The L.A. County Board of Supervisors approved a $10 million grant on Sept. 15 intended to support breweries and other small businesses that are forced to be closed in L.A. despite being allowed to operate under state orders. Two weeks later with no further information on the program, local brewers see the grant as a bandaid solution for an industry struggling to survive in the only county where breweries remain closed.
During the County’s reopening rollback on June 29, all breweries that partner with 3rd partner food vendors were ordered to shut down, despite having been given the green flag to reopen on June 1. This includes approximately 70 of L.A.’s 90 craft breweries who don’t have their own kitchen and have been forced to remain closed while breweries in all 57 other counties are allowed to open for outdoor service.
The grant, which was proposed by Supervisor Hahn, will divide $10 million between a number of qualifying businesses, not just breweries, and likely will not be available until the end of November.
“We’re pleased that the County recognizes that we are struggling, but really when it comes down to it our struggle is mostly due to the County’s decision to close breweries like ours that were partnering with 3rd party vendors under a catering license,” said Scott Francis, Co-Founder, President & CEO of Santa Monica Brew Works.
During the brief period when L.A. breweries were allowed to reopen, brewers set up outdoor dining that operated under restaurant COVID-19 safety protocols and used food trucks and caterers. Many small and independent craft breweries typically derive the majority of their profits from in-person on-premise sales (draft), which have less overhead and better profit margins than out-of-house off-premise (canned beer) sales.
“We don’t understand why you can go to Long Beach or Orange County and have beer and food outside of the brewery, but right over the border in L.A. County you can’t. We are losing our customers to these neighboring towns because L.A. County has decided arbitrarily that these five supervisors are in charge of everything,” said Steve Lieberman, the Co-owner of Surfridge Brewery. “I think opening our tasting rooms is going to give us a lot more money quicker and revive our businesses a lot faster than the tiny piece of this pie they are going to give out.”
The Board has yet to release information on how much businesses will receive from the grant, but it will be divided between more than just the 70 breweries closed for in-person service.
“That proposed assistance doesn’t amount to much for breweries who have been struggling for so long and whose overheads are typically far more substantial than most bars or restaurants,” said Francis. “While the grant sounds great, it’s not what the headlines make it out to be – and for us our primary focus remains our pursuit to reopen.”
Under the current circumstances business is extremely challenging for local brewers. While Surfridge Brewery benefited from to-go sales during lock-down, Lieberman has recently found that people are tired of drinking and dining at home and are preferring to participate in outdoor dining. Competition is also fierce as more breweries are selling at liquor stores and restaurants sales are down as the service industry is operating at lower capacities. Surfridge Brewery is only making about 10 percent of what its revenue was prior to COVID-19.
“There are some breweries that are saying if I don’t open soon I’m going to be shutting my doors. A lot of these breweries are owned by families; these aren’t big corporate conglomerates like Budweiser,” said Lieberman. “My wife is our CFO, my son helps us clean the floors, we are there as a family doing this. It’s all we have and the L.A. County Board of Supervisors is gambling with that.”
Santa Monica Brew Works points to their high hygiene standards and community-centered ethos as additional reasons they should be able to operate outdoor dining. They are invested in several community initiatives and had three special can releases this year with charitable attachments.
“Our commitment to safety protocols is unrivaled in the service space. Breweries can and do operate in a safer and more stringent environment than restaurants. As manufacturers of a food product that requires aseptic technique, we have rigorous Standard Operating Procedures (SOP’s) that all employees must adhere to. We have the benefit of large outdoor spaces and we are engaged on a daily basis in industrial cleaning measures,” said Francis. “The fabric of our business is love of the community and right now it feels like the people in charge of protecting the community are not showing us the understanding our business model deserves.”
Clara@smdp.com