Beer in a glass in front of the U.S. Capitol Building in Washington, DC

While U.S. businesses grapple with the coronavirus pandemic, the Brewers Association seeks aid from Congress on behalf of the craft beer industry.

Brewers Association Seeks Congressional Aid for Beer Industry

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The Senate approved a multi-billion dollar relief bill to offer immediate aid in the wake of the COVID-19 pandemic Wednesday afternoon.

This bill makes coronavirus testing free, provides paid sick leave, expands unemployment benefits and provides grants to states to process and pay claims.

The legislation, which passed the House over the past weekend was then signed into law by President Donald Trump.

Another aid package is already in the works and Senate majority leader Mitch McConnell (R.-Ky.) called Wednesday’s vote “a very important first step.” He said his party is working with Trump on a “consolidated position” and will then begin discussions with Senate Democrats.

McConnell stressed the Senate is to remain in session and senate members are not to travel far from Washington, D.C.

The Department of the Treasury has proposed measures to include in the next aid rollout, which include $300 billion in loans, rather than direct financial assistance, for small businesses.

If secured, the qualifying terms for these loans would be that businesses with 500 or fewer employees use them to cover six weeks of payroll at up to $1,540 per week per employee with the requirement that “employee compensation must be sustained for all employees for eight weeks from the date the loan is disbursed.”

“The coronavirus is slowing our economy to a near standstill and we’re almost certainly anticipating a recession,” Senate minority leader Chuck Schumer (D.-N.Y.) said prior to the vote. “You go to the streets of many cities, towns and villages — they’re empty. Schools are closed in large portions of the country and businesses are struggling not to lay off workers because they don’t have customers.”

More than 30 states have mandated shutdowns of on-premise consumption at bars, restaurants and breweries nationwide. Nearly 60% of craft breweries told trade group the Brewers Association in a survey about the effects of the pandemic that they expect to lay off employees in the coming days and weeks.

According to Brewbound, the Brewers Association president and CEO Bob Pease wrote that the Senate would likely push forward another aid package that could include:

  • “A temporary suspension or deferral of federal excise taxes;
  • A waiver of penalties for payment of late excise tax fees;
  • A business tax credit for lost sales;
  • Flexibility in submitting amendments to licenses for current permit holders;
  • An increase in funding for Small Business Administration (SBA) Disaster Relief Assistance programs;
  • Deferment of SBA loan payments/no interest loans;
  • Deferment of payments with no interest accrual for loans with commercial lenders;
  • A freeze on premium increases for unemployment insurance;
  • Suspension of payroll taxes;
  • Compensation Fund.”

While the BA supports those efforts, Pease said what his organization’s members need more than anything is “cash, so the compensation fund is of most interest.”

“If you are a taproom brewery then this week it’s a good chance you just saw your businesses cash flow go to $0 in the matter of 24 hours,” Pease wrote. “These small businesses won’t be able to hang on for longer in the current environment so we are doing all we can to advocate for government action that will make an immediate impact.”

As such, Pease sent a letter to congressional leaders today asking that the next round of support include several measures to help craft breweries. They include:

  • Providing small brewers with direct monetary relief in the amount of $3 billion to help cover costs associated with closures mandated by state and local officials;
  • Providing loan deferments for up to two months, with no interest accruals from commercial lenders;
  • Making unemployment insurance available for all temporary laid off or furloughed employees, with no long-term negative impact on employers’ insurance premiums;
  • Providing paid sick leave for people who don’t have benefits through their employer;
  • Providing paid quarantine leave for employees of businesses shut down due to quarantine;
  • Providing a temporary suspension or deferral of federal excise taxes.”

“We would urge you to consider these and/or other measures to shore up this expanding, vibrant domestic industry so that it is not overwhelmed by this short-term but devastating health emergency,” Pease wrote.

U.S. Treasury Secretary Steven Mnuchin had previously warned Senate Republicans that one-fifth of all workers could become unemployed without government assistance.

Many craft breweries, such as Russian River, McMenamins and Night Shift have already furloughed or laid off staff to allow their workers to collect unemployment benefits. Beer Marketers’ Insights, citing the Denver Business Journal, reported that Boulder, Colorado-headquartered Mountain Sun Pubs and Breweries laid off 350 employees from its five locations and Denver Beer Company cut 35 jobs.

In Raleigh, North Carolina, Trophy Brewing laid off 75 employees, according to Indy Week, while Washougal, Washington-based 54 40 Brewing Company cut 90% of its staff, according to KATU.

One brewery, San Leandro, California-based Cleophus Quealy Beer Company, said the impact of a weeks-long forced closure would be too much to withstand and announced it would close for good next month.

Meanwhile, John Lane, the co-owner of Ohio-based craft beer bar and restaurant chain the Winking Lizard Tavern, told Cleveland.com that the state-mandated closure of bars and restaurants forced him to lay off 1,100 employees.

“I think they know how much we love them and that we want them back, and we want them back as soon as we can,” he told the outlet.

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