ABL Dispatch

ABL DISPATCH — THE LATEST INDUSTRY NEWS FROM WASHINGTON

BY JOHN BODNOVICH, ABL EXECUTIVE DIRECTOR

Over the last few months, a fair amount has transpired in Washington, D.C., and American Beverage Licensees (ABL) has been actively engaged in many issues.

COVID-19 Relief Efforts

The first half of 2022 in Washington saw what some of the last, best attempts may be to secure federal relief for bars and taverns impacted by COVID-19. Unfortunately, due to macro political issues (inflation, midterm primaries, Biden administration priorities, etc.), efforts to advance legislation to help small hospitality businesses stalled in the Senate. There may still be another bite at the apple after the elections in a lame-duck session, but the writing on the wall is Congress is moving on from COVID-19 relief bills despite the challenges that many businesses still face.

Restaurant Revitalization Fund (RRF) Replenishment Act

The first week of April, ABL activated grassroots to secure additional relief for businesses struggling to recover from the pandemic by supporting H.R. 3807, which would provide an additional $42 billion in funding for the RRF. The bill passed the House and eyes turned to the Senate to see if 60 Senators would vote to support S.4008, which would have replenished the RRF with $40 billion — believed to have been enough to provide grants to all pending applications.

ABL once again activated grassroots, targeting senators who were potential yes votes. ABL sent letters to Senate offices pointing out,“With RRF grants, Main Street bars and taverns will be able to hire back employees and afford basic goods that they need to run food and drink establishments. They will also be able to pay back loans and climb out from under debt that many took on during the pandemic to keep their businesses afloat.”

ABL also worked with a coalition of more than 30 businesses and trade associations to argue that “nearly 200,000 small businesses have been left behind, and now four out of five of these restaurants and bars are in danger of closing permanently, threatening all of the livelihoods they support.” Despite these efforts, and more than a year’s worth of advocacy and campaigning, a vote to advance a bill to replenish the RRF failed in the Senate, 52-43. Every Democratic senator present voted in favor of moving the bill forward, as did a handful of Republicans. In speaking with those close to the issue, the current inflationary environment, coupled with a lack of specific spending offsets, were identified as factors in the final vote tally.

It is frustrating for ABL members who applied for RRF grants and were denied, only to see their competitors down the street receive grants, with little rhyme or reason as to why one business was aided and another left out. ABL repeatedly made this point, but to no avail.

Legislative Agenda for the Second Half of 2022

As we move closer to the August congressional recess and midterm elections, ABL’s legislative and policy agenda for the remainder of the year and the 117th Congress reflects a pro-small-business posture; working with members who may be leaders in the 118th congressional majority; and supporting bills and initiatives that may not pass this year, but will likely be reintroduced and hold better prospects of passage in 2023.

Helping ABL Members Address Workforce Issues

ABL is supporting the Essential Workers for Economic Advancement (EWEA) Act. Introduced in the House by Rep. Lloyd Smucker (R-PA), the act would “amend the Immigration and Nationality Act to provide for an H–2C nonimmigrant classification” to address hospitality industry staffing challenges by creating a program of nonimmigrant, three-year visas for workers.

Workforce issues — namely finding and keeping workers at bars and taverns for all positions — is the number one business operations issue for ABL members. While there is no Democratic lead cosponsor at the moment, ABL is working with other supportive groups to secure one. The association is also working on a target list of cosponsors for meetings to build support for the bill. While ABL’s expectations are measured and there is no immediate path forward for the bill at this time, socializing the issue and educating on the bill will be helpful if and when it is introduced in the next Congress.

Following the release of the U.S. Department of the Treasury Report, “Competition in the Market for Beer, Wine and Spirits,” on February 9, ABL has been advocating for its members in the face of a document that calls for giving small brewers, distillers and wineries a pass on abiding by federal trade practice laws, among other changes. On June 21, ABL sent a letter to leadership at the U.S. Treasury Department, further sharing its concerns.

As a result of the report, the Alcohol and Tobacco Tax and Trade Bureau (TTB) has started issuing notices of proposed rulemaking, including Notice No. 212 on June 8 that would remove “requirements that brewers intending to sell and serve beer on brewery premises designate and maintain a separate ‘tavern’ area within the brewery for such activities, and including instead general provisions to account for beer sold and served to customers anywhere on brewery premises.” This rulemaking would further erode threetier boundaries and exacerbate unfair competition by brewers against retailers. It would also introduce the prospect of the federal government deregulating nonfederally licensed entities. ABL will be working with its members to submit comments on this proposal, which are due by August 8, 2022.

Protection from Privacy Lawsuits/Shakedowns

After months of negotiations, three of the four leaders of the House Energy and Commerce Committee and Senate Commerce Committee staff have come to a bipartisan, bicameral agreement to move forward with data privacy legislation this Congress. ABL is working with the Main Street Privacy Coalition (ABL is a member) to shape the bill. The bill is moving very quickly as there was a House Energy and Commerce Committee hearing on June 15 and subcommittee markup on June 23, with a full committee mark to follow in July with the goal of House passage by the end of July. The potential impact of the proposed legislation on liquor stores and bars could be significant should the legislation allow a “private right of action” (PRA) for individuals to sue local business for privacy breaches or shake them down with demand letters similar to those in Americans with Disabilities Act (ADA) schemes.

ABL is working to lobby key House and Senate members to amend and/ or oppose the legislation. ABL has suggested bolstering the PRA guardrails to prevent trolls from issuing demand letters that retailers might consider paying (despite having done nothing wrong) rather than engage in a costly legal fight. The other main issues, in addition to PRAs, are making sure that ABL members’ customer loyalty programs are allowed to stay in place with no issues and preemption of overly broad state privacy laws. ABL is also working on adjusting the exemption for “small businesses” to make sure it covers as many ABL members as possible.

Fighting for Credit Card Swipe Fee Fairness

On May 4, the Senate Judiciary Committee held a hearing on “Excessive Swipe Fees and Barriers to Competition in the Credit and Debit Card Systems.” ABL, coordinating with the Merchants Payments Coalition, submitted a comment for the record at the hearing.

ABL stated: “The hearing shines a light on the broken payment card fee system wherein beverage licensees who accept payment cards face take-it-orleave-it decisions that provide them with few choices and drive up costs for them and their consumers. Payment card swipe fees are one of the highest expenses for the taverns and liquor stores that ABL represents. In many cases, these fees outpace rent and utilities, and are second only to labor costs. Small beverage businesses have no option for negotiating these swipe fees, nor any ability to choose which cards they can accept if they want to take any of the cards from a banking institution, Visa or MasterCard under “honor all card” rules … After the challenges of the last two years of the pandemic, the last thing that bars and taverns need as they fight to return to running profitable businesses is an unwarranted fee increase.”

May Was Tavern Month

This May, ABL celebrated Tavern Month by promoting America’s bars and taverns, and using the occasion to call on members of Congress to pass legislation to replenish the RRF, stating: “From March 2020 through March 2021, bar and restaurant sales of beer, wine and spirits declined by $90 billion. The level of loss was catastrophic for many small, single-unit operators who still find themselves financially digging out in the face of heightening inflation, supply chain challenges and labor shortages that show no sign of waning. Supporting and celebrating America’s bars and taverns this May means getting them the resources they need to remain some of America’s last Main Street businesses.” TLW

ABL is the voice of America’s beer, wine and spirits retailers in Washington, D.C. ABL represents the TLW and its many members, as well as thousands of other on- and off-premise retailers of beverage alcohol across the United States.

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