October 15, 2013

Maine’s breweries simmer during shutdown

Local beer businesses are waiting for federal approvals to move ahead with their plans.

By Eric Russell erussell@pressherald.com
Staff Writer

The prolonged government shutdown is squeezing an unlikely victim with a growing presence in Maine – the craft brewing industry.

click image to enlarge

Nathan Sanborn, who along with his wife, Heather, are owners of the Rising Tide Brewery in Portland.

John Ewing/Staff Photographer

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Kai Adams, co-founder of Sebago Brewing Company.

Gordon Chibroski/Staff Photographer

An obscure agency known as the Alcohol and Tobacco Tax and Trade Bureau – a division of the U.S. Department of Treasury that oversees breweries – has furloughed all but 35 of its 483 employees since Oct. 1. That means no one is available to approve new breweries or what are known as certification of label approvals, which any beer must have before it can be sold. The applications for the certification typically come in at a rate of about 400 per day.

“If you don’t have that, you can’t go to market,” said Kai Adams, co-founder of Sebago Brewing in Gorham.

That could have a large impact for an industry that is growing in popularity in Maine. It has temporarily shut down not only applications for new breweries but also existing breweries’ ability to market themselves outside the state.

The craft brewing industry is in the midst of a tremendous period of growth, both in Maine and nationwide. From 2009 through 2012, beer production by Maine breweries increased from 4.1 million gallons to 7.9 million gallons.

Most national beers, such as Budweiser or Coors, have had their labels approved for years. As long as the recipe doesn’t change, no new label is needed.

But the Portland area’s growing number of craft brewers are constantly experimenting with new recipes and seasonal styles for eventual sale to the public. That means for any beer they create that uses nontraditional methods or nontraditional ingredients, or any time they tweak a beer recipe, they need a new label approval.

Adams said Sebago has one pending batch of beer that is “completely shut down” because of the government shutdown.

That beer is still sitting in a fermentation tank, waiting for a label so it can be bottled.

Rising Tide Brewery in Portland also has a batch that has been brewed and bottled but still needs federal approval, according to co-owner Heather Sanborn.

DeeDee Germain at Allagash Brewing in Portland said her brewery has several labels still awaiting approval.

For as long as the shutdown lasts, those brewers in Maine will only be able to sell new beers inside the state.

Sanborn said she and her husband, Nathan Sanborn, were recently told by the state’s liquor licensing unit that brewers can still bottle and label new beers without federal approval, as long as the beer is not sold across state lines.

It was a bit of good news for the state’s 35 or so brewers, many of which likely also have labels pending, but the long-term economic impact of the shutdown remains uncertain for the industry.

“The (beer) we have awaiting federal approval, it’s limited release, so we won’t have any trouble selling it all in Maine,” Sanborn said. “But there are marketing concerns.”

Rising Tide is trying to expand its market throughout New England, and part of that is offering new varieties as often as possible. The new varieties are small batches, she said, of about 100 cases.

“We release new labels all the time,” Sanborn said. “That’s a huge part of our industry.”

Sanborn said she isn’t sure whether her brewery will be hit hard by the shutdown.

“We can still brew our core beers,” she said. “But as a small-business owner, I want predictability.”

Adams, at Sebago, agreed there could be an impact in not being able to ship new labels out of state for the time being, but he hoped it would be short-lived.

“At least we can still sell it here,” he said.

(Continued on page 2)

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