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State law to bolster small craft breweries

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CANTON - Small craft breweries got a boost Wednesday when Gov Andrew M. Cuomo signed legislation that will reinstate tax breaks that were scrapped earlier this year by a court ruling, and grant brewers more authority to sell locally made brews.

The legislation accomplishes a broad menu business-friendly goals — increasing the demand of locally grown hops and grain and enabling breweries to sell products to local shops and wineries. Breweries producing 1,500 or fewer barrels a year will be exempt from the annual brand label fee, along with other costly tax and filing fees.

The state’s $200 million brewery industry includes more than 90 small breweries.

Seven wineries sprouted in the north country in the past decade, and industry leaders say this legislation could spur a similar growth period here by allowing wineries and breweries to collaborate by selling each other’s products.

The law enables breweries to conduct tastings, serve labeled beer at stores and restaurants owned by or adjacent to their business, and sell their products to wineries and distilleries across the state.

It will also change the requirements for brewers to receive a farm brewery license to encourage them to buy their hops and grains from local farms. Through 2018, at least 20 percent of ingredients must be grown or produced in New York State to receive a license. That figure will gradually escalate to 90 percent by 2024 under the law.

Optimistic about the law’s impact here in the north country, David B. Fralick, president of the Northern New York Growers Association, expects numerous breweries to be launched in the coming years to complement the region’s burgeoning wine industry.

“The wineries used to have their own environment to work in, but now breweries can step right in” with the same privileges, Mr. Fralick said. “They’ve now got a better and bigger market because some of the wineries and farms are already interested in selling crafted beers. It’s a really good time to start growing crops.”

After speaking with a handful of winery owners in the region, Mr. Fralick said many of them are now interested in starting brewery operations of their own.

Wineries’ “bottling process is a little different, but their equipment is almost identical,” he said. “And they already have facilities, don’t have to go through the approval process and understand the process of doing it.”

He estimated that about 20 percent of wineries here will likely start brewery operations.

Mr. Cuomo expects the law to bolster tourism statewide by encouraging breweries to expand and sell more products.

“In addition to producing some of the finest beer in the world, New York’s craft breweries are creating jobs, supporting our state’s farmers and hops growers, as well as bringing in tourism dollars in local communities across New York,” he said in a statement. “The legislation signed today demonstrates that the new New York is truly working for small business, as this law will allow breweries and wineries the opportunity to invest in new opportunities and expand their operations. I commend the bill sponsors and legislative leaders for their work on this important law.”

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