Local Breweries Plead for Help in Fighting New State Regulations

Jersey City’s two craft beermakers — like their brethren from around New Jersey — are in a big brouhaha with state regulators over a “special ruling” they say threatens their livelihoods and that the state says was crafted to balance the interests of New Jersey’s restaurants.

Members of the City Council and state Assemblyman Raj Mukherji came to their defense at a Friday press conference co-hosted by 902 Brewing Company and Departed Soles Brewing Company, the two local breweries.

“Just as they’re on the verge of recovery, to create artificial barriers to the success and the economic recovery of these small businesses doesn’t make a lot of sense,” said Mukherji. “Craft breweries are just asking for fairness, for equity, for reasonable legislation.”

The special ruling by the state Division of Alcoholic Beverage Control requires breweries to conduct in-person or virtual tours of their premises before they can serve patrons, and it prohibits the establishments from selling coffee or food on premise (though it does allow patrons to consume food and drink delivered from elsewhere).

The regulation also stipulates that beermakers can hold no more than 25 on-site special events (such as  gatherings to watch TV championship sports, live amplified music, or DJ concerts), 52 private parties, and 12 off-site events per year.

The ruling was to have gone into effect in 2018 but was revised and deferred to July 1, 2022 after brewery owners statewide protested.

One such opponent is Brian Kulbacki, Departed Soles’ owner. Kulbacki said the restrictions on “limited brewery” licensees “will harm us, our staff, and many people in the community like musicians and others who participate in the events we sponsor.”

Brian Kulbacki of Departed Soles Brewery

He also noted the ruling requires breweries to advise the ABC when holding special events and to create guest lists of the events for the agency.

“It hinders our ability to book food trucks to park outside the premises,” Kulbacki added.  Essentially, “the ruling restricts free trade.”

A press release issued by the state attorney general’s office said the special conditions spelled out in the ABC ruling “are the result of an extensive outreach effort by the (ABC) Division to meet with industry leaders, individual craft brewery owners, members of the Legislature, and others whose objections led the Division to suspend a prior special ruling issued in October 2018.” Mukherji, however, pushed back, saying ABC hadn’t given legislators notice of the changes.

The newest version of the special ruling, the release said, is “intended to provide a simplified ‘blueprint’ to help ensure full knowledge of what is legally required on the part of licensees and a fair marketplace.”

According to the attorney general, the state did make some concessions to the breweries in the revised ruling. “First, an ‘off-premises event’ now includes a maximum of three consecutive days under a single ‘off-premises event’ permit. Second, the cost of this permit has been reduced to $100 per day,” the press release advises.

Moreover, the release says, “The Division believes the activities permitted under the (revised) special ruling strike a fair and appropriate balance between the interests of … restaurants and bars and the craft brewing industry. The Division will continue to work with all licensees to promote a fair and robust alcoholic beverage industry in New Jersey.”

In response, Kulbacki said, “There are only two entities that can stop (the special ruling): the legislature and the governor.”

The issue has sometimes pitted restaurants, which must often pay many hundreds of thousands for a liquor license, against breweries for whom the license is a relatively small yearly fee.

“Yes, liquor licenses do cost an absurd amount of money,” conceded Kulbacki, “but breweries should not be punished for that.” He noted that when all of a brewery’s fees were combined, they amounted to hundreds of thousands of dollars. “People like to say that we don’t pay a lot for our license, but that’s just not true.”

For his part, Mukherji said he was committed to protecting restaurants’ investments.

Mukherji said he would be sponsoring legislation to fix the problem.  “We need to consider whether reforming all of our liquor license laws are in order.”