The Monthly Mash: May 2021

Dear Friends of the Craft Spirits Community:

The word advocacy comes from Old Latin advocare, which means “Summon–to call to one’s aid.” ACSA is pouring its energy into just that, in multiple arenas.

Our just-completed Public Policy Conference (cohosted with DISCUS) assembled more than 200 members of our industry to ask Congress for help. Elected legislators heard our pleas for additional stimulus, removal of tariffs and their support for postal service shipping of our alcoholic beverages. We were honored to be joined by a senior panel from the U.S. Alcohol and Tobacco Tax and Trade Bureau (TTB), who provided a solid background of what’s ahead at the agency. Another panel presentation educated participants on how direct-to-consumer (DtC) shipping can be done safely with full compliance on government regulations.

Our advocacy continued one day later when our own immediate past president, Chris Montana, gave testimony to a congressional subcommittee to advocate for Congress to fully fund the Restaurant Revitalization Fund, which also benefits distilleries with tasting rooms. We’re also working with our partners at state guilds to ensure that we are reaching the right DSPs when we begin work on the next installment of the Craft Spirits Data Project, which continues to be an important tool as we push for progress for craft distilleries.

As we look forward to a bright summer ahead, let’s also take time to quench our thirst for knowledge with a fresh lineup of webinars and make plans for our 8th Annual Distillers’ Convention and Vendor Trade Show in Louisville this December. Finally, let’s take a moment to toast our incredible community of craft spirits producers with a few cocktails from ACSA members.

Cheers,

Margie

Distilling dominated Congressional appointment books this week as more than 200 craft spirits producers from nearly every U.S. state talked COVID-19 relief, trade tariffs and direct-to-consumer (DtC) shipping with Senators and Representatives on both sides of the aisle. The spirits community gathered for more than 150 virtual meetings during the American Craft Spirits Association (ACSA) and Distilled Spirits Council of the United States (DISCUS) Public Policy Conference on May 25th and 26th.

On the COVID-19 relief front, distillers urged support for two bills in particular: the Restaurants Act (H.R. 793/S. 255) and the Fairness for Craft Beverage Producers Act (H.R. 1035). Congress has already allocated $28.6 billion in relief for restaurants, bars and distilleries with tasting rooms through the Restaurant Revitalization Fund. But the federal government has already received more than 300,000 requests for more than $69 billion of relief since it opened on May 3, putting demand at more than double the existing funds. The Restaurants Act, sponsored by Rep. Earl Blumenauer (D-OR) in the House and Sen. Roger Wicker (R-MS) in the Senate, would add $120 billion in funds.

Other major objectives on spirits producers’ agenda included tariffs and the USPS Shipping Equity Act, both of which you can read more about below.

On the first day of the conference, about a dozen officials from the U.S. Alcohol and Tobacco Tax and Trade Bureau (TTB) generously offered their time to address attending distillers and answer any TTB-related questions. The big theme of the discussion was “streamlining,” as the regulatory officials discussed new technologies and protocols that will enhance efficiency of processes related to label approvals, permitting and filing and resolving claims.

“Certainly we recognize that it is more important now than it has ever been that we’re able to get folks into business and get their products into the market as quickly as we can,” said TTB Deputy Administrator David Wulf.

Vienna Barger, principal at Southern Distilling Co. in Statesville, North Carolina, said gatherings such as these are key to building the overall spirits community.

“We feel that participating in Public Policy Conferences and meeting with our Congressional representatives is critically important to build united alliances, strengthen relationships and raise awareness of the regulations and policies that help our businesses to not only grow, but to thrive,” Barger said. “This is such an exciting time for the spirits industry and all of the craft distilleries across the country, as we emerge from the impacts of the pandemic with a permanently reduced FET and momentum to continue paving our way to great successes.”

Chris Montana, ACSA’s immediate past president and the founder of Du Nord Craft Spirits in Minneapolis, gave testimony to members of Congress via Zoom on Thursday on behalf of craft spirits producers. Montana was part of a panel of small business owners and advocates who addressed the Committee on Small Business Subcommittee on Oversight, Investigations, and Regulations in a remote hearing.

The hearing gave members an opportunity to hear about the implementation and effectiveness of the Small Business Administration’s pandemic-related grant programs, the Shuttered Venue Operators Grant (SVOG) and the Restaurant Revitalization Fund (RRF). Montana praised the federal government for providing relief through initiatives like the Paycheck Protection Program (PPP).

“On behalf of the microdistilleries across the country, thank you for stepping up for us,” said Montana. “When we stepped up for our communities [to make hand sanitizer] we didn’t do it because we wanted a handshake or a pat on the back or a cookie. We did it because that’s what you do. You use the resources that you have to do what you can to help the people who need helping, and I’m proud to say that that’s what my government did, too. The fact that my business has survived to reach today is traceable directly back to the PPP, EIDL and restaurant revitalization programs, and I know that there are many other micodisitilleries across the nation who would say the same.”

Rep. Dean Phillips (D-MN), the chairman of the subcommittee, noted that the RRF had an initial priority period for grants to women-owned businesses, veteran-owned businesses and socially or economically disadvantaged businesses. He asked Montana to share why he thought the priority period was an important part of the program. Montana mentioned that he had initially failed to secure PPP funding, and was grateful for the priority period for RRF, for which applications closed recently after the fund received more than 300,000 applications for more than $69 billion of relief.

“This place wouldn’t be open but for those funds,” said Montana. “I think that the real challenge here is not so much to focus on the fact that instead of being left out again, this population did get a fair chance at those funds. I think instead the focus should be on how can we make sure that everyone now gets that same access. … I really do hope that this committee and this Congress find a way to fully fund the program.”

Members of Congress this month introduced bipartisan legislation that would allow the United States Postal Service (USPS) to ship alcohol—including distilled spirits—directly to consumers in accordance with state laws.

Congresswoman Jackie Speier (D-CA), Congressman Dan Newhouse (R-WA), and 17 original House co-sponsors introduced the United States Postal Service Shipping Equity Act (H.R. 2517). This bipartisan bill—which now has 44 co-sponsors—would end the Prohibition-era ban that prevents USPS from shipping alcoholic beverages to consumers. Senator Jeff Merkley (D-OR) introduced companion legislation in the U.S. Senate, as well.

“On behalf of the American Craft Spirits Association, we are pleased to endorse the United States Postal Service Shipping Equity Act,” said Margie A.S. Lehrman, CEO of ACSA. “It is long past time that we bring our laws into the 21st Century for distilled spirits in an effort to better cater to our consumers. More than 2,250 craft distillers nationwide, mostly small businesses, should have the option of using the Postal Service for delivering their products in a safe and responsible manner, just as they are able to use other package delivery services. Consumers should have the option of enjoying American-made craft spirits from all corners of the U.S with the ease with which they shop for other artisanal products. We applaud the work of Congresswoman Speier, Congressman Newhouse and Senator Merkley on this effort.”

Click here to learn more and to see comments from Congresswoman Speier, Congressman Newhouse and Senator Merkley.

Earlier this month, United States Trade Representative Katherine Tai, U.S. Secretary of Commerce Gina M. Raimondo and European Commission Executive Vice President Valdis Dombrovskis announced the start of discussions to address global steel and aluminum excess capacity. They agreed to enter into discussions on the mutual resolution of concerns in this area that addresses steel and aluminum excess capacity and the deployment of effective solutions, including appropriate trade measures, to preserve critical industries. To ensure the most constructive environment for these joint efforts, they agreed to avoid changes on these issues that negatively affect bilateral trade.

As part of its effort to reboot transatlantic trade, the EU announced that it will not double its tariff on American whiskeys to 50% on June 1, as was previously announced.

“Following nearly three years of international trade-related setbacks and more than a year of a pandemic that has hamstrung our industry, we are heartened by this very encouraging development between U.S. and EU trade policy leaders,” said Margie A.S. Lehrman, CEO of ACSA. “Prior to the implementation of the recent series of tariffs and retaliatory tariffs, international demand for American spirits, particularly whiskey, had been surging. Many American craft spirits producers had relied on overseas markets to grow their businesses and have had to face dramatically reduced revenue streams when the tariffs were implemented. While craft distillers are certainly relieved that the already-onerous export tariff burden on their small businesses won’t double in less than a week, we recognize that this is only a first step in a more complicated process of eliminating such trade headwinds. ACSA will continue to work with the Biden Administration to achieve that ultimate outcome.”

During ACSA’s quarterly state guild roundtable on Thursday, ACSA CEO Margie A.S. Lehrman asked guild leaders to assist with some of the work on the front end of this year’s Craft Spirits Data Project, which is a collaborative effort with Park Street. Specifically, ACSA is asking guilds to review DSPs in their state and indicate whether they qualify as craft spirits producers. The Craft Spirits Data Project has been the single most impactful economic project we have spearheaded, as our findings draw a clear line between our industry and job development, agricultural growth, and increased tourism.

Our forefathers built America with the fundamental principle of each citizen’s right to vote. In deciding on a candidate, we tend to think about who has our voice in Congress—who has our backs in both good and tough times, and who will promote and advocate for our best interests. The American Craft Spirits Association follows that principle as the only national registered trade group created and governed bycraft distillers. That’s what makes us different from other groups out there. That’s what makes us continuously think about what’s at stake and how we can better advocate for our small business interests. And, that’s why our national elections and who serves on the Board of Directors is basic to representation of your collective welfare.

The pandemic wreaked havoc on many of our operations. Our election process was similarly impacted. This is to notify you that we haven’t forgotten about the importance we place on a strong governing body. For that very reason, because of the need for fluency during a rather tumultuous year, we are delaying our national elections until the regular cycle in the late spring of 2022. Pursuant to our bylaws, “Each Designated Director serves for a term of three (3) years, unless otherwise extended by the then current Board due to Force Majeure events,” (including, among many items, a pandemic). The board is in unanimous agreement that the present force majeure is reason to extend board terms. [On a personal note, the CEO is incredibly grateful for the willingness of those board members to continue to work beyond the three years.]

This December, ACSA is looking forward to seeing you in person at our 8th Annual Distillers’ Convention and Vendor Trade Show in Louisville, Kentucky, where we will network, learn, and toast our incomparable, vibrant industry.

We are planning an outstanding lineup of educational programs for every level of experience, focusing on business essentials, technical/distilling, and sales and marketing. If you’re looking for even more education for your or your team, starting on Dec. 2 we’ll host a distillery start-up 101 pre-convention session will offer 1.5 days of content specifically geared toward start-ups and those just entering the industry. Additionally, a full-day safety course will be presented by Industrial Safety & Training Services on Dec. 3. Master class registration and additional information to follow.

Plus, 10 hours will be devoted solely to the exhibit hall to enable you to network with potential or existing suppliers face-to-face, with masks perhaps hiding our smiles of being reunited.

As the health and safety of our attendees will continue to be our main priority, expect a release of COVID-19 precautions shortly.

All prior exhibitor and attendee registration fees from the July 2021 event will automatically roll over and be applied to the December dates. If you need to check registration status or have any immediate questions, please contact Teresa McDaniel at (502) 807-4249 and/or teresa@americancraftspirits.org.

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Non-Member Attendee: $795

Additional Non-Member Attendees (1-5): $425 per person

Additional Non-Member Attendees (6+): $120 per person

If you register as a voting member, you’ll receive discounts on convention registration and competition fees, free webinars (including our archives), and more. Sign-up here to join ACSA’s craft spirits community!

10×10 Single Booth: $1,900

20×10 Double Booth: $3,300