Kim Reynolds, Governor
Adam Gregg, Lt. Governor
Stephen Larson, Administrator

Native Distillers

As the result of Governor Branstad signing HF 607, native distillers will be entering into a new model of doing business effective July 1, 2017. Below is a list of the expanded retail privileges that will be available to native distillers as well as details of regulatory policies that must be followed.

Serving spirits by the drink           

  1. NEW Class “C” Native Distilled Spirits Liquor Control License: Native distillers producing not more than 100,000 proof gallons a year and planning to serve their spirits by the drink at their native distillery must obtain a class “C” native distilled spirits liquor control license. The application process for this new license classification will initially be on a paper application. An electronic application will be available at a later date. Remember that the local authority must review the application. It is the applicant’s responsibility to know when the local authority meets to consider applications for alcohol licenses/permits.

After the local authority has completed its review and taken action on the application, it will be submitted to the Division for review.  If the Division approves the application, a Letter of Authorization will be sent to the email on record. The Letter of Authorization will allow business operations under your class “C” native distilled spirits liquor control license to begin on the effective date indicated on the letter. You will be emailed an actual license at a date after July 1, 2017.

  • The class “C” native distilled spirits liquor control license allows native distillers to serve only the spirits manufactured on the licensed premises. It does not allow sales by the drink of any other alcoholic beverage (i.e. wine or beer).
  • All native distilled spirits sold and served by a class “C” native distilled spirits liquor control licensee must be purchased from a class “E” liquor control licensee. Spirits cannot be purchased from a class “E” liquor control licensee before July 1, 2017, nor before the effective date of the class “C” native distilled spirits liquor control license. Additionally, spirits currently used for tastings or bottle sales cannot be used for serving drinks by the glass. Records for all retail purchases and sales must be kept pursuant to Iowa Code section 123.33.
  • Any premises to be licensed under a class “C” native distilled spirits liquor control license must be equipped with tables and chairs to accommodate at least 25 persons.
  • Any premises to be licensed under a class “C” native distilled spirits liquor control license must also have separate toilet facilities for men and women. If the premises to be licensed is not equipped with at least two bathrooms, an applicant may petition for a waiver of the requirement. Please contact Tyler Ackerson (Ackerson@iowaabd.com) for more information regarding the waiver process.
  1. Dramshop Insurance: Dramshop insurance is a precondition to holding and maintaining an Iowa liquor control license. The insurance policy must remain in effect during the entire period of the license and be updated annually upon renewal of the liquor control license.  Proof of a dramshop policy must be demonstrated prior to local authority approval.  Contact an insurance carrier now.
     
  2. Food Service Establishment License:  Businesses that sell and serve alcoholic beverages for consumption on the licensed premises are required to obtain a Food Service Establishment license. Pre-operational inspection and approval is required before opening for business.  To find the regulatory authority responsible for inspecting and licensing food establishments by area, click here and scroll to the county list at the bottom of the page.

Increased bottle sales

  • Native distillers manufacturing less than 100,000 proof gallons a year will be allowed to sell up to 9 liters (12 750mL bottles) of their spirits per person (of legal age) per day. Bottles sold must pass through the wholesaler.
  • Native distillers manufacturing more than 100,000 proof gallons a year will be allowed to sell up to 1.5 liters (2 750mL bottles) of their spirits per person (of legal age) per day. Bottles sold must pass through the wholesaler.
  • Records of individual purchases of native distilled spirits for off-premises consumption must be maintained for three years, pursuant to Iowa Code section 123.43A.

Tasting privileges

  • Patrons may be given up to two 0.5-ounce tastes per brand of native distilled spirits manufactured at the native distillery. Patrons may be given up to two 2-ounce tastes of a mixed drink or cocktail as defined in 185 Iowa Administrative Code section 4.5(1)“b”.
  • Tastes will no longer be required to be provided in conjunction with a tour.
  • Tastes must remain free of charge.  However, a class “C” native distilled spirits liquor control license holder may charge for tastings.  If charging for a tasting, the spirits used must have been obtained from a class “E” liquor control licensee.

All native distillers will be able to provide tastes, regardless of annual production amounts.

Printed from the website on September 19, 2017 at 8:40am.