Tuesday, December 10, 2013

Banner headline Tuesday, Part One: In the matter of PourGate, total and unequivocal defeat for the Floyd County Health Department.

In June of 2013, overnight and without warning, the Floyd County Health Department decided that temporary food serving permits of the sort required of elephant ear vendors at Harvest Homecoming would henceforth be required of alcoholic beverage permittees dispensing beer at similar events. As justification, the health department pointed to the enabling ordinance, a form of which has been on both city and county books for decades, and most recently was updated by the city in 2008.

NABC strongly disagreed.

We pointed out that there was no legal precedent for such control, that no other health department in the state presumed to possess such authority, and that permits issued to us by the Indiana Alcohol & Tobacco Commission are the only ones we need to operate in a temporary fashion.

Furthermore, we backed up our case with an Indiana Court of Appeals ruling known as Fort Wayne v Kotsopolous, which was so clear that even a layman could grasp it. But the department's attorney didn't, and in spite of our efforts, an obviously befuddled health department board did not rule in favor of our appeal, instead offering a half-baked compromise involving ongoing regulation without fees.

It was a farce. We persisted.

In August, NABC took the case to the board of the Brewers of Indiana Guild, which agreed that the FCHD's position was improper. Legal wheels in Indianapolis promptly were set into motion, and the ATC asked the Indiana Attorney General's office for an advisory opinion. The opinion was issued roughly three weeks ago, and although we knew the outcome then, only now do we have the 2,100-word text of the opinion.

From top to bottom, the advisory opinion completely vindicates NABC's position as expressed on the very first evening in June, when the FCHD issued a citation to us for failure to possess a temporary food serving permit that we did not need to have. We were right, and the health department was wrong. Period.

The AG's advisory opinion is no mere technicality. It is a 360-degree slam dunk from the foul line, referencing the very same appeals court ruling presented to the health department's attorney at the board hearing in July. I'll publish the entirety of the text soon, after we've had a chance to review it and to decide what comes next.

For now, here is a key passage that makes it quite clear:

The regulation imposed by Floyd County for Temporary Food Service Permits is similar to the ordinance in Kotsopolous in that it is now the policy of the Floyd County health department to require all alcoholic beverage establishments to obtain this permit even if they have a three way permit with Type 222 privileges attached. This “lev[ies] a tax, fee or license requirement on alcohol sales,” which the court in Kotsopolus found to be invalid. Kotsopolus, 704 N.E.2d at 1072.

When NABSB participates in festivals they are participating in the sale and traffic of their product and the Floyd County ordinance imposes a restriction on those sales by not allowing NABSB to sell their product without first acquiring an additional permit at an additional cost. By regulating the sale of NABSB’s beer in this way, the Floyd County ordinance has interfered where the state has already regulated. Not only is this in violation of what is expressly stated in IC 7.1-3-8-2 and I. 7.1-3-9-6 regarding local regulation of alcohol and tobacco, but it also is a violation of the Home Rule Act.

Also, here is the conclusion:

The Temporary Food Permit ordinance enacted by Floyd County requiring a permit for businesses, such as the New Albanian Bank Street Brewery to participate in festivals, is not valid. The ordinance limits the ability of NABSB to sell its products at local festivals and interferes with the permission given by the state permits already held by NABSB for this activity. This is in direct conflict with IC 7.1-3-9-2 and IC 7.1-3-9-6 which restrict this type of local regulation of alcohol sales. In addition to this, the ordinance is in violation of the Home Rule Act which allows for localities to broadly regulate as long as those regulations do not directly interfere with a statute or agency action or if a statute is comprehensive enough that it preempts the local regulation.

What this means to me is that any way one chooses to look at it -- the enabling ordinance itself, and the health department's whimsical interpretation of it -- the requirement to possess a permit in addition to the ATC's is utterly groundless.

In short: What NABC said, all along.

It's one down, one to go. The matter of the defamatory photo shown below is not connected with the advisory opinion issued by the AG, although perhaps now the Floyd County commissioners at long last will start paying attention and exercising the oversight they've shirked thus far.

Given the AG's submission, these same commissioners may be well advised to look outside their bunker, and seek legal opinions elsewhere -- if you know what I mean.



Michael said...

Well, it's about time! Good for you NABC!

John Gonder said...

Congratulations on a nifty gnat swat.