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lb <br />CITY COUNCIL <br />AGENDA ITEM 6A <br />STAFF ORIGINATOR: Paul Bengtson <br />MEETING DATE: January 9, 2012 <br />TOPIC: First Reading of Ordinance Number 1 -12 <br />Zoning Ordinance Amendment to add brewpubs, <br />breweries and taprooms as uses allowed in certain <br />zoning districts. <br />VOTE REQUIRED: 4/5 <br />INTRODUCTION <br />In 2011, Minnesota state law was changed to create a new class of liquor license called a brewer <br />taproom license. The "Surly Bill," as it became known, provides new opportunities for micro <br />breweries to sell their malt liquor products directly to the public on -site. Shortly after the <br />passage of that bill, the City Council discussed the potential economic development <br />opportunities for the City and directed staff to initiate the zoning ordinance and City Code <br />amendments necessary to provide for these types of uses. <br />BACKGROUND <br />Current Statutory Licensing Scheme <br />The licensing scheme for breweries is somewhat complicated. Small breweries are informally <br />divided into two groups: brew pubs and microbreweries. Brew pubs (e.g. Granite City and Rock <br />Bottom) are primarily retail establishments (restaurant/bar), with a small brewing business on the <br />side. Microbreweries are production facilities who sell wholesale to retailers, albeit on a small <br />scale. The Surly Bill allows some of these microbreweries to enter the on -site retail malt liquor <br />sales business (i.e., the taprooms). The following table sets forth the statutory licensing authority <br />and shows what the breweries are allowed to sell under state law: <br />P18 <br />