Alcohol and Tobacco Tax and 

Trade Bureau

FY 2018

Capital Investment Plan
Investment Name: TTB Scientific Equipment Refresh

Type of Investment: Major Non-IT Investment

Description:

Scientific equipment refresh at TTB's laboratories.

Investment Anticipated Outlay: ($000,000s): 

Type 2015 and 

Prior 

Actual

2016 

Actual

2017 

Enacted

2018 

Estimated

2019 

Estimated

2020 

Estimated

2021 

Estimated

2022 and 

Beyond 

Estimated

Total

DME Costs 0.00 0.00 0.00 0.00 N/A N/A N/A N/A 0.00

O&M Costs 0.60 0.50 0.78 0.60 N/A N/A N/A N/A 2.48

Total Costs 0.60 0.50 0.78 0.60 N/A N/A N/A N/A 2.48

Number of 

FTE 0.00 0.00 0.00 0.00 N/A N/A N/A N/A 0.00

Summary of Purpose, Goals, and Benefits: 

TTB laboratories provide critical technical support to TTB program offices to assist them in 

carrying out the TTB mission to collect tax revenue due on alcohol, tobacco, and firearms 

products; protect consumers through proper alcohol beverage labeling; and prevent unfair or 

unlawful trade of alcohol and tobacco products. This mission directly aligns to the Treasury 

objectives of effectively administering the tax code and facilitating U.S. commerce through 

trusted products and services. TTB program offices depend upon the laboratories to provide the 

accurate and authoritative data and conclusions that are required to ensure regulatory compliance 

and support enforcement decisions on regulated products. 

TTB Program Office Support: The areas in which TTB chemists analyze alcohol and tobacco 

products to support TTB programs include: 

* Product classification for tax collection

* Regulatory compliance 

* Enforcement cases

* Product integrity investigations

* Revenue audits and investigations

* Pre-Certificate of Label Approval product testing

* Product safety and consumer complaints

* Trade barrier issues

* Technical criteria for rulemaking

Through technical support provided by its labs, TTB endeavors to develop science-based policies 

for industry regulation and provide technically sound scientific data to carry out tax and 

regulatory enforcement actions.
TTB has four labs housed in two separate facilities. The TTB National Laboratory Center in 

Beltsville, MD houses the Tobacco Lab, Beverage Alcohol Lab and Nonbeverage Products Lab. 

The Compliance Lab is located in Walnut Creek, CA. The work performed by the Tobacco Lab 

and the Beverage Alcohol Lab is instrumental in assisting TTB with its enforcement efforts in 

the tobacco and alcohol beverage areas. As individuals and businesses develop schemes to create 

counterfeit products for sale or attempt to sell illegal products in the market place, the labs lend 

their expertise in support of the investigations, which include, testing products, developing new 

test methodologies, and authenticating products using analytical technology. Manufacturers may 

also attempt to avoid tax or incur a lesser tax by improperly classifying various alcohol and 

tobacco products. The analytical work that the TTB labs perform, when such incidences occur, 

are instrumental in TTB's ability to pursue individuals and businesses who seek to evade taxes, 

engage in illegal activity, and defraud the U.S. Government.

Return on Investment: 

The technical support provided by TTB Laboratories is critical to TTB's goals of developing 

science-based policies for industry regulation, and carrying out regulatory enforcement actions 

based on scientific data. TTB acquires new equipment that will provide laboratory personnel 

with the tools to ensure that the alcohol and tobacco products tested are compliant with TTB 

regulations and that the products submitted for analysis are authentic. The acquisition of the 

proposed new equipment will allow TTB chemists to access information that is currently not 

available to them.

To deliver effective technical support to TTB program offices and industry, the laboratories 

require, at a minimum, a set of key instruments that are essential for any modern regulatory 

analytical laboratory. Strategic investments have been made to build state-of-the art and worldclass laboratories that are respected by industry, domestic and international regulatory partners, 

and the scientific community.

The benefits of the use of this investment in scientific equipment allows for sophisticated 

analysis carried out by TTB chemists that are needed for: 

* Complex mixture analysis

* Quantification of the target compound

* Physical and chemical properties of samples

TTB's Tobacco Laboratory provides comprehensive technical support to all TTB programs

related to tobacco products, including investigations of tobacco cases, counterfeiting, diversion, 

and other illegal trade practices and tax evasion activities, as well as tax classification to protect 

the revenue. In support of Field Operations efforts, the Tobacco Laboratory provides technical 

assistance to special agents, the Intelligence Division, and the Trade Investigations Division for 

counterfeit and diversion cases on tobacco products.

TTB's Beverage Alcohol Laboratory continues to provide technical support to investigations of 

the illegal sale, production, and distribution of alcohol beverage products. In addition to TTB's 

investigations, it supports other Federal and State agencies in alcohol products investigations.
Accomplishments and Future Objectives: 

TTB chemists routinely utilize the sophisticated instruments for the analysis of regulated 

products to determine their class and type for proper tax collection, authenticate products, 

confirm the truthfulness of label declarations, ensure product safety (e.g., pesticide, heavy 

metals, mycotoxins, prohibited ingredients, limited ingredients), support counterfeiting and tax 

evasion investigations and cases, help regulated industry export US products, and help industry 

to remain compliant with TTB laws and regulations.

In addition, with the rapid changes of technology, laboratory equipment becomes obsolete in a 

short period of time. Vendors develop new generations of instruments, typically stop supporting 

outdated equipment software, do not supply parts for old equipment, and phase out maintenance 

services for old equipment. Consequently, most laboratory instruments have finite life cycles. As 

the instruments reach the end of their life cycles, they must be replaced to maintain the 

requirements of accuracy and integrity of data listed previously.

The objective is to maintain scientific equipment to provide accurate and reliable data for both 

industry members and other stakeholders. The consequences of not replacing old and outdated 

instruments are: 

* Loss of capabilities to effectively support program needs 

* Increased risk of support disruption from equipment breakdown or malfunction

* Data produced by the old instruments may not be accurate and dependable

* Inaccurate technical conclusions from unreliable data. TTB enforcement actions based on 

unreliable data may not withstand the scientific or legal scrutiny or challenges from the industry

* Loss of ISO 17025 accreditation of TTB laboratories. ISO 17025 accreditation of TTB labs is 

contingent on maintenance of functional and well-maintained instruments that are capable of 

generating accurate data

To avoid the situations mentioned above, TTB's laboratories developed a Yearly Equipment 

Refresh Program. The life-cycles for various instruments were developed based on instrument 

performance in the TTB laboratories, information received from other federal regulatory 

laboratories, and information from vendors on their support/service plans and new product 

development cycles.