Craft Alcohol Production (Brewpub / Taproom / Cocktail Rooms)

Issue

Various entities have contacted the city to inquire about the possibility of opening a brewery or distillery in Chanhassen; however, the City Code does not currently permit the licensing of brewpubs, taprooms, or cocktail rooms.

Examples:

  • Brewpub: Granite City Food & Brewery, 5500 Excelsior Blvd., St. Louis Park
  • Taproom: Excelsior Brewing Company, 421 3rd Street Excelsior
  • Cocktail rooms: J. Carver Distillery, 1320 Mill Lane, Waconia

Background

In 2011 Minnesota passed the “Surly Bill” which allowed brewers to directly sell their own beer on site, pending the appropriate municipal licenses. This law and its subsequent amendments allow cities to create and issue cocktail room licenses, on- and off- sale licenses for brew pubs, brewer taproom licenses, and small brewer off-sale licenses. Cities may also authorize Sunday on-sale for holders of brewer taproom licenses, and Sunday off-sale for holders of small brewer off-sale licenses. Cocktail room licenses are limited to distilleries producing less than 40,000 proof gallons a year. Brew pubs are restricted from selling more than 3,500 barrels a year. Brewer taproom license are limited to breweries producing less than 250,000 barrels a year. Small brewer off-sale licenses can only be issued to breweries producing less than 20,000 barrels are year.

Cideries, facilities that produce hard cider, have also been gaining popularity; however, Minnesota law currently classifies hard cider as a wine which means the above licenses cannot be applied to cideries. A brief discussion on what steps the city would need to take to permit a cidery is included in the analysis section. It is possible that as craft cideries gain in popularity state law will be changed to treat them more similarly to craft breweries and distilleries.

Many communities have amended their ordinances to take advantage of these provisions and allow taprooms, brew pubs, cocktail rooms, and other craft alcohol production and consumption venues. The increased permissiveness and flexibility in state and local laws, along with a growing market for craft alcohol, has led to a proliferation of craft alcohol producers.

With the rapid growth of the craft alcohol industry and Chanhassen’s strong demographics there has been interest in opening one of these facilities in our community. The City Code does not currently allow the city to license taprooms, cocktail rooms, or brewpubs, and any alcohol production would be restricted to Industrial Office Park Districts (IOP). The city may wish to preemptively consider if it wishes to allow craft alcohol production and under what terms.

The following sections of the Chanhassen City Code are subject to changes:

  • Chapter 1 - General Provisions
  • Chapter 4 - License, Permit, and Administrative Fees
  • Chapter 10 - Licenses, Permits and Miscellaneous Business Regulations
  • Chapter 20 - Zoning

Get More Information 

Click on the meeting date link in the schedule below to view the agenda and packet items for that meeting.

Schedule

Date Meeting Type Action
May 15, 2018 Planning Commission Public Hearing Recommend Approval
June 11, 2018 City Council Approved