Grant program aims to make Alberta craft breweries 'signature industry'

“We’d say it’s a great day today.” That’s Terry Rock’s view on a new grant program aimed to support Alberta’s small craft brewery industry announced Thursday.

Maximum a single brewery could get is $12M per year but none are currently at that level

The maximum a single small craft brewery could get in annual grants is $12 million if they were to get close to the limit of 300,000 hectolitres produced and sold. The program starts Aug. 5. (Colin Hall/CBC)

"We'd say it's a great day today."

That's Terry Rock's view on a new grant program aimed to support Alberta's small craft brewery industry announced Thursday.

Rock is the executive director at the Alberta Small Brewers Association.

"A craft beer produced by an independent producer, produces seven to 10 times more jobs per unit than a macro beer. That's why this industry is so important for Alberta. The economic impact way outstretches the amount of market share that a craft beer would have in our province," Rock said.

Terry Rock of the Alberta Small Brewers Association says it's a great day. (Colin Hall/CBC)

"There are about 40 [breweries] now and with at least a dozen if not 20 breweries in the planning stages, we see tens of millions of dollars of new investment and dozens of new jobs coming very soon to Alberta."

The Alberta Small Brewers Development Program provides a monthly grant to breweries that produce and sell up to 300,000 hectolitres of product each year. Producers submit sales records to the province semi-annually.

Agriculture and Forestry Minister Oneil Carlier said the current 37 craft breweries aren't close to the 300,000 hectolitres limit. (Colin Hall/CBC)

"The 37 or so small breweries aren't anywhere close to that 300,000 hectolitres as of yet," Agriculture and Forestry Minister Oneil Carlier said.

"Once they exceed that, they get no money."

If a single producer were to get very close but not exceed that limit, they could receive a maximum grant of $12 million annually, Carlier said.

The government believes it will hand back a total of $20 million per year for ten years.

Playing favourites

The Opposition Wildrose Party leader said the grant is about the province playing favourites.

"Wildrose believes in a free and open market, and the fact that Albertans know a good product when they see it," Brian Jean said in a statement.

"I have full confidence that the great Albertan small and medium sized breweries can continue to compete with other beers from across the country without the government having to pick winners and losers."

Part of changes announced in budget

The grant is part of tax changes announced in the October budget.

In the previous tax regime many Alberta brewers capped their production at 19,999 hectolitres because if they made 20,000 or more, the tax per litre would more than double. The October budget created a new tax regime that raises taxes incrementally as production totals rise.

"This is fantastic news, absolutely," Tool Shed Brewing Company co-founder Graham Sherman said at the time.

"The new, graduated increase, not only does it mean we don't have to cap ourselves … but it also means that, as of today, our markup just got cut in half because we fall into that first category," he said.

Kenney not happy

Jason Kenney, who hopes to unite and lead Alberta conservatives in the next provincial election, weighed in with a Facebook rant.

"The NDP is applying the newly increased markup on all brands of beer. Consumers will be forced to pay more. And the NDP is going to use your money to subsidize some brewers — whether you drink that brand or not," a July 13 post on his Facebook page reads.

Earlier this month the Saskatchewan government called the changes offside and against the spirit of inter-provincial trade, estimating a 200 per cent cost increase for Saskatoon's Great Western Brewing.

Alberta Premier Rachel Notley shot back.

Saskatchewan Premier Brad Wall said Alberta's new craft beer tax regime is going to cost brewers in his province money. Alberta Premier Rachel Notley said she didn't need another lecture. (CBC)

"I will not be lectured about any efforts that our government might take in the future in order to support our small brewers, our economic diversification, our workers and our industries," Notley said at the time.

Minister of Finance Joe Ceci downplayed the interprovincial rift.

Minister of Finance Joe Ceci said the tax changes are trade compliant. He said Alberta has the most open system of liquor marketing. (Colin Hall/CBC)

"Discussions are ongoing between Alberta and Saskatchewan," Ceci said Thursday.

"I know we are trade compliant in that we are doing this to level the playing field for all beer whether small, large, wherever your origin, you will pay the same markup. We are the province with the most open system of liquor marketing. Anybody who wants to get this province can where that is not the same in other provinces."

The grant program begins Aug. 5.