So after the meeting, this is obviously a hot topic and Jason wanted some suggestions posted, so here is my short proposal. It's not super technical, but I thought it might be a good starting point to talk about the license issue. I think we can all agree on lower taxes across the board so this does not address the tax issue. It was great seeing the turnout last night, looking forward to what this year has in store! Distillery License and Fee Proposal 1) Eliminate two license types and have single license for distilleries. A fee increase is inevitable for current craft license holders however despite the percentage change, the overall increase is not a detriment to most or all businesses currently operating. Suggest $250-$350/year. 2) In order to maintain monetary incentives of using a majority of Washington products, breaks will be allowed based on the individual product and not the license type. The compensation would be similar to the current craft license breaks in terms of a percentage of retail sales revenue that is not assessed on that product. I do not foresee the state being able to handle monthly tax reports with hundreds of different individual products (versus the current reports simply based on sales and production reports based on type of liquor etc). I propose that the additional paperwork that will inevitably be required should be the responsibility of the distillery. Fees can be calculated in full, but before final submission and payment, there can be a spot to subtract the amount owed based on the number and volume of products sold that qualify for the Washington state ingredient discount. The state would need paperwork filed for each TTB approved product that details raw ingredients used and can verify that the majority are local, and it would be the distiller’s responsibility to keep records and invoices for purchases on raw materials should an audit occur. Benefits for Washington State -Simplicity in one license type -Incentives to support Washington raw materials. While these incentives exist now, this will open up more usage through current “full” license type distillers to take advantage as well where as currently it is only craft licensees. Also, this will allow current craft licensees to produce more unique products with ingredients not locally available, growing their business while also providing additional revenue for the state. Benefits for Distilleries -Simplicity of licensing, and a monetary break for commercial license holders -Allows expansion of product lines for current craft license holders -Lowers barriers to entry into the market for new distilleries -Very little change to current record-keeping requirements -One license type could streamline other legislation for benefits that the wine and beer industry already enjoy but our two license system is creating too much confusion Potential issues: -What does this mean in terms of distribution to off-premise licensees and to distributors and what do their fees look like? -This benefits distilleries more, especially in tasting room sales, so how will the push back from larger distributors and players in the market fair? -Can we quantify the benefits to the state with a dollar amount, as they may just see lower revenue with an initial look at a proposal like this? There's my $.02, no matter what happens I'm just going to keep plugging along and making the best spirits I can, and adapt as needed as we see changes or not. We're still pretty new and green, so if I missed some blaring issue in this proposal please be nice!