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Ralph at Tuthilltown

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Everything posted by Ralph at Tuthilltown

  1. About the only one's who think of this franchise as "micro distillery" are the marketing guys at ABSOLUTE. I don't think the proposal would fly for any informed consumer and certainly not with the real craft distillers in the US who will see this for what it is. I don't think they are kidding anyone but themselves and the "give it to me cheap" market. When asked if the base spirit is actually distilled at the "local" site, with some coaxing the answer finally came, the GNS arrives at the site full strength and is bottled with local water. That is neither, "local" nor "craft". The fact is that Michaelangelo seems to have hit the nail on the head, it's a good demonstration that Craft Distilling is now a serious, legitimate member of the profitable spirits world. What was that phrase "Imitation is the most sincere form of flattery." Big producer investment in the "small brand" image is a semaphore, the concept of crafted artisan spirits has delivered its message to the big guns, and they are trying their best to emulate, simulate and obfuscate the Craft message. R
  2. When striving for "Green Whiskey" remember it is not just about fuel consumption. Remember before you make "Green" claims that your spirits are contained in a heavy glass container, and that you are shipping your liquid across the country burning fuel the whole trip. Remember too, our carbon footprint is inherently broad, since fermentation creates substantial CO2. So careful when you tag your goods as "Green".
  3. The point of a "barrel aged cocktail" is that the whole cocktail is aged together and served out of the barrel, in most cases. Aging the non-alcoholic parts would not produce the same result. And the popular aged cocktails being prepared are spirits mainly, like a MANHATTAN. Putting juice or a mixer in an oak whiskey barrel would not produce the same result as putting the spirit (a solvent) into oak along with the other ingredients.
  4. The "barrel aged cocktail" is growing in popularity. Many craft distillers are putting their used oak barrels to use as promotional tools in on-premise accounts where the mixologist creates a cocktail, ages it in a recently emptied whiskey barrel on the back bar where it can be seen by customers, then serves it to consumers when it has taken on the rich qualities of the whiskey impregnated oak. Regulators in some States have noticed and are taking action to enforce Prohibition era laws, and are applying questionable precedents where no specific regulation clearly addresses the issue. Some alcohol control laws prohibit serving spirits "from a tap". This is State regulator territory, States control distribution. The State regulators’ oft cited basis for enforcement of such regulations is protection of the consumer. The server may be short changing the consumer on alcohol content if the spirit is not being poured directly from the bottle it came in is the logic. Some States are, in the case of barrel aged cocktails, claiming that aging spirits in oak is “manipulation” of the spirits and therefore falls under the definition of “rectifying” which requires a rectifier’s permit. It this is the case, every bartender and mixologist is breaking the law every time they manipulate the a spirit when they prepare a cocktail, or for that matter even put an ice cube or water into a spirit. And serving a pre mixed drink from a barrel is not serving “spirits” from a tap, it is serving a “cocktail”, they are not the same thing. Can we hear from the spirits producers and on-premise operators, barmen, mixologists, consumers? Some of the important questions which are being asked: How widespread is the practice of pre-batching cocktails in oak barrels, are you doing it, is it popular with consumers? Is there some State regulation which applies to this practice? Or is it not directly addressed in your State law and open to interpretation by regulators? Are regulators applying questionable legal precedent to regulating barrel aging cocktails in your State? Has your barrel aged program been challenged by State regulators? Was it resolved? How? State Regulating authorities are at a loss determining the scope of the practice and are eager to understand it. Some are reaching out to the trade to get basic data on barrel aging programs. Your responses and State alcohol law information will be very helpful. Ralph
  5. A Master Distiller operates within the law. Basement hobby distillers may have the "distillation" part down, but they are not accepting the full responsibility for the craft activity. I used to run up against this same logic in the climbing business. Highly experienced rock climbers often hire out to beginners as "guides". They sometimes do not get a guide license and they rarely carry insurance for their clients. Just being really good at something is not enough. A "Master's" job, like a climbing guide's, includes the protection of everyone involved, protection which extends beyond immediate physical safety to include a safe conclusion to the undertaking and a realization that accidents happen and it's the "Master" or the "guide" who must protect his charges in the event of accident and injury. What happens when something goes wrong, who is "responsible". If a basement distiller without a license blows up his house or starts a fire which jeopardizes others, his neighbors, the community, an injustice? When a "home distiller" operates without a license, uninspected, uninsured against accidents, who ensures responsible practice? There may be no accepted course of study or academic award or formal process in place for determining who is a "Master Distiller", but it is my opinion the absence of any formal program or criteria does not change the fact that the title "Master" is not one which is self-awarded, it is recognition from some higher authority in whatever category. The term "Master" includes a much broader field than simply operating a still. It includes safe legal operating practices, staff safety considerations, insurance, ensuring product is safe, having professional inspection of systems. This is NOT making beer or wine, it generating volatile gas and no matter how many precautions you make to keep your little home distilling set up safe, it is NOT SAFE, accidents happen.
  6. No debate on the ambiguity, sometimes being an advantage. May I suggest, Mr. Dunbar, that you put your suggestions to the TTB. My personal preference is for an interpretation based on the degree of connection. Not an attorney, but my call is that if the building is not connected (by wall, breezeway, roof, fence, etc) to the building which is the actual distillery building, that separation is sufficient to determine it is not "connected" with a home or residence. We'll see what comes of the TTB discussion on the topic.
  7. It is true that phone comments are not to be taken as THE resolution. But they can bring contradicting opinions to the front, especially when the caller can identify the source of the misinformation as they work their way up the ladder of responsibility. The TTB is addressing this issue at an upcoming meeting with their Cincinnati office in DC shortly. The ambiguity is deliberate apparently, so that they can determine the extent of "connection" and determine on a case by case basis, this is true. I believe there is a "one size fits all" solution to the text problem. We'll stay close to this and see what comes out of the upcoming TTB meeting. The TTB representative in Regulatory office agrees the language is ambiguous, they are addressing this.
  8. Thanks Chuck. I retract my last comment suggesting this be put to rest, obviously the interpretations being received from Investigators at TTB are not in conformance with practice. I agree that the ongoing polite but not necessarily deferential dialogue with the respondent at TTB is important. It will form the basis for your appeal if you must file one. But also, the previous suggestion that you pick up the phone and call the TTB directly is a good one, and take notes on the conversations. I stand with Chuck on this, the law and precedent agree: there is no prohibition against having a DSP premises on the same parcel as a residence, a domicile, a house. There are numerous examples of licensed DSPs with residences on the same lot, not connected to the distillery building or rickhouse or other of the "licensed premises". And this is exactly the kind of matter the AMERICAN CRAFT DISTILLERS ASSOCIATION is organized to address.
  9. The most effective lobbyist is the one who is a True Believer in the cause they're pitching. It's your business, your staff, your distillery; no one will be as passionate and dedicated to increasing its potential for success then you will. Give me engaged activist constituents over high paid lobbyists any political day of the week. State or Federal level, get on the phone, type a letter and mail it or Express it to your State and Federal Legislators. Make the introduction, then keep up a regular correspondence describing the wonderful things that Craft Distillers are doing for your home State and for the National Economy. It does take time, persistence, tenacity and determination but it IS possible to move the wheels of government even if only in small incremental steps. First step is to let them know you exist, you pay taxes and you vote.
  10. Thanks Bluestar. Indeed, the original definition we composed a couple years ago allowed for addition of botanicals and other processes that "substantially change the character of the spirit" when GNS is used as a base. Some argue that fermentation is a basic requirement for a "craft" operation, but I'm not so sure since there is craft and skill in the combining of botanicals and other materials. It seems most agree with criteria which includes distilling in a still and change of character when using GNS. You are correct that "rectification" includes distillation. In any case, to manipulate the spirits a DSP permit from the Fed is required, regardless the various State license categories.
  11. My personal opinion is that fermentation is a critical aspect of the craft. However, the ACDA and most craft distillers agree that the bottom line is a double line: the BASIC PERMIT and the STATE PERMIT. The question: "Must a craft distiller ferment his own mash?" is open to discussion, but at this point the main distinguishing fact separating rectifiers and blenders from Distillers is: a Distiller distills.There are a number of distilleries opening in partnership with brewers who prepare their mash. For some it is a necessary step, jobbing out the fermentation due to space prohibitions and equipment shortages. There is certainly craft in the combining of botanicals for gin. It is an ongoing debate.
  12. Thanks Brad. What about the rest of the craft distillers? Are you all on the phone with your Congressmen/women and Senators, are they all on your calendars for a visit to your distilleries? Have you primed all you employees with the reasons they are important to the economy? It is unlikely that Legislators will set aside enough time, if at all, to visit more than one distillery site; so any one who succeeds in getting their Legislator to agree to come to the distillery and learn about craft distilling should reach out to all the distillers in their State and make sure they are there in force, with their tax paying, VOTING employees to make the point. Come on folks, this is going to save you a ton of money if we're successful. GET TO WORK.
  13. My opinion on the "Master" recognition: it is exactly that, a "recognition" of experience, education and determination. It is not a title one takes upon oneself. It is an awarded title, not self-assigned. It's inappropriate for a person to take on the title: Master Electrician, or Master anything without some qualification from a recognized source. Of course you could put "Master Electrician" on your card and sell yourself as such, and it might work, right up to the point you must convince an insurance company to insure your work or the house you wired for your buddy burns down.
  14. These points were made to the TTB Staff at the recent DISCUS LEGISLATIVE CONFERENCE in DC. The TTB agreed the Standards of Identity need updating, but they may not introduce that change it must come from a petition for change. Unfortunately there is no "form" for such a petition. It must be composed with the best explanation of the justification. As Chuck points out, it is a long process. That does not argue for continuation of inaccurate definitions, many of which handcuff creative new distillers' innovation. While it is true that the law specifies no time limit, the actual text of the Standards of Identity is less than exact, the definition of "whiskey" reads: Class 2; whisky. “Whisky” is an alcoholic distillate from a fermented mash of grain produced at less than 190° proof in such manner that the distillate possesses the taste, aroma, and characteristics generally attributed to whisky, stored in oak containers", the argument has been made that whiskey put into a barrel overnight would not take on the "taste, aroma, and characteristics generally attributed to whisky", but that is a subjective call and the TTB has not enforced it. The argument could be made that the requirement for typical "whiskey-ness" characteristics comes before the requirement that it be stored in oak containers, so the "taste, aroma and characteristics" would be generally attributed to the raw spirit, unoaked. Regardless the strength of the arguments, the distillers in the meeting strongly requested the TTB make some decision on this matter. But the action must be taken by a DSP in the form of a petition. That petition, if launched, should apply to the entire STANDARDS OF IDENTITY, and not just the issue of oaked or unoaked whiskeys. It will be a long and difficult process, but it should begin.
  15. Take a look at the attached One Pager on the proposed Craft Distiller Excise Tax discount. Then contact your Federal Legislators and educate them. INVITE YOUR SENATOR AND CONGRESSMAN TO SEE A WORKING DISTILLERY WHILE IN THE DISTRICT FOR SUMMER BREAK, invite them to meet your voting/taxpaying staff, sample your Agricultural products and witness the visitor traffic you generate. Let them know the nascent American Craft Distilling industry would like parity with our Beer and Wine making cousins' discounted Federal Excise Tax rates. Check out the attached. craft spirits parity one pager 73013.pdf
  16. Please download and review the attached one page description of the bill being prepared which, when passed, will reduce the FET rate for the first 100,000 proof gallons of your production by 80%. craft spirits parity one pager 73013.pdf
  17. Small Distiller Parity Support the recent expansion and encourage further growth of small U.S.-based spirits manufacturing by creating a reduced federal excise tax rate for small-scale distilled spirits makers, creating parity with the current reduced tiers for small beer and wine producers. Problem Small Craft Distillers are attempting to enter the market every day to join what is one of the most significant and exciting domestic manufacturing growth industries in the United States. These small manufacturers purchase local agricultural products, create jobs and support their local economies through payroll, property and other taxes, and tourism but are thwarted by a disproportionate tax burden that puts them at a substantial competitive disadvantage. Background The distilled spirits industry has enjoyed a renaissance of local, artisan production of unique spirits over the last ten years. Our numbers have swelled from less than 40 licensed makers in 2003 to more than 400 in 2012. Because of these efforts, consumers in America and abroad are beginning to experience innovation and quality in spirits similar to that which took place with micro-brewers in the 1980s-1990s and independent winemakers in the 1970s-1980s. What made the growth of small beer and wine makers possible — other than hard work and passion — was a reduced federal excise tax rate that allowed them to successfully make and sell artisan products without the economic benefits of extremely large-scale production. Today, small-scale beer producers pay 39% of the full federal excise tax that medium and large producers pay. Similarly, small producers of average-proof wine (<14% alcohol) pay 18% of the full rate. To put this in context, small beer producers pay $0.02 vs $0.05 in federal excise tax per 12 oz can, while small wine producers pay $0.04 vs $0.21 per 750 ml bottle. By contrast, small spirits makers pay the full rate — $2.14 per 80-proof 750 ml bottle of spirits. Solution Small-scale spirits producers need a similar reduced-rate federal excise tax structure to continue to innovate, create U.S.-based manufacturing jobs, support U.S. agriculture, support tourism through visitor centers and tasting rooms, and compete effectively in the marketplace with reasonably-priced handcrafted spirits. The following reformed tax structure will bring balance and equity to smaller distilled spirits producers: • Tier one/Above 100,000 proof gallons — 100% rate • Tier two/First 100,000 proof gallons — 20% rate Benefits This tax reform will enhance the continued growth of an “American heritage” industry that expands support of domestic agriculture and increases exports of American goods. Further, it will allow craft distillers to continue to innovate, create U.S.-based manufacturing jobs, support U.S. agriculture, support tourism through visitor centers and tasting rooms, and compete effectively in the marketplace with competitively-priced handcrafted spirits. Finally, this tax streamlining will result in a negligible short-term revenue impact while promising a significant increase in federal revenue as the domestic craft distilling industry grows. Contact: Ralph Erenzo (845) 797.9010 or Mark Shilling (512) 426.2796
  18. IMPORTANT DISTILLERY ALERT TAKE ACTION NOW Distillers. The Legislative Committee of the American Craft Distillers Association is making efforts on two fronts toward eventual passage of its proposal amending the Federal Tax Code. They are: Education of legislators, and Introduction of this proposal into the anticipated Tax Code Revision. That Revision is being prepared now, so it is time for you to act. This is how you can get involved in the effort to reduce your Excise Tax rate: Review the attached "one pager" describing the issue and the proposed resolution and effects on the 400+ Craft Distillers nationwide and especially in your State; Write your US Legislators today and urge your Senator and Congressmen to help the growth of our craft industry by supporting the proposal to reduce your Federal Excise Tax rate, tell them: who you are, what you make from Agricultural raw materials, how many voters you employ (or will over next two years); Contact your US Senators and Congressmen and invite them to visit your distillery while they’re in the district; Prepare for the visit with such information at the tip of your tongue as: number of voting employees, typical tax bill you pay, number of visitors who come as tourists, sales tax tourism generates to the State at your site alone, the volume of raw materials you buy from New York farmers; Point out the fact Micro Brewers and small Wineries already enjoy similarly discounted Excise Tax rates and the effect the discount has had on the growth and success of those two industries; Describe the benefits your operation brings to the community and your State; Invite press to the get acquainted visit. The purpose of this introductory effort is for you to meet and educate your Legislators about the issue and prepare them for the introduction of the bill and discussions which will accompany the effort to get it passed into law. Regardless if your distillery is a member of ACDA or ADI, this effects your bottom line. REACH OUT TO YOUR FEDERAL LEGISLATORS TODAY. Act today. Contact me directly if you have questions; or have your Legislator's office contact AMERICAN CRAFT DISTILLERS ASSOCIATION for more information. This is a non-partisan issue, we need bilateral support. Ralph Erenzo Chairman, ACDA Legislative Committee TUTHILLTOWN SPIRITS FARM DISTILLERY Gardiner, New York
  19. Mr. Mash, We're not sitting on our hands, no sireee. Shortly distillers will receive an email from AMERICAN CRAFT DISTILLERS ASSOCIATION which is a CALL TO ACTION. We are launching our effort to get the FET reduced for distillers now. First step is education of Legislators about how Craft Distilleries work, how they contribute to the economy and why they are important. August is when Federal Legislators are in their home districts and able to visit their constituents. And the best way to round up support for your distillery among your Legislators is to get them to visit your site and meet your voting/tax paying staff and perhaps some of your Farm partners. Watch for the mailing. TAKE ACTION!
  20. This thread would be more productive if it reflected readers' response to the fundamental question: What is a Craft Distillery? Complaints about what everyone else is claiming true or not, gets us no closer to an acceptable definition of the term or the category. The BC definition is close to something reasonable: 1) All products must be fermented and distilled at the licensed distillery site using 100 per cent BC agricultural inputs; and 2) All products must be produced utilizing traditional spirit making techniques. The production of spirit cooler products or other highly processed products are not permitted, nor is the use of neutral grain spirits in the production of any products; and 3) The distillery has an annual production of finished products below 50,000 litres. There are some items which are questionable for the American Craft producer. In many States the requirement for use of indigenous raw agricultural materials is 75% or so. Since not all States have malting facilities it would be unreasonable to make any limit 100%. There is also a need for a clause which allows out of State raw materials in case of declared crop failure. “Traditional spirit making techniques” is a subjective description and makes any innovation growing out of small production research and development, questionable. “Highly processed” is subjective as well, it could be said of certain gins and cordials they are “highly processed”. Production limits are not desirable since they limit the potential success of the producer and limit the amount of product the distillery can put into long term storage. The ACDA and the NY CRAFT DISTILLERS GUILD as well as other State guilds have agreed if there are to be limits, the limit should be on goods “removed from bond” in a given year. Charles’ quoted BC definition may not exactly meet the needs and wishes of the American Craft Distillers, but it is the more productive contribution to this discussion. R
  21. Sorry for not posting sooner. This meeting went well. It's not possible to predict the outcome of the trade talks. We've been only discouraged by all industry persons who comment on the effort. And the Euros we speak to decline to involve themselves, wishing not to wake the sleeping SWA's ire. There is a quid pro quo for the EU which makes a recognition of American Whiskey desirable for all the non-Scotland, non-Irish producers. If the EU does move to recognize American Whiskey it is more likely there would be reciprocation in the form of a broadening of the recognition by the US of ALL European made whisky and a subsequent elimination of the "new oak rule" in American law which as applied currently keeps all Euro whisky not aged in new oak out of the US market. Is the EU considering the entire Union by not finding a way into the American market for the non-Scottish, non-Irish Malt Whiskies, or considering only the proprietary position enjoyed by Irish and Scotch whisky makers in the US market? I guess we'll see. The encouraging note is that the US Trade Representative is taking the issue seriously and continuing to press the point.
  22. Remember when "unique" actually meant one-of-a-kind? Or, when "extreme" was a condition open only to the very bold and from which only a few returned intact? When "natural" meant it is in its useful natural state and was not manipulated? These terms lost their cache as a result of media overuse. Advertisers, Marketers, Adventure Parks, hamburgers, deodorant, toothpaste, chewing gum; all have diluted the impact of such descriptives and rendered them meaningless. It is not some sinister plot, just the way it goes in the modern world where communication is nearly immediate and greed is a driving factor. If it sells, it will be copied and mass distributed to make as much profit as possible from its fleeting popularity before the arrival of the next new thing. The true craft producer needs to focus on his own product, making it the best he can, making it available and telling the truth in his advertising, regardless what some greedy deep-pocketed corporate competitor does. It is not possible to stop overuse or misuse, exaggeration or hyperbole, it is simply the nature of the marketplace. But we don't have to participate, we don't need to take advantage of consumer naiveté. That is one hallmark of a real "craftsman", the truth about his goods. Tell the truth. If the truth you tell doesn't sell, perhaps you would better focus on the thing itself and not how you can inflate it just to convince reluctant consumers. Consumers want quality, they want the real story. The opposite is also true, if they come to disbelieve your pitch they will be offended and you'll lose the customer loyalty we all strive so hard to hold on to. No Craft Distiller has to exaggerate anything they are doing, or anything about their goods, what you're doing is cool enough without any inflation.
  23. Glass making, printing, growing grain; these are not "distilling". They are trades and crafts in their own right, in the same way as a qualified cooper does not need to also grow the oak trees to own the title "Craftsman". The other terms are subjective in nature and very difficult to accurately define in this case. There is no way to practically prevent the coopting of terms such as "craft", "artisan", "hand made" and as we all know, if a major producer decides to use such terms which are not defined as a matter of law, the producer can say anything that the TTB permits them to say on their labels or advertising. It is up to the craft industry to organize, introduce definitions where necessary. Unfortunately, using production volume is dicey. Who decides the appropriate volume for a "craft" producer? Do craft producers with successful brands (that pay the bills) risk losing their "craft" status? This is the ongoing debate, "what is craft"?
  24. Thank you John. Agreed. The interim Board of the ACDA is considering, as you suggest, the possibility of lending ACDA certification to programs such as that which ADI is promoting. However, any qualified certification must carry the weight of the support of the licensed industry participants. ACDA is young and still coalescing. It will take a little time to get any kind of acceptable certification program underway. But that does not suggest that in the meanwhile we can use the "standards" established by a private club for the industry. This will confuse the marketplace, especially if the ADI certification does not meet with acceptance by the industry as a whole. Those who have worked hard, risked their own resources, filed the extensive paperwork, paid for the insurance and staff and fuel and taxes; these are the qualified professionals who will be most directly affected by the setting of any standards and should have direct input into the standards. Any compilation of "standards" will take some time, and should not be rushed simply to sew up use of a term or claim "first in" status. The most experienced craft distillers in the US are deeply involved in the creation of the industry association and certifications as well as Legislative action, tax reform and safety; but we are all starting from scratch and these things will take some time. Licensed distillers should get on board, join ACDA and contribute.
  25. I have not noticed any "vitriol" rising between those who wish their distilleries to grow and those who like their small operations. To each his own. The only antagonism I read here on this topic is in your comments. The definition of "craft" is yet to be agreed. Those who comment on such as TITOs growth and size don't appear to begrudge the success. The ongoing question is what constitutes "craft". But more importantly, the real issue is "truth in advertising". Agree with my opinion or not, but multiple automatic stills producing prodigious amounts of vodka by redistilling GNS from another producer is not "craft" as I understand it. Basing advertising and PR efforts on the way things "used to be" is not appropriate.
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