Amongst beer enthusiasts, craft beers have become increasingly popular throughout the country in the past decade. With the efforts of local brew enthusiasts, Rhode Island has actively sought to reduce the licensing requirements previously placed on breweries in the hopes of encouraging local businesses in the increasingly popular sector. However, even with recent additions to the law, there remain a number of important considerations when opening and operating a brewery in the state.
The first requirement in obtaining any license to manufacture alcohol in Rhode Island is to be a resident of the state. A business can choose to incorporate in Rhode Island, which will make the corporation a resident of the state, or individuals may apply as a sole proprietor if they meet the residency requirement.
Rhode Island offers two different licenses for businesses interested in manufacturing beer. First, there is the option of operating a more traditional brewery. Such a brewery must obtain a manufacturer’s license. A manufacturer’s license allows for the operation of a brewery in the state, the sale of malt beverages at wholesale to other license holders, and the transportation of beer between the place of manufacturing and another license holder or common carrier. As of 2013, breweries are now able to provide to visitors, in conjunction with a tasting/tour, a clearly marked sample of no more than 375 ml per visit of malt beverages for off-premise consumption. This amount equates to one six pack, three 22-ounce bombers, a conventional growler, or two growlettes/howlers. No sales may be made for on-premise consumption; however, a brewery may charge for the cost of a tour.
The second option for a business that wants to brew its own beer is to obtain a brewpub manufacturer’s license. A brewpub manufacturer’s license allows for the retail sale of beer on the premises. However, the license does not authorize the retail sale of beer for any off-premise consumption EXCEPT for the sale of a half-gallon bottle (growler) to consumers. Holders of a brewpub license are authorized to sell their product at wholesale to a licensed wholesaler or common carrier. Furthermore, if you choose to establish a brewpub which serves food and operates a kitchen, you will need to obtain a license from the Rhode Island Department of Health. The application requires the submission of a proposed menu, which will also need to accompany your application to the Department of Business Regulation.
Whether you choose to operate a brewery or brewpub, the application process is similar. First, you will need to send an application to the Department of Business Regulation Division of Commercial Licensing. Businesses must also present copies of zoning certificates/approvals and fire inspections/approvals, a federal basic permit, and a criminal history record. Obtaining these certificates is handled through the municipality in which the business is located. The business will need to be in a position to begin operations prior to fire and health code inspections. Once the municipality has issued all the appropriate certificates, and you have obtained your license from the state, you will submit your application to the city or town and include the date and result of the state hearing.
While local brewers continue to push officials to make licensing of small breweries more accessible in order to compete with breweries in surrounding states, changes come slowly. With such complex requirements and a minefield of red-tape, sound legal advice can assist in preventing future blunders that could potentially be both costly and time consuming.