Relief package headed to Trump's desk, could provide millions for Maine brewers, loggers, others

File Photo / Maureen Milliken Expansion and renovation at the Freeport headquarters of Maine Beer Co., shown in this 2019 photo, were made possible by a lower federal excise tax, co-owner Dan Kleban has said. New legislation may make the tax break permanent.

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By William Hall

President Donald Trump on Tuesday is expected to sign into law a $900 billion COVID-19 relief package that will send payments of $600 to millions of Americans and provide a financial lifeline for thousands of struggling businesses across the country.

The help includes a measure that could save Maine craft breweries over $1 million a year in taxes. The state’s loggers, shipbuilders and others may benefit from the omnibus legislation too.

After being mired in months of political stalemate, the package on Monday passed both houses of Congress by lopsided margins and went to Trump’s desk Tuesday morning. Among the provisions is the Craft Beverage Modernization and Tax Reform Act, which lowers the federal excise tax on beer, wine and spirits from small producers.

The president and Congress originally enacted the tax break in 2017 for a period of two years, and in 2019 renewed the relief until Dec. 31, 2020. The new law, which received votes from all four members of Maine’s congressional delegation, would make the relief permanent.

The Brewers Association, a national trade group of craft brewers chaired by Maine Beer Co. co-founder Dan Kleban, estimates that Maine breweries would have paid an extra $1.25 million in federal excise tax during 2019 if the break had not then been in effect.

Commenting on Congress’ passage of the new bill, Kleban on Monday said in a prepared statement, “This is much-needed good news for America’s small and independent craft brewers, which like much of the food and beverage industry have been hit hard by the pandemic. The last thing we needed was for our taxes to double.

The passing of this act helps ensure that we can continue to invest in our employees and in growing our businesses."

Another provision of the relief package will provide $200 million in federal relief for the country’s timber harvesting and hauling businesses. The funds will go to help businesses where the COVID–19 pandemic has resulted in a loss of 10% or more in 2020 revenue compared to 2019.

“The significance of this announcement for timber harvesters and haulers in the United States cannot be overstated,” said Dana Doran, executive director of the Professional Logging Contractors of Maine, in a news release.

“At no prior time in our nation’s history have loggers been offered formal support and relief from our nation’s government … Loggers and truckers need the same help and recognition farmers and fishermen have received since the pandemic began. Now at long last they are getting it.”

Most Maine logging contractors who are members of the PLC, the state’s trade association for timber harvesters and haulers, are reporting a 30% to 40% reduction in their markets for wood this year, the group noted in the release. As Mainebiz reported last week, the state's logging industry contributed an estimated $619 million to the Maine economy in 2017, and the industry has been counting on the federal relief.

In addition, the new relief package provides funding for two Maine shipyards serving the U.S. Navy. The legislation appropriates $3.2 billion in 2021 for procuring Arleigh Burke-class destroyers, which Bath Iron Works can compete to build. The package authorizes $78.2 million for the completion of Zumwalt-class destroyers, all of which are being built at BIW.

The legislation also gives $160 million for construction of Dry Dock One at Portsmouth Naval Shipyard in Kittery.