Navigating the Current Normal
Re-opening
During this crisis, the California Department of Alcoholic Beverage Control has to date temporarily suspended or modified enforcement of 16 legal prohibitions of its licensees to assist in their ability to conduct business and survive. As breweries and businesses attempt to continue commerce during this time of constant flux, it is becoming increasingly more-complicated for them to assure they are doing so in accordance with current guidance from regulatory bodies (These include federal and state regulations, the Alcohol and Tobacco Tax and Trade Bureau,
California ABC, local agencies, etc.).
Beer Past Prime
Given the cease and/or slowdown of business for breweries and many of the retail establishments that carry their beer, there are currently many cases where beer has passed its prime. Varying requirements direct handling of that product, depending on where that beer has been. Brewers have the option of destroying beer that has never left the brewery without restriction or prior approval and can submit claims for refund of excise taxes (state and federal) previously paid on said beer. And, thanks in-part to a relaxing by the California ABC restrictions governing returns of alcoholic beverages after they have left the brewery, returns by retail licensees are now also being accepted in greater numbers.
For beer returned to the brewery, additional recordkeeping and ABC approvals may also be necessary if a claim for refund or credit of excise taxes paid will be sought. I won’t bore you with all of the details, forms and processes required for federal and state claims here. Brewers, feel free to reach out to me with any questions or for assistance with the process. Time permitting, I’m happy to help Southern California breweries that are considering submitting claims, returns and reports. Consider it my way of giving back to a brewing community I want to see get back on track without additional strains on business. If going it on your own, I recommend a thorough review of the Electronic Code of Federal Regulations/ Title 27/ Chapter 1/ Subchapter A/ Part 25; specifically the following subsections: 25.221 Voluntary destruction of beer; 25.225 Destruction of tax paid beer which never left the brewery; 25.283 Claims for refund of tax; 25.211 Beer Returned to brewery. For federal claims TTB Form 5620.8b and its associated Frequently Asked Questions (FAQs) are informative sources (ttb.gov). For state refunds refer to: cdtfa.ca.gov/taxesand-fees/refund.htm and Form CDTFA-101.
As noted in a previous column, as an alternative to dumping down the drain many breweries are donating overstock and past-prime beer to local distilleries for ready distillation and making of hand sanitizer during this pandemic.
As our state and country embark on a complicated, slow and distance-required reopening process, navigation can be onerous and complicated. To assist more beer and alcohol-related businesses in opening for onsite consumption, the ABC has made additional allowances.
Expansion of the existing license’s footprint (where it normally conducts its business) is being allowed to include adjacent and nearby areas. This will help with meeting distancing requirements and accommodating customer numbers that will also make business worthwhile. Note that while the ABC is temporarily allowing for expanding ones serving area to include outside adjacent areas, it still requires licensees to assure that their local governing authorities have also authorized using the area for serving meals and alcoholic beverages.
Judging by an increasing number of examples of adjacent parking spaces now housing temporary outdoor eating spaces for breweries, pubs, and restaurants now open, localities appear to be accommodating.
The COVID-19 Temporary Catering Authorization Application will also allow businesses that have not historically served food (i.e. breweries with taprooms without kitchens) to enter into agreements with other entities to perform the meal service requirement for Phase 2 opening.
Bootlegger’s Brewery has even launched its own Bootlegger’s Concept Kitchen Food Truck to provide its own in-house food selections and open its Fullerton location.
Keep in mind that during California Phase 2 Reopening business owners are required to comply with CDC, state, county and local guidelines. They are new for everyone and it’s far from business-as-usual. Support your local businesses, but be sure to grant them a great deal of slack during this trying new period of adjustment.
For my brewery friends, there is extensive info and FAQs available to assist alcohol licensees on the ABC’s website (abc.ca.gov). Access the COVID-19 Updates link for complete guidelines for each of the five Notices of Regulatory Relief along with extensive
FAQs.