Lobbying for Brewers: Measures that Matter in 2022

On behalf of independent breweries, Brewers Association lobbyists are prioritizing issues such as direct-to-consumer shipping, support for hospitality businesses, and tax changes that could put breweries at a disadvantage on retail shelves.

Kate Bernot May 12, 2022 - 9 min read

Lobbying for Brewers: Measures that Matter in 2022 Primary Image

Illustration: Jamie Bogner

As the craft-beer industry matures, business models diverge. The challenge for the industry’s trade group, the Brewers Association (BA), is to prioritize legislation that addresses the needs of its smallest taproom members as well as its largest distributing breweries.

The top three “grassroots advocacy” goals—as explained at the Craft Brewers Conference by BA chief counsel Marc Sorini and director of federal affairs Katie Marisic—address three distinct sales channels: direct-to-consumer; on-premise taproom and brewpub; and chain retail. Together, it’s a bit of a “something for everyone” menu to assure members of all sizes and models that the BA is working on their behalf.

Both Marisic and Sorini emphasize that the three items discussed below are issues about which they hope individual breweries will contact their federal and local lawmakers, even while BA staff push for them in Washington, D.C.

Here’s what these initiatives would mean for brewing businesses, along with factors that affect their likelihood of success.


The USPS Shipping Equity Act

Direct-to-consumer (DTC) shipping of beer has been a lifeline for some breweries during the pandemic. While it’s legal for out-of-state producers to ship beer to customers in only 12 states, breweries of varying sizes have made these sales an important part of their business strategy. (For examples, see “Subscriptions, Perks, and Play: Strategies to Drive Recurring DTC Orders.”

However, the U.S. Postal Service—and the customers who rely on it—have been left out of this equation. For about 85 years, the postal service has not been able to deliver alcohol. Critics of this ban say it’s an unneeded vestige of Prohibition and that adults should be able to receive adult beverages; proponents say that mailed alcohol would inevitably end up in the hands of underage drinkers. The USPS Shipping Equity Act, introduced with bipartisan support in both the House and Senate, would put the USPS on equal footing with private carriers such as FedEx and UPS, which are allowed to deliver alcohol to legal-age drinkers who show IDs.

Marisic says this measure is critical for rural customers who want to purchase beer but who may not be served by those private carriers. It’s also projected to be a boon to the postal service’s finances, to the tune of at least $50 million in the first year of implementation. Finally, it promotes competition among delivery companies, potentially lowering shipping prices. (Notably, both the National Beer Wholesalers Association and the Wine & Spirits Wholesalers of America—which represent distributors that are generally bypassed by DTC sales—oppose the USPS Shipping Equity Act.).

The question for this piece of legislation is whether it’s on Congress’ short list right now. Congressional summer recesses are looming, while emergencies both foreign and domestic are vying for attention. Similar legislation in 2015, 2017, and 2019 failed to pass. However, the BA hopes that the pandemic’s boon to DTC permissions has changed this equation.

Revitalizing the Restaurant Revitalization Fund

The Restaurant Revitalization Fund (RRF), which directly supports hospitality businesses affected by the pandemic, provided $460 million to about 1,500 breweries last year. However, Marisic says, that’s hardly been enough.


Created under the American Rescue Plan Act in March 2021, the RRF’s original fund of $28.6 billion was depleted by May, with only about one-third of eligible applicants receiving any support. Marisic says the BA is making a major appeal to replenish the RRF. She emphasizes that this is not a request for new money: Lawmakers originally said that the RRF would receive $60 million total in funding, with the initial grants as a first installment. Now, Marisic says, it’s time for Congress to approve the rest of the money to assist small businesses still suffering from on-premise sales declines as a result of the pandemic.

The House approved an additional $42 million for the RRF in April, but that relief package has yet to pass the Senate; its Senate counterpart bill, Small Business COVID Relief Act of 2022, includes $40 million for the RRF.

One hurdle facing Senate approval is the same as what the USPS Shipping Equity Act faces: This may not rise to the top of senators’ priority list. To them, it may not appear urgent at all. Restaurants, bars, and taprooms are largely back open now, without pandemic-era restrictions. It was perhaps easier to make the case for emergency funding when dining rooms were closed and breweries were producing hand sanitizer. Today, in many cities, on-premise activity looks close to what it was pre-pandemic.

The Capitol Hill news outlet Roll Call reported Wednesday that the Senate may vote on the bill next week. If not, it may hinge on what happens with COVID and the hospitality business in the coming months; Marisic says that a vote could also come as part of an end-of-year spending bill.

Opposition to Spirits-Based RTD Tax Equivalency

Distilled spirits are generally taxed at a higher rate than beer at the federal and local levels, even when it comes to products of equal alcohol content. Thus, the spirits industry is pushing for what it calls “tax equivalency”—arguing, for example, that the excise taxes should be the same for a 5 percent ABV hard seltzer produced by a brewery and a 5 percent ABV spirit-based canned cocktail produced by a distillery. The BA is united with other beer trade groups, such as the Beer Institute and the National Beer Wholesalers Association, in opposing this tax equivalency at all levels.


Tax equivalency would have the biggest impact at the chain retail level, where drinkers make purchasing decisions between canned cocktails and beer in real time, taking price into consideration among other factors.

The beer trade groups argue that not all alcoholic beverages are the same and that beer has long been a more moderate beverage deserving of its lower excise tax rates. The concern is that lower taxes on ready-to-drink cocktails (RTDs) would make them more profitable, cheaper, and more available, potentially pushing beer off the retail shelves. Notably, expanded retail availability for spirits-based RTDs is a big part of the tax-equivalency lobbying at the state level.

To put that concern in context: Beer has been losing market share to spirits for decades, and lately breweries have been struggling to compete for occasions and product types that they once dominated. “Until 18 months ago, it looked like beer was winning the ‘beyond-beer’ wars, with hard seltzers and [flavored malt beverages],” Sorini says. “Now, it’s liquor RTD products.”

To avoid ceding “beyond beer” to spirits-based RTDs, the BA says it is vigorously opposing tax-equivalency bills at the federal and state levels, in cooperation with the other beer trade groups. So far, the group effort appears to have more wins than losses, with states including Arizona, Hawaii, Maryland, and New Jersey voting down tax-equivalency bills so far this year. Similar bills are still pending in Alabama, Kentucky, Minnesota, and Ohio, though the BA considers them all “unlikely to progress” this year.

However, this early win streak could change direction as more state lawmakers introduce tax-equivalency legislation, and as the popularity of RTDs continues to grow. While the BA encourages its members to continue to oppose tax equivalency, it may be a harder sell to the wider drinking public. From the consumer’s point of view, common sense might suggest that a 5 percent ABV drink is a 5 percent ABV drink, no matter what its fermentable base is.