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S.C. distilleries warn of closures if crisis continues without help

Staff //July 24, 2020//

S.C. distilleries warn of closures if crisis continues without help

Staff //July 24, 2020//

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The president of the S.C. Craft Distillers Guild told the S.C. congressional delegation that without increased federal help to deal with the impact of the coronavirus pandemic, many distilleries in the state could be facing closure.

In a joint letter, Scott Blackwell, president of the S.C. Craft Distillers Guild, and Chris Swonger, president and CEO of the Distilled Spirits Council of the U.S., asked the delegation to support a second round of coronavirus relief for businesses.

“As a result  of the COVID-19 crisis, many distilleries in South Carolina have been forced to furlough or lay off employees,” Blackwell and Swonger wrote. “Absent additional relief, some distilleries soon may be faced with the tough decision to permanently close their doors, thus also impacting their farmer suppliers and others throughout the hospitality and tourism industries.”

Fourteen distilleries in South Carolina received federally backed loans through Paycheck Protection Program, which was part of the first coronavirus relief package passed by Congress earlier this year.

In their loan application to the Small Business Administration, those distilleries said 162 jobs had been saved by the money. In total, S.C. distilleries borrowed between $1.5 million and $2 million. Most of the loans were for less than $100,000, an analysis of SBA data shows.

Terressentia in North Charleston received the largest loan, between $1 million and $2 million, to save 106 jobs, the data show.

But the distilleries are asking for more than just help covering their employee salaries and benefits. They’re also asking for help for restaurants, as the food and beverage sector drives a lot of the demand for distilled products, and they want to see a shift in trade barriers for S.C. distilled products.

The requests to the S.C. congressional delegation:

  • Provide federal excise tax relief.    
  • Suspend tariffs on distilled spirits.  
  • Support the Restaurants Act, creating a revitalization fund for qualifying food and beverage businesses. 
  • Replace funding for the Paycheck Protection Program and Economic Injury Disaster Loan program.

The letter noted that the distilled spirits sector was an economic driver in the state, with more than 20,000 jobs related to the industry in 2018. Blackwell and Swonger said that the industry supported $1.6 billion in commerce that year.

“Now, we urge Congress to act swiftly to enact further measures that provide liquidity and certainty to distillers who have seen sudden and steep declines in sales with the closure of stores in certain areas and travel-related outlets, restaurants, bars, and tasting rooms,” Blackwell and Swonger wrote.