30 Apr

Oregon tries to bring Congress to the craft beer keg

In a House of Representatives with more division than a math textbook, where he himself can be among the most partisan warriors, Peter DeFazio has found a subject of bipartisan support:


Anyone watching this Congress would drink to that.

In 2007, the Springfield Democrat joined with Hood River Republican Greg Walden to start the Small Brewers Caucus, dedicated to supporting craft brewing. Now the caucus has 143 members, with heavy representation from both parties, and a live legislative agenda.

Unlike a lot of Capitol factions, it also has a strong philosophical core.

“Life is too short for bad beer,” declares DeFazio. “Why would you drink that stuff?”

Clearly, DeFazio, a longtime home brewer, has an element of self-interest here. But he’s also speaking for a yeasty Oregon constituency.
Oregon just became the first state to have craft beer top 20 percent of its beer consumption, highest in the country. (The national average is closer to 6.5 percent.) The state’s ever-rising number of craft breweries claim a $2.8 billion impact on the state’s economy, creating 29,000 jobs directly and indirectly.

“Directly and indirectly” is a kind of squishy number, the kind of statistic that holds up best after a couple of pitchers – the Oregon Brewers Guild claims direct employment of 7,900 – but taken literally, 29,000 would suggest that Oregon now has about as many jobs from beer as from timber.

It also explains why Oregon, like Colorado, has its entire House delegation in the Small Brewers Caucus, with Oregon Sen. Ron Wyden leading a Senate Small Brewers Caucus.

Earlier this month, DeFazio visited the national Craft Brewers Conference, which drew 11,500 people to Portland. Typically, he gives a keynote address at the event; this year congressional scheduling prevented that, but DeFazio came to mingle and marvel at the new beers and new products, such as a dog leash equipped with a beer bottle opener – presumably for the benefit of the walker, not the dog.

Besides issues of taste – not always predominant on Capitol Hill – support of craft beer carries another theme for DeFazio, an international trade hard-liner. Unlike craft beers, major mainstream U.S. brewers – the ones that advertise on national sports events and sponsor Spring Break parties – are now all foreign owned. Anheuser-Busch belongs to the Belgian-Brazilian InBev, Miller is now owned by SABMiller (South African Breweries), which has also acquired Coors.

“Every time you buy one of those beers,” warns DeFazio, sounding as if he’s shuddering at the thought, “you’re adding to the U.S. trade deficit.”
To support the craft beer industry, the Small Brewers Caucus has introduced the Small BREW Act, the Small Brewers Reinvesting and Expanding Workforce Act. It would reduce the per-barrel excise tax on brewers of up to 2 million barrels, presumably freeing up revenues for the development and production of more IPAs.

Last month, the Colorado-based Brewers Association, representing craft brewers, sponsored a Hill Climb to lobby for the bill. Brewers visited more than 100 congressional offices and finished the day with a press event featuring presentations from five breweries, including Deschutes Brewery of Bend.

The Small BREW Act faces competing legislation, the BEER Act (the Brewers Excise and Economic Relief Act). It’s supported by the Beer Institute, dominated by the largest brewers and importers, and would sharply cut excise taxes for brewers of all sizes. Most Oregon members aren’t co-sponsoring the BEER Act, but congresspeople from Wisconsin and Missouri are.

Larger brewers have been getting more defensive about craft brewers, an attitude reflected in Budweiser’s famous Super Bowl ad deriding “Pumpkin Peach Ale.” The ad was intended to produce snickering around the country, but some Oregon beer enthusiasts might have wondered where to get a pint.

With the current Congress, of course, nobody expects either bill to go anywhere soon. DeFazio sees the Small BREW Act’s best chance as being not a stand-alone bill but part of a larger tax overhaul. Congress hasn’t managed anything like that in years, but Ways and Means chairman Paul Ryan, R-Wis., insists he’s working on it.

DeFazio points out that Ryan’s tax thinking is based on “dynamic scoring,” the faith that cutting taxes raises revenue and that budget projections should be figured that way.

And what should be more dynamically scored than beer?

Craft beer, as DeFazio and the rest of the delegation realize, is now more than a hobby around here. It’s a rising part of our economy, and deserves government support and encouragement.

In Congress, it’s been a discouraging year.

It would be nice to have a happy hour.

NOTE: This column appeared in The Oregonian, 4/29/15.

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