The article below from Maryland Public Policy Institute describes the nonsense going on in our General Assembly regarding the Maryland Brewery Industry. Why in the world would they deliberately slow the growth of this burgeoning business which is growing and will bring many jobs and significant revenue to our state. Who are they trying to protect?
If they discourage business in our state, I guess those in favor of this bill believe they can always raise taxes on the rest of us! This is why it is so important to re-elect Governor Hogan and give him the support he needs in the General Assembly to bring common sense to the governance of this state. The only way we can limit the terms of the General Assembly is to VOTE THEM OUT. I am running for State Delegate in District 14 … In November … Let’s bring sensible voices to Annapolis.
Maryland’s Home-Grown Breweries
Deserve the Same Opportunity as Guinness
Carol Park Feb 27, 2018
On February 23, the House Economic Matters Committee hearing turned into a battle of two opposing craft beer bills for Maryland. As no final decisions have been made yet as to which bill will be passed, it is not too late to ask the important question: What are the opportunity costs of letting Maryland’s local craft brewers shut down while allowing Guinness to thrive alone?
House Bill 518, also known as the “Reform on Tap Act,” was introduced by Maryland comptroller Peter Franchot to eliminate production caps for Maryland craft breweries. On the other hand, House Bill 1052, introduced by Delegate Dereck Davis and Talmadge Branch, seeks to reduce production caps from 2,000 to 500 barrels a year for all craft brewers in Maryland except one: Guinness.
Understandably so, Maryland legislators were thrilled when Guinness owner Diageo announced in 2017 that the company will be opening a $50 million U.S. headquarter brewery in Baltimore. In response, legislators decided to introduce Bill 1283 to pave the way for Guinness to open in Baltimore by increasing the production cap for all breweries in Maryland.
A year later, Davis and Branch want to reduce the production cap back to 500 barrels a year but conveniently exempt Guinness from the new law, devastating the smaller local brewery owners. According to chief executive Jim Caruso, Flying Dog has halted the $54 million expansion because of “because of regulatory and legislative issues.” Similarly, the founder of Union Craft Brewing Adam Benesch said, “We would make a greater investment and a greater commitment if we knew there was certainty to allow us to grow.”
The Department of Legislative Services calculated that local revenue would have increased by $9.8 million if the Flying Dog expansion went through. This opportunity cost figure should be extrapolated to understand the overall economic costs on Maryland’s economy if all Maryland breweries decided to halt expansion plans, shut down or move to Virginia.
As of 2017, there are 84 craft breweries operating in Maryland. Maryland breweries support 6,500 jobs and account for $228 million in wages. These dollars are especially important figures because they are fed back to local Maryland economies at gas stations, retail shops, restaurants and so on. For every dollar spent on local craft beer in Maryland, 67 cents is estimated to stay local. An 2016 economic impact study found that the craft beer industry had an overall economic impact of $802.7 million in Maryland.
All of these numbers is compared to at most 70 jobs and 300,000 visitors that Guinness has announced it is expecting. It is sufficient to note that 70 jobs cannot replace 6,500 and that 300,000 tourists cannot bring $802.7 million to Maryland.
House Bill 518 is the step in the right direction for Maryland, saying it “will eliminate the arbitrary limits and change the laws that benefit corporate beer monopolies at the expense of our local, independent craft brewers.” By eliminating the production and take-home sale limits, the craft brewers will be empowered to invest and expand their business at the pace they desire.
All in all, the Reform on Tap Act of 2018 is meant to increase competition and promote economic growth through increased tourism and job creation in Maryland. Meanwhile, House Bill 1052 seeks to destroy competition, reduce consumer choices and possibly increase beer prices in Maryland because of restricted supply.
In the end, the purpose of regulating the alcohol industry is not to remove competition but to promote public health. It is ludicrous to suggest that Maryland’s public health can be improved if people consumed Guinness over local craft beers.
Home-grown breweries in Maryland deserve the same opportunity as Guinness. Blindly advocating for the Guinness monopoly without understanding the opportunity costs will undermine Maryland’s craft beer industry and hurt Maryland’s economy. Contrary to popular notion, economic growth is not a zero-sum game. If production caps were lifted, healthy competition can lead to simultaneous growth of Maryland’s local breweries and Guinnes
Copyright 2018 The Maryland Public Policy Institute All Rights Reserved.
Comments on HB 173 Ranked Choice Voting for Montgomery
“Ranked Choice Voting” is promoted as a way to assure that “winners” get a majority not just a plurality in At-Large elections. An example of usefulness for this bill would be the Montgomery County Democrat primary for four At-Large seats on the County Council this year where a very large number of candidates are running. The people getting the most votes will not necessarily have been voted on by the majority of the voters.
Perhaps this voting method would be useful in this one Democratic primary, but I have a better idea for dealing with At-Large districts. Get rid of them. Why do we even have At-Large districts? For the Montgomery County Council, At-Large members were supposed to guarantee that some members of the council would consider the needs of the whole county when looking for solutions to problems. As a Damascus resident I do not believe that the makeup of the Council, where eight out of the nine members live near or below the beltway, guarantees any voice for the far north regions of the county … At-large is simply a way to assure that elected officials get most of their votes from the most densely populated areas. I can tell you that people in Damascus do not believe that the At-Large members of our Council are at all aware of our problems.
While this bill is not currently applicable for state offices, we still are faced with At-Large elections for State House seats within a district. We run three delegates against three delegates covering the whole district instead of running one against one in three single member districts. This all but assures that most votes come from the party of the densely populated regions, which, I believe, is a distortion of equal representation. I believe the purpose of the bicameral system we have in Maryland is that each of three delegates should live in the area of the district they represent, and the senator should represent the whole district.
If this bill were to apply to state races, it would give an advantage to the majority party. Even if an opponent could eke out enough votes from the majority party to win a close third place in a state election, it is most likely that there will be more votes from the majority party for 4th, 5th and 6th place to assure the 3rd place winner will not be able to get into office.
When this bill was introduced in December, it was stated that it was difficult to explain exactly how Ranked Voting works. It was said several times that it is a “very complicated calculation.”
Is there anyone on this committee who can immediately explain in simple mathematical terms how Ranked Choice Voting will work? Does anyone think most voters will be able to check out the validity of the final tabulation of votes? I was appalled when I learned that even our Board of Elections will not be able to calculate the ranked voting results, but we will have to spend time and money to let our votes be calculated by a third party. I cannot believe this complicated method of determining who wins will increase our voters’ confidence in the election system.
Ranked Voting lacks simplicity and transparency for the voter and when added to gerrymandering and At-Large districts, it favors one party In Montgomery County.
Thank you for taking the time to hear my testimony.
Montgomery County resident