Murphy reportedly expects to conditionally veto brewery bill post-election

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After sitting on Gov. Phil Murphy’s desk since late June, legislation that would ease some of the state’s restrictions on breweries, cideries and distilleries will reportedly be sent back to lawmakers this fall.

While the administration has previously said the Democratic governor was expected to issue a conditional veto so that the measure can be included in a larger reform effort of the state’s decades-old liquor license system, there is now a clearer picture of when Murphy will act.

Jennifer Sciortino, a spokesperson for the governor’s office, recently told the New Jersey Monitor that Murphy will act on the bill once lawmakers return to Trenton following November’s elections, when all 120 legislative seats are on the ballot.

In response to a request for comment from NJBIZ, Sciortino referred back to a statement she made last month, saying, “The Governor unequivocally supports easing restrictions on New Jersey breweries, which is why he proposed these reforms himself earlier this year. However, he has been clear that our outdated liquor license system needs comprehensive reform, not a piecemeal approach, in order to ensure equity and affordability so that all small businesses and the entire industry as a whole will benefit.”

In response to the latest media report, Brewers Guild of New Jersey Executive Director Eric Orlando issued a statement Sept. 8 saying, “After more than a yearlong effort to gain acceptance of a permanent fix to brewery license restrictions, which have severely hampered the economic viability of the craft beer industry in New Jersey and negatively impacted consumer enjoyment of their local breweries, it is extremely disappointing that the Governor has decided to issue a conditional veto on this important legislation.”

He went on to say, “The more than 140 craft breweries in our state are at their heart small businesses, and regardless of what industry a small business works in, they cannot be asked to operate in an environment where their businesses are beholden to the political whims of the moment, particularly around a controversial issue such as liquor license reform.”

Holding breweries ‘hostage’

As part of a ruling handed down four years ago by the state Division of Alcoholic Beverage Control, New Jersey’s growing craft brewing industry must comply with a series of regulations, including limits on the number of on-site events that can be held and a ban on offering food, serving coffee and coordinating with food vendors.

The rules – which went into effect July 1, 2022 – also require breweries to give patrons a tour of the facility before they can consume alcohol.

In response to growing concerns from the industry that the regulations would put them out of business or force them across state lines, lawmakers began looking to roll back some of the restrictions.

Approved unanimously by the state Senate on June 26 and the state Assembly on June 30, the legislation in question would repeal limitations on how many special events a brewery can host, along with a rule that prevents them from working with vendors to serve food or providing packaged snacks. The measure also gives licensed alcoholic beverage manufacturers the option to hold an unlimited number of private parties on premises each year and the ability to host up to 25 off-premises special events and 25 social affairs events per year.

Under a July directive issued by the Division of Alcoholic Beverage Control, enforcement of the regulations is paused through Dec. 31, 2023, the current legislative term.

In a Sept. 8 statement, state Sen. Michael Testa, R-1st District, one of the bill’s sponsors, said, “Gov. Murphy’s decision to hold our breweries hostage in a broader liquor license reform debate runs counter to the State’s push to grow our tourism industry. We’ve seen breweries starting to go out of business because of these oppressive rules overregulating their businesses and limiting their ability to serve food and hold certain events.”

“The legislation that I sponsored would help breweries lift these unnecessary regulations,” the senator commented. “Gov. Murphy’s liquor license reform is separate and apart from the business of breweries and they should not be used as a bargaining chip.”

Orlando said, “This legislation achieved almost the unfathomable in terms of any piece of alcohol industry-related legislation in recent times: unanimous bipartisan legislative support, broad alcohol industry consensus and overwhelming public support with some polling numbers reaching as high as 92% in favor of aspects of the bill. The Guild and its industry partners delivered on the ask of this administration and state regulators to change the laws which oversee the industry and its daily operations so that it would be clear to brewery owners, the NJABC, industry stakeholders and fans what breweries could do in the operation of their businesses.”

He continued, “Despite all of this, we will continue to work with the Murphy Administration and Legislature to ensure restrictions are permanently ended by year’s end, whether it be in the form of another standalone proposal or in the context of broader liquor license reforms as signaled by the Administration.”