Friday, October 24, 2008

Good news in the Legislature yesterday

I was beat out by a blogger in California on a Nebraska beer story yesterday, one of the best beer bloggers out there in my opinion and a blog you should follow. Nebraska failed to pass the bill that would reclassify alcopops as spirits so they could tax them as such and meet a grpups neo-prohibitionist movement of thinking that this will reduce under-age drinking and drinking in general.

I am going to research Project Extra Mile further before I go to far off the deep end here but my guess is they would just as soon everyone not drink, not just minors. That is the general drive behind MADD these days and I bet this group is not very different. Lets get one thing straight, underage drinking is a problem and something that needs to be addressed, but demonizing the drinking of alcohol and creating more laws to control it is not the answer. Proper education and responsible parenting is the correct step. If you have a healthy respect for something and don't believe it is something mysterious and evil it is less likely to be abused. Alcohol consumption should be treated like driving for our kids. We should teach them about how to use it prior to them getting the right to use it.

Anyway, off the soap box, congrats to the Nebraska legislature on not passing this bill. This has become an issue in California for Craft beer makers that make beer and store in whiskey barrels, or the like, because they may fall under the alcopop designation and therefore the tax because of the small amount of spirits in those beers. This could have been disastrous for our local craft beer makers that barrel age.

So for those that follow this blog in other states, watch out for these bills coming across your legislature's table and fight them. I missed this one and I regret it but I am glad it didn't pass.


Eric said...

I think your analysis is right on. However, this wasn't a bill before the Legislature. Project Extra Mile was trying to persuade the Nebraska Liquor Control Commission to reclassify alcopops. The commission made the right decision, but it is only a matter of time before this really does go before the Legislature and becomes much more highly politicized as a result.

Project Extra Mile was trying to get the classification changed because they viewed alcopops as "better tasting" than beer which makes them, therefore (in their insanely flawed logic), more likely to be abused by underage drinkers. They tried to use the fact that some of these beverages have some distilled spirits in them as a technicality for getting them classified as distilled spirits.

But, it is only a matter of time before they go after "better tasting" beer. How much you wanna bet that your average Project Extra Mile member would consider Lindemans Kriek an alcopop?

Eric said...

By the way, for anyone interested, Project Extra Mile is funded in part with public funds. So, it is you and I paying for this advocacy.

Nate B. said...

Thanks for you clarification on the liquor control commission. The fact they are partly funded by my tax dollars makes me ill. These groups have the right idea at heart but it is the fact they take it to eliminating and punishing instead of properly educating the youth on how to drink responsibly that makes me mad.

Segnid said...

Nebraska LCC is pretty straight-forward in most of these labeling and taxation things. They simply mimic the federal laws. As Jay alludes, lots of other states decide to make their own rules for classification and labeling that are different from, and sometimes contradictory to, federal law.

So the LCC is simply sticking with its status qua in keeping its designation in line with the TTB.

FWIW, the TTB considers a "flavored malt beverage" to be a beverage that contains less than 49% of its alcohol from distillation. Still a significant amount of cheap distilled alcohol, in my view. Many "real" beers are classified as "flavored malt beverages".

Nebraska liquor statues don't make the distinction between these hybrid beverages clear in their verbiage. The LCC has now ruled on that. I don't see how there could be a similar argument that beer should be moved into a different tax category. The only basis for that would be an attempt to add in an alcohol cap for beer, something which a few states have recently dropped from their books completely.

While alcopops do provide a much easier flavor transition from soda to alcohol (that must be what Eric is implying by "better tasting"?), the legal basis for this "challenge" was not the flavor of these concoctions, but the way the legal statues were worded with regard to tax classification.

The idea that jacking up the taxes on these would prevent even ONE minor from drinking is debatable at best. There will always be cheap alcohol. I sure didn't have any trouble with cheap beer when I was 15. And plenty of kids were happy mixing cheap spirits and soda on their own, without having it done in the beverage factory for them.

The tax rate for beer in Nebraska is $0.31/gal. For distilled spirits it is $3.75/gal. This means that the tax on a case of 24 12oz bottles of alcopop would go from $0.65 to $7.84.

The result on the retail shelf would be that a $5.99 6-pack (is that even how much this goop costs?) would become something like $8.99.

CJ said...

I have no comments on the legal mumbo jumbo...rather the parenting portion.

Nate is right on that underage drinking is more aobut parenting then it is about restrictive laws and increased taxation of product.