Governor Cuomo and Legislative Leaders Announce Agreement to Modernize New York’s Alcoholic Beverage Control Law

June 15th, 2016 • by Paul Leone
Paul Leone

Paul Leone

Paul Leone is the Executive Director of the New York State Brewers Association.

Agreement Expands Sunday Alcohol Sales at Restaurants and Bars as Part of Comprehensive Blue Laws Overhaul

Legislation Also Broadens Retail Sales by Producers and Eases Regulatory Requirements for Wineries, Breweries, Distilleries and Cideries

Governor Andrew M. Cuomo, Senate Majority Leader John Flanagan, Assembly Speaker Carl Heastie and Senate Independent Democratic Conference Leader Jeffrey Klein today announced an agreement on legislation to modernize New York’s 80-year-old Alcoholic Beverage Control Law. The agreement allows alcohol to be sold earlier on Sundays, adds commonsense provisions to broaden retail sales by producers, and reduces burdensome fees for wineries, distilleries, breweries and cideries statewide. The agreement builds upon Governor Cuomo’s sweeping actions to simplify regulations for the beverage industry, resulting in an unprecedented, three-fold increase in licensed wineries, breweries, distilleries and cideries over the last five years.

“We’ve worked hard to cut red tape, lower costs and roll back burdensome regulations to help New York’s craft beverage industry thrive and create jobs, as well as some of the best beer, wine, cider and distilled spirits in the world,” Governor Cuomo said. “This agreement to overhaul this state’s archaic blue laws will build upon these ongoing efforts by knocking down artificial barriers for restaurants and small businesses and helping this industry grow even stronger.”

Senate Majority Leader John Flanagan said, “There was broad consensus between the Governor and Legislature that New York’s blue laws were outdated and in need of reform, specifically the provision which barred those enjoying brunch from purchasing an alcoholic beverage before noon on Sunday. Working with our colleagues in government, I am pleased we were able to arrive at an agreement to make common-sense changes that reduce red tape and eliminate regulations, help businesses grow and thrive, and reflect the overwhelming wishes of consumers all across this state.”

Assembly Speaker Carl Heastie said, “As New Yorkers, we are fortunate to have a wealth of resources at our fingertips that allow us the opportunity to craft some of the best wine, beer, cider and spirits in the country. This legislation represents our ongoing commitment to the beverage and hospitality industries so that they can continue to showcase the best of what New York has to offer. By making it easier to do business here, we will encourage new business development, inspire tourism and open the door for new ventures.”

Senate Independent Democratic Conference Leader Jeffrey Klein said, “This agreement updates an archaic law with common sense changes that will undoubtedly be a brew for better business in New York State. I’m proud that we eliminated burdens and regulatory obstacles to help small businesses flourish in this state.”

The Agreement

The agreement will ensure the craft beverage industry in New York continues to thrive by amending the ABC Law to include the following:

  • Expand Sunday Sales: The ABC Law includes provisions strictly prohibiting the sale of alcoholic beverages at on-premises establishments (restaurants, bars, taverns) before noon on Sunday. The agreement expands Sunday sales at restaurants and bars by changing the statewide opening hours from noon to 10 am. In addition, the agreement enables these licensees to apply for a permit, limited to twelve per year, to sell alcoholic beverages for consumption on the premises on Sundays between 8 a.m. and the new 10 a.m. opening hour in areas outside New York City.
  • Eliminate Burdensome Paperwork Requirements for Craft Manufacturers: At the 2012 Wine, Beer and Spirits Summit, Governor Cuomo ended the State Liquor Authority’s policy prohibiting multiple manufacturing licenses at the same location, recognizing the additional burdens this placed, for example, on a small winery that wanted to also make whiskey – including building a separate facility. However, businesses holding multiple licenses must still file paperwork and renewals for each separate license. The agreement combines craft manufacturing licenses into one application to reduce burdensome paperwork for these small businesses.
  • Authorize the Sale of Wine in Growlers: Current law requires that wine sold at retail for off-premises consumption be kept in their original sealed containers, and consequently, New York wineries are prohibited from filling growlers. This prohibition unduly burdens wineries that can open a container to sell wine for on-premises consumption, or can sell wine for off-premises consumption, but cannot fill a growler to be taken away from the winery. The agreement enacts a common sense change to the law to allow wineries to fill their customer’s growlers. In addition, the agreement authorizes wineries and farm wineries to allow customers to take home partially finished bottles of wine.
  • Reduce Fees for Craft Beverage Salespeople: The ABC Law currently requires that any salesperson or solicitor employed by a manufacturer or wholesaler must obtain a solicitor’s permit in addition to a bond. Recognizing the financial hardship imposed by these unnecessary additional fees, the agreement eliminates the fee for a solicitor’s permit for craft manufacturers and removes the bond requirement for all manufacturers.
  • Reduced Fees for Small Wholesalers: The primary business of most alcohol beverage wholesalers is selling their products to licensed retailers, such as bars, restaurants and liquor stores. However, there are currently a number of small wholesalers in New York that sell limited number of brands they import directly to large wholesalers for distribution to retailers. Under the current law, these small wholesalers must pay the same amount for their license as their larger counterparts, with costs ranging from $1,460 for a one year beer license to $27,280 for a three year liquor wholesale license. This financial burden often requires these small businesses to make a choice between continuing to hold a New York wholesale license or to relocate their business outside of New York. The agreement amends the ABC Law to create a low-cost “importer’s license” that would be available to wholesalers that sell only to other wholesalers.
  • Authorize Gift Wrapping: The agreement allows liquor stores to sell gift wrapping and gift bags to their customers.

Legislation to amend the ABC Law was first proposed by Governor Cuomo in May as a direct result of the Alcoholic Beverage Control Law Working Group – a blue ribbon panel created by Governor Cuomo in November 2015 tasked with developing recommendations to modernize the laws governing the manufacturing, wholesale and retail of alcoholic beverages in New York State.

Building on Prior Industry Reforms to Grow New York’s Economy

The agreement builds on the progress made by the Governor over the past five years, including enacting the Craft New York Act, to cut burdensome requirements on producers and ease restrictions regarding the marketing of craft products. Since 2011, the state has implemented a number of significant reforms and expanded programs to grow the craft beverage industry, including creating new farm-based manufacturing licenses, launching a $60 million statewide promotional campaign and hosting wine, beer and spirits summits across the state.

The success of New York’s investments in the craft beverage industry can be seen from the Finger Lakes to the North Fork of Long Island. Under the leadership of Governor Cuomo, New York is now home to nearly 900 wineries, breweries, distilleries and cideries. The number of farm wineries in New York has increased by nearly 60 percent, from 195 in 2010 to 310 today. Additionally, the number of microbreweries has grown by 263 percent, from 40 in 2010 to 145, while the number of farm distilleries grew from just 10 in 2010 to 90 today. Two new licenses have been created since 2011: the farm brewery license in 2013 and the farm cidery license in 2014, with New York now home to 120 farm breweries and 21 farm cideries businesses.

New York State Liquor Authority Chairman Vincent Bradley said: “This legislation is another example of the Governor’s continuing efforts to make the state a better place to do business. While these policy proposals have been discussed and debated for years, today’s agreement demonstrates that leadership matters, and I thank Governor Cuomo, the community and industry leaders who served on the working group, as well as the members of the legislature for reaching an agreement on these important and needed changes.”

New York State Agriculture and Markets Commissioner Richard A. Ball said: “No State has done more to assist and promote craft beverage manufacturing than New York, and these changes to the ABC Law build on the commitment to further strengthen the already booming industry. By amending confusing and outdated aspects of the law, current and future craft beverage manufactures in the state will be able to operate more freely, grow their businesses and boost the economy. I commend Governor Cuomo and members of the legislature for recognizing the importance and benefit of these modifications.”