Commerce Finance and Policy

TWENTY-NINTH MEETING

2021-2022 Regular Session - Wednesday, October 27, 2021

STATE OF MINNESOTA TWENTY-NINTH MEETING
HOUSE OF REPRESENTATIVES NINETY-SECOND SESSION

COMMERCE FINANCE AND POLICY COMMITTEE

Representative Zack Stephenson, Chair of the Commerce Finance and Policy Committee, called the virtual meeting to order at 1:00 PM on October 27, 2021, pursuant to House rule 10.01. The meeting was broadcast via Zoom and House Public Information Services.

The clerk took the roll.

Members present:
STEPHENSON, Zack, Chair
KOTYZA-WITTHUHN, Carlie, Vice Chair
O’DRISCOLL, Tim, GOP Lead
CARLSON, Andrew
DAVNIE, Jim
ELKINS, Steve
HALEY, Barb
KOEGEL, Erin
LEE, Fue
LILLIE, Leon
LUCERO, Eric
OLSON, Liz
PFARR, Brian
RASMUSSON, Jordan
RICHARDSON, Ruth
THEIS, Tama

Members absent:
BAHR, Cal
LISLEGARD, Dave

A quorum was present.

Representative Kotyza-Witthuhn moved to approve the minutes from the committee meeting on April 13, 2021. THE MOTION PREVAILED.

Representative Kotyza-Witthuhn moved to approve the minutes from the committee meeting on June 15, 2021. THE MOTION PREVAILED.

Representative Kotyza-Witthuhn moved to approve the minutes from the committee meeting on September 27, 2021. THE MOTION PREVAILED.

HFXXXX/SF 2096 (Koegel) - For-sale items at exclusive liquor stores modification

The following testified on HFXXXX/SF 2096:
Colin Marsch, Drinkworks/Anheuser Busch
Paul Kaspszak, Minnesota Municipal Beverage Association

HF1640 (Hornstein) - Farm winery license issuance to sake producer authorized

The following testified on HF1640:
Blake Richardson, Moto-i
Joel Carlson, Minnesota Wine and Spirits Wholesale Association

HF122 (Hertaus) - Liquor; city population requirement to qualify for exemption from temporary license restrictions modified

The following testified on HF122:
Brandt Erwin, Minnesota Beer Wholesalers Association

HF902 (Becker-Finn) - License restrictions modified

The following testified on HF902:
Bartley Blume, Bent Brewstillery
Pat Trudgeon, City Manager, City of Roseville
Joel Carlson, Minnesota Wine and Spirits Wholesale Association
Ed Reynoso, Teamsters Joint Council 32

HF2619 (Bliss) - Commerce; variance request licensee regulatory requirements modified

The following testified on HF2619:
Brandt Erwin, Minnesota Beer Wholesalers Association
Dan Huff, Assistant Commissioner, Minnesota Department of Health

Draft HF- CK0066 (Baker) authorizing licenses for on-sale at the Willmar Civic Center

The following testified on CK0066:
Kirk Olimb, coach, Willmar Warhawks Hockey Team
Brandt Erwin, Minnesota Beer Wholesalers Association

HF374 (O’Driscoll) - Sauk Rapids; on-sale liquor licenses authorized

The following testified on HF374:
Ross Olson, City Administrator, City of Sauk Rapids
Brandt Erwin, Minnesota Beer Wholesalers Association

Draft HF- CK0087 (Agbaje) - modifying the annual production limit for microdistillery on-and off-sale to exclude spirits bottled under a third-party contract

The following testified on CK0087:
Mary Schnitker, Skaalvenn Distillery
Joel Carlson, Minnesota Wine and Spirits Wholesale Association

Draft HF- CK0073 (Davnie) - allowing producers to provide liquor to nonprofit organizations for tasting events

The following testified on CK0073:
Theresa Swaney, Lake Street Council
Brandt Erwin, Minnesota Beer Wholesalers Association

Draft HF- CK0063 (Nash) - allowing strong beer licenses for certain town ball game events

The following testified on CK0063:
Joel Carlson, Minnesota Wine and Spirits Wholesale Association

Draft HF- CK0064 (Nash) - allowing certain 3.2 percent malt liquor license to authorize the sale of malt liquor not exceeding 4.5 percent alcohol by volume

The following testified on CK0064:
Joel Carlson, Minnesota Wine and Spirits Wholesale Association
Paul Kaspszak, Minnesota Municipal Beverage Association
Tony Chesak, Minnesota Licensed Beverage Association

HF2132 (Berg) - On-sale liquor license holder outdoor consumption authorized

The following testified on HF2132:
Brandt Erwin, Minnesota Beer Wholesalers Association

Draft HF- CK0082 (Wolgamott) - Eliminating the prohibition on growler sales by certain brewers

The following testified on CK0082:
Jamie MacFarlane, Castle Danger
Dan Schwarz, Lift Bridge
Brandt Erwin, Minnesota Beer Wholesalers Association

Representative Kotyza Witthuhn assumed the gavel at 2:27 PM.

Draft HF- CK0057 (Koznick) - allowing growlers to be sold in 32 oz. bottles

The following testified on CK0057:
Brandt Erwin, Minnesota Beer Wholesalers Association

Representative Stephenson assumed the gavel at 2:33 PM.

HF1963 (Kresha) - Wine transfer allowed between commonly owned liquor stores

The following testified on HF1963:
Edward Cooper, Total Wine & More
Joel Carlson, Minnesota Wine and Spirits Wholesale Association
Ed Reynoso, Teamsters Joint Council 32
Brandt Erwin, Minnesota Beer Wholesalers Association
Dan Campo, South Lyndale Liquors

HF2256 (Erickson) - On-sale intoxicating liquor licenses authorized for event centers located on a farm

The following testified on HF2256:
Kimberly Hayes, Alpha and Omega Pizza Farm
Brandt Erwin, Minnesota Beer Wholesalers Association

Draft HF- CK0072 (Kottyza-Witthuhn) - regulating direct shippers of wine; imposing sales and use taxes, liquor gross receipts taxes, and excise taxes on direct shipments of wine; providing for licensing and required reports; providing for classification of data

The following testified on CK0072:
Joel Carlson, Minnesota Wine and Spirits Wholesale Association
Lee McGrath, Institute for Justice

HF27 (Jurgens) - Sunday liquor sales hours modified

The following testified on HF27:
Brandt Erwin, Minnesota Beer Wholesalers Association

Draft HF- CK0085 (Jordan) - allowing distilleries of any size to operate a cocktail room

The following testified on CK0085:
Phil Steger, Brother Justus Distillery
Joel Carlson, Minnesota Wine and Spirits Wholesale Association
Ed Reynoso, Teamsters Joint Council 32

HFXXXX/SF 2525 (Becker-Finn) - microdistillery definition modification

The following testified on HFXXXX/SF 2525:
Mike Duggan, O’Shaughnessy Distillery
Joel Carlson, Minnesota Wine and Spirits Wholesale Association

HF1214 (Daudt) - Coupons permitted as payment for liquor purchase

The following testified on HF1214:
Brandt Erwin, Minnesota Beer Wholesalers Association

HF1215 (Daudt) - Exclusive liquor store permitted sale items modified

The following testified on HF1215:
Paul Kaspszak, Minnesota Municipal Beverage Association
Tony Chesak, Minnesota Licensed Beverage Association

HF1216 (Daudt) - Municipality issuance of off-sale liquor license to any one person or place prohibition repealed

The following testified on HF1216:
Tony Chesak, Minnesota Licensed Beverage Association
Ed Reynoso, Teamsters Joint Council 32
Brandt Erwin, Minnesota Beer Wholesalers Association
Joel Carlson, Minnesota Wine and Spirits Wholesale Association

HF1597 (Daudt) - Wine and beer sale by food retailers authorized

The following testified on HF1597:
Lonnie McQuirter, 36 Lyn Refuel Station
Dave Ring, Kwik Trip
Jeff Bagniewski, Jeff’s Little Store
Paul Kaspszak, Minnesota Municipal Beverage Association
Tony Chesak, Minnesota Licensed Beverage Association
Ed Reynoso, Teamsters Joint Council 32
Brandt Erwin, Minnesota Beer Wholesalers Association
Joel Carlson, Minnesota Wine and Spirits Wholesale Association
Dan Campo, South Lyndale Liquors

HF1192 (Olson) - Liquor taxation provisions modified; microdistillery off-sale limit modified; malt liquor packaging and off-sale requirements modified; brand registration requirements modified; bar and restaurant off-sale limitation authorized; and clarifying, conforming, and technical changes made

The following testified on HF1192:
Mark Schiller, Loon Liquors
Ben Hugus, Ursa Minor Brewing
Brandt Erwin, Minnesota Beer Wholesalers Association
Megan Park, Unmapped Brewing Co.
Ed Reynoso, Teamsters Joint Council 32
Dan Justesen, Utepils Brewing Co.
Joel Carlson, Minnesota Wine and Spirits Wholesale Association
Anne Spaeth, The Lynhall
Tony Chesak, Minnesota Licensed Beverage Association
Jesse Hauf, 10K Brewing
Paul Kaspszak, Minnesota Municipal Beverage Association

The meeting was adjourned at 4:46 PM.

Representative Zack Stephenson, Chair

Simon Brown,
Committee Legislative Assistant

More Info On This Meeting..

Bills Added:

HF27 (Jurgens) - Sunday liquor sales hours modified.
HF122 (Hertaus) - Liquor; city population requirement modified to qualify for exemption from temporary license restrictions.
HF374 (O'Driscoll) - Sauk Rapids; on-sale liquor licenses authorized.
HF902 (Becker-Finn) - Liquor license restrictions modified.
HF1192 (Olson) - Liquor taxation provisions modified; microdistillery off-sale limit modified; malt liquor packaging and off-sale requirements modified; brand registration requirements modified; bar and restaurant off-sale limitation authorized; and clarifying, conforming, and technical changes made.
HF1214 (Daudt) - Coupons permitted as payment for liquor purchase.
HF1215 (Daudt) - Exclusive liquor store permitted sale items modified.
HF1216 (Daudt) - Municipality issuance of off-sale liquor license to any one person or place prohibition repealed.
HF1597 (Daudt) - Wine and beer sale by food retailers authorized.
HF1640 (Hornstein) - Farm winery license issuance to sake producer authorized.
HF1963 (Kresha) - Wine transfer allowed between commonly owned liquor stores.
HF2132 (Berg) - On-sale liquor license holder outdoor consumption authorized.
HF2256 (Erickson) - On-sale intoxicating liquor licenses authorized for event centers located on a farm.
HF2619 (Bliss) - Commerce; variance request licensee regulatory requirements modified.

Documents:

Commerce Minutes - 27 - 4.13.21.pdf - 10/11/2021
Commerce Minutes - 28 - 9.27.pdf - 10/11/2021
Commerce Minutes - FIRST SPECIAL SESSION - 1SS 6.15.21.pdf - 10/11/2021
CK057.pdf - 10/11/2021
CK063.pdf - 10/11/2021
CK064.pdf - 10/11/2021
CK066.pdf - 10/11/2021
CK072.pdf - 10/11/2021
CK073.pdf - 10/11/2021
CK082.pdf - 10/11/2021
CK085.pdf - 10/11/2021
CK087.pdf - 10/11/2021
SF2096-0.pdf - 10/11/2021
SF2525-0.pdf - 10/11/2021
3.2 Beer Picture.jpg - 10/26/2021
3.2 Education_Flyer(1).pdf - 10/26/2021
MN DTC testimony 10-27-21.pdf - 10/26/2021
MN Retailers Written Testimony.pdf - 10/26/2021
Liquor Law Changes 2021 Update.pdf - 10/26/2021
Redhead Creamery_HF1192_HearingTestimony_Oct27.pdf - 10/26/2021
Take 16_HF1192_HearingTestimony_Oct27.pdf - 10/26/2021
Utepils_HF1192_HearingTestimony_Oct27.pdf - 10/26/2021
Wooden Ship_HF1192_HearingTestimony_Oct27.pdf - 10/26/2021
10K_HF1192_HearingTestimony_Oct27.pdf - 10/26/2021
Bauhaus_HF1192_HearingTestimony_Oct27.pdf - 10/26/2021
HeadFlyer_HF1192_HearingTestimony_Oct27.pdf - 10/26/2021
Jack Pine_HF1192_HearingTestimony_Oct27.pdf - 10/26/2021
2256 Erickson.ck.pdf - 10/26/2021
2619 Bliss.ck.pdf - 10/26/2021
Ally Restaurants_HF1192_HearingTestimony_Oct27.pdf - 10/26/2021
Angry Inch_HF1192_HearingTestimony_Oct27.pdf - 10/26/2021
Testimony on HF27 by Total Wine & More's Edward Cooper - Sunday hours of operation - 102621.pdf - 10/26/2021
1192 Olson.ck.pdf - 10/26/2021
1597 Daudt.ck.pdf - 10/26/2021
1963 Kresha.ck.pdf - 10/26/2021
2132 Berg.ck.pdf - 10/26/2021
Liquor Hearing Breakdown - Sheet1 (1).pdf - 10/27/2021
Agenda 10_27_21 (2).pdf - 10/27/2021
xxxx Kotyza-Witthuhn.ck.pdf - 10/27/2021
xxxx Davnie.ck.pdf - 10/27/2021
CK063A1.pdf - 10/27/2021
CK064A1.pdf - 10/27/2021
xxxx Jordan.ck.pdf - 10/27/2021
xxxx Wolgamott.ck.pdf - 10/27/2021

Audio:
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* The bills on the agenda were heard on an informational only basis - no formal action was taken.
* Inclusion in this informational hearing does not necessarily indicate a bill's advancement during the regular session.
02:38 - Introductory comments by the Chair.
06:42 - HFXXXX/SF2096 (Koegel) For-sale items at exclusive liquor stores.
12:01 - HF1640 (Hornstein) Farm winery license issuance to sake producer authorized.
17:49 - HF122 (Hertaus) Liquor; city population requirement to qualify for exemption from temporary license restrictions modified.
21:08 - HF902 (Becker-Finn) License restrictions modified.
31:00 - HF2619 (Bliss) Commerce; variance request licensee regulatory requirements modified.
36:57 - HFXXXX (draft CK066) (Baker) Authorizing licenses for on-sale at the Willmar Civic Center.
40:05 - HF374 (O'Driscoll) Sauk Rapids; on-sale liquor licenses authorized.
42:41 - HFXXXX (draft CK087) (Agbaje) Modifying the annual production limit for microdistillery on-and off-sale to exclude spirits bottled under a third-party contract.
48:33 - HFXXXX (draft CK073) (Davnie) Allowing producers to provide liquor to nonprofit organizations for tasting events.
53:13 - HFXXXX (draft CK063) (Nash) Allowing strong beer licenses for certain town ball game events.
58:38 - HFXXXX (draft CK064) (Nash) Allowing certain 3.2 percent malt liquor license to authorize the sale of malt liquor not exceeding 4.5 percent alcohol by volume.
1:06:13 - HF2132 (Berg) On-sale liquor license holder outdoor consumption authorized.
1:12:58 - HFXXXX (draft CK082) (Wolgamott) Eliminating the prohibition on growler sales by certain brewers.
1:27:14 - HFXXXX (draft CK057) (Koznick) Allowing growlers to be sold in 32oz bottles.
1:32:42 - HF1963 (Kresha) Wine transfer allowed between commonly owned liquor stores.
1:42:10 - HF2256 (Erickson) On-sale intoxicating liquor licenses authorized for event centers located on a farm.
1:46:34 - HFXXXX (draft CK072) (Kotyza-Witthuhn) Regulating direct shippers of wine; imposing sales and use taxes, liquor gross receipts taxes, and excise taxes on direct shipments of wine; providing for licensing and required reports; providing for classification of data.
1:54:35 - HF27 (Jurgens) Sunday liquor sales hours modified.
1:57:02 - HFXXXX (draft CK085) (Jordan) Allowing distilleries of any size to operate a cocktail room.
2:06:52 - HFXXXX/SF2525 (Becker-Finn) Microdistillery definition modification.
2:17:00 - HF1214 (Daudt) Coupons permitted as payment for liquor purchase.
2:20:04 - HF1215 (Daudt) Exclusive liquor store permitted sale items modified.
2:24:03 - HF1216 (Daudt) Municipality issuance of off-sale liquor license to any one person or place prohibition repealed.
2:28:34 - HF1597 (Daudt) Wine and beer sale by food retailers authorized.
2:53:36 - HF1192 (Olson, L.) Liquor taxation provisions modified; microdistillery off-sale limit modified; malt liquor packaging and off-sale requirements modified; brand registration requirements modified; bar and restaurant off-sale limitation authorized; and clarifying, conforming, and technical changes made.
Runs 3 hours, 45 minutes.

Show Full Schedule Agenda:

**NOTE: The bills on the agenda are being heard on an informational only basis - no formal action will be taken. Inclusion in this informational hearing does not necessarily indicate a bill’s advancement during the regular session.**

Approval of the Minutes
-April 13, 2021
-June 15, 2021
-September 27, 2021

Informational Basis Only:
-HF XXXX - SF 2096 - (Koegel) - For-sale items at exclusive liquor stores
-HF 1640 (Hornstein) - Farm winery license issuance to sake producer authorized
-HF 122 (Hertaus) - Liquor; city population requirement to qualify for exemption from temporary license restrictions modified
-HF 902 (Becker-Finn) - License restrictions modified
-HF 2619 (Bliss) - Commerce; variance request licensee regulatory requirements modified
-HF XXXX - draft CK066 (Baker) - authorizing licenses for on-sale at the Willmar Civic Center
-HF 374 (O’Driscoll) - Sauk Rapids; on-sale liquor licenses authorized
-HF XXXX - draft CK087 (Agbaje) - modifying the annual production limit for microdistillery on-and off-sale to exclude spirits bottled under a third-party contract
-HF XXXX - draft CK073 (Davnie) - allowing producers to provide liquor to nonprofit organizations for tasting events
-HF XXXX - draft CK063 (Nash) - allowing strong beer licenses for certain town ball game events
-HF XXXX - draft CK064 (Nash) - allowing certain 3.2 percent malt liquor license to authorize the sale of malt liquor not exceeding 4.5 percent alcohol by volume
-HF 2132 (Berg) - On-sale liquor license holder outdoor consumption authorized
-HF XXXX - draft CK082 (Wolgamott) - Eliminating the prohibition on growler sales by certain brewers
-HF XXXX - draft CK057 (Koznick) - allowing growlers to be sold in 32 oz. bottles
-HF 1963 (Kresha) - Wine transfer allowed between commonly owned liquor stores
-HF 2256 (Erickson) - On-sale intoxicating liquor licenses authorized for event centers located on a farm
-HF XXXX - draft CK072 (Kotyza-Witthuhn) - regulating direct shippers of wine; imposing sales and use taxes, liquor gross receipts taxes, and excise taxes on direct shipments of wine; providing for licensing and required reports; providing for classification of data
-HF 62 (Scott) - Farm winery agricultural requirements eliminated
-HF 27 (Jurgens) - Sunday liquor sales hours modified
-HF XXXX - draft CK085 (Jordan) - allowing distilleries of any size to operate a cocktail room
-HF XXXX - SF 2525 (Becker-Finn) - microdistillery definition modification.
-HF 1214 (Daudt) - Coupons permitted as payment for liquor purchase.
-HF 1215 (Daudt) - Exclusive liquor store permitted sale items modified
-HF 1216 (Daudt) - Municipality issuance of off-sale liquor license to any one person or place prohibition repealed
-HF 1597 (Daudt) - Wine and beer sale by food retailers authorized
-HF 1192 (Olson) - Liquor taxation provisions modified; microdistillery off-sale limit modified; malt liquor packaging and off-sale requirements modified; brand registration requirements modified; bar and restaurant off-sale limitation authorized; and clarifying, conforming, and technical changes made

VIEWING: This remote hearing may be viewed live via the House webcast schedule page: https://www.house.leg.state.mn.us/htv/schedule.asp. An archived recording will be made available on the Audio & Video Archive page after the hearing: https://www.house.leg.state.mn.us/committees/archives/92003. This remote hearing is taking place pursuant to Rule 10.01, which you may view here: https://www.house.leg.state.mn.us/cco/rules/permrule/1001.htm

ACCESSIBILITY: HTV 1 and HTV 2 will provide live closed captioning. Video archives of meetings streamed on HTV 3, 4, and 5 will have closed captions added. Other reasonable accessibility accommodations may be made with advance notice. If you have questions about the accessibility of remote hearings or require an accommodation, please contact Jenny Nash at: jenny.nash@house.mn or by leaving a message at 651-296-4122. PLEASE DO NOT contact Jenny regarding agenda items, testimony, or the substance of the hearing.

DOCUMENTS: Any meeting documents will be posted on the House Commerce committee website at https://www.house.leg.state.mn.us/Committees/Home/92003

TESTIMONY: To request to testify or to submit written testimony to be included in the official record, please email the Committee Administrator no later than 4:30 pm the day before the hearing, at adeline.miller@house.mn. If requesting to testify virtually, please state which bill you’d like to testify on and your position (support/opposition/neutral) in your email request.