Legislature Approves Bill Raising Brewery Production Limits

The new production cap will be 60,000 barrels

By Dillon Tabish
Kalispell Brewing Company. Greg Lindstrom | Flathead Beacon

Breweries across Montana are raising pint glasses in celebration of a bill approved by the Montana Legislature that will increase production limits.

On Thursday, the state House sided the state Senate and approved HB 541 in overwhelming fashion, 94-6.

The bill allows Montana breweries to grow beyond 10,000 barrels of annual production without losing the ability to operate a taproom, which are limited to serving 48 ounces of beer and cannot serve past 8 p.m. The new production cap will be 60,000 barrels.

“HB 541 is the most important legislation we’ve seen for Montana’s craft brewing industry in 18 years,” said Matt Leow, executive director of the Montana Brewers Association. “The Legislature has signaled a green light for Montana breweries to grow, giving breweries the confidence to make investments to expand their production. That means more jobs, increased demand for Montana-grown barley and greater access to Montana craft beer.”

Rep. Adam Hertz, R-Missoula, sponsored HB 541 with co-sponsors Rep. Ellie Hill, D-Missoula, and Rep. Greg Hertz, R-Polson.

The bill underwent heavy scrutiny and at one point was amended in a Senate committee to set the production cap at 12,000 barrels and include a tax increase for breweries producing between 10,000 and 20,000 barrels annually. If approved, the amended bill would have forced KettleHouse Brewing in Missoula to close its north side taproom, sparking backlash that killed the amendment.

The 60,000 barrel limit was restored on the Senate floor along with new regulations for taprooms, limiting breweries to no more than three taprooms and a total of 2,000 barrels of on premises sales. The Montana Tavern Association withdrew their opposition to the bill with the inclusion of the taproom limitations. The Montana Beer and Wine Distributors supported the brewery bill.

“This is really exciting and a really positive bill,” said Maggie Doherty, co-owner of Kalispell Brewing Company. “That 10,000 barrel cap was really limiting craft beer’s success in Montana. Now it positions craft breweries across the state to make important contributions to the economy and the industry and allow more channels for regional development.”

She continued, “I think it’s just a sign that the state is realizing what an amazing industry Montana beer is.”

Doherty said the 2,000 barrel cap for on-premise sales is large enough that it shouldn’t hinder any taprooms across Montana.

There are more than 60 breweries in 35 communities, including nine in Northwest Montana.

HB 541 is headed to Gov. Steve Bullock’s desk to be signed into law.