Alabama business roundup: Headlines from across the state

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Here’s a roundup of some of the top weekend business headlines from across the state: Craft brewers: Alabama laws stifle growth of burgeoning beer industry

Like many of Alabama’s close to three dozen craft brewers who stepped into an industry barely formed, Jeremy Pate is above all optimistic.

On the Dothan farm where his grandparents used to grow corn and peas, Pate started Folklore Brewing & Meadery a few years ago, offering the only locally produced beer in the Wiregrass region. There he has lots of room to grow, but Pate says beer laws in the state need to catch up first.

Pate, 40, believes the existing regulations, which restrict breweries from selling beer directly to customers other than through a licensed retailer, are not broad enough for his business to thrive.

“There are beers that we do not distribute, that we do in very small scale, experimental nature,” he said.

People often want to buy those, or another beer that’s to their liking. Unlike many states, Alabama law prohibits brewers from selling it — either in a keg, bottle or glass jug — to-go.

Pate started by making a simple wheat ale when he opened in 2013. Wiregrass Wheat, he called it. Today, you can find one of his beers in restaurants and stores in Enterprise, Ozark and around Opelika and Auburn. Revenue from retail distribution is great, but not as lucrative as the cash that comes from residents and beer aficionados in search of something new to drink in their taproom.

“The profits on a bottle that we sell out there in the market is miniscule compared to what we get by the pint,” Pate said, “so the limiting factor is how much beer came one person safely consume at a brewery?”

Fighting ‘history’

Pate is not alone in his frustration with the state. Beer makers in north Alabama and down along the Gulf Coast have long agreed lawmakers could do better by the burgeoning industry. And there have been efforts since 2009 when a law allowing beers with a higher alcohol content to be sold was passed.

But it was a relatively small change in the grand scheme of things.

“It was not until the Brewery Modernization Act that any breweries wanted to be in Alabama, period,” Pate said. That law was passed in 2011, and aside from a bill allowing 22-ounce bottles known as “bombers” to be sold by breweries, expanding regulations for the industry has stopped.

Brewers, who sometimes struggle to eke out a profit, say this has put a vise grip on available business opportunities and limits their ability to compete. Meanwhile, there’s about $23 million in unrealized economic activity in the beer industry, a figure that could grow with more relaxed beer laws, according to a recent study by Jacksonville State University.

Like many, Pate knows there is more money to be made with off-premise sales, but in December 2014 he started bottling “bombers” for distribution.

“That’s the only way that we have any chance to grow because of the limited laws,” he said. “And even at that rate we’re going to have to grow slower than other breweries in other states.”

Using what’s known now as the “three tier system,” lawmakers placed in between the manufacturer and retailer an independent wholesaler to keep one company from controlling each stage of the process: production, distribution and sales.

Beer and alcohol production was a different industry in 1933. The three-tier law never anticipated a surge in craft beer production several decades later, mainly by small upstarts, not dominant corporations.

But “history” is the chief opponent to changing the old law, said Jason Wilson, current president of the Alabama Brewers Guild and founder of Back Forty Beer Company in Gadsden. In Alabama, and more generally in the Deep South, Wilson said changing “a lot of the stereotypes and misconceptions that are associated with alcohol” is not easy.

Legislative challenges

As a case in point, look to the recent Legislative session. A number of proposed solutions filtered through the statehouse in Montgomery.

The largest bill, which would have allowed growler sales for breweries and brewpubs, and given them the option to participate in entertainment districts, failed. A trimmed down version of that bill also died. And a last-ditch measure that would have permitted just to-go beer sales didn’t come up for a vote.

The one bright spot was the creation of the Alabama Alcoholic Beverage Study Commission, which has the task of making the state’s laws consistent with others around the country. Wilson said his hopes for the group “are a little bit grander” than simply identifying policy outcomes.

The commission, which is hosting public hearings this month in Alabama, has “a pretty promising mission statement,” he said, “– now whether we can accomplish those things this year, I don’t know.”

The Guild has already offered the commission a jump start, creating a list of proposals that outline the organization’s objectives. At least one of those, the creation of a single craft brewer license for brewpubs and breweries, may cause some in the industry to pause.

“That means everybody is operating under one license, and I would have to revert back to ABC to see if you can actually regulate under those types of circumstances,” said Donna Alexander, executive director of the Alabama Wholesale Beer Association. Overall, she said craft brewers do not pose an existential threat to the beer wholesalers she represents.

Limited opportunity 

In the meantime, some business opportunities are slowed. And an industry that produced close to 40,000 barrels of beer last year is moving at half speed. Some feel it more than others.   

Making about 250 barrels of beer every year, Druid City Brewing in Tuscaloosa is up against a real demand crunch, said co-owner Elliott Roberts.

“We’re actively exploring expansion plans, but where we have trouble is, well, money,” Roberts said.

Nailing down the right real estate has also been a challenge, but primarily it comes down to creating more revenue.

“The business is healthy, it’s not a problem,” Roberts said, “but I don’t have $1 million in the bank to be able to fund an expansion. I wouldn’t have $1 million to fund an expansion if we did have growlers, but I’d be closer.”

Alabama Newscenter: Gov. Bentley said new incentives are already spurring economic development activity

Alabama Gov. Robert Bentley said the state’s new incentives are being used to woo prospective companies to the state and are attracting interest from new projects.

Addressing members of the Economic Development Association of Alabama (EDAA) at their annual summer conference on Monday, Bentley thanked them for their help in helping pass three of five bills in this year’s legislative sessions.

The new incentives allow companies to recoup taxes from payrolls and materials as they add jobs and build or expand. The pay-as-you-go incentives are not only preferable to the state – which has had to take on debt in the past to pay for incentives – but companies also see them as better for their business than the former tax credits.

“Creating jobs always should be our number one goal,” Bentley told economic developers from across the state. “In any polling you see related to Alabama, ‘economy’ is No. 1.”

In an interview after his address, Bentley said the new incentives are already being used with some projects, and prospective companies are being enticed with the new incentives.

“The new incentives package, that is really being received well. (The incentives) are great,” Bentley said. “I’m so proud of EDAA and the people who worked on that – our economic developers, Greg Canfield and the Department of Commerce – and then the Legislature for passing the three main parts of it and I signed into the law.”

Asked if the state is seeing increased activity in the state as a result of the new incentives package, Bentley was quick to respond.

“We sure are,” he said. “It really is working well.”

Bentley also praised the teamwork approach to economic development in Alabama.

“I really enjoy visiting with EDAA, which is the economic team of the state,” Bentley said. “These are local people all over the state of Alabama. They do a fantastic job for their areas. Economic development is a team effort from locals as well as the state.”

Birmingham Business Journal: Verizon to host virtual career fair for jobseekers in Alabama and Georgia

Verizon Wireless has announced it will host its first-ever nationwide virtual career fair on July 23 for those seeking employment in Georgia and Alabama.

The virtual job fair is for interested candidates to use technology to connect online and chat directly with company recruiters, according to a release from Verizon.

The virtual career fair will be from 9 a.m. to 2:30 p.m. on Thursday, July 23.

Candidates from anywhere in the U.S. may participate, including students and graduates from more than 100 colleges specifically targeted by Verizon, including: Georgia Southern University, Georgia Perimeter College, Albany State University, Atlanta Metropolitan College, Auburn University and University of Alabama.

“In the past, jobseekers may have had to travel and prepare to interview for what might be a single opportunity,” said Tracie Lovell, associate director of human resources for Verizon Wireless in the Georgia/Alabama Region. “It seems natural for an innovative company like Verizon to use technology to connect skilled applicants with our recruiters in a convenient, yet impactful, way. We’re confident that we will connect with many outstanding potential employees, who can help us better serve our customers here in the region.”

Before July 23, jobseekers should create an account here to view available positions and additional details. with the option of gaining access through their LinkedIn account.

Dothan Eagle: Lockheed to purchase Sikorsky, but local impact not known

Global security and aerospace companyLockheed Martinannounced Monday it will acquire Black Hawk helicopter maker Sikorsky Aircraft for $9 billion, but it’s too early to tell how the acquisition might affect local jobs.

A news release said Lockheed Martin reached a definitive agreement with Sikorsky’s parent company,United Technologies, to purchase Sikorsky. If regulatory officials approve the acquisition, the companies might close on the deal by the first quarter of 2016. The purchase price is expected to be $7.1 billion after taking into account tax benefits that result from the transaction.

The news release said Lockheed intends to align Sikorsky under the Lockheed Martin Mission Systems and Training (MST) business segment, on which Lockheed already partners with Sikorsky in some critical programs.

Both Lockheed and Sikorsky have facilities in Troy. Lockheed’s Troy facility, which produces the Joint Air-to-Surface Standoff Missile (JASSM) and specializes in testing and storage for other missile programs, had about 300 full-time employees last year and expected to add 200 more by year 2020, according to the company.

A previous Dothan Eagle report showed Sikorsky’s engineering and design center in Troy employed about 538 people last year. Sikorsky specializes in military and commercial rotary-wing aircraft.

Lockheed spokesman Dan Nelson said Sikorsky is expected to retain its headquarters in Stratford, Connecticut, but that it is too early to tell how the acquisition might impact both companies’ locations in Alabama.

“Upon closing the acquisition, we will review all operations to identify ways to improve efficiency and affordability,” Nelson said.

He added that Sikorsky is “a great strategic fit” to Lockheed.

“Sikorsky is an established brand with great employees and it will complement our broad portfolio of aerospace and defense products and technologies,” he said.