× Expand Robin Shepard Isaac Showaki of Octopi is affected by the federal shutdown because he contract-brews for out-of-state breweries.

As the federal government shutdown continues, the local brewing industry is beginning to feel its effects. The Alcohol and Tobacco, Tax and Trade Bureau (TTB) is considered a non-essential government operation, so its employees are on furlough. The agency oversees labeling requirements for beer, and also approves the permits for new breweries.

“Our first concern should be for the federal workers who are not getting paid,” says Isaac Showaki, owner of Octopi Brewing in Waunakee. “But for the brewing industry, it’s also creating havoc.”

Showaki currently has 18 beer labels awaiting action by the TTB, while a significant amount of beer sits in tanks waiting to be packaged. “We can’t get anyone on the phone to discuss label approvals or the required recipe formulation reviews,” he says.

Octopi is a contract brewery that makes beer for different companies throughout the country.

When beer is made in Wisconsin and distributed out of state, its labels must first be approved by TTB. “We have beer that is ready to be packaged and we can’t move it,” says Showaki.

It’s not only those current labels in limbo. The backlog is beginning to affect the brewery’s overall production schedule. Without label approval, Octopi can’t order its cans, either.

The shutdown is especially challenging for breweries that are constantly coming up with new recipes and new beers. “If you’re a brewery that relies on introducing new beers all the time, you’re likely being hurt,” says Showaki.

Some beers are more of a concern than others. The increasingly popular New England IPA style, for instance, needs to be packaged as fresh as possible. Hoppy beers don’t have as long a shelf life as other styles; breweries can’t hold them in tanks or kegs as long as, say, a lager.

Likely to be affected are new releases in Octopi’s Untitled Art series planned for early 2019.

Additionally, “If this goes on another 30 days we could lose contracts and beer,” says Showaki.

A shuttered TTB is also a challenge for new breweries that must submit their Federal Brewer’s Notice, a critical step in being able to make beer at all. New breweries must have federal permission before state and local approvals are granted.

Fortunately, Madison’s two newest breweries that are still under construction already obtained federal approval before the shutdown started. Union Corners Brewery, 2438 Winnebago St., and Delta Beer Lab, 167 East Bader Road, had their federal paperwork submitted and approved months earlier. Both breweries are working toward a late February opening.

Delta’s Tim Piotrowski went through a 16-day federal government shutdown in 2013, just as he was helping set up the Freehouse brewpub in Minneapolis. While the shutdown wasn’t as long, Piotrowski estimates it caused a 70-day backlog in getting his Brewer’s Notice approved for the Freehouse. “That’s why we were very proactive to get our permits, so we didn’t have that problem here,” he says.

Piotrowski notes that in 2013 there were just over 2,800 craft breweries operating in the country; today, there are more than 7,000. Continued growth could mean an even bigger mountain of backed-up permit requests facing TTB.

Before the shutdown, label approval was taking roughly eight to 10 days; Showaki guesses that even if the government starts up again in early January, the delay would be 30 to 35 days.

Says Showaki: “Even once federal offices are open, there will be a big backlog and it gets longer every day the shutdown continues.”