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State's alcohol laws examined by task force

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URBANDALE, Iowa — A state task force composed of stakeholders from across the alcoholic beverages industry met Friday to take an introductory step toward changing Iowa’s alcohol laws.

The group, convened by Gov. Terry Branstad, held its first meeting Friday at the Urbandale Public Library. The group plans to meet another half-dozen times before making recommendations to the governor and state lawmakers before next year’s legislative session.

In their initial comments, members expressed a desire for clarified and streamlined state alcohol laws.

A central issue sure to come before the task force is whether distilleries that sell spirits such as whiskey and vodka should be allowed to sell the product they make on-site, as is permitted for craft breweries and wineries.

“We’d like to be treated the same way as breweries and wineries,” said Garrett Burchett, a task force member and an owner of Mississippi River Distilling Co. in LeClaire. “We’ve worked on legislation for five years. We think we have a pretty good thought of what that looks like. We’d like an opportunity to vet that with this group.”

Beer wholesalers have pushed back against such changes. They say it would upset the three-tier system around which state alcohol laws are built: an independent distributor must operate between the manufacture and sale of alcohol.

“I understand the governor’s purpose of (the task force). He’s looking at economic development,” said Robert Fahr, a task force member and president of Fahr Beverage in Waterloo. “But basically, we as an industry, we were built on the three-tier system. … By having the wholesaler, we’re protecting the distribution to all people on an equal basis.”

The state has carved out exceptions to the three-tier system for small breweries and wineries. Distilleries are asking for the same consideration.

Those in border towns see the issue as especially pressing; all six states that border Iowa and 36 total allow distilleries to sell spirits by the glass.

“We’re losing some business,” said Matt Johnson, a task force member and owner of Barley’s Bar and Grill in Council Bluffs. “People are going (across the border into Nebraska), not to Iowa.”

Debi Durham, director of state economic development and a task force co-chair, said portions of the state’s alcohol laws are impeding economic growth. She said she hopes the group can suggest changes that create more economic opportunities but won’t negatively affect public safety or the three-tier system.

“I do think that we will come forth with a plan that we can agree to that is a responsible plan for growth,” Durham said.

Stephen Larson, the other task force co-chair and administrator of the state’s Alcoholic Beverages Division, said the group’s work is important because the industry is changing with the recent explosion of craft breweries, wineries and distilleries.

“This industry, your industry, is changing rapidly,” Larson said. “And we must be able to adapt fairly and rapidly.”

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