BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                  AB 647
                                                                  Page  1

          Date of Hearing:   May 1, 2013

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                  Mike Gatto, Chair

                    AB 647 (Chesbro) - As Amended:  April 8, 2013 

          Policy Committee:                              Governmental  
          Organization Vote:                            16 - 0 

          Urgency:     No                   State Mandated Local Program:  
          Yes    Reimbursable:              No

           SUMMARY  

          This bill clarifies the Department of Alcoholic Beverage  
          Control's (ABC) current labeling requirements for refilled beer  
          containers. Specifically, this bill states that a beer  
          manufacturer that refills any container supplied by a consumer  
          is required to affix a label on the container prior to its  
          resale to the consumer. In addition, this bill clarifies that a  
          beer manufacturer means any person that has facilities and  
          equipment for the purposes of, and is engaged in the commercial  
          manufacture of beer.

           FISCAL EFFECT  

          Costs associated with this legislation should be minor and  
          absorbable within ABC's current resources. 

           COMMENTS  

           Purpose  . This bill addresses two areas of concern for the  
          author: 1) the abuse of the statutory definition of beer  
          manufacturer by licensed entities that do not possess or use  
          facilities or equipment to actually manufacture beer; and 2) the  
          uncertainty of labeling requirements for the re-filling of  
          off-sale consumer sized beer containers, also referred to as  
          growlers, by licensed beer manufacturers. 

          As an example of the abuse of the definition of beer  
          manufacturer, the author notes that recently an entity claiming  
          to be a beer manufacturer failed to show proof that they owned  
          or used actual brewing facilities or equipment for the actual  
          production of beer. In reality, the beer manufacturer was simply  








                                                                  AB 647
                                                                  Page  2

          purchasing beer from another manufacturer and relabeling it to  
          sell as his product. Unfortunately, because the definition of  
          manufacturer does not currently require a beer manufacturer to  
          own equipment for commercial beer making, ABC was unable to  
          bring any action against the individual. 

          In order to solve that problem, AB 647 proposes to strengthen  
          the current definition of beer manufacturer to ensure that a  
          beer manufacturer actually has the facilities and equipment for  
          the purposes of, and is engaged in, the commercial manufacture  
          of beer.  

          This bill also deals with California growler laws.  According to  
          the author, refilling off-sale consumer sized beer containers by  
          beer manufacturers is a popular way for consumers to sample  
          beers from different breweries in an affordable way and offers  
          an environmentally favorable method of doing so.  Currently, if  
          you buy a growler container it can only be filled with beer from  
          the brewery that sold that growler.  Consumers would like to  
          re-use their containers from one brewery to the next but  
          labeling requirements and questions by licensees pose a barrier.  
           This bill clarifies that a licensee must affix a new label to  
          the container, prior to its resale to the consumer but that the  
          container can be reused. 


           Analysis Prepared by  :    Julie Salley-Gray / APPR. / (916)  
          319-2081