Regulation Nation: Breweries fight back against new government grain rules

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Beer brewers criticize FDA's spent grains proposal

Garrett Tenney reports from Chicago

A fight is brewing between American beer makers and the federal government over happy hour ... for cows.

For centuries, brewers have given or sold the leftover grain from the brewing process to local ranchers and dairy farmers for cattle feed. But new regulations proposed by the Food and Drug Administration threaten to end that relationship.

"The whole brewing community was shocked about it," said Josh Deth, co-owner of Revolution Brewing in Chicago, Ill.

Deth, whose title is "Chairman of the Party," says it's always been a great deal for both sides. The ranchers get the grain, and the brewers get those leftovers removed from their facilities for free.

"We're trading, giving something of value to each other and working it out. I think that's one of the really great things, and people really hate to see the government get involved in something where they can just as easily stay out of this."

Under the FDA's proposed regulations, so-called spent grains would be regulated the same as pet food.

Deth said the regulations would make it far too costly for him to prepare the grains to be passed along to farmers. The only remaining option would be sending it to a landfill, which would cost more than $100,000 a year.

That would be bad for dairy and cattle farmers like Jim Minich, who gets 30 tons of spent grain from Revolution Brewing each week. Not only does the grain save him more than $100,000 a year in feed costs, his 750 cows also produce more milk after chowing down on their "happy hour."

"I mean it's just basically grain and it's got a lot of yeast in it and it's wet, so it adds to the palatability of the feed so they eat more," he said.

The regulations are part of the FDA's Food Safety Modernization Act, a sweeping new food safety reform law signed by President Obama in 2011. According to the FDA, the purpose of the law is to improve the safety of animal food.

There's no record of spent grains causing any problems for cows or humans, though, according to Chris Thorne, a spokesman with the Beer Institute.

"We already meet or exceed the goals that the FDA would like us to see. So we see these regulatory procedures as completely unnecessary," Thorne told Fox News.

The FDA was flooded by comments from brewers, distillers and cow farmers when the proposed rule was announced.

Several members of Congress have since added their voices as well to those asking the administration to reconsider the law.

Responding to the outcry, the FDA said in a statement it is now looking to revise the language for the rule this summer before issuing a final decision sometime next year.

"We are working to develop regulations that are responsive to the concerns expressed, practical for businesses, and that also help ensure that food for animals is safe and will not cause injury to animals or humans," the FDA said.