EDITORIAL: Nevada statutes hinder craft brewing industry

These are heady days for the craft beer makers. After a boom and bust cycle two decades ago, the industry has seen steady growth now for more than a decade. In 2015, small and independent brewers accounted for 12 percent of all U.S. beer sales.

But several states still feature antiquated laws on the books that hinder industry expansion. Nevada, for instance, imposes restrictions on brewers who produce more than 15,000 barrels a year. Such statutes — which discourage entrepreneurship while making it more difficult for homegrown outfits to prosper and compete — amount to naked protection for the powerful liquor wholesalers.

That would all change, however, under Senate Bill 130. The proposal frees small breweries to produce up to 45,000 barrels a year without consequence.

“I tend to believe we should do what we can to foster these small businesses within this state,” said the bill’s sponsor, state Sen. James Settelmeyer, a Minden Republican. “This is a growing industry, to say the least.”

Wyndee Forrest, co-owner of CraftHaus Brewery in Henderson, told lawmakers that without a change in the law, he’ll be forced to leave Nevada to accommodate his rapid growth. “A production cap is counterintuitive to our state becoming competitive in the craft beer marketplace,” he said.

No kidding. But standing in the way of progress are the wholesalers, who over decades have become expert at manipulating the rules to shield their profits — otherwise known as rent-seeking. “Beer sales are down,” a lobbyist for the wholesalers told lawmakers. “I understand the issue of growth. But it has to be managed.”

Fair enough. But how about we allow the market to pick the winners and losers rather than impose arbitrary production restrictions intended to benefit entrenched interests.

Removing the cap entirely would be the best route. But SB 130 is an improvement to the status quo. It deserves quick passage and the governor’s signature.