Industry Orgs Applaud Bill to Boost Bars, Restaurants and Venues with Draft Systems

WASHINGTON — Today, the Beer Institute, the oldest national trade association representing the beer industry, released the following statement after Reps. Darin LaHood (IL-16) and Steven Horsford (NV-04) introduced H.R.7577, the Creating Hospitality Economic Enhancement for Restaurants and Servers (CHEERS) Act. The CHEERS Act would provide a tax deduction for bars, restaurants and entertainment venues with draft beer systems to help revitalize hospitality establishments still struggling years after the pandemic.

The beer industry is committed to supporting its retail partners in the hospitality industry that were deeply impacted by the pandemic,” said Brian Crawford, president and CEO of the Beer Institute. “That’s why we applaud Reps. LaHood and Horsford for introducing the CHEERS Act, which will provide relief to your favorite local pubs, bars, restaurants and entertainment venues nationwide that serve fresh, ice-cold beer on draft. Beer is America’s favorite alcohol beverage, and with draft systems in tens of thousands of establishments across the country, this bill will allow businesses to create more jobs and stimulate local economies from coast to coast.

Illinois has a rich history of craft brewers and local bars from Chicago to Peoria and beyond,” said Rep. Darin LaHood (IL-16). “Many of our bars, restaurants, and the hospitality sector at large are still feeling the negative effects of the pandemic and subsequent lockdown policies. This bipartisan bill will support these local establishments by incentivizing the expansion of tap lines and keg equipment on commercial premises. Local bars and restaurants are an essential part of the identity of our communities in Illinois, and I am proud to lead this effort to revitalize the hospitality sector, support local jobs, generate economic growth, and promote the use of sustainable tap equipment in bars and restaurants.

Las Vegas is our nation’s hospitality and entertainment capital, if not the world,” said Rep. Steven Horsford (NV-04). “The CHEERS Act would boost not only our smaller bars, clubs and entertainment venues but also many of our casinos, hotels and arenas. This will allow many small business owners in my district to grow their business and invest more in their employees. And we will reduce waste created by using smaller, disposable containers at many restaurants, bars and other venues. I am proud to join my colleague, Mr. LaHood, in introducing this legislation to boost our local and national economy.

Following the introduction of the CHEERS Act, numerous trade associations and stakeholder groups in the hospitality industry spoke out in support of the bill, saying:

The CHEERS Act would give restaurant and bar owners new tools to innovate how they serve beer to customers,” said Sean Kennedy, executive vice president for public affairs of the National Restaurant Association. “The result would be more consumer choice, strengthened sustainability options, and needed support for restaurant owners in every neighborhood.

In the wake of the ongoing pandemic, the independent restaurant and bar community has grappled with a notable decline in draft beer sales. This unfortunate trend presents yet another significant challenge to the profitability of these establishments that operate on razor-thin margins. Recognizing the pressing need for support, the Independent Restaurant Coalition endorses the CHEERS Act,” said Erika Polmar, executive director of the Independent Restaurant Coalition. “We are grateful for the dedicated champions of this vital initiative, Reps. LaHood and Horsford, for taking this important step towards addressing the economic challenges faced by restaurants and bars and urge Congress to act quickly.

As the hospitality industry continues to navigate the long-lasting impacts of the COVID-19 pandemic, the CHEERS Act represents a crucial lifeline for bars and restaurants, offering them much-needed tax relief to help revitalize their businesses,” said Matthew Haller, president and CEO of the International Franchise Association. “This legislation not only supports the recovery of on-premise establishments but also encourages sustainability and innovation within the industry. We applaud Reps. LaHood and Horsford for their leadership in championing this initiative, which will undoubtedly provide a significant boost to our franchise members and the broader hospitality sector.

As the largest pourer of draft beer in the US, we expect the ability to deduct more sustainable keg equipment could go a long way,” said Buffalo Wild Wings. “Buffalo Wild Wings franchises across the country, as well as the environment we and our guests live in, could benefit from Reps. LaHood and Horsford’s leadership on this issue.

Independent venues still need help as they face inflation, predatory resellers driving up ticket costs, and the challenges plaguing all small businesses,” said Stephen Parker, executive director of the National Independent Venues Association. “The CHEERS Act would provide assistance to them for simply continuing offering cost- and energy-efficient draft beverages. It would also give independent venues a financial pathway to install draft lines if they have not been able to before. We urge Congress to prioritize relief and sustainability by passing The CHEERS Act.

America’s restaurants and bars are important to their local communities and play a critical role in a vibrant, safe and competitive U.S. alcohol marketplace,” said Craig Purser, president and CEO of the National Beer Wholesalers Association. “Unfortunately, challenges from COVID, labor shortages and inflation have hit them especially hard. Beer distributors understand the challenges these businesses face as they seek to build back. The CHEERS Act will allow beer retailers to make important investments in draught beer to help revitalize these important community businesses. On behalf of America’s beer and beverage distributors, we thank Representatives Darin LaHood and Steven Horsford for their support of the hospitality industry.

Small and independent craft brewers know all too well the impacts of the pandemic on the hospitality industry,” said Bob Pease, president and CEO of the Brewers Association. “With 30% of all draft beer sold produced by craft brewers, restaurants, bars, and retail partners are integral parts of the brewing community, and healthy on-premise business and draught service are crucial to the overall health of small and independent craft brewers. We enthusiastically support the introduction of the CHEERS Act and thank Congressmen LaHood and Horsford for supporting legislation that will encourage economic growth and help these important partners.

Draft beer sales provide a distinctively on-premise opportunity to attract and welcome consumers to local bars and taverns,” said John Bodnovich, executive director of American Beverage Licensees. “These small beverage businesses, which often serve as important ‘third places’ where people can visit with friends and relax in a familiar setting.  Their success is vital to job creation, economic growth and American hospitality culture.  We appreciate Reps. LaHood and Horsford introducing the CHEERS Act, which recognizes the importance of our nation’s bars and taverns and helps as they continue to navigate the current economic environment.

The hospitality industry is in many ways at the center of our communities and our economy,” said Dan Vorlage, executive director of the Steel Keg Association. “Because these local businesses operate with tight margins and other pressures, it is a challenge to make up-front investments in equipment that unlock lower costs and sustainability benefits over time. The CHEERS Act will make draft beverage systems more affordable, encouraging the use of efficient and sustainable, reusable steel kegs. We raise a glass to the Beer Institute, Reps. LaHood and Harsford, and all of the leaders rallying to support pubs, bars and restaurants.

The American Cider Association recognizes that healthy draft sales are connected to a thriving hospitality sector and are critical to the future of the cider industry,” said Michelle McGrath, CEO of the American Cider Association. “Draft cider represents 60% of hard cider consumed at establishments, and on-premise consumption is an important gateway for consumer adoption of cider. Restaurants, neighborhood pubs, taprooms, sports arenas, bars, movie theaters and more are all important to the commercial cider ecosystem. We appreciate that the CHEERS Act will support investments by draft accounts in new, energy-efficient draft equipment. Relief for the hospitality industry is very needed right now, and the CHEERS Act will help provide some of that relief.

BeerBoard proudly endorses the proposed CHEERS Act, sponsored by Reps. Darin LaHood and Steven Horsford,” said Mark Young, founder and CEO of BeerBoard. “It is exciting to see this bill incentivize and support the adoption of technology and advanced equipment systems by on-premise retailers and beer suppliers. As the leader in technology for the three tiers of the hospitality industry, BeerBoard continues to work to unite the industry, enhance efficiency and drive improved revenues for all. The CHEERS Act will play a major role in that effort.

As a draft beer-centric operator, Tully’s Good Times supports this legislation,” said Daniel Giamartino, owner of Tully’s Good Times. “We look forward to continuing efforts from our leaders to provide pathways that enhance our industry.

Not only is draft beer the freshest and the way the brewer intends us to drink their beer, but it is also the most green and sustainable packaging as there is no waste,” said John Lane, co-owner of the Winking Lizard Tavern. “Unlike bottles and cans that land in the landfill, kegs are refilled and rotated in the market, ensuring a fresh beer with no packaging waste!

Since 2005, the tax code has provided the Section 179D deduction for qualifying investments in energy-efficient systems on commercial premises. This provision would be expanded to apply to all new keg and tap properties, incentivizing the use of draft lines and keg equipment in taprooms, restaurants, bars and entertainment venues. The legislation also would provide an additional benefit for the remodeling of draft property and for lost or stolen kegs. Congress has modified definitions for qualifying property within Section 179D several times in recent years to expand the scope of the deduction. The CHEERS Act expands Section 179D again to include an incentive for energy-efficient draft containers and installation property, providing immediate tax relief to struggling on-premise businesses.

In May 2023, the Beer Institute released its latest version of the Beer Serves America report, which showed that the U.S. beer industry contributes more than $409 billion to our economy – equivalent to 1.6% of GDP. The beer industry pays more than $132 billion in wages and $63.8 billion in taxes. Nearly 2.4 million American jobs rely on a strong beer industry, including 92,159 brewer and beer importer jobs, 77,847 manufacturing jobs, 137,420 distribution jobs, 52,220 agricultural jobs and 979,805 retail jobs.

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