Control State News January 31, 2019 ID: Bill introduced to reform Idaho's license laws JOB OPPORTUNITY License State News Virginia ABC Director of Communications CT: Branford Brewery Says Bill Would "Crush" Craft The Director of Communications serves as the Business primary media spokesperson for the agency, and as the point of contact for media issues for all Industry News divisions. This position is required to work with executive staff and board members on Proximo Spirits Names Michael Keyes As President And CEO development and approval of statements and releases as needed. Being A Brewer In A Country: A Challenging Business For more details, click here. Trader Joe's Kills Its Grocery Delivery Program Brittany Burrell, MHRM, SHRM-CP | Talent Acquisition Consultant Daily News Virginia ABC | 2901 Hermitage Road, Richmond, United States: Legal And Policy Issues Surrounding Taprooms VA 23220 Office: (804) 204-2319 5 Alcohol Apps to Help You Track Drinks, Calories, BAC, and More Fax: (804) 213-4437 [email protected] Being "Sober Curious" Helps Some Explore Relationship With www.abc.virginia.gov Alcohol SAVE THE DATE March 17-19, 2019 26th Annual Symposium on Alcohol Beverage Law and Regulation Registration is open for NABCA’s 2019 Legal Symposium. For program details, travel information and to register online, please click here.

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The Public Health Considerations of Fetal Alcohol Spectrum Disorders (White Paper) Native American Nations & State Alcohol Policies: An Analysis (White Paper) Alcohol Technology in the World of Tomorrow - (White Paper) The Control State Agency Info Sheets. Please view website for more information. NABCA Survey Database (members only) Upcoming NABCA Meetings Statistical Data Reports www.NABCA.org

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CONTROL STATE NEWS ID: Bill introduced to reform Idaho's liquor license laws Idaho Press By Savannah Cardon January 30, 2019 BOISE — The Senate State Affairs Committee on Wednesday introduced legislation that would completely reform Idaho’s liquor license laws to address the state’s steep license prices, while also imposing additional requirements on restaurants serving alcohol. The bill, sponsored by Sen. Jim Rice, R-Caldwell, strikes the current quota system for issuing licenses based on population, and instead gives the control to local cities and counties. It also adds incentives to state license holders and tightens the regulations and punishments on those who serve alcohol in Idaho. “I know this is going to be a highly contested issue, and I think it’s something we do need to take a look at as we try to modernize and adjust for what’s going on in our state,” said Senate Assistant Majority Leader Chuck Winder, R-Boise. “I commend Senator Rice for having the courage and the time to go back in and really look at these laws and I look forward to hearing the public testimony as we move forward." If passed, it would take effect on Jan. 1, 2020. The state would no longer issue licenses and cities and counties would have the power to issue — or choose not to issue — non-transferable liquor-by-the-drink licenses. The existing state licenses would still be transferable on the secondary market, and would be transferable from one city to another, which is not the case today. “This is something that would enhance local control,” Rice said. “It also provides the process if the citizens chose to try and override their city council or county commission by voter initiative.” The current quota system, which Rice said has “created some rather interesting dynamics throughout our state,” gives every Idaho city at least two liquor licenses, and one additional license for every 1,500 people. The nearly 70- year-old system has caused a wait time of five to eight years in Boise for a $750 state-issued license. As the state grows at a rapid pace, the quota system has created a long waiting list of businesses hoping to obtain a license, as well as a disparity of licenses because they can only be sold in the city issued. This has led to a secondary market in selling and leasing existing licenses, which can sell for six-figure prices. "We're back and forth as we try to find a way to update and modernize our liquor system in Idaho so the small businesses, the small restaurants would have an opportunity to have a liquor license," State Affairs Committee Chairwoman Patti Anne Lodge, R-Huston, said. "The way it is now, it's too expensive for the small business people to get a license." If the bill becomes law, existing liquor licenses would retain some value — they’d be given a 10 percent discount on liquor purchases from the state dispensary. Current law allows for a 5 percent discount. The bill also clarifies and makes the penalties clear and stronger for businesses with liquor licenses. It requires that the state have specific training for employees who would be serving liquor. Training could include topics like learning how to recognize when somebody has had too much to drink. Liquor license reform has been a topic of discussion for many years. Lawmakers have before tried to change the state's liquor laws, but have yet to see success; former Gov. Butch Otter unsuccessfully proposed reforms a decade ago. "This is not the day to settle whether it's right or wrong," Sen. Kelly Anthon, R-Burley, said. "This is a day to determine whether this is an appropriate conversation to have."

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LICENSE STATE NEWS CT: Branford Brewery Says Bill Would "Crush" Craft Beer Business A bill being pushed by lobbyists for the liquor industry would be a killer to the growing craft beer industry, brewers claim. Branford Patch By Jack Kramer, Patch Staff January 30, 2019 BRANFORD, CT - A proposed bill being pushed by the lobbyists for the liquor industry has caught the attention of one the popular breweries in Branford - Duvig - which is asking its customers and all fans of craft breweries in the state to push back. The bill, "An Act Concerning Brewery Sales for On-Premise Or Off-Premise Consumption" would require breweries to either sell their product on premises or for off premises purposes - but not both. This is what Duvig has to say on its Facebook page about the bill: "This is the bill that is trying to crush CT breweries. "It says that a brewery has to choose between selling their beer to be consumed inside the brewery or carry out only like a liquor store. "No longer will they be able to do both!! This will close down many of us!!! Call your local reps and say no." The bill is here: https://www.cga.ct.gov/2019/TO... Legislation has also been submitted on behalf of craft brewers to ask legislators to lift the limit on how much beer they can sell from the state's increasingly popularity brewery industry. Currently, craft brewers in the state are limited to selling only 9 liters of beer per customer transaction from their breweries — which translates into "about 21, 16-ounce cans." Nearby states don't have such limits. Again it is the powerful liquor industry lobby fighting to keep the limits in place.

INDUSTRY NEWS Proximo Spirits Names Michael Keyes As President And CEO Shanken News Daily January 30, 2019 After a lengthy search, Proximo Spirits has announced that Michael Keyes will be its next president and chief executive. A 30-year industry veteran, Keyes comes to Proximo from Brown-Forman, where he served for 10 years as president, North America. Keyes will oversee Proximo’s business across the U.S. and Canada. The appointment is effective February 4. “Mike is a proven leader with the right skills and experience to lead our most profitable markets,” said Juan Domingo Beckmann, CEO of Proximo’s parent company, Becle, S.A.B. de C.V., also known as Grupo Cuervo. Keyes’s appointment marks a new era at Proximo, which was led by veteran spirits executive Mark Teasdale from 2007-2018. Teasdale left Proximo last summer to join former colleague Elwyn Gladstone at Malfy gin marketer Biggar and Leith. Since then, Proximo board member Michael Cheek has been serving as acting CEO.

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Jose Cuervo Tequila, by far Proximo’s largest brand, was up 2% to 3.7 million cases in the U.S. last year, according to Impact Databank’s estimate. While competition has ramped up in Tequila lately, the category-leading Cuervo has continued to grow, adding about 400,000 cases to its total over the past three years, with its higher-priced Tradicional offering helping to propel gains. Meanwhile, Proximo has looked to expand its presence in other high-growth areas of the industry, including (e)y. The company acquired Pendleton Canadian whisky from Hood River Distillers for $205 million just over a year ago, and the brand continues to increase by double-digits. In Irish whiskey, Proximo recently launched the new Proper No. 12 brand, which is owned by mixed martial arts champion Conor McGregor’s Éire Born Spirits. Proximo had total U.S. volume of nearly 10 million cases last year, Impact Databank estimates. Proximo parent company Grupo Cuervo posted North American sales up 8.9% to nearly MXN$4 billion ($203m) for its fiscal third quarter, ended in September.—Daniel Marsteller

Being A Brewer In A Wine Country: A Challenging Business Forbes By Annalisa Girardi, Contributor January 30, 2019 Over the past few years, craft beer has been conquering bars and restaurants, becoming strongly appreciated across Europe and North America, as a product that consumers are willing to pay more for in exchange for quality and taste. The craft beer movement has sprung recently, fast becoming part of well-established gastronomic traditions. However, it has not always been an easy journey, especially in those countries where beer’s production and consumption lie in the shadows of another beverage: wine. In Italy wine is called the “nectar of the gods” and its history is as ancient as the one of the first human settlements in the peninsula. During the Roman empire winemaking became an art, part of the daily diet and a commercial activity which accompanied peoples and cultures through the eras. In modern times, Italy became the world’s largest producer of wine, with about 40 to 50 million hectoliters per year which make up for one-fourth of the global production. The wine market generates in Italy an income of over $10 million, a revenue that the country has always tried to secure. One way to do so was to exempt wine from the excise tax, a duty imposed all over Europe on alcoholic beverages. An excise is called an indirect tax, which means that the duty is implemented at the moment of production rather than at sale. The taxation is applied by degree Plato, the measure that determines the level of alcohol in a beverage: the more alcoholic the product is, the higher the excise will be. However, in Italy this does not apply to wine. While wine businesses can enjoy a duty-free production, beer faces a tax of $3.47 per degree Plato, which means that brewers must pay $41.7 for every hectoliter. Italy has one of the highest excises in Europe, which is almost four times what Germany applies. Clearly this put beer companies in a disadvantaged position compared to wine producers, that are not at all subjected to a tax regime. Besides, over the years the tax has raised along with the production: in 2017 brewers produced 7% more than what they did in 2016 and exports reached 2.7 million hectoliters, 7.9% more than 2016. This is the data presented in the 2017 Annual Report of AssoBirra, an association which reunites the major producers of beer in Italy since 1907. The note also stressed that the growth of the sector is also benefiting the labor market, offering jobs to more than 140,000 people, 3,000 more than what it did in 2016. Annual revenues are increasing for the sector, which is thus acquiring more political weight in the market. UnionBirrai, the trade union for microbreweries, succeeded in presenting to the parliament a draft law, which was later approved, to cut the excise to $3.41 per degree Plato for all producers, and an additional reduction of 40% on alcohol taxes for independent brewers that have a production lower than 10,000 hectoliters.

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The proposal is part of the 2019 Budget Law and will be put into force in the following months. Tax relief has been the result of a growing market that, even though is far from the world's top beer's producer, is very promising and expected to have excellent turnouts. Even if the reduction is very small, it is a starting point that paves the way for beer to make room for itself in a market that has traditionally been dominated by wine.

Trader Joe's Kills Its Grocery Delivery Program It ends on March 1. Food & Wine By Mike Pomranz January 30, 2019 Trader Joe’s has always done things differently than traditional grocery stores: That’s pretty much its appeal and one of the reasons it’s developed so many hardcore devotees over the decades. Now it appears that Trader Joe’s is going its own way again—or at least going against one of the biggest industry trends. The chain has announced it’s ending its grocery delivery service in New York City and is reportedly done with the idea of delivery altogether. Trader Joe’s was actually a bit ahead of the curve when it comes to delivery. According to Business Insider, the brand has been offering to bring groceries to customers’ homes in the New York City area for ten years now. But on March 1, they’ll be ending that service. “Instead of passing along unsustainable cost increases to our customers, removing delivery will allow us to continue offering outstanding values — quality products for great everyday prices, and to make better use of valuable space in our stores,” Trader Joe's representative Kenya Friend- Daniel told BI. “This was not a decision we made lightly. We value our customers and all that they do to come shop with us.” Trader Joe’s apparently also told Business Insider that the company has no plans to introduce delivery in any other markets. Though Americans have been relatively slow in switching to online grocery ordering and home delivery, the concept has gained tons of momentum since home-delivery masters Amazon proved they were going all in on the grocery game by acquiring Whole Foods in 2017. Since then, Amazon has continued to roll out two-hour delivery from Whole Foods in more and more markets across the country, inspiring other major grocery retailers like Kroger and Walmart to step up their delivery game as well. And yet, if Trader Joe’s really is worried about costs, maybe it's best they let the big boys battle this one out for now: It’s not like they can’t reconsider down the road. And for those desperate to have Trader Joe’s delivered, third-party services are still apparently willing to do that dirty work for you. But come on…you know it’s not the same without seeing those Hawaiian shirts.

DAILY NEWS United States: Legal And Policy Issues Surrounding Taprooms Mondaq Article by Arthur J. DeCelle McDermott Will & Emery January 31, 2019 Rapid growth in the number of small and independent breweries that rely on taproom sales has received a lot of attention- not all of it positive-across the beer industry. Any disruptive change in a mature product market is news. Until the unprecedented growth in the number of very small and independent craft brewers, taproom sales went largely unnoticed. Competing retailers, beer wholesalers, and even well-established craft brewers were pleased with steadily growing craft beer sales and consumer demand. As demand has leveled out and competition has increased, taprooms are receiving increased scrutiny. NABCA Daily News Update (1/31/2019) 6

The U.S. beer industry is shaped in part by a unique combination of laws and policies that add legal and political forces to ordinary market dynamics. Rules vary from state to state with a federal overlay that can create even more confusion. One recurring, confounding issue in the beer industry is that government regulation simply cannot keep up with changes in the national economy, technology, and other fundamentals of the 21st century business environment. A continuing concern of government at all levels is industry integrity and the effects of an alcohol beverage licensee on surrounding communities. Those concerns are addressed in the approval processes of state licenses and the federal Brewer's Notice issued by the Alcohol and Tobacco Tax and Trade Bureau (TTB). That taprooms exist because of a "legal loophole" is simply a myth. By nature, a brewery has a substantial physical presence. A brewery with a taproom is licensed at a highly visible location with loading docks, tanks, and complex plumbing and circuitry. Diagrams of the operation are on file with regulators along with fingerprints and more than enough information to file a mortgage application for each owner and officer on the permit or license. Every brewery owner has substantial obligations imposed by the terms of several licenses. He or she must exercise direct supervision over production and retail activities and pay taxes on a regular schedule throughout the year. The entire business is directly subject to penalties that could be imposed by the TTB, state ABCs, state and local police agencies, or all of the above. Few other businesses operate under such an extraordinary regulatory phalanx. From a practical perspective, legal considerations are critical in assessing whether a taproom is the best business decision for a new or growing brewery. Each state licensing law authorizing brewery taprooms and brewpubs operations has its own nuances. Some laws severely limit the economic viability of brewery taprooms and potential for growth. Brewery owners are best served by gaining a full understanding of their state's licensing requirements. Some states follow the federal model, treating brewers as manufacturers and authorizing retail sales on the brewery premises. Several states have complex exceptions that permit brewers to operate wholly-owned retail establishments at locations other than the licensed brewery. Longstanding Florida law allows taprooms at breweries provided they enhance the state's tourism industry, which means they must schedule regular public tours. In addition, a lengthy exception to the tied house law allows a brewery to obtain up to eight retail licenses "for the sale of alcoholic beverages on property consisting of a single complex, which property shall include a brewery and such other structures which promote the brewery and the tourist industry of the state." Virginia has analogous laws authorizing retail sales in proximity to breweries. (Think of Busch Gardens and Sea World when they were owned by Anheuser-Busch.) If one looks at competing industry segments, wine and spirits suppliers and distributors have embraced tasting rooms and expanded sales opportunities. Policy changes that the wine and spirits industry supported over the last two decades are paying off for all three industry tiers today. Change did not occur overnight. A familiar pattern of litigation and legislative battles accompanied the amendments to state licensing and tied house laws. But direct shipping, tasting opportunities, expanded retail privileges, and wine and spirits trails are examples of policies that ultimately fostered growth for the industry overall. Current beer industry dynamics are creating pressure on state lawmakers and regulators. Established wholesale and retail interests seek to restrict the retail privileges of brewers. Successful local craft brewers are seeking to expand retail privileges to create a base for their brands and to add a profit center to their breweries. One of their biggest challenges is to quell the growing concern over taprooms. The Brewers Association's analysis of TTB data shows that direct sales to consumers at brewpubs and brewery taprooms combined were on track to hit three million barrels in 2018. That number must be divided by more than 5,000 breweries with taprooms. The total national volume also includes substantial volume at A-B and MillerCoors taprooms, two of which (St. Louis and Golden) have hundreds of thousands of visitors annually. The average taproom sales volume is approximately 7,500 case equivalents (CE) and the median is estimated by the BA to be 4,800 CEs. Keep in mind that 75 percent of craft brewers in the U.S. produce less than 1,000 barrels or 13,700 CEs annually. NABCA Daily News Update (1/31/2019) 7

Taprooms are often viewed as a threat to the viability of beer distributors, although the size and scope of most taprooms is a rounding error when compared to the volumes of most U.S. distributors. In most counties in the U.S., close to 100 percent of the beer is sold by two wholesalers to all retail customers. Large urban markets may have three or four full-service wholesalers. If the current trend in brewery sales continues, taproom sales might change the amount of beer that is sold by licensed distributors to 95 percent by the time people born this week turn 21. Taprooms are a different business model, but they are certainly not a threat to distributors, many of whom sell millions of cases annually. Retailers are also concerned over taprooms, particularly in states where license quotas and other limitations exist. Conflicts even exist among craft brewers in states where breweries with limited capacity are authorized to operate primarily as retail outlets. These commercial and political issues are likely to lead to continued changes in brewery licensing criteria in the foreseeable future. State and local officials possess significant discretion in licensing proceedings. In addition to existing licensing requirements, barriers to new projects can arise through frequent changes in state laws to accommodate new projects and in response to political pressure from established interests. Several state licensing laws in key states have been amended twice in the same legislative session. To the extent possible, steps should be taken to confirm that all of the commercial activities needed to sustain a viable business are authorized under state and local law. All necessary government authorizations must also be obtained in advance so that the new enterprise can commence operations in a predictable timeframe. If you are considering the addition of a taproom, a cautious approach is needed. Prior to making financial or other commitments involving breweries, property, or other assets, state requirements should be reviewed and fully understood. Any questions that are not clearly addressed in the text of laws and regulations should be clarified with the relevant state ABC and/or local government with jurisdiction over a prospective brewery or retail site. Originally published in The New Brewer, January/February 2019

5 Alcohol Apps to Help You Track Drinks, Calories, BAC, and More KXXV January 30, 2019 The World Health Organization recently reported that dangerous alcohol consumption kills over 3 million people each year, worldwide. Alcohol-related deaths represent over 5 percent of all recorded deaths. Government leaders continue to develop strategies to fight harmful drinking and its damage. One of these strategies includes promoting persuasive technology. Persuasive technology is designed to change behaviors through persuasion and not force. You can see this technology today on the many personal phone apps designed to reduce unhealthy alcohol use disorder. These apps can change attitudes about harmful drinking through social influence behavioral change strategies. Read more here about this breakthrough in mobile technology. You just might find the alcohol app that can save your life. How Does an Alcohol App Work? Alcohol Apps use two main kinds of strategies. Some apps rely on your self-control to help you monitor your intake. Other apps use motivation techniques to reward or praise you when you reduce your intake. Self-control apps depend on users to manage their own consumption. These apps provide information on topics like blood alcohol concentration levels. Self-control apps can’t tell you if your alcohol intake level is over a high level of risk.

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Motivation apps use competitions to challenge you to meet your goals. They also use reminders and notifications to help you control your drinking. Motivation apps also allow users to receive encouragement through social media on a regular basis. There are certainly challenges to developing healthcare mobile apps that meet the user’s preference. These apps show great promise to show users how to stop drinking. To do this, developers know that apps should add value to their user’s experience. That’s why some alcohol tracker apps are customized to a user’s preference. For example, some apps provide gradual milestones. This allows users to make incremental progress at every step of the change process. Are you ready to start the new year right and give up drinking? If so, here are some alcohol apps worth checking out: AlcoDroid Alcohol Tracker You can use AlcoDroid to track how often you consume. AlcoDroid calculates an estimated blood alcohol content based on your recorded data. Follow this app to track how much money you’ve spent on alcohol as well. Daybreak App The British company Vodafone created the Daybreak app to give high-risk drinkers help where they needed it. Daybreak provides an assessment to help drinkers understand their goals and milestones. They also recommend tailored activities for positive change. IntelliDrink This app calculates your estimated alcohol retention and absorption rates over time. It can also let you know when you’ve reached a specific blood alcohol content level that you specify. Nomo Sobriety Clocks This app has a sobriety calculator that can track how long users have been clean or sober. Use this app to follow how much time has passed since your last drink. Nomo Sobriety Clocks also have games to help distract your mind during cravings. SoberTool SoberTool counts your sober days and money funds saved from buying alcohol. There’s a community forum where you can share motivational messages with others on the same path Next Steps Feel like you know more about which alcohol app can help you? Download one of these programs to your smartphone or Android device today. Sobriety is waiting for you. Don’t forget to check our site for other helpful advice on the best health apps on the market today. Don’t be afraid to leverage technology to help solve problems that are keeping you from making your life the best that it can be.

Being "Sober Curious" Helps Some Explore Relationship With Alcohol The Fix By Beth Leipholtz January 30, 2019 “Being sober curious is about ¬questioning every impulse or expectation to drink and using the answers to inform whether or not you actually drink,” says the author who coined the term. Make room, Dry January—there’s another sobriety exploration method in town. In recent months, the term “sober curious” has become more prominent. Rather than abstaining completely from alcohol, those who are sober curious may choose to take a break from drinking and give some thought to their relationship with alcohol. NABCA Daily News Update (1/31/2019) 9

The concept, according to Time, was coined by Ruby Warrington and is the title of her new book as well. In the book, Warrington explores the idea of reexamining one’s relationship with alcohol. Time reports that while Warrington never struggled with substance use disorder, she did use alcohol to be more at ease in social situations and to cope with or cover her feelings. “Being sober curious is about ¬questioning every impulse or expectation to drink and using the answers to inform whether or not you actually drink,” Warrington tells Cosmopolitan. While Warrington doesn’t necessarily press the idea that alcohol should be cut out of one’s life forever, she does think there are benefits to stepping back from it. She says, according to Time, that rather than squeeze out confidence from alcohol, it can come from healthier methods, like positive affirmations and power poses. In addition to helping her mentally, Warrington tells Cosmopolitan that cutting down alcohol helped her feel better physically. “My anxiety levels were lower. I woke up fresh. I had so much more energy,” she said. In the book, Warrington also addresses the idea of FOMA, or “fear of missing alcohol.” She provides some advice to get around this fear, such as taking part in new hobbies or ditching dinner plans and going out for brunch instead. Psychotherapist Alison Stone tells Bustle that being “sober curious” isn’t restrictive and allows people to make decisions based on their feelings. “Identifying as sober curious prevents us from falling into a black and white way of thinking, feeling, and behaving,” she said. “It can help us better understand our relationship with alcohol, too—when do we drink more than we intended to? Are we drinking because we want to, or because we feel we need to? Having curiosity opens up the possibilities to better understand ourselves and our motives for doing things.” Stone adds that when something in one’s life is restricted or completely off limits, it may just make that person want it more. In that way, being sober curious is beneficial. “That is partially due to the psychological impact of making an extreme decision—there are often parts of us that want to do the exact opposite of that decision,” Stone stated. But while being sober curious may work for some, others may need to stick to complete abstinence from alcohol.

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