WALLOON LAKE — The Michigan Craft Distillers Association is praising passage of HB 4842, which promises to reduce the markup on distilled spirits.
The bill passed the Michigan Senate on April 28 after being approved by the Michigan House in May 2021, according to a release from the MCDA. The organization is encouraging Michigan Gov. Gretchen Whitmer to sign the legislation.
The bill “would reduce the markup charged on a distilled spirits product from 65% to 32.5% with the usage of 40% Michigan agriculture in the distilling of the base spirit,” according to the release.
Currently, distilled products are sold to the State of Michigan, which acts as the wholesaler. The state applies a 65% markup to each bottle.
“HB 4842 is our signature piece of legislation; something MCDA has been working on for over five years,” MCDA President and Long Road Distillers co-owner Jon O’Connor said in the release. “Having passed in both the Senate and the House, it will now be presented to the Governor for her consideration to sign into law.
“We want her to know how important this is to our industry and what a significant impact it will have for Michigan small distillers.”
In addition to allowing small distillers to market their products “at more competitive prices,” the MCDA said HB 4842 will result in significant growth in the industry, which will create additional jobs and community investment, according to the release. The bill also holds promise for the agricultural community.
“This bill represents an opportunity for the state of Michigan to become one of the most competitive states in our nation for craft distillers to sell their products while simultaneously bringing significant value-added opportunities for Michigan farmers and agricultural producers,” O’Connor said in the release. “HB 4842 is an elegant solution to a complex problem, and one which we see having significant potential to grow and support both the distilling and agricultural sectors within our state.”
The MCDA was formed in October 2014 and represents 30 craft distilleries with nearly 50 unique tasting-room locations in the state.
Michigan ranks ninth in the overall number of distilleries in the U.S., according to the release, which cites data from the American Craft Spirits Association.
