BUFFALO (WBEN - Brendan Keany) - Senator Chuck Schumer stopped by the Labatt Brew House Monday morning to explain why another federal government shutdown could have serious consequences for the rapidly growing brewing industry in New York.
Senator Schumer speaking at Labatt Brew House. He says the government shutdown created backlog of new beer applications, and he's calling on the TTB to clear the log jam and approve Labatt USA's applications to avoid losing millions in revenue. pic.twitter.com/ssVQv746LA
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"New York's beverage industry is growing; there are 420 breweries, they produce $4 billion in annual economic impact, and there are 400 wineries and 100 distilleries. It's one of the real success stories in Upstate New York and in Western New York," said Schumer. "However, like other industries throughout Upstate and throughout Western New York, the alcoholic beverage industry was put in serious jeopardy by the preventable 35-day shutdown, and would be put in more jeopardy if there's another."
The industry is highly regulated by the federal government, and specifically by a particular bureau of the Treasury Department, known as the Alcohol Tobacco Tax and Trade Bureau (TTB). In fact, there's not much that a brewing company can do without approval by TTB, and that's why Schumer believes it to be so important to New York's economy that another shutdown be avoided.
Ian Kaminsky serves as the director of legal affairs for FIFCO USA, which is the parent company of Labatt, and he explained the role of the TTB and its importance in greater depth.
"Each new product, each new package configuration, each new label that we produce, requires approval, not only from the TTB at the federal level, but also at each state that we bring the product into," said Kaminsky. "The TTB typically operates with a turnaround time of around 15 days. Post shutdown, that turnaround time was extended to 40-plus days, and so you stack that on top of the fact that none of the states will actually register the products until they have TTB approval, so your talking anywhere from 60-90 or more days when we're usually planning for somewhere between 45-60 max."
Kaminsky then said that pushes the whole schedule back, and it could cut into the most important time of their selling year.
"That, then pushes out our time to market significantly and jeopardizes our ability to bring those products to market in our critical summer selling season, which for us, is even more critical because our business is concentrated in the Northeast and a lot of Great Lakes states, where the summer selling season is a little bit shorter than it is down south," he said.
Schumer is now calling on governmental action so the brewing industry is negatively impacted as little as possible.
"When there was a shutdown, the TTB was closed, and during that time, the number of applications doubled to about 10,000," said Schumer. "There is now a large backlog, and I am urging TTB to get rid of that backlog quickly."
Specifically, Schumer has called on the TTB to do the following:
- To the extent possible, redirect additional staff to process the backlogged label, formula, and permit applications until TTB has reached its processing time goals
- Authorize additional overtime until TTB is able to again meet its ten-day service standard for formula and label approvals
- Use its enforcement discretion with businesses in good standing who continued business activity during the shutdown to stay in business
Schumer then described the economic impact of breweries in the region.
