In 2012, the growing ranks of craft beer creators in Tennessee were feeling distinctly unloved. “Let’s just say that we were in the second position behind liquor manufacturing,” is how Carl Meier, president and co-founder of The Black Abbey Brewing Company and the current president of the Tennessee Craft Brewers Guild, puts it.
“There was a need to convince the state Legislature and others that we weren’t just a bunch of ne’er do wells pumping out alcohol for the sake of keg stands and all-night ragers.”
That need to elevate the product, as well as its growing economic impact across the state, led some of those early brewers to form the Guild that same year. The decade since has been marked by significant legislative achievements around taxation and distribution, as well as programming that plugs brewers into the state’s important and legislatively powerful farming communities.
“I would say that the Guild has grown from a somewhat ragtag group of thinly stretched owners to a professional organization with staff, one that is able to accomplish things at the state level, things we would have never ought possible 10 years ago,” says Meier, adding that huge credit is due to guild founder Linus Hall, founder and owner of Yazoo Brewing Company in Nashville, and the other brewers who jumped on board to try to push tax reform through the state Legislature.
Taxation without representation?
“Taxes were fixed to price, which was an unfair advantage to higher-priced products,” Meier explains. “The Guild initiated the ‘fix beer tax’ project so the tax would be attached to volume versus price, which helps breweries selling more expensive products. It worked because it was very much a grassroots project, popular with the public, and so a small brewery community was able to gain momentum and get the attention of some legislators.”
Other early successes included a change in the “gravity cap,” or the alcohol percentage that defines what can be considered beer – versus liquor – for taxation and retail purposes.
And in addition to passing legislation, the Guild also works to ward off unfavorable bills. This year, it helped defeat a bill that would have put alcohol-based canned cocktails into grocery stores. With that bill’s failure, those stocks are still limited to malt-based products.
Another focus will be keeping the growing number of breweries and their economic impact top of mind in the corridors of power in the capitol building.
“There are more breweries now than there ever have been, and so our voice should be commensurately louder,” Meier says. “One thing we want to be heard on is Tennessee’s tax structure. We have the highest wholesale tax in the nation; even if we cut it in half, we’d still be No. 5. I think that’s something that requires consistent attention from the Guild, and something that is important to the Tennessee consumer.”
To wit, a higher beer tax means the cost of a glass of beer, or a six pack, is “higher than it needs to be,” Meier says.
“There is still some temperance-era thought surrounding the bugaboo of alcohol production that has unfairly hung around the beer industry’s necks,” he says. “Tennessee has been a whiskey state for a long time. Our partners in the whiskey and liquor production have done great things in terms of revenue generation for the state, for the agriculture community.
“Sometimes beer is left in the second position behind them, and so we’re working with them and others to open people’s eyes to beer’s possibilities.
“We’re making a luxury item. At Black Abbey our slogan is ‘Created. Not made,’ and we want to show that this is a luxury item that Tennessee consumers want and are choosing,” Meier continues. “By partnering with the legislature, with the Tennessee Malt Beverage Association, with our distributor partners, we can bring that awareness to this craft, and showcase how we are generating jobs, generating tax revenue, building communities and employing Tennesseans.”
Over time, the Guild continued to be active, scoring legislative wins and forging partnerships with the state’s liquor-producing community, as well as reaching out to farmers. There also were quiet years with businesses to run and operational challenges to face. Everything ramped back up in 2018 when the Craft Brewers Conference, a large industry event put on by the Brewers Association, came to Nashville. It returns to Nashville May 7-10 at Music City Center.
“We were able to raise money both through a commemorative beer for the CBC and through events,” Meier says. “That helped us fund an executive director position, which meant we’d finally have staff to keep the momentum going when we were all busy brewing beer.
Nashville’s Yazoo Brewing Company and its founder, Linus Hall, was a driving force in organizing the Tennessee Craft Brewers Guild.
-- Photograph Provided“We also are in the position to keep encouraging the partnership between manufacturers and farmers, which is a really powerful opportunity to grow both our industries.”
High-visibility programs launched
Shepherding those tasks falls to TCBG executive director Sharon Cheek, who came on board in October 2019 and wasted no time deepening the connections the Guild and its members had begun to make.
That has led to two major programs, the Farm To Tap initiative and the newly launched Tennessee Ale Trail. The goal, Cheek says, is to ensure state officials and residents alike see how the brewing community is very much tied into all things Tennessee – including the state motto, “Agriculture and Commerce.”
“We hit the ground running,” she says. “And the first thing we ran into was the pandemic. Our board and members really pulled together. We were ‘Team Beer’ and we focused on how do we keep all the breweries open and moving forward.
“We worked with lobbyists to make sure our voice continued to be heard at the legislature. We stood up programs like home delivery and took part in some amazing financial grant programs and financial aid packages. It was very good to see state support for small businesses that included these breweries.”
As a sign of the Guild’s growing clout, the state also has invested significant funding into the Farm to Tap program, more than $1.1 million to date in three years. The program encourages the use of Tennessee-sourced ingredients in Tennessee beer and draws a straight line to the motto, Cheek says.
“We put farmers and brewers in the same room, networking with each other, and all kinds of things happen,” she says. “Brewers donate spent grain to farmers, which is a great reuse of that material. We’ve created the Tennessee Hops Week as part of this program, with the second one set for this June. Basically, we’re encouraging farmers and brewers to work together any way they can.”
The Guild also has partnered with the Tennessee Malt Beverage Association to expand self-distribution in the state. Until recently, brewers could only distribute their product within their home county – a third-party distributor was needed outside the borders. By working with the distributors, a compromise was reached that set a statewide self-distribution limit of 1,800 barrels a year.
“Think about it as a farm team versus a major league team,” Cheek says. “Now these smaller outfits can show what they’ve got across the state, get a foothold in the marketplace in different areas and generate demand for their products. When they do, they can move up to a bigger platform.
“So far, it’s working. I talked to a brewer a couple of months ago who began self-distribution into Davidson County, has gotten very popular with beer fans there and now has two distributors who are courting him for his business. It’s exactly the kind of thing we hoped for.”
Ale Trail and tourists
Insulated fermentation tanks at Knoxville’s Pretentious Beer.
-- Photograph ProvidedWith farming outreach well in hand, the Guild now is hoping to connect with the state’s robust tourism industry. To that end, the Tennessee Ale Trail was launched in January. There are 60 guild members on the trail with 10 more in the works, Creek says.
“Right now, it’s still part of the Farm to Tap effort, but we see it as a great way to connect with consumers and would love to work with tourism officials,” she says. “We have a lot of exciting things going on and much to share, with a lot of different current and potential partners.”
Tennessee Brewers will make their presence known at May 7-10 Craft Brewers Conference. The opening reception has 40 breweries on hand with 37 from the state, Cheek says, adding she’ll be on a panel and other guild members will be plugged into the event. That will be followed by the upcoming Hops Week, which will expand into Memphis and Knoxville this year.
The Guild also is preparing to launch a $100,000 microgrant program for members who need equipment to use Tennessee-sourced ingredients in their beers.
“It might be a bladder press, a purée machine, spent-grain bins … whatever the need, we’re sinking money into getting them that equipment, and we’re super excited about that,” Creek says.
In addition to hosting high-profile events and helping the brewing community grow, Meier says that the Guild will be cementing its place as the voice of a growing, statewide business sector and all that involves.
“We’ll be pushing for discussion around the wholesale tax and working toward a specific plan on how to address that,” he says. “I think if we work with the state government and other interested parties, like the (Wine & Spirits Wholesalers of Tennessee), we can address something that is very prohibitive in an otherwise very pro-business state.”
“There’ll be other things we need to address, because something’s always popping up,” he continues. “We’re at a place now where we’re being included in conversations, which is very helpful.
“If you think back, a lot of work went into having wine be allowed in grocery stores. The brewery community was not very involved in these discussions. As that type of legislative change occurs, now we’re hoping to be at the table because those talks, those decisions, will affect our businesses.”