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LegislationUncategorizedGuild Responds to COVID-19

March 21, 2020

Link to .pdf here.

Governor Lee,

As the COVID-19 pandemic continues, the Tennessee Craft Brewers Guild members are focused on ensuring the health and safety of our patrons and our workers. As bars, taprooms, and restaurants across Tennessee close to stop the spread of the virus, the economic impact to the brewing industry in Tennessee is already particularly great. The outlook for the foreseeable future is concerning, and the impact of this pandemic is considerable.

For context, there are over 100 craft breweries in at least 26 counties in Tennessee, that employ nearly 9,000 Tennesseans full-time, and employ many more part-time. In 2018, the national Brewers Association estimated Tennessee Craft Brewers contributed an economic impact of over $1.3 billion. Meanwhile, many of our members have served for decades as pillars in the welcoming environment of Tennessee’s communities, for locals and tourists alike. In fact, within one week of the March 2020 tornadoes, breweries across the state raised nearly $10,000 in relief effort.

These establishments are certainly compliant as government and health officials encourage promoting social distancing. While some have been forced to close, others have voluntarily done so for the greater good. Sadly, this presents us with an economic crisis. Since we are unable to open our taprooms to the public, many of our members are already in imminent danger of indefinitely – and possibly permanently – closing.

The Guild is working on a response to this crisis. From working with local governments on creative approaches for selling beer like curbside pick-up, to exploring policy options for assistance in eventual recovery due to business interruptions, and of course working with our members’ insurance companies for possible coverage.

The Tennessee Craft Brewing industry’s entrepreneurs, hospitality workers, local taprooms, and restaurants need your help during this difficult time. Below are possible policy strategies for relief we would like to propose:

  • Streamlining unemployment: Ensuring our hospitality workers are able to easily apply for and secure unemployment benefits, whether their establishments have been required to close or encouraged to and do so voluntarily. In addition, the cap on unemployment should be raised to reflect a percentage of a person’s normal income, rather than being set at a max of $275/week.
  • Utilities, rent, or payroll relief: Any possible grant or other small business relief to assist in paying regular bills, while our businesses are required or encouraged not to operate.
  • Loans with low or zero interest financing: Yesterday’s announcement about the federal SBA low interest loan program is helpful, and we’re hopeful it’s made available to all counties as soon as possible. However, we need to go further by providing 100% government guarantees on these loans. We can’t expect our small business owners in Tennessee to sign personal guarantees on large SBA loans, risking the entirety of their financial futures and bankruptcy, while they work to keep their teams employed and financially stable through a crisis with an indefinite timeline. Additionally, if other opportunities for assistance similar to this arise, we support and encourage Tennessee to participate. Again, it is important that any relief such as this is accessible whether the small business is required or encouraged to close or operate at a lower capacity.
  • Taxes and payment deferments: Specifically, interest- and penalty-free deferred payments for 30 to 90 days after the date in which the state of emergency declaration is officially lifted. For our industry, sales & use taxes, beer excise, and the wholesale beer tax might be deferred for this time. Additionally, extending the payment date for quarterly taxes and filings would be of great assistance for our small businesses.
  • Insurance Coverage: In the coming months, some insurance providers may claim they only cover a business if their property has physical damage. Based on a voluntary or mandated closure, it is quite possible that an insurance company could deny a claim of certain losses due to a lack of physical damage. Legislators in some states are working on regulations that may compel insurance companies to grant coverage. Most, if not all, business insurance policies have exceptions for pandemics and outbreaks of novel viruses & diseases. Please compel these companies to pay on their business interruption policies.
  • Support for beer shipment, delivery, and door pickup for consumers: Many alcohol providers are allowed to deliver and ship to their customer’s homes, but our members’ businesses are not due to state and local laws. Some of our members are already working closely with local beer boards on this very issue, and we would appreciate your support at the state level as well on this. Allowing our breweries to ship and deliver direct to consumer statewide could create a new and valuable stream of income that might provide a little help keep to them in business.

The Guild is aware that state leadership, including you, are already discussing and providing some policy strategies for relief. We are grateful, and would like to work with you and any task force or committee that may be formed to address this pandemic, and the impact it has on our economy. Especially small businesses like Tennessee Craft Breweries.

My Very Best,

Sharon Michie

Executive Director, Tennessee Craft Brewers Guild