(Source: MIRS.news, Published 07/05/2022) A Rep. Pat Outman (R-Six Lakes) sponsored bill to lower markup costs for grain purchases will also help cut costs for Michigan distillers, said Gov. Gretchen Whitmer after signing the bill into law.
"Small businesses are the backbone of our economy, and today I am proud to sign bipartisan legislation that supports an iconic and growing Michigan industry – craft distilleries," Whitmer said. “Since my first day in office, I have been focused on growing Michigan's economy, creating good-paying jobs, and investing in a range of industries across Michigan, including our strong food and agriculture businesses.”
HB 4842, which received bipartisan support in both chambers, reduces the markup charged on a distilled spirit product from 65% to 32.5% if at least 40% of the grain used is grown in Michigan.
Currently, a distiller selling in Michigan must first sell to the state, as the wholesaler of spirits. The state then applies a markup to each bottle.
The bill will incentivize distillers to use more Michigan grown grain, Jenelle Jagmin, executive director of the Michigan Craft Beverage Council, said.
“Of more than 80 craft distillers in the state, many are currently using Michigan grain in a portion of their product,” she said. “This new bill creates an incentive for craft distillers to use Michigan grown grain, providing additional markets for our farmers. It also provides opportunities for craft distillers using Michigan grain to invest back into their businesses and communities, creating even more good-paying jobs.”
The legislation will also allow distillers to keep prices lower, Kent Rabish, owner of Grand Traverse Distillery, said. He called the bill "the single largest help for craft distillers since 2007, when Grand Traverse Distillery started producing spirits.”
“We have always used local grain, and this is going to help the bottom line tremendously." he said. "We were planning on a price increase with our vodka line since we have never increased the price, and with the cost-of-living adjustments we just couldn’t afford to sell it any longer at $30 a bottle. This bill helps us maintain the cost for consumers.”
The bill also received support from the Department of Agriculture and Rural Development and the Michigan Craft Distillers Association.
