Adam Watson of Against the Grain spoke at the HB 136 hearing Tuesday, calling existing caps on on-site beer sales “arbitrary and unnecessary.” | Courtesy of KET

The Kentucky Senate Licensing and Occupations Committee Tuesday morning unanimously approved House Bill 136, which would ease the limits of on-premise beer sales by breweries.

Since 2013, the cap has been 288 ounces, meaning breweries have faced strict limits on keg, growler and packaged beer sales. The bill, as passed by committee, lifts that limit to three cases of beer, or three times as much beer as previously.

HB 136 will now move to a full vote of the Kentucky Senate, most likely later this week, according to Derek Selznick, executive director of the Kentucky Guild of Brewers.

Adam Watson, co-owner of Against the Grain Brewery, spoke briefly at the hearing, telling the committee the passage of the bill is “vital” to the continued growth of a craft beer industry that employs 600 people statewide.

Some have expressed concern that distributors, the middle tier in the three-tier system established after Prohibition, would be financially hurt by the bill’s passage by limiting the amount of beer available for retail sale. Watson, however, called the cap “arbitrary and unnecessary,” and countered the notion that the breweries would be undermining retail sales.

“I can guarantee I can sell more beer out of the 6,700 retail outlets (in Kentucky) rather than hoarding it” and selling it at the Louisville brewery, he said.

He noted that Against the Grain distributes in 40 states and 25 countries, proof that the product is available to distributors.

The bill’s sponsor, Rep. Adam Koenig, R-69, kept it brief, merely explaining that in addition to the lift of the cap, HB 136 also changes the way breweries pay state taxes, sending them directly to the state instead of through the distributor, as it has been in the past.

State Sen. Damon Thayer called for no cap on on-site sales. | Courtesy of KET

The unanimous vote followed an impassioned speech by Sen. Damon Thayer, R-17, the state senate majority leader, who lives in Georgetown, where Country Boy Brewing is located.

Thayer accused the distribution and retail tiers of the alcoholic beverage system of “ganging up” on the production tier, using “lies, threats of retaliation and actual retaliation.”

He said he had proof to support his assertions but did not present any at the hearing.

Thayer pleaded to return the bill to its original form, which proposed no sales cap and would be similar to laws regarding wine sales at wineries.

“Stop mistreating your partners who produce the product that makes up the one part of the beer industry that is growing right now,” he said, before utilizing an image that brought chuckles from the room. “At the end of ‘Braveheart,’ William Wallace yelled, as he was being drawn and quartered, ‘Freedom!’ Not ‘Freedom with a three-case cap!’ ”

As the chuckles dissipated, Thayer concluded, “Watch it again, it’s a great movie.”