Peter Franchot

Reform of Maryland's Craft Beer Laws

During the 2017 Legislative Session, Maryland legislators passed a bill that imposed restrictions on the sale and distribution of craft beer products in the state. While legislators who advocated for the measure argued that the legislation was a step in the right direction, many - including a majority of Maryland craft brewers - decried it as too restrictive and would compromise the growth of the industry in the state.

The legislation, then designated as House Bill 1283^[4], contained provisions such as prohibiting breweries from selling beer on-premises unless the products were brewed and fermented entirely on site; prohibited contract brewing, which helps startup breweries gain their footing in the market; rolled back taproom hours of operation; and included language that required any additional 1,000 barrels - beyond the 500-barrel annual limit on taproom beer sales - be bought from wholesalers at a marked up cost. The bill, heavily amended after heavy criticism from stakeholders and the public, was eventually passed by the legislature. While Gov. Larry Hogan allowed the bill to become law without his signature, he wrote - in a letter to the General Assembly’s presiding officers - that “...House Bill 1283 contains several troubling provisions, which will more than likely prove detrimental to Maryland’s burgeoning craft beer industry - hampering the economic growth, job creation, and tax revenue it produces.”^[5]

Towards the end of the legislative session, Franchot emerged as the craft beer industry’s biggest political ally, and heavily criticized the General Assembly for adopting House Bill 1283.

A day after the legislature closed its 90-day session, Franchot traveled to a craft brewery in Frederick to announce that he was a forming the “Reform on Tap” task force to study Maryland’s craft beer laws and propose reforms to what he considered to be “antiquated, dysfunctional, anti-small business, and anti-consumer.”^[6]

Franchot’s task force, which was composed of 40 members from the craft brewing industry and also included four lawmakers, met over a nine-month period and culminated with a release of a report and an announcement that the comptroller would introduce legislation seeking to loosen existing restrictions on the craft brewing industry in Maryland.^[7]

While there was considerable public support for Franchot’s proposals, the comptroller was met with a hostile response when the legislature convened in January 2018. A number of legislators, particularly those on the House Economic Matters Committee - the legislative committee with primary jurisdiction over alcohol laws, found Franchot’s criticism of their passage of House Bill 1283 to be offensive. Additionally, a number of legislators expressed concern over Franchot’s advocacy for an industry that he is charged with regulating.

In what many considered as a retaliatory response to Franchot, Del. Ben Kramer (D-Montgomery County) and Del. Warren Miller (R-Howard County) introduced legislation forming a task force to study which agency is best suited to regulate the alcohol industry in Maryland.^[8]

After a contentious hearing in the House Economic Matters Committee that lasted several hours and featured dozens of brewers, elected officials, and other stakeholders who testified in support of Franchot’s bill^[9], the committee voted 17-4 to reject the comptroller’s legislation. After learning of the bill’s defeat, Franchot once again lambasted legislators by saying, “The corporate beer lobbyists did their job and got their money’s worth… Our independent craft brewers ... have once again received the message that our state’s leaders are fundamentally hostile to their line of work.”^[10]

Franchot has stated he will continue his advocacy for the craft beer industry until reforms are adopted.^[11]

Board of Public Works

Franchot, along with the governor and the state treasurer, compose the Board of Public Works - a constitutionally-appointed body that is charged with reviewing and approving most state contracts, issuing wetlands licenses, approving the expenditure of general obligation bond funds and funds for capital improvements, among other duties.

During his tenure on the Board, Franchot has worked to advance initiatives that reform the state’s procurement process and practices^[12], including the reduction of single-bid contracts^[13], increased participation among minority and women-owned enterprises^[14], and opposing contracts that he deems to be wasteful of taxpayer dollars.

School After Labor Day

Franchot - citing benefits to tourism-dependent businesses, families, and teachers - was a strong proponent of having a post-Labor Day start for Maryland public schools. Local school boards of education previously had the authority to determine the start date and end date of school years, and Franchot decried some school systems who started school years in mid-August and ended well into the month of June.

In 2013, a report published by the Maryland Bureau of Revenue Estimates found that a post-Labor Day school start would generate an additional $74.3 million in direct economic activity, including $3.7 million in new wages, and $7.7 million in state and local revenue. ^[20]

In June 2014, a 19-member legislative task force that included teachers, administrators, parents, business owners, and lawmakers overwhelmingly voted to recommend that the Governor and the General Assembly adopt a post-Labor Day school start. The task force found no evidence that a later school start date would have a detrimental impact on students’ learning experience, and teachers’ ability to plan and perform their duties.^[21]

Franchot launched a petition urging policymakers to adopt a post-Labor Day school start. Nearly 25,000 citizens, including Hogan and former Maryland Gov. Martin O’Malley (D), signed the petition. Public polls have shown that a vast majority of Marylanders - with figures ranging from 92 and 67 percent, respectively - support the measure.^[22]

Despite legislation being introduced to implement a post-Labor Day school start, the bills stalled and never passed.

In August 2016, Hogan - with Franchot and a host of elected officials present - signed an executive order during a press event on the Ocean City Boardwalk mandating that public schools start after Labor Day.^[23]

Opposition to Slots and Expanded Gambling in Maryland

Franchot campaigned against bringing slot machine gambling to Maryland. As a member of the House of Delegates, he led a successful coalition of lawmakers to oppose the Constitutional amendment to legalize slots. The coalition succeeded in placing before the voters a Constitutional amendment to legalize slots.

In 2008, Franchot, along with hundreds of grassroots leaders from around the state, launched Marylanders United to Stop Slots to encourage a 'no' vote on the referendum. Franchot argued that the high social costs of increased crime, broken families and bankruptcies would outweigh any revenue gains.

Franchot’s opposition to the slots referendum put him at odds with fellow members of his own party, including Gov. Martin O’Malley and Senate President Thomas V. Mike Miller, both of whom were prominent proponents of the slots referendum.^[24]

The 2008 slots referendum passed by a narrow margin, 52 percent to 48 percent.

In 2012, another gambling referendum was placed on the ballot that sought to expand gambling in Maryland with the addition of a new casino in Prince George’s County and the addition of table games.

In an interview with the Washington Examiner in 2012 on gambling expansion in Maryland, Franchot expressed heavy skepticism about the promise of casino revenue being used for educational purposes.  "Any education funding that goes into the Education Trust Fund is subject to being raided by the legislature," Franchot said. "That is what's happened historically; that inevitably is what will happen again.”^[25]

In the 2018 Legislative Session - six years after proponents of the casino gambling claimed that casino revenue would support Maryland’s public schools - the General Assembly passed legislation that would allow voters to place a lockbox on gambling revenue that was promised to be dedicated to education, essentially acknowledging that earlier claims of increased education funding did not come to fruition.^[26] In an interview, Franchot said, “The Governor back then. The legislative leaders. All of them knew this was fundamentally a lie… It was a crass, cynical effort to dupe people.”^[27]

External links

• Official Comptroller's biography
• Franchot for Comptroller, election website