said. “We hope that it becomes a problem.”
Stacy said Brown’s plans to attend the upcoming beer and wine summit. “We’re psyched,” he said. “We’re happy they’re having it. We don’t have anything to complain about. The state has been great.”
Katleski said there are still rules that could be tweaked to make things easier for small brewers. He said that the state liquor authority bars brewers from pouring their own beer at beer festivals, and that the task is often entrusted to a volunteer who doesn’t know very much about the brewer’s product.
The Brewers Association defines craft brewers as “small, independent and traditional.” Typically, a craft brewer has an annual production of 6 million beers or less.
“A lot of people don’t consider it craft beer,” Stacy said. “They just think of it as beer. It’s how beer should be.”
McDonald said Mad Jack is drawing customers to the Van Dyck.
“People come for the beer.”