The Ultimate Guide to Starting a Craft Brewery in Ohio
Craft brewery growth has exploded in America, with the industry estimated to value upwards of $27 billion dollars. According to the Brewer’s Association, the 50 fastest growing craft breweries in the United States delivered 10 percent of craft brewer growth. Craft brewer’s have provided more than 150,000 jobs and have produced well over 25 billion barrels of beer in 2019 alone.
Ohio has its fair share of exceptional breweries – but there is always room for more in this booming industry. Some notable brewing companies in the Buckeye State are:
It’s important to note that all of these exceptional breweries started small – and ensuring that your brewery is on strong legal footing is critical to long term success. Breweries are complex and unique in the legal regulatory framework of Ohio – as they incorporate aspects of both State and Federal law. While it is difficult to address all of the specific details of your business venture, this guide from the Ohio Liquor License Lawyers at Sawan & Sawan aims are giving you a complete understanding of the legal considerations that go into starting a new brewery.
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State Licenses and Permits for Craft Brewers in Ohio
Prospective brewery owners should keep in mind that both state and federal laws regulate alcohol. Only dealing with one, while ignoring the other, can lead to legal entanglements. The state of Ohio has a three tier licensing system for alcohol. These three tiers are:
- Wholesale Distribution
Many bar and restaurant owners decided they would like to also produce or manufacture beer so they can sell their brewed product in their restaurant. However, laws referred to as “tied house laws” in Ohio often prohibit the ownership of a retail establishment by the same ownership involved in the manufacturers permit. In general, Ohio has three main licenses for the manufacturer of beer
|Type of Permit||Permit Cost||Permit Description|
|A1||$3,906||ORC 4303.02 - Manufacturer of Beer – producing more than 31 million gallons per year, wherever produced, and sell beer products to wholesale permit holders.|
|A1A||$3,906||ORC 4303.21 - Beer, and any intoxicating liquor by the glass or container on A-1 or A-2 permit premises only until 2:30am.|
|A1C||$1,000||ORC 4303.022 - Manufacturer of Beer - producing up to 31 million gallons per year wherever produced, for sale on premises at retail for on premises consumption, and sell beer products to retail and wholesale permit holders|
The permit that is best suited for your proposed brewery will depend on the unique circumstances of your venture – including the method of distribution and the volume of production. We recommend contacting a qualified liquor license Attorney to get a legal opinion regarding the best course for your unique situation.
Don’t Forget Ohio EPA Regulations
Aside from the State liquor license permitting requirements, it’s vital to consider the environmental compliance laws whenever you are contemplating starting a brewery. Since many breweries are located in dense urban areas and discharge waste water into municipal sewer systems, there are some unique environmental considerations in play. You Will need to work with the local municipality to determine the requirements that your brewery will need to follow to discharge waste water into the municipal system. The state EPA will often require permits in certain specific circumstances such as:
- The construction of any on-site wastewater treatment or collection systems
- Any direct discharge of wastewater to any “waters of the state” – such as rivers and streams
- Any discharges a stormwater that occur during the construction process
- The construction of any private wells that supply drinking water
Depending on a variety of factors, you may be required to pre-treat your wastewater to reduce contaminants prior to discharging them. In the circumstance, you will need to work with the Ohio EPA’s division of surface water to retain a permit to install a pre-treatment system. If on the other hand, you will be discharging waste water into a stream, lake, river or other water of the state, you may be required to obtain a National Pollution Discharge Elimination System Permit from the Ohio EPA.
Lastly, Ohio EPA may require certain authorizations for the disposal of solid waste. Since the brewing of beer requires the use of grains, such as grains and yeast, many brewing operators app to use composting to reduce their solid waste. While composting is a good idea, you should be mindful of the necessity to involve the Ohio EPA before doing so.
Laying the Groundwork For Your Ohio Brewery
The process of starting a brewery is made significantly easier by ensuring that some of the foundational requirements are in place before proceeding. Before proceeding with the regulatory and legal considerations, we recommend that all prospective brewery operators in owners consider the following non-exhaustive list of things:
- Ensure that you have the appropriate corporate formation – i.e. LLC, Inc., etc.
- Ensure that you have a strong and well thought out business plan
- Conduct trademark searches and necessary registrations
- Complete background checks of all owners of the business
- Have a clear and concise financing plan that will hold up to regulatory scrutiny
- Either secure or have a memorandum of understanding for the brewery premises. Remember that a business address is required for application as a brewery.
- Secure the means for obtaining the necessary equipment for the brewery.
Navigating the Alcohol and Tobacco Trade and Tax Bureau
The Alcohol and Tobacco Trade and Tax Bureau (“TTB”) collects the requires taxes and regulates the sale of alcohol, tobacco, firearms and ammunition. When starting a brewery, working with the TTB is perhaps the most important and time consuming step in the process. If you are planning on making beer for public consumption, you will need to obtain a permit from TTB that approves all recipes, beer labels and operational details. In order to begin this process, you will need to file a “Brewer’s Notice” and a “Brewer’s Bond” – and may need to submit to a thorough on site inspection. The process of obtaining approval from TTB can take anywhere from 6-12 months
The Value of Experienced Legal Counsel
The regulations and intricacies of starting a brewery can be extremely technical and complicated. The process can be long and arduous, but it’s much easier when you have experienced and knowledgeable legal counsel to help you navigate the process. Streamlining this process starts from the very formation of your company – and early counsel involvement can ensure you are on the right footing for success. Our liquor license lawyers also have extensive experience communicating effectively with regulatory agencies, which can help to simplify and streamline the process.
Contact an Attorney today to discuss your brewery plans.
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