U.S. Sens. Mark Warner and Tim Kaine (both D-VA) today wrote to Treasury Secretary Steven Mnuchin to inquire about the impact of the government shutdown on craft breweries in Virginia.
The shutdown has halted operations at the federal agency that regulates alcohol production and distribution, the Alcohol and Tobacco Tax and Trade Bureau (TTB), part of the U.S. Department of the Treasury. As a result, craft brewers across Virginia have been unable to secure approvals for labeling changes, new recipes, or operating permits.
“According to various reports, thousands of applications for alcohol labels have been put on hold. The craft beer industry depends on innovation to drive growth, and the shutdown has and will prevent craft breweries from introducing new beers to the market. It is hard enough for these craft brewers to operate a business, and the shuttering of TTB is yet another example of how the Administration’s shutdown is making it harder for American business owners,” the Senators wrote.
The Senators requested that the Department provide answers about how many craft brewery requests for TTB action are currently pending as a result of the shutdown, and what plans are for reducing and resolving the backlog.
The beer industry employs more than 28,000 people in Virginia, and contributes more $9.3 billion annually to Virginia’s economy. Virginia is home to 206 licensed breweries, a growth rate of more than 450 percent since 2012, making craft beer an important economic driver for the Commonwealth.
“Breweries in Virginia operate in a supply chain, and the shutdown’s impacts on breweries will resonate up and down the supply chain, negatively impacting the farmers, suppliers, and customers. The shutdown will limit business owners’ investment, hiring, and growth. Virginia is not alone in benefiting from this industry; craft brewing contributes $76.2 billion and more than 500,000 jobs to the U.S. economy,” the Senators told Mnuchin.
In the letter, Warner and Kaine raised the example of Port City Brewing Company in Alexandria, whose founder Bill Butcher wrote to the Senators earlier this month to say, “We work hard to get ahead of our business and this shutdown wrecks our plans. If we can’t get our new labels approved in a timely manner, it affects our entire operation, and damages our revenue stream, which relies on new beers in the market… We have spent the closing months of 2018 planning our business out for 2019. This shutdown has made all of this planning work futile.”
Later today at 3:30 PM, Sen. Warner will visit Port City Brewing to hear directly from Butcher about the economic impact of President Trump’s shutdown, and meet with federal workers.
Likewise, Sen. Kaine this morning visited Old Ox Brewery in Ashburn, Va. for a roundtable discussion with small businesses about the impact of the shutdown.
A copy of today’s letter is available here.
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Chris Graham
