Quarterly U.S. Guild Report: Winter 2015-16

This winter brings another round of updates from state guilds around the country. We have several new states contributing to the conversation, and new developments from some of last quarter’s contributors. And don’t miss a companion piece providing a great review of PROOF, Washington Distiller’s Guild’s annual consumer event, with guild president Jason Parker. Thank you to all of the passionate guild presidents, directors, and members who have taken the time to share their message with our industry!

Alaska

Distillers Guild of Alaska

Alaska, the last frontier of distilling, now has a growing distilling industry. The Distillers Guild of Alaska was formed in 2014 with four member DSPs. The founding distilleries are Ursa Major Distilling (Fairbanks), Port Chilkoot Distillery (Haines), Anchorage Distillery (Anchorage), and High Mark Distillery (Soldotna). The Guild initially formed to write and push for state legislation, in the form of HB309, to allow for direct sales and on-site tasting rooms. The bill was signed into law in October 2014, allowing the five operating DSPs in Alaska to open tasting rooms this year, which all seem to be a big success. The Guild works closely with the Alaska Tourism Industry Association, Alaska Farm Bureau, CHARR, and the Alaska Department of Economic Development to promote the distilleries and to stay involved in legislative issues. The Guild was awarded a legislative citation by State Representative Chris Tuck (D-Anchorage), acknowledging the contribution to economic development and small business growth in Alaska. The Guild worked with the State and the University of Alaska to develop an “Export Opportunities Guide” for craft spirits and beer and is also working in partnership with the Brewers Guild of Alaska to create the first annual “AlaskaCrafted” tasting event to be held in Anchorage in May 2016. Ursa Major Distilling and Anchorage Distilling use only Alaska-grown grain and work directly with barley farmers here to maintain an “Alaskan Grown” and “Made in Alaska” certification. There are four new distilleries being built in Alaska, including our newest member, Amalga Distillery (Juneau).

Heather Shade Port
Chilkoot Distillery President,
Distillers Guild of Alaska

 

California

California Artisanal Distillers Guild

California finally gets to play! In 2015 we had a bill kicked to the curb (AB1233) but the momentum it had garnered led us to start working with several other sectors of the industry on the Craft Distillers Act (AB1295) which was signed into law by Governor Brown in October to become effective January 1, 2016.

The result is that craft distilleries that manufacture their spirits in California will be able to apply for a Craft Distiller’s license which will allow them the privilege of limited direct-to-consumer sales in conjunction with tastings on site, among other things. This is huge, and will finally allow California Distilleries to compete on an equal footing with our colleagues nationwide.

The majority of the lobbying work was handled by one of our board members Cris Steller of Dry Diggings Distillery, who has worked tirelessly on a direct to consumer bill in one shape or other for years. We owe him much. Thanks.

We continue to work closely with the ABC to help clearly interpret California law and to act as go-between for our members. We are also working on events for 2016 and are thrilled to be welcoming ADI for their conference in San Diego in April 2016.

Onwards!

Timo Marshall
President, CADG
Cat Herder, Spirit Works Distillery
For more information find us at www.CADSP.org

 

Colorado

Colorado Distillers Guild

Colorado Distillers Guild held our fall meeting on October 23 in Breckenridge in conjunction with the Breckenridge Craft Spirits Festival. We had a great turnout with a mix of fresh and veteran DSPs in attendance. The first hour was a basic recap of the year including our freshly finished Economic Impact Study, a recap and look forward on legislative issues, a financial update and general guild news. The second hour we had a presentation from our friends at Keep Colorado Local about the upcoming battle to preserve the existing single retail outlet system against the push by a handful of out-of-state retailers to put full strength wine and beer in multiple outlets, which could have a devastating impact on our local retail partners. Lastly our affiliate members were able to introduce themselves to our members. At the end we enjoyed great food and cocktails from our friends at Modis before heading out on the town for the Poker Run that highlighted craft cocktails at bars and restaurants all over town and had a wonderful weekend celebrating Craft Distilled Spirits!

LAST MINUTE UPDATE: We have had distillers being visited by the Colorado Department of Public Health and Environment (CDPHE) on behalf of the FDA and we are working with the CDPHE and our legal and legislative teams to determine the legality and potential extent of these visits and licensing requirements.

The CDG hopes you have a prosperous OND and a great holiday season!

P.T. Wood
Wood’s High Mountain Distillery
President CDG

 

Delaware

Delaware Wineries Association

No guild? What is a craft distillery to do? Certainly, each state in our wonderful country presents its own set of post-prohibition challenges to our growth as a business. However, since craft beverage industry members face similar hurdles, we decided we did not have to go it alone. So, in 2013, Painted Stave Distilling partnered with two local wineries to start the Delaware Wineries Association (DWA). The mission of our association is to promote the consumption and production of handcrafted wine and distilled spirits in our state. To achieve our mission we coordinate on consumer education, legislative, marketing, and promotional activities. In addition to executing a number of successful cross-promotional events and activities to reach and educate consumers, the DWA won a Specialty Crop Block Grant from the USDA to help promote and market our industry, and played a significant role in forming the Mid-Atlantic Wine Region. Legislatively the DWA is very active, and recently hosted the Delaware Small Business Caucus to discuss and win support for changes to tourism signage, direct shipping, and farmers’ market laws. Legislation in many of those areas is currently being developed. Presently, the DWA has eight members, including a meadery, and is getting meaningful shit done.

Ron Gomes
Past Painted Stave Distilling
hello@paintedstave.com
www.dewineries.com

 

Maine

Maine Distiller’s Guild

2015 has been a year of tremendous growth for the Maine Distiller’s Guild. The number of distilleries in Maine grew from 8 to 13 in 2015 with more in development for 2016. After the inaugural meeting in December 2014, members joined forces to form a 501(c)(6), elect a guild president, create a logo, work on legislation, attend the NABCA Craft Spirits Symposium, and plan the launch of a Maine Distiller’s Guild public tasting event.

Ian Michaud, of Liquid Riot Bottling Company in Portland, Maine, was elected MDG president in November 2015. Under his leadership marketing plans are being made to create a Maine Distillery Trail pamphlet for Spring 2016 and an annual festival to showcase Maine-made spirits in Fall of 2016.

In ongoing efforts to improve communication between the distillers and BABLO—Maine Liquor Control—Keith Bodine of Sweetgrass Winery & Distillery attended the National Alcohol Beverage Control Association (NABCA) Craft Spirits Symposium with BABLO to discuss the interaction and impact of craft distilleries within control states. The Maine Distiller’s Guild aim is to work with BABLO as one voice in regulation and legislation to accommodate changes that improve business for craft distilling in the state of Maine.

Maine distillers are looking forward to 2016. Maine is known for its foodie tourism with an abundance of quality local food and award-winning restaurants; Maine spirits are poised to be included in that distinction.

Keith and Constance Bodine
Sweetgrass Farm Winery & Distillery
www.sweetgrasswinery.com

 

Massachusetts

Massachusetts Distillers Alliance

The Massachusetts Distillers Alliance has pulled together to collectively raise over $3,000 to support the national effort by the American Craft Spirits Association to bring equality to the tax code that overburdens America’s craft distillers. Through matching each other’s donations, collective support, and encouragement, the MDA has pulled together in genuine camaraderie to not only support each other’s businesses, but also to support the nationwide craft distilling community. The goal of this effort is to reduce distilleries’ Federal Excise Tax rate by 80 percent to match the kind of discount already enjoyed by craft brewers and small wineries but denied to spirit distillers.

If anyone can stand up to bring awareness to unfair tax codes, it’s the crew from Massachusetts!

Maggie Campbell
Privateer Rum

 

Montana

Montana Distillers Guild

The Montana Distillers Guild, after a successful legislative session, has been working over the last six months with the Department of Revenue to finalize details regarding new laws created which allow for direct transportation of product to State Liquor Stores. We anticipate a huge savings in time and money for our small distillers.

Montana micro-distilleries are allowed a tasting room as a marketing tool for their product, but are severely limited in the amount of product (2 oz.) that can be served to a potential customer on a daily basis. This is one of the issues we will be discussing at the recently formed statewide Alcohol Coalition round table attended by taverns, restaurants, breweries, and casinos. We’re hopeful for a healthy discussion among industry partners.

As a relatively new association, the Montana Guild now has room to focus on marketing our Montana-made products in new and exciting ways, and hope to have a new website and marketing campaign well in hand by late spring. Please watch for us!

Full member list of Montana Distillers Guild:

  • Headframe Spirits
  • Headframe Spirits Manufacturing
  • Willie’s Distillery
  • Glacier Distilling
  • Trailhead Spirits
  • The Montana Distillery
  • Rattlesnake Creek Distillery
  • Hardwater Distilling
  • Whistling Andy
  • Wild Rye Distilling
  • Bozeman Spirits
  • Triple Divide Spirits
  • Dry Hills Distillery
  • Whitefish Spirits

Jennifer L. Hensley
Government Affairs Liaison

 

New Mexico

New Mexico Distillers Guild

New Mexico Distillers Guild members had a successful fall season with festival participation and political outreach at both the state and federal levels. Four of our five members participated in Brew Fest 6 in early October at the state fairgrounds during the Albuquerque International Balloon Fiesta. We had great exposure for individual members and the Guild, and the response from the beer-driven crowd was very positive, though with so many breweries participating it was difficult to gauge whether we were a hit or merely a curiosity. This was the first year distilleries, cideries and wineries were invited to participate in any meaningful way.

Politically, we enlisted the support of Senator Martin Heinrich, D-NM as a cosponsor of S. 1562, the Craft Beverage Modernization and Tax Reform Act of 2015. At the state level we participated in a summit of craft beverage alcohol producers with the Alcohol & Gaming Division and plans are to attend interim legislative committee meetings to raise awareness of our industry. We are formulating a lobbying strategy to achieve our goals of retail reciprocity so that all NM craft alcohol producers can serve and sell each other’s’ products in our tasting/tap rooms (presently, only winegrowers and brewers can do so), as well as state excise tax parity. These issues may not be addressed until 2017 given the limited, budget-oriented nature of the 2016 “short” 30 day legislative session which starts in January. The relationships and outreach we do will further those efforts and include a special tasting social for politicians and legislators to be held at Santa Fe Spirits’ tasting room in the state capitol during the upcoming session.

Dr. Greg McAllister
Algodones Distillery, NMDG Sec’y/Treas.
505.301.9992
greg@algodonesdistillery.com

 

North Carolina

Distillers Association of North Carolina

The seeds of the North Carolina trade association for craft distillers were sown by a small key group of craft distillery owners in 2011. The organization initially registered with the state in 2013, and gained its 501(c)(6) status and formalized the current organizational bylaws, as the Distillers Association of North Carolina (DANC), this summer. With six functional committees, and 35 participating distilleries, the active group is eager to lead the industry forward in North Carolina.

The association was organized to:

  • Promote the common business and regulatory interests of its members and the licensed craft distilling industry in North Carolina
  • Enhance consumer awareness of North Carolina craft spirits
  • Develop and guide legislation that promotes the long-term health and growth of the North Carolina craft distilling industry

Legislative advocacy has been a significant focus of the association and its membership this year, which has resulted in a recent noteworthy victory, following five years of efforts, spanning three different legislative sessions. Effective October 1, 2015, North Carolina distilleries are now permitted to sell their distilled spirits products to their tour customers. Under the new law, sales are limited to one bottle, per person, per year at each distillery.

Another important area of focus for the association and its membership has been an ongoing partnership with the NC Department of Agriculture, which has resulted in the establishment of the North Carolina Craft Distillers Trail. To date, the new #VisitNCSpirits marketing tool has been promoted with a Collector’s Edition Passport booklet, with a page for each member distillery, as well as, the recent launch of an accompanying Visit NC Spirits app.

The association is excited about plans to expand its membership in the coming year, as well as continuing to build on legislative advocacy and marketing efforts to support the growth and success of NC’s craft distilleries.

S. Vienna Barger
Owner, Southern Distilling Company
vienna@sodistilling.com
Membership Coordinator, DANC
distillersassocofnc@gmail.com
www.distillersassociationofnc.com

 

Oregon

Oregon Distillers Guild

TOAST, our annual craft spirit event, was named Best Spirits Festival by SIP Northwest magazine. This recognition comes as the Guild finalizes plans for the 2016 event. TOAST 2016 will be on February 27th from 4-10 pm and located in Portland at Really Big Video event space. This 7,300 square feet facility is located in the heart of the Pearl District and vendor information can be found at oregondistillerytrail.com/vendors. Governor Kate Brown signed HB 2567 into law on June 25th which has expanded Oregon distilleries ability to improve production practices and showcase their spirits. Bulk transfer is now allowed between Oregon distilleries’ and changes have been made to allow mixed samples and cocktails to contain additional product not produced by the distillery. Previously, sample and full cocktails could only contain spirits produced by the distillery. By allowing other spirits to be used in sampling at tasting rooms, Oregon distillers will have the capability to showcase their product in multi-spirit classic cocktails, which is how many consumers prefer to consume spirits. Looking ahead, the Guild is reviewing legislative options to reduce state tax on spirits for distillers who produce less than 30K pgs on an annual basis. This type of law would be applicable to any distillery that ships products to Oregon.

Ted Pappas
Owner, Big Bottom Distilling, LLC
President, Oregon Distillers Guild

 

Texas

Texas Distilled Spirits Association

Craft distilling in Texas continues to grow at an impressive pace with over 80 distillers licensed to manufacture spirits in Texas, compared to only two dozen when a group of Texas distillers came together to form the Texas Distilled Spirits Association in 2012. The latest trend for our members is to build “destination” distilleries that serve as venues for events, tastings, and tours for craft spirit enthusiasts. Legislation passed in Texas in 2013 allows distilleries to sell spirits directly to consumers for off-site consumption, which has increased interest in locating and starting new distilleries in Texas due to expanded marketing options for distillers through these new venues.

“When I opened my distillery over eight years ago, it was against the law to sample at our facility, and we were not permitted to sell bottles or cocktails,” says Kelly Railean, a founding member of TDSA and Master Distiller & President of Railean Distillers, located in San Leon, TX. Railean cites the recent legislation as a major factor in the substantial growth of her company. “We’ve hired additional workers, our production has increased, and we expanded our facility. We can now effectively use our tasting room and craft spirits cocktail bar as a marketing tool to reach the general public, and we educate consumers about Texas spirits during our tours and tastings. The additional revenue stream from the bar, tasting room, and gift shop has allowed us to increase our marketing budget for billboards, magazine and newspaper advertisements, tastings, and other events.”

Shaun Siems, another TDSA member and President/Head Distiller at Spirit of Texas distillery in Pflugerville, TX, has also seen positive impacts from TDSA’s work at the Texas Capitol. Siems explains how advocacy has impacted his distillery by noting that, “the passing of this bill has opened the door for us to create new products that we can test-market by having them only available for tasting at the distillery before bringing them to the stores. We can host events at our distilleries now, as well as give customers the opportunity to purchase the products that they get to taste onsite.”

Daniel Barnes, founder of Treaty Oak Distilling Company, and a founding member and President of TDSA, attributes the legislative changes that TDSA has accomplished over the past few years as having completely changed his business. His distillery moved to a new ranch property in Dripping Springs, TX, with a focus on entertaining and education that would not have otherwise been possible without being able to sell cocktails and bottles directly to the public. The changes in Texas law now allow distillers to have one-on-one conversations with customers that would not have been possible previously. According to Barnes, “Craft distilling’s future was protected by these changes and the future is brighter for us all now!”

The next legislative session begins in January of 2017 and TDSA is developing its “wish list” to bring to the Texas Capitol. We’ve made great strides in educating legislators about our industry and the free-market spirit of our state gives us a great opportunity to keep improving the environment for distillers, and ultimately, for our customers. For more information about TDSA, please go to www.texasdistilledspirits.org.

Richard Evans
Executive Director & Government Affairs Director,
Texas Distilled Spirits Association
Contact: Jessica Evans

(info@texasdistilledspirits.org, 512-771-0439)

 

Washington

Washington Distillers Guild

The Washington Distillers Guild (WDG) is using the momentum from the last two hugely successful legislative sessions to lobby for even more privileges for the 110 licensed distilleries in WA State. This session’s efforts focus on unifying the two licenses types (Craft and Distiller/Rectifier) into a single license while still providing incentives to use at least 50% WA grown ingredients in production. The goal is to provide a unified voice for all WA distilleries to the legislature and Liquor board, and allow every distillery the opportunity to receive incentives for using WA grown produce. We also plan to address the outrageously high Spirit Sales Tax—the highest in the country at 20.5%—which consumers currently pay at the register, on top of an additional $3.7708/liter tax ($2.83/750 ml bottle).

In July we had our third annual distillery showcase event titled PROOF 2015, where we had a sold-out event to 859 attendees, featuring 39 distilleries, 14 restaurants, and 9 sponsors. Money raised from that event will help us continue with our legislative agenda and marketing efforts.

The WDG also had the opportunity to meet with leadership from the Washington Brewers Guild and the Washington Wine Institute to discuss coordinating some of our efforts to highlight our three WA industries. We’re early in the conversations, but the opportunities look promising.

  • Other projects we’re working on include:
  • Creating a Washington Distillery Trail
  • Further developing our new Associate Membership program
  • Rebuilding the WDG web site
  • Continuing to develop educational seminars with local and federal organizations

In 2016 the WDG will present at least two events showcasing WA distilleries, in at least two different parts of the state. More may happen if we increase our staff hours. Our goal is to have every part of the state represented with locally-produced events, to raise money for the guild, and to provide more marketing opportunities for our members.

Jason Parker
President, WDG
www.washingtondistillersguild.org

 

Is your state guild missing?

Don’t miss out on this opportunity to reach a national audience of craft distillers and suppliers! Share your latest victories, recruit supporters, request suggestions to solve your latest challenges, and inspire fellow guilds. Email brian@artisanspiritmag.com to get involved!

 

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