Government Shutdown ‘Could Have Significant Impacts’ on California’s Breweries

SACRAMENTO -- Among the federal employees deemed "non-essential" and otherwise on hiatus during the partial federal government shutdown are those from the Alcohol and Tobacco Tax and Trade Bureau, which approves most new beer labels.

"If you are a brewery that is trying to release a new brand or a seasonal beer release right now, you won't be able to get your label approved," said Leia Bailey with the California Craft Brewers Association. "So you won't be able to release that beer right now."

The shutdown only impacts new beers that will be sold out of state.

Still, California has close to a thousand craft breweries and contributes more than $7 billion to the state's economy annually.

"There's a lot of potential impacts," Bailey told FOX40. "I don't think it's been a long enough time span to see any of those yet but downstream definitely."

Currently only about a quarter of the state's craft breweries ship beer out of state. But in a landscape overflowing with newness and innovation, amid intense competition, getting new beers into the market is no longer a half full, half empty type of argument.

"It could be an expensive pause here," Bailey said. "Even three weeks could have significant impacts."

If the shutdown continues, more than 200 California craft breweries in need of a federal license just to open will also be on hold and it could significantly impact the business as a whole.

"It's that first step and if they don't have that they can't move forward," Bailey said.

The TTB doesn't just handle beer, it oversees all alcohol, including wine. So, potentially, the shutdown could have a big impact on that industry as well.

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