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During the Shutdown: What’s A Meadery to Do?

By January 5, 2019October 5th, 2021No Comments

As two bills that might have ended the 34-day government shutdown were defeated today, many alcohol producers are nearing a crisis point. With the TTB closed, there are no new COLAs being issued and no new formulas being approved, causing a massive crunch in sales funnels and production schedules.

If new products are released during the shutdown, they are still held to normal standards.

So, if you thought that this was the regulatory version of The Purge… it’s not. If you release a new mead that doesn’t have a COLA or an approved formula, you can definitely be fined or punished for it. Of course, there are no inspectors working right now, so in theory you could maybe get an entire batch out and sold off before anyone could find out or document it, but that’s a pretty absurd risk, given that we’re already at the longest shutdown in history. Honestly, you shouldn’t have any WIP without an approved formula, anyway, so we’re mostly talking about COLAs.

COLAS are for interstate commerce.

So, if your state does not require a COLA or an exemption for a product to be legal, you can sell new products through your tasting room, provided you’re working with an approved formula. If your state does require a COLA, you’re out of luck, and if you’re working with a formula that isn’t covered under the common formulas, that’s also against the law. Technically, wineries are supposed to get exemptions for their in-state-only wines, but that’s rarely observed and there’s a school of thought that it’s not even Constitutional. As risks go, selling in your home state – particularly out of your taproom – is fairly low-risk for a product with an approved formula.

Then there’s kegs.

Of course, you can keg up and pour on-premise almost whatever you want (provided the formula is approved). Technically, you’re supposed to get the keg collars approved, but that’s a pretty low level of risk without any inspectors working. This doesn’t help much for packaging plans, but if you’ve got stuff in tanks and need to move it, kegs might help. States differ on how closely they enforce the keg collar thing, so be careful with how widely you sell kegs, but bars are usually pretty savvy on how discreet you need to be.

This highlights why it’s worth getting things approved before you need them.

If you’ve got recipes and designs done, in general, submit them, even if you’re not sure you’re ever going to use them. Now might be a good time to back to old recipes and tweak them within the ranges you gave on the formula, or to look back on some stuff you filed but never used or never scaled. Or maybe it’s a good opportunity to try out some of those common formula ideas (onion wine, anyone?).

Pay taxes.

Yes, the government still wants taxes and reporting. No, you can’t just ignore it and make some principled stand about how if they’re working you’re not doing something. If you do that, when they come back – and, of course, they will – you’re likely to be hit with fines and late fees.