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HACKENSACK, N.J. — The locked doors of federal agencies in Washington are leading to locked taps and empty vats at craft breweries around the country.
One such scene unfolds in an 11,000-square-foot warehouse in northern New Jersey, where the usual low hum and screeching hiss of an active brewhouse and the musty stench of fermentation wafting outside are absent. Instead, there is just the echo of passing conversation and stale cold air.
The partial government shutdown has idled a division of the Treasury Department that regulates manufacturers of craft beer, dealing a blow to a booming industry and disappointing discerning drinkers.
At Alementary Brewing in Hackensack, the owners cannot get federal approval to begin brewing in their warehouse space — they operate a smaller brewhouse across the street — since their application for the new location is sitting on empty desks. They nervously wait each day as the bills and overhead from their $1 million investment to ramp up their production and distribution begin to pile up.
“No entrepreneur ever thinks to write down ‘completely dysfunctional government’ on your risk matrix when you’re thinking, ‘What are the things I have to account for?’” Blake Crawford, an owner of the brewery, said.
The impact of the shutdown has been vast: Federal employees are without a paycheck; funds for food stamps and other assistance programs are running low; waste is overflowing in national parks; Transportation Security Administration agents forced to work without pay are calling out sick; and the Food and Drug Administration has suspended some food inspections.
But a distillation of the shutdown’s far-reaching consequences can be seen in the surging $76 billion craft beer industry, which is driven by many smaller operations. The industry is regulated by the Alcohol and Tobacco Tax and Trade Bureau, which controls craft breweries mainly in two ways: approving any new brewery equipment and approving labels on new lines of beer.
In New Jersey, the fledgling industry has grown to 90 craft breweries today from 51 in 2015, tying the state with Kentucky for the fastest rate of growth, according to the Brewers Association, a national trade group. With more than 7,000 breweries nationwide, the fallout from a slowdown of work in small breweries can have ripple effects.
“It’s an easy thing to say this is just about breweries and label approval and I can’t open my brewery,” Mr. Crawford said. “But the problem goes well beyond that. It goes to impacting farmers. It goes to impacting our suppliers. Breweries use a lot of stainless steel and aluminum.”
President Trump’s Tuesday address to the nation and the Democratic response only deepened his worry.
“We would have hired more people by now,” Mr. Crawford said. “The reason there isn’t a plumber in here right now is because we saw the television last night and we were like, ‘This could go on for a while.’”
The plight of the brewers has started to catch the attention of lawmakers in Washington.
“We’ve created this false choice,” said Representative Josh Gottheimer, a Democratic congressman from northern New Jersey who recently visited the Alementary brewery. Mr. Gottheimer noted that his district includes 12 craft breweries, part of a $1.7 billion industry in the state. “There’s no reason we can’t have tough borders and reopen the government and do our jobs.”
With the alcohol bureau shut down, breweries across the country are facing similar problems as Alementary is, throwing their business plans and survival into question.
In Colorado, where nearly 400 microbreweries contribute $3 billion dollars to the state’s economy, Spice Trade Brewing had been planning a large expansion for two years. But right as it was finalizing a lease on a new building, the shutdown suspended its licensing.
“There’s a real chance that the building that we’ve been spending all this time and money on could fall through if our landlord doesn’t want to sit around and wait for a couple of months while we wait for our license,” Jeff Tyler, the head brewer at Spice Trade, said. “Real estate prices are just going up. If this pushes us back, it could have a real impact on our rent price.”
In New York City, Transmitter brewery in Queens is looking to expand from tiny quarters in Long Island City to a much larger facility in the Navy Yard in Brooklyn. But its move has also been held up by the shutdown.
“People don’t even realize how deep it goes,” Rob Kolb, a founder of Transmitter, said. “We’re a small business and it could potentially ruin us. You can’t pay rent in two places without increasing revenue. and there’s no way to increase revenue if you can’t make beer.”
The bureau’s oversight over labeling has also made the shutdown difficult. From graphic design to alcohol warnings to listing the percentage of alcohol by volume, every new beer must have its label approved before it can be sold nationally. Some states do allow breweries to sell in-state before getting federal label approval.
For many smaller breweries, a constant churn of new beers is as important for attracting new customers as is having established fan favorites. Jersey Girl Brewing in Hackettstown, N.J., had been planning to introduce a beer each month and had begun to gather ingredients and lay out a brewing schedule. Without label approval, the beer already brewed could sit in tanks, go stale in cans, or, in a worst-case scenario, have to be thrown away.
In Maryland, 1623 Brewing is in Carroll County, which shares a border with Pennsylvania and is a short drive to Virginia and West Virginia. The brewery had been increasing its production with plans to expand to those three states, but without label approval it will be left with a glut of beer.
“We lean a little bit right as far as the political spectrum is concerned, but this doesn’t serve anybody,” said Zac Rissmiller, an owner of 1623, said of the shutdown. “I’m all for border security, but holding the American people hostage over something that’s an international issue seems to me to be a no-win game.”
The label-approval process also extends beyond the beer industry to winemakers and liquor distilleries.
“We are exclusively distributed in New Jersey,” said Zack Ohebshalom, a founder of Asbury Park Distilling in Asbury Park, N.J., which produces spirits. “My plan for 2019 is to reach into New York and Pennsylvania. So if this shutdown continues, that may not be as realistic in the short term as we initially hoped.”
Many liquor distillers across the country that offer seasonal specials are also caught in the logjam.
“All the companies are directly impacted,” said Frank Coleman, the senior vice president of the Distilled Spirits Council in Washington.
At Alementary, the handcuffed expansion is worrisome not just to Mr. Crawford and Michael Roosevelt, the other founder, but to nearby brewers. The men had made handshake agreements with small breweries to produce some of their beer at the warehouse space. For now, that is not possible.
So ingredients and beer in production risks going stale.
“It’s like they’re pouring beer out on the street,” Mr. Gottheimer said.