Washington law prevents tasting rooms from receiving federal aid
A congressional delegation sent a letter to the Small Business Administration requesting a change.
GIG HARBOR, Wash. – A law in Washington state prevents some businesses from receiving federal financial assistance to help them.
According to U.S. Representative Derek Kilmer (D-District 6), tasting rooms at distilleries, wineries and breweries are not eligible for grants from the U.S. Small Business Administration (SBA).
SBA funding requires that at least 33% of a tasting room’s profits come from on-site sales such as tastings, cocktails, or food.
But Kilmer said Washington state law prohibits these companies from making more than 30% of their profits from on-premises sales.
Kilmer is leading a group of representatives and senators calling on the SBA to remove this requirement as part of the American Rescue Plan’s Restaurant Revitalization Fund.
In a letter signed by the entire state congressional delegation and sent to the administrator of the SBA, lawmakers said: “In view of this disconnect between state law and the criteria of the SBA, we are concerned that Washington State distilleries may not be eligible for access. [Restaurant Revitalization Fund] relief – which they desperately need and which the US bailout plan was designed to provide.
Kilmer said he was awaiting news from the Small Business Administration.
“I don’t think the SBA did this out of spite. I think it just didn’t take into account some of the realities in states like ours. But it’s a big deal, ”Kilmer said.
Heritage Distilling Company CEO and co-founder Justin Stiefel has compared 2020 to “a dirty diaper.”
The Gig Harbor-based company has laid off about half of its employees in the past year. Expansion plans have been delayed.
Stiefel has said he would like to apply for millions of dollars in new federal grants, but only if the language changes.
“I think it’s important for the SBA to recognize what the intention of Congress was,” Stiefel said. “Their intention was to support the entire industry: restaurants, bars, hotels and the producers who support them.”