LINCOLN — Caleb Pollard readied Friday for the grand opening of his brand-new brewery in the Sand Hills community of Ord, Scratchtown Brewing Co.
But first, he made a stop at the State Capitol in Lincoln, to speak on behalf of little brewers like him across the state.
He spoke to the Legislature's General Affairs Committee during a hearing of LR 175, which calls for an interim study of Nebraska's craft brewing industry.
Specifically, Pollard and others who testified in support of the study hope it leads to a loosening of Nebraska's beer distribution laws, as well as for lower excise taxes for the small operations like Scratchtown.
“Craft breweries are local economic development, pure and simple,” said State Sen. Kate Sullivan of Cedar Rapids, who introduced the resolution.
Nebraska is home to 20 craft breweries, defined as those that produce less than 20,000 barrels of beer per year. Another 14 craft breweries are in the planning stages, she said.
Breweries can sell their beer without the aid of a distributor at their own brew pubs, but not elsewhere. In Pollard's case, that means that if an establishment three doors down from his own wants to stock Scratchtown beers, it would need to order it through a distributor 65 miles away in Grand Island, Neb.
Working with a distributor is also costly for the small breweries, said Matt Stinchfield, who is in the process of opening Ploughshare Brewing Co. in Lincoln. He said distributors often charge a markup on 25 percent to 35 percent on craft beers, which the brewery generally ends up eating.
Kim Kavulak, who started Omaha's Nebraska Brewing Company with her husband six years ago, would like to see a decrease in the excise tax on craft beer. In Nebraska, beer is taxed at 31 cents per gallon, higher than any of Nebraska's neighboring states. Beer from both huge domestic breweries and small independent ones are taxed at the same rate, she said.
Hobert Rupe, director of the Nebraska Liquor Control Commission, was the only person to raise concerns about LR 175 during Friday's hearing.
Craft brewery liquor licenses already allow breweries to sell their own beers in their own tasting rooms without going through a distributor, Rupe said. And technically, Pollard could deliver a keg of beer to an establishment three doors down from Scratchtown, as long as his distributor handled the paperwork, he said.
Rupe also worried about the legality of taxing big brewers and little ones at different rates.
And he pointed out that the craft beer industry — in Nebraska and elsewhere — doesn't seem to be struggling too much.
“American craft beer is the only segment where (beer) sales are going up,” he said.
No further hearings are scheduled.