Editor’s Note: This sponsored column is written by Nick Anderson, beermonger at Arrowine (4508 Lee Highway).
The government shutdown that began Tuesday morning is big topic of the week nationally, but especially in our area. Thousands of government employees are currently off the job, waiting to see if congress can reach an agreement that will reopen the ‘non-essential’ departments and parks that are either closed or largely empty right now. With the last government shutdown occurring 17 years ago when I was in high school, I hadn’t even considered how the beer business might be affected by the shutdown, but sure enough, it is.
There are two main issues for the craft beer industry to deal with during the shutdown. By the numbers, the largest of these issues is the Treasury Department’s Tax and Trade Bureau (TTB) ceasing approval of new beer labels and recipes. Beer news site Beerpulse estimates that 400 labels per day won’t receive approvals during the shutdown, based on the over 110,000 labels that TTB had approved over the course of 2013 through the end of September. More immediately detrimental to the health of craft breweries is the Small Business Administration halting approval of new loans for the duration of the shutdown. As the rhetoric heated up in D.C. ahead of midnight on Tuesday morning, breweries like San Antonio’s Alamo Beer Company raced to complete paperwork and get approval for their SBA loans before the deadline, which Alamo did Friday afternoon.
Closer to home, Alexandria’s Port City Brewing Company has felt the effects of the shutdown. I asked Port City’s founder Bill Butcher about difficulties they were facing after he mentioned to me on Twitter that they were trying to deal with an SBA loan ahead of the shutdown. Butcher told me that Port City “…had to scramble ahead of the shutdown in order to expedite all of our paper work to get everything in before Monday.” Fortunately, Port City got the paper work in and had their loan approved over the weekend, but even with that they’re not yet in the clear: Butcher noted that “if something comes up that we need to change during this period,”—meaning the duration of the shutdown—“it will not be possible.”
Regarding the TTB halting label/formula approvals, Butcher said “We have some exciting and innovative beers in the works, some of which have formula submittals, and all of this is on hold. This will delay getting our new beers brewed and out on the market.” Not every department is closed, however: my email conversation with Butcher revealed that the government still sees fit to interact on at least one level with craft breweries, saying “We will continue, of course, to file and pay our Excise taxes as required. These TTB offices are not affected by the shutdown.”
Take care out there if you’re stuck waiting to go back to work. Until next week.
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