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It’s no coincidence that in this edition of the State Guild Quarterly Update almost every guild has something to say about taxes, either on the state or federal level. The theme may be repetitive, but that makes it no less meaningful. The end of the year, and more pressingly, the end of the FET reduction, is fast approaching. If you haven’t already, make those calls and contact those representatives.
We also have a new addition to the quarterly update with the introduction of the Society of Distilling Scientists and Technologies (SDST). A group founded by distilling scientists, producers, and industry nerds who want to advance the science, research, and knowledge of our industry. (Full disclosure: Artisan Spirit Magazine Editor, Brian Christensen is a founding member of the aforementioned organization, along with much smarter people.)
Society of Distilling Scientistsand Technologists
Several members of the wider distilled spirits industry — educators, analysts, publishers and distillers, along with interested administrators from the major distilling societies — have been involved in discussions for several years now about the need to better disseminate relevant scientific findings and the details of methods of analysis to help take all distillers to the next level of professional development. A solid understanding of the sciences behind distilled spirits production and understanding relevant methods of analysis of spirits is important to ensure the highest quality potable beverage production and the safety for distillery workers and their allied trade contacts. Providing a dedicated scientific body to support the distilling industry (outside of Europe) has been sadly lacking, whereas brewers and winemakers are adequately covered through several of their own scientific societies that have been in existence for many decades.
The proposed Society of Distilling Scientists and Technologists (SDST), to be formed as a non-profit group in 2019, will encourage membership from distillers and scientists associated with 1) research or quality control operations within the larger potable distilling industry, 2) manufacturers of distilling plant equipment, stills, etc., and 3) those supplying scientific and test instruments for the industry and distilling raw materials businesses (maltsters, botanical suppliers etc.). The name has been chosen to include all the sciences that touch upon distilling and distillation — chemists, biologists, microbiologists, physicists, mathematicians and engineers. All the sciences touch upon the vast technical complexity of distillation and should have a body of experts within the broader membership to assist all distillers in the scientific and technical details of our industry.
As a body the SDST will provide for education a library citation resource service for providing the reference details for essential distilling publications — papers, books and symposium volumes — and a group of experts available to share information to improve the excellence and reputation of new and established distillers.
The core goal of the SDST is simple: “Focus on the science.” If you would like more information regarding the SDST please contact either Brian Christensen (brian@artisanspiritmag.com) or Gary Spedding (gspedding@alcbevtesting.com) for further details and future meeting dates.
Brian Christensen & Gary SpeddingInterim Cat Herders & Science Nerds
Illinois
Illinois Craft Distillers Association
The Illinois Craft Distillers Association worked closely with the Wine & Spirits Distributors of Illinois as well as the Liquor Control Commission to ensure the three-tier system was maintained while granting some additional privileges to gain parity with craft brewers allowing for growth for our industry in our state. We feel this bill, HB 2675, will be a boost to craft distillers of all sizes and the first legislation of its kind to provide assistance for small and larger craft distillers in our state.
HB 2675 has passed the state house and is currently before the Illinois Senate. It is expected that lawmakers will support the bill, which will greatly benefit the state’s 34 licensed craft distilleries, and all those to come. More information about the bill can be found at www.illinoispolicy.org/craft-liquor-may-catch-on-quicker-if-illinois-changes-law.
Noelle DiPrizioChicago Distilling Company
Maryland
Maryland Distillers Guild
Maryland distillers are celebrating a successful legislative session, with two thirds of proposed bills passed and awaiting the governors’ signature — all of which increase retail opportunities and customer engagement. Revisions to the current off-site permit allow distillers to attend unlimited farmers markets and more off-site events (34 total, up from six per year); and includes a new on-premise consumption permit that authorizes a local (county) liquor board to create and issue a permit that permits a Maryland Class 1 distiller to offer limited mixed drinks to customers of legal drinking age.
Jaime WindonOwner/Co-Founder | Lyon Distilling Co.President | Maryland Distillers Guild
Massachusetts
Massachusetts Distillers Alliance
The Working with the Massachusetts Department of Agriculture, the Massachusetts Distillers Alliance has aggregated data from distillers throughout MA to better present a cohesive picture of craft distilling in the state.
Distillers will utilize the economic snapshot information when lobbying on the federal, state and local levels.
Such efforts include continued FET reduction, parity between all craft beverages, and lobbying for legislation introduced at the MA state house that would allow for distillers to sell at agricultural events throughout the state. MDA is also continuing with marketing efforts to educate and engage the craft spirit consumer expanding web site functionality including the Distillers Trail.
For more information, find us at www.massdistill.com.
Alison DeWolfePrivateer Rum
New Mexico
New Mexico Distillers Guild
The New Mexico Distillers Guild celebrated a legislative victory this spring with the passage of important legislation resulting in a state excise tax reduction of 80% for small producers similar to the FET reduction and bringing craft distillers into alignment with the tiered excise tax structure enjoyed by small winemakers and craft brewers in the state. The legislation also allows for private celebration permits so craft distillers can use their licenses to host and serve at private events on- or off-site. The guild is grateful to the leadership of Legislative Chair Skye Morris-Devore of member Tractor Brewing (and Distilling) Co. for all her tireless efforts! Now attention turns toward developing a signature event to highlight the guild and its members to promote New Mexico craft spirits.
Greg McAllisterCo-Owner, Algodones DistillerySec’y/Treas, NM Distillers Guild
New York
New York State Distillers Guild
Our annual two-day conference for 2019 was once again held at the Carey Institute for Global Good outside of Albany, New York, on March 28th and 29th. At the beginning of the conference, we welcomed our newly elected seventh board member — Randall Beach of Murray’s Fools Distilling Co. This year’s conference was our most successful conference to date with over 50 member distilleries in attendance. We were joined by representatives from DISCUS, the NYS Liquor Authority, and ACSA Executive Director Margie Lehrman. Educational topics and presentations were enjoyed from more than 10 associate members including a panel on distribution options, ongoing efforts for a regional grain project, and a talk on unconventional distilling.
In early May our second-annual New York State Distilled Spirits Competition was completed. As was the case last year, our guild-based competition was conducted in tandem with the Great American International Spirits Competition (www.gramspirits.com). Partnering with an existing and larger competition allowed our judging to have a reduced cost associated with the staffing, proctoring, accommodations, and logistical operations needed. Since both competitions were judged simultaneously, submissions were afforded the opportunity to enter both without paying additional fees or providing further product. Once judging was completed, spirit entries from New York guild members spirits were separated out in a data cut from the overall numbers to be used for our Guild’s competition.
We’ve added a Distillery of the Year award to this year’s competition along with the continued Governor’s Cup trophy being engraved and awarded to the spirit winning best of show designation. This year’s competition saw 155 spirits entered from over 39 New York distilleries. The results and awards from the competition will be distributed and celebrated in late June.
Having yet to engage a lobbyist, all our legislative efforts are maintained in house. Our primary focus this session is NY Senate Bill s.246 — Production Tax Credit Relief. Currently, the production tax credit available to other beverage categories in New York grants relief of 95% up to 103% for eligible state excise taxes. This bill focuses on addressing the inequality and bringing economic parity to all craft manufactures statewide.
Other legislative goals we’re working toward this session are expansion of the existing branch office privilege from one location to five locations for farm distilleries, creating parity for A1 licenses to sample and sell their products on-site, streamline pricing posting requirements from monthly to annual, and finally the inclusion of distilled spirits in the existing temporary beer, wine, and cider permit for retail and consumption at events.
We’re always interested in working with other industry organizations and guilds. Have an idea for a collaboration or just want to chat? Drop us a line at newyorkstatedistillersguild@gmail.com.
Cheers!
Cory MuscatoLockhouse Distillery – Buffalo, NYPresident – New York State Distillers Guild
Ohio
Ohio Distiller’s Guild
While the Ohio Distiller’s Guild is still advocating for craft liquor reform in the new Ohio General Assembly, we are also working with the American Craft Spirits Association in their efforts to extend or make permanent the federal excise tax cut. Seeing as Ohio has 16 US house members and two influential US senators, we are educating and motivating our members to lobby the Ohio delegation.
Starting a business is very risky. Therefore, if the excise tax cut is extended it will help Ohio business owners minimize their financial risk and increase their chances of building a successful and profitable business. During our annual Ohio Distiller’s Guild Conference on May 20th, we will go in-depth and explain how important the excise tax is to the craft liquor industry and how to advocate for your company!
John SingletonGuild Executive DirectorGovernment Advantage Group
Oregon
Oregon Distillers Guild
Nine years ago, there were only 16 licensed distillers in Oregon. Today there are 69. Distillers bring $1.4 billion in economic benefit to the state while selling over $63 million annually.
Because Oregon is a control state, there are inherent challenges for small distillers to market their products to drive larger sales volumes. On top of that, the governor has proposed a five-percent markup on all distilled spirits.
Distillers licensed in Oregon are allowed to have tasting rooms, but the current statutory framework makes generating enough revenue to cover costs difficult. Most distilleries have small tasting rooms, but since they generally don’t pencil out, most are open only a few days a week or by appointment.
The Oregon Distillers Guild is seeking to improve the economic viability of distillery tasting rooms by allowing distillers to keep more of the money it currently returns to the state from onsite product sales. Our proposed changes would occur in the OLCC budget bill, SB 5519. The bill would reduce the revenue transfer back to OLCC from 33% to 5% for tasting room sales. It would also split the compensation pool that is currently combined for Oregon Distillery Tasting Rooms and OLCC Liquor Stores.
Guild members continue to reach out to their local legislators to get SB 5519 passed.
Jamie HowardCo-founder/MarketingSinister Distilling CompanyODG Board Member, Treasurer
Wyoming
Wyoming Distillers Guild
Our state legislative efforts over the past two years have yielded positive results! Come July 1, we will see a few bills become effective that we fought and lobbied hard for. In collaboration with our Wyoming State Liquor Association and our state senators and representatives, the bills that we presented have now become law.
HB 219 is a bill that will grant each distillery 12 “manufacturer’s off-premises permits” annually to help our small businesses promote our brands and boost sales. This will essentially allow us to host off-site events, attend farmers markets, concerts, fundraisers, etc. that otherwise we may not have had the ability to be a part of.
Also, with the passage of SF 140, we are now able to self-distribute directly from our bonded facility into our satellite tasting room. This cleans up the previous need for us to ship our product to the state warehouse, to then place an order to have it shipped all the way back. This will save time, money, energy and resources.
We still have hopes to someday increase the number of satellite tasting rooms we can operate. Currently we are afforded only one under Wyoming law, but it would certainly be beneficial to our members if we could at least have our distillery location and one (or more) off-site tasting rooms. We will continue our efforts on this initiative.
We continue to focus our federal efforts on making the FET reduction permanent. Multiple members of our guild plan to attend the Public Policy Conference out in Washington, D.C. this coming July. There is nothing more important that we can do for our business community than to get this legislation permanent.
Huge thanks to the ACSA staff and the member distilleries in Minneapolis for an amazing conference this year. Great to see you all there, can’t wait for next year!
Travis GoodmanSecretary/Treasurer,Wyoming Distillers Guild