Legal Guide to Starting a Brewery in Indiana

IndianaBeer note: Today we’re pleased to bring you a guest article from Sara Aisenberg of Surety Bonds. As we’ve witnessed an increasing number of professional and amateur brewers pursuing the dream of launching their own brewery, Sara brings you some helpful tips on legal items you’ll need to consider.

If you make a great homebrew, you know that crafting beer is a process — from preparing to fermenting to conditioning to packaging and everything else in between. If you’ve decided to turn your hobby into a licensed business, you probably have the brewing part of the equation down. However, you might not know much about the business side of things. To ensure that your brewery gets up and running without any setbacks, follow this legal guide to starting a brewery in Indiana.

Know the law.

Anytime you jump into a venture that involves legalities, it’s important to know every law that applies to your industry. A great place to start is researching Indiana’s brewer permits as stated in Indiana Code 7.1-3-2. It’s also important to understand the federal laws pertaining to the brewing industry. For example, the Indiana Alcohol and Tobacco Commission doesn’t require brewery owners to post a surety bond to get licensed at the state level, but a bond is required at the federal level. In most cases, individuals interested in starting a brewery will need to post a brewer’s bond or a brewer’s collateral bond. For clarifications on fulfilling this surety bond requirement, consult the U.S. Alcohol and Tobacco Tax and Trade Bureau website.

Determine which liquor license you need.

The first step in getting an alcoholic beverage license in Indiana is to determine what kind of license you need, which you can do by visiting the license type section of the Indiana Alcohol and Tobacco Commission website. In most cases, individuals wanting to open an independent brewery will need a brewer or small brewer license. If you plan to sell your beer on site, in restaurants or in stores, you might also need a beer retailer or beer wholesaler license.

Once you’ve determined the type of license you need, you’ll have to find out if that particular type of license is available in your area. If the license you need is available, you can move forward with the licensing process. If the quota for your particular license is filled, you can try to buy the license from a current license holder. In most cases, assistance is available to connect individuals seeking a license with individuals looking to sell their license.

Submit your paperwork.

When you’re ready to begin the application process, contact the Indiana Alcohol and Tobacco Commission to request the necessary forms. You must submit the following paperwork to be considered for an alcohol license in Indiana:

  • four copies of your floor plans signed and dated by you
  • any necessary articles of incorporation
  • a signed lease or proof of ownership of the premises where the license will be used
  • property tax clearance from your county treasurer
  • a “consent to transfer” form signed by the current license holder, if applicable
  • a renewal application if the license expires in less than four months from the transfer date, if applicable
  • a transfer of location application, if applicable

After you’ve submitted your paperwork, you can expect to wait anywhere from 8-12 weeks before the process is completed. Most counties in Indiana require that applicants seeking an alcoholic beverage permit appear at a local board meeting. A member of the Indiana State Excise Police serves on this board and will visit the site at which you intend to operate the permit at some point during the application and approval process.

Although dealing with legal requirements is a large part of starting a business, doing so is just the beginning of the start-up process. Once your application is complete, it’s time to brainstorm and execute the tasks that will turn your idea into a tangible business and brand, which includes marketing products, setting prices, hiring employees and developing a company culture. Understanding the legal aspects of starting a brewery will give you a solid foundation on which to build.

SAisenberg5_2012WEB

Sara Aisenberg is the executive writer for the SuretyBonds.com educational outreach program, an effort to helps entrepreneurs of all kinds understand the legal requirements they must fulfill before starting their own businesses. As a newcomer to Columbia, Missouri, Sara is exploring all that the Midwest has to offer — including some local beer! Follow Sara on Twitter @SaraAisenberg.

3 comments:

Bob Ostrander said...

Sara, thank you very much for your insight.

In "Determine which ..." you talk about quotas. Indiana law, IC 7.1-3-22-1 limits congressional districts to 4 breweries.

"The commission, however, shall not issue more than four (4) brewer's permits in the same congressional district."

Potential brewers should keep this in mind if the B.I.G. can't get it changed. Downtown Indianapolis and the Broadripple area of Indianapolis both have three breweries in their (state) congressional district. (The wording of the law hopefully implies "state", right?)

Again, Thanks,
Bob.

S L said...

"Brewer's" permits are not the same as "small brewer's" permits. A small brewer is beneath 30,000 BBL per year, so no one has to worry yet.

-Steve Llewellyn

Stephen Bailey said...

How much should someone expect to pay for all licenses and permits to begin brewing less than 30,000 BBL per year say in Allen county?

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