Major Stimulus Gains Traction in D.C.: What’s in There for Brewers?

Negotiators have reached a deal on an unprecedented $2 trillion economic stimulus package. It includes many provisions that affect independent breweries and other small businesses struggling amid the coronavirus pandemic.

Brewing Industry Guide Staff Mar 26, 2020 - 4 min read

Major Stimulus Gains Traction in D.C.: What’s in There for Brewers?  Primary Image

The beer industry and its workers could get relief from an unprecedented government plan to boost the economy, as the nation hunkers down amid a global pandemic.

In the wee hours of Wednesday morning, congressional and White House negotiators announced that they had reached a deal on the $2 trillion stimulus package. Among other provisions, the ambitious plan includes various forms of relief for independent breweries, other small businesses, and their workers.

The House and Senate had yet to vote on final approval, a step that could be complicated by the virus itself—a handful of lawmakers are either infected, self-isolated, or in quarantine, and gathering them for a vote risks further spread. But chamber leaders from both parties expressed optimism that they would overcome logistical hurdles and approve the package swiftly.

As of Wednesday afternoon, congressional leaders had yet to release the full text of the bill. However, negotiators have described many of its key provisions. Notably, they include direct payments to most taxpayers to help people meet their needs as the economy contracts. Many other provisions in the deal—watched closely by the brewing industry—directly affect small businesses and their employees.

Julie Verratti, cofounder of Denizens Brewing in Maryland and a former advisor to the Small Business Administration (SBA), has followed the legislation and describes relevant provisions in the deal. They include:

  • $10 billion for emergency grants from the SBA, to provide up to $10,000 of immediate relief for small-business operating costs.
  • $17 billion for the SBA to cover six months of payments for businesses with existing SBA loans.
  • SBA loan forgiveness to cover mortgage, rent, and utility costs.
  • Companies that accept the loans prohibited from buying back their own stock for the period of assistance plus one year.
  • Enhanced unemployment insurance extended to four months, including for freelancers and other self-employed gig workers.
  • Additional unemployment insurance of up to $600 per week, on top of what the states provide, ensuring that most workers can receive their full salary for four months.
  • Unspecified but “robust” worker protections attached to all federal loans for businesses.

Congressional leaders involved in hammering out the deal expressed optimism that passage would be swift, but Washington has ways of dashing expectations. As the deal’s details gradually became clear on Wednesday, some Republicans threatened to stall it over the enhanced unemployment benefits, fearing they would encourage people not to work.

The goal of the stimulus is to support an economy reeling in reaction to the coronavirus pandemic. In a widespread effort to blunt the impact of the virus, and at the urging of health experts and public officials, people are practicing social distancing—staying home as much as possible, avoiding crowds, keeping physically apart from others outside their immediate families. The goal is to “flatten the curve” of infections, so that the country’s health-care system is not severely overloaded during the crisis—a situation that would lead to more deaths.

Inevitably, the sudden changes in public behavior are damaging the hospitality industry, including breweries large and small. Bars and taprooms have virtually all had to shut. However, many breweries, bars, and restaurants have found ways to adapt, such as offering beer and food for takeaway, hoping to keep their businesses afloat until the crisis passes—a matter of weeks or months, nobody is certain.

Worldwide, the virus has infected more than 438,000 people and killed almost 20,000. As in many countries, it is currently spreading exponentially in the United States, with the latest official counts—limited by testing—at almost 60,000 cases and more than 800 deaths.