Will Local Farm Brewery Laws Impact Your Brewery?

July 7th, 2018 • by Jennifer Tsyn
Jennifer Tsyn

Jennifer Tsyn

Jennifer Tsyn is a member of the Bond Schoeneck & King law firm, and works out of the firm’s Albany office. Jen represents businesses and individuals in a variety of business law matters, with a focus on liquor licensing issues.

Some municipalities in New York State have passed, or are considering, local laws that will require farm breweries, farm wineries or farm distilleries to operate in a particular way. Some towns may require the farm brewery or farm winery to dedicate a certain percentage of land to growing crops, over and above the land they’ve already set aside for event space or to operate the brewery. Other local laws may require special permits for events, or more stringent building or zoning approvals when the owners want to expand.

It appears that the local focus in many areas, particularly on Long Island, is on the farm winery, but farm breweries should also take notice.

Which Law Takes Precedence?

When a municipality tries to limit operations, through zoning or other local regulation, the question that often results is, “Can the town do that to me? I already have a farm brewery liquor license!” The New York State Liquor Authority treats a liquor license as a privilege, not a right, and the Alcohol Beverage Control law requires all licensees to follow local laws. What happens if the municipality’s laws are different than the Alcohol Beverage Control Law?

That may depend on the exact nature of the local law that the municipality has passed, and the reasons for passing it. A court, when evaluating whether the local law should be enforced, will have to determine whether the state law (the Alcohol Beverage Control Law) “preempts” the local law, in that the state law prohibits the local law from being enforced. Some factors that the court will consider, which may weigh in the town’s favor, are whether the local law being objected to is a zoning law (which courts give a good deal of deference to), whether the local law applies to everyone in the town and not just those holding liquor licenses or just farm breweries, and the reasons that the town passed the local law.

If a licensed brewery operates on a farm, what about the Right to Farm Law? That law states at section 305-a: “Local governments, when exercising their powers to enact and administer comprehensive plans and local laws, ordinances, rules or regulations, shall exercise these powers in such manner as may realize the policy and goals set forth in this article [Article 25-AA of the Agriculture and Markets Law], and shall not unreasonably restrict or regulate farm operations within agricultural districts in contravention of the purposes of this article unless it can be shown that the public health or safety is threatened.”

The Two-Part Test

So, when does the town’s local law “unreasonably restrict or regulate” the operations of a farm brewery? First, it should be noted that the language quoted above only applies to farm brewery operations on property located in an agricultural district. If the property is within an agricultural district, the question that then arises is whether the activity that the farm brewery seeks to protect (for example, holding weddings or having beer tastings) constitutes “farm operations.” If those hurdles are met, then the Department of Agriculture and Markets will evaluate the local law for “reasonableness” in a test that consists of two parts:

1) whether the law or ordinance is reasonable “on its face,” (it is not vague) and

2) whether it is reasonable as applied to a particular situation.

Even if the Department of Agriculture and Markets concludes that a particular law or ordinance unreasonably restricts farm operations, consideration must be given as to whether the public health or safety is threatened by the regulated activity. If the Department of Agriculture and Markets concludes that a local law or ordinance unreasonably restricts or regulates farm operations in an agricultural district, and public health and safety is not threatened, then the Department will notify the involved municipality and attempt to arrive at a solution which addresses the concerns of the Department as well as the concerns of the locality.

The process of getting the Department of Agriculture and Markets involved with respect to a local law is difficult, time-consuming and may not result in relief to the farm brewery. Before you reach this point in the process, the best course of action is to work with the town, city or village while it is still considering passing the local law. Issues concerning the impact of local laws and ordinances on farm structures or farming practices are solved far more easily at the drafting stage than after the provision is in place. Get involved before the laws are passed. Contact the Department of Agriculture and Markets, either by phone or in writing, before your municipality enacts a local law or ordinance that may restrict farming or farm operations in an agricultural district.