US government shutdown stalls craft beer innovation

About one-quarter of the US government has been shut down for nearly three weeks, making it the third-longest shutdown in US history. More than 400,000 federal employees are either furloughed from their jobs or working without pay, and several national parks have closed due to waste pileup.

But the stalemate is affecting the American people in other ways as well. The Alcohol and Tobacco Tax and Trade Bureau (TTB) is one of many government agencies out of commission, so it has not been approving labels or processing permit requests from alcoholic beverage companies.

Lost revenue and delayed openings

The Brewers Association has advised breweries that labels and permits will take longer to acquire, and even when things are back up and running the market is likely to experience a backlog in the process. In 2018, requests for new beer, wine and spirits at the agency topped 200,000.

Because this affects new product launches, breweries that rely on frequent releases will start to feel the consequences of lost revenue over the coming months. Startup breweries that were planning to open this month are having to delay their launch date.

Katie Marisic of the Brewers Association also added, “If your brewery is in the process of applying for a loan from a bank or credit union they are likely unable to get the information they need from the federal government to process your loan.”​

Small craft operations in states like New York, New Jersey, Oklahoma, Kansas and Missouri have already been public about issues with maintaining their business during the shutdown. Products aren’t making it onto the menu as scheduled, and they require additional federal approval to sell and ship to other states.

No end in sight

The TTB still has a functioning website during the shutdown, though an initial landing page warns visitors of its limitations. It states that permit applications are still accessible, but those submitted won’t be approved, agency communication will be suspended and other site information won’t be updated until the shutdown is lifted.

TTB employees have been directed not to report to work and prohibited from volunteering work during the shutdown.

President Trump has not relented on his request that the shutdown-ending spending package include more than $5bn allocated for a border wall between the US and Mexico. Democrats are staunchly refusing to consider the wall funding.

A compromising deal passed through Congress is typical in ending a government shutdown, though Trump is threatening to declare a national emergency and redirect money for the wall from the Defense Department.

He claimed that he wouldn’t need approval from Congress to do so, but also threatened to keep the shutdown going for ‘months or even years’ in order to properly secure funding for the border wall. Trump has stated that he believes the 400,000 currently unpaid federal employees support his decisions and may even consider it ‘far more important’ than getting back to work.