dhdunbar

I think there is a common misunderstanding of the relationship between state and federal law. I remember at one time Idaho defined wine in a way that spirits products of less than 24% ABV were wines within the state. That cnflict caused no problems. The state went its way; the federal government did too. Or at least I think I recall this. It has been some time. However, if I'm correct, it would be illustrative of the fact that although it is true that you must obey both federal and state law, nothing compels the two governments to impose the same requirements or define terms in the same way. The question, "What is brandy for the purposes of the FAA Act?" will determine how you must label any product you introduce into interstate or foreign commerce, but that does not mean that, despite the federal labeling, some state, somewhere, might hold it to be brandy for the purposes of some state law relating to some requirement, such as allowing sales of spirits distilled from honey wine, which are a specialty item under federal law, but could come under the rubric of brandy for the purposes of some state law related to retail sales by craft distillers. I have no idea what California requires or prohibits, but when looking for a fit between state and federal law, remember that definitions can differ. The most common one divergence, I think, may be in the definition of "import," which on the federal level means to add to the mass of goods belonging to the United States, which may not be exact, but which is close, whereas the states generally use the term to mean bringing the goods into the state from either outside of the country or from another state. I'll add one more statement, because something I said above is not absolutely correct. You must obey both federal and state law if you can obey both. But where there is a direct and positive conflict between what the state requires and what the federal government requires, the states prevail. That rule has run afoul of the commerce clause in the past few years, but I think it holds well until the courts decide otherwise. That said, I'm not an attorney, this is not meant to be legal advice, if you find a situation like that (unlikely) consult your attorney and let the attorney advise you about which law you should violate in order to obey the other. Again, this is not going to happen but rarely, if ever, and I l know of no example of where it might even exist.

If the FDA website is current, then coffee liqueurs are fine: Here is a FAQ from the site (http://www.fda.gov/Food/IngredientsPackagingLabeling/FoodAdditivesIngredients/ucm233726.htm) : Does this action apply to coffee-based liqueurs? No. These Warning Letters are not directed at alcoholic beverages that only contain caffeine as a natural constituent of one or more of their ingredients, such as a coffee flavoring. The alcoholic beverages that are the subject of FDA's Warning Letters are malt beverages to which the manufacturer has directly added caffeine as a separate ingredient.

The rules concerning statements of age are among those that seem, when you start reading them, to go on forever. They occur alongside rules that apply to the statements about the percentage of neutral spirits that are in a blend. For the sake of clarity, if not sanity, I will strike all references to percentages in the following discussion. Further, I’ll wipe from the slate any references to blended whiskey at all. I’ll also knock out references to bottled in bond labeling and to imported whiskey. Those eliminations make understanding §5.40 a bit easier. I’ll quote the regulations without indicating anything has been dropped. The first rule is that statements of age are optional on whiskey that is four years old or more. Unless a whiskey is four years old or more, you must make a statement of age. There is no option. The age of the youngest whiskey in the mix or blend (remember, we are not talking about whiskey that contains neutral spirits) is the age of the spirit. Mix 999 gallons of whiskey that are 12 years old and one gallon of whiskey that is three years old, and the whole 1000 gallons is declared to be three years old. The statement of age that must appear on the label “shall” – remember “shall” means it must - read substantially as follows” “ ___ years old.” There is absolutely no provision here for a statement of the sort, “Aged less than four years,” as some have suggested. If TTB accepts the latter, then it does. But that is not the way the rules are written. Any wiggle room comes from TTB’s practice, not its requirements. Stripping out the various provisions for blends, that is pretty much the whole shebang. Age it less than four years and you have to state the age; age it four years or more and stating the age is optional. One question remains, “What is age?” For this, we must look to TTB’s definitions in §5.11, where we find that, as used in Part 5, age has a particular meaning that changes with the type of whiskey to which we apply it. In fact, some whiskey acquires no age at all - and I’m not referring to those “unaged” whiskey, whose existence depends on TTB’s penchant for ignoring the requirements of its own regulations Let’s be clear about that point. Whiskey is, by class standards, “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 (except that corn whisky need not be so stored), and bottled at not less than 80° proof. Again, let’s throw corn whiskey out of this discussion, because it is that annoying exception that proves (in the sense of tests) the rule. We will pretend that no such thing as corn whiskey exists. Then, if we want to make a “corn whiskey,” we can revisit the regulations and examine the whole separate set of rules for corn whiskey without getting snarled with the rules that apply for every other kind of whiskey. So, throwing out corn, here is the rule. All whiskey is stored in oak containers. Many make much of the fact that the regulations do not require a specified period of storage. They like to tout a seemingly clever interpretation, stating that this means that 30 seconds in oak suffices. Everyone who touts that, or similar rules, ignores the requirement that whatever emerges from the storage must possess “the taste, aroma, and characteristics generally attributed to whiskey.” From the labels one sees, TTB must be among those who ignore the “characteristics” rule. But here I am dealing with what the regulations require, not with what TTB allows in practice. Indeed, the requirement that you state age in the form “___ years old,” implies that TTB anticipates, by rule if not practice, some substantial time in oak. I am not arguing that this makes any sense. The arguments that lead to the definition took place long ago, when different segments of the industry – those who made whiskey by rectification and those who did so by storing in oak - sought to turn the regulations to their advantage. Note that the standard for whiskey says that it must be “stored in oak.” It does not "aged in oak,“ or even that it must be aged at all. The terms “age” and “store” have different meanings. Any time a whiskey goes into oak, it is stored. However, the definition of “age” gets tangled with the standards of identity for the different products. Again, to make it more easily understood, some parsing is in order. Age means: The period during which, after distillation and before bottling, distilled spirits have been stored in oak containers. Now, this is misleading because the definition uses the general term “distilled spirits,” from which one might conclude that any spirit may acquire age as a result of its being stored in oak. I’m trying to avoid detours into things other than whiskey, but I don’t want to leave open so wide a door to misunderstanding. Some spirits, other than whiskey, do acquire age, as TTB choses to use the term, but not all spirits do. Here is the complete picture, derived from §5.40: ( Statements of age for rum, brandy, and Tequila. Age may, but need not, be stated on labels of rums, brandies, and Tequila, except that an appropriate statement with respect to age shall appear on the brand label in case of brandy (other than immature brandies and fruit brandies which are not customarily stored in oak containers) not stored in oak containers for a period of at least 2 years. If age is stated, it shall be substantially as follows: “__ years old”; the blank to be filled in with the age of the youngest distilled spirits in the product. © Statement of storage for grain spirits. In case of grain spirits, the period of storage in oak containers may be stated in immediate conjunction with the required percentage statement; for example, “__% grain spirits stored __ years in oak containers.” I will not again comment that aged gin is becoming so common that some competitions even have it as a class for which they make awards. Let’s get back to whiskey. As I said, the meaning of the term “age” gets entangled with the standards of identity. For those who may be familiar with the battles over the definition of whiskey, first in 1906 and then again in 1935-1937 and finally in 1968, the term “age” gets entangled with the difference between “American type” whiskeys, e.g. bourbon, wheat, rye and malt whiskies, which were held to have the characteristics of whiskey aged in new charred oak, and other whiskey, e.g., Scotch, Irish, and Canadian whiskeys, which were held to have characteristics of whiskeys aged in reused oak barrels. Thus, when we parse the definition of age, we find that: For spirits of the class whiskey, which are not further designated as a type if whiskey, age means the period of time spent in oak. For American type whiskeys, i.e. those labeled bourbon, wheat, rye or malt, “age” means the period of time these whiskeys were stored in charred new oak containers. For whiskey made in the United States, in the manner of whiskeys other than American type whiskeys, that is, whiskeys stored in reused oak, and labeled with the designation, whiskey distilled from bourbon, wheat, rye, or malt mash, no statement of age is allowed. Changes to the regulations in 1968 allowed a different form of statement. §5.40(a)(4) provides that, “in the case of whisky produced in the United States and stored in reused oak containers, except for corn whisky, and for light whisky produced on or after January 26, 1968, there shall be stated in lieu of the words “__ years old” the period of storage in reused oak containers as follows: “__ stored __ years in reused cooperage.” So there you have the requirements for the statement of “age” as best I can distill them into something understandable. I am working on an article that will describe, in some detail, how these requirements were spawned. Although they were advanced in the guise of rules designed to protect the consumer, I think it is obvious from the twists and turns of the regulation, that few consumers have any notion of the difference between Malt Whiskey and Whiskey Distilled from Malt Mash, or the charred new oak vs. reused oak distinctions, or even oak vs. maple, for that matter. These rules reflect established distillers fighting over market and government bureaucracies attempting to secure their turf as regulators.

dwhuff recommended Jennifer Royall. I do too. As a consultant I submit more than a handful of applications to TTB. When the client does not have a preference, I work through Jennifer. Her bonds come back without annoying errors. The price is reasonable, the process is not complicated, and the service is good. I get nothing in return for the referrals except the good service. Here is some general advice. Bonds are one of the cheapest things you'll buy for the distillery. I recommend that you buy a bond sufficient to cover what you will need at the end of the first year, then add a little. Unless you are really on a shoestring, and I have been at times in my life, the small extra cost makes buying a larger than needed bond a good play. That is not to say that others won't provide service that is just as good s hers. But she is the one with whom I have been working, so I can vouch for her.

I'm jumping in late, but can't let this go by. Be very careful how you read the regulations. Are one liter commercial samples permited under certain circumstances? Yes, but .... We must visit 19.434. Do that - Google 19.434 and read the entire section, a well as those around it, to understand the tax rules on sampling. Here is an excerpt that iis pertinent to the question of furnishing samples to customers. ( Customer samples. If a bona fide purchase agreement exists that is contingent upon quality approval, a proprietor may furnish to a prospective customer a sample of spirits not exceeding 1 liter for quality testing. Note that this requires a preexisting bona fide purchase agreement where the acceptance of the order is contingent on quality approval. It is not a sample you provide for the purpose of secure a buy-sell agreement. Furnish this sort of sample is furnished to confirm that the goods conform to the existing contract. In that same paragraph - "A proprietor may furnish a sample not to exceed 1 liter to a prospective customer for quality testing in anticipation of a purchase agreement if the customer is authorized to receive bulk spirits for industrial use. As a craft distiller, you are not creating bulk spirits for industrial use. The language is specific - since it does not include bulk samples for non-industrial (beverage) use, the provision does not apply to your operations. Here is a confession. I started to answer this question and had it wrong. I had to correct myself. How did I get it straight? I looked at the regulations. I've got far more experience than most, but I look. It is habit. It is sound practice. Don't trust answers that do not cite the chapter and verse. Even from someone who claims my experience. Make me tell you where to find the information and then confirm it for yourself. That is important. What is the saying, "Trust but verify." It applies here. It will save you grief.

I have advised people to run from buildings that are eligible for historic status, but that advice is certainly not etched in stone. It is tempered with an admonition that before one runs, one should consider the value of the location. Whether to run or not should be a business decision. As you point out, locating in a building that is eligible for, or has been listed as, a national historic monument can certainly be an “asset” worth purchasing with the investment of your time. I might even learn to do a backflip if someone promised me eight to ten times the business out the door. The important point is that you are not bared from establishing a DSP in such a location. I am not an expert in this matter, but here is what I think I know about it. It will give you a basis of asking your questions to persons who purport to be experts, and they are easy to find on almost any subject. · The NHRP is the official list of the Nation's historic places worthy of preservation. · The National Register is administered by the National Park Service under the Secretary of the Interior. · According to the NPS - Owners [of property on the NRHP] can do anything they wish with their property provided that no Federal license, permit, or funding is involved. That brings us to a potential giant “whoops.” If you want to be a DSP, then a federal permit is involved. On the other hand, you may not be the owner of the property. Where does this leave you? Here is what TTB says about its involvement in the issue. · Any Federal agency which authorizes activities which may impact on properties included in or eligible for inclusion in the National Register of Historic Places is responsible for evaluating the nature of the impact and reporting its finding to the Advisory Council on Historic Preservation. · Since the TTB issues permits … which may affect construction or use of historic properties, we must take the potential impact on such activities into account when considering whether to authorize such activities. That is a statement of what they are required to do. But what do they actually do? I don’t know, but let’s look at their further advice on the matter: · If your proposed premises are included in or eligible for inclusion in the NRHP and you plan to make any changes to construction or use of those premises, we strongly recommend that you contact your State Historic Preservation Office early in the planning process, and follow state guidelines. Failure to do so may result in delay of your permit or registry, or request for additional changes to your premises. The emphasis is mine. Note that TTB does not say that you must contact the State Historic Preservation Officer. They “strongly recommend” instead. Also note that TTB does not say, in this bit of advice, “We are going to evaluate your project and reporting our findings to the Advisory Council on Historic Preservation.” It does not say, "We will take the construction required or the use into consideration when it decides whether to approve your application.” It instead strongly recommends that you do that. I have not been involved in such an application, but I recall from my past life, that they simply made note of the fact and let the appropriate agencies do the heavy lifting. In that regard, if you look at the "other required documents" that you must submit with the application to register the DSP, there is no mention of requiring, as a part of the application, any further information if you state that the premises is eligible for consideration, etc. Also note that when you check the "yes" box on the question on the permit application form, they do not provide any link to further explanations they will require if you answer yes, as they do in many cases. I conclude that they do not want the information because they will do nothing with it. Do I know that? No I don't. That does not mean that you should just check yes and go blithely on your way. Somewhere there is someone, in some office, who has some power, who does care. That someone, whether it is TTB or another agency, may step in with a long list of requirements. That said, it sounds as if you may be locating within a building that someone else has proposed to list on the national historic register. So here is some perhaps obvious advice. Begin by talking with them the persons who are developing the project. If they have applied for historic status, they will probably have employed an architect who understands the rules and who is guiding them through the process. Someone has probably been in contact with all of the appropriate agencies. If they are converting the building to commercial space, they will probably have sought answers to the questions that potential tenants may ask. Finally, while I’m not an attorney, you might ask one whether you should include, in the lease, an escape clause in case someone who has the power to approve denies the use of the premises as a DSP or makes it just too darned expensive to consider. That is good advice in general, which may be confirmed by anyone who has had a go around with the local fire marshal, wetlands preservation people, or water authorities. So my advice is, “Don’t run.” Check first, and then see if, the facts in your very particular case, you think running is the correct business decision.

Noting has changed except TTB has amended §19.601 to remove the requirement that a DSP record the kind of spirits bottled in its daily summary records of cased goods held in the processing account. The bottling record still must show the quantity and kind bottled from any batch. Let’s take a trip through the regulations together. Sec. 19.354, which is headed “Bottling or packaging records,” requires a record for each batch of spirits bottled or packaged. The requirements for this record are in §19.599. These recrods still must include, among a long list of other bits of information, the kind of spirits in the batch (19.599(e) and the total quantity bottled. This must include the dates the bottles were filled, but it can be more than one date, so it is not a daily record and would not, in any case, summarize the cases of bottled spirits you are holding onto pending withdrawal from processing. Section 19.601 requires the daily record that shows, on any given day, the cases of spirits that you have in the processing account. They are the “Finished products records.” As written, §19.601(a) requires that you keep “daily transaction records and a daily summary record of the kind and quantity of finished products bottled or packaged within the processing account at the distilled spirits plant,” along with the beginning and ending quantity of bottled spirits on hand, and any overages. It is a record you would post daily from your bottling records. The change announced removes the “kind” requirement from the finished product records but not from the bottling record. As I read the changes, prior to this latest announcement, as of April 8, 2014, you would have been required to keep a finished goods record that included separate summaries for each of the different kinds of spirits you held in the packages in the processing account, i.e., five different types would have required five different daily summary records, or one record with five columns. With this announcement, TTB is simply saying that you can keep one record that lumps together all of the kinds. Don’t bother to break it down by type; just report the quantity. It is still a required daily record. TTB’s explanations in the ruling is interesting. In brief, the ruling explains: · The requirement to record kinds was added in 2011. It had not been there before. · TTB added it because the law required it (See 26 USC 5207). TTB considered it a conforming change that would not cause major difficulties. · Subsequently, major players complained it would cost $20,000 to $50,000 each to develop the new systems required to capture the information. · In 2012 TTB listened, and said, we can’t change the regulation back to the way it was, because these changes we've made reflect what the law requires. For the same reason, we can’t grant a variance to the requirement, but we will establish a grace period in which we won’t take adverse action if your records omit kind but otherwise comply. · So TTB first gave everyone until April 8, 2012 to comply and then extended that to April 8, 2014 when industry said, “Hey, it’s going to cost us even more than we first thought.” . · So TTB reviewed its position and issued the ruling on March 27, about 12 days before the grace period was to expire. By ruling, TTB removed the requirement it had said it could not, quietly forgetting its claim that it can’t ignore what the law says. It is doing so, it says, because it has been able to audit just fine without the additional information of the kind of spirits. This is a new standard for regulations. TTB’s regulations, it seems, no longer must require what the law requires, as long as omissions don’t create administrative difficulties or create danger to the revenue. It is an interesting precedent. But, here is the curious part, to me at least. TTB waited until about two weeks before the grace period was to expire to issue this final rule. I ask rhetorically, “Hasn’t everyone already made the changes necessary to capture the information they would have needed to capture by April 8, if TTB had not relented?” So how does this cut the cost to industry? It is money that a prudent person would already have spent. Did anyone tell you – and I mean you personally - not to amend your records to capture this bit of information? Were you told, don’t go to the bother? Was anyone told don’t go to the bother? And if no one received a selected whisper not to bother, why does TTB go to the bother of issuing this notice now, after everyone, presumably, has spent the money to voluntarily comply come the fast approaching April 8 deadline. It would seem hard to make $50,000 or more worthy of changes between now and then, although I'll bet yo could do it for a lot less. Anyway, if you are a small player, I think you will want a perpetual inventory by kind or “sku” so that you can plan your production schedule. Not having such a record would seem to be potentially more costly than the dollars you would spend to keep track of how much bourbon, vodka, gin, and rye you have available for sale.

Yes, you may expand to add space. It is called noncontiguous premises and here are the provisions that apply: Sec. 19.53 Continuity of plant premises. As a general rule, the premises of a distilled spirits plant must be continuous except for separations by public waterways, roads, or carrier rights-of-way. However, the appropriate TTB officer may approve the registration of the plant where there are separations of the plant premises and all parts of the plant are in the same general location if: (a) There is no jeopardy to revenue caused by the separation of premises; and ( The separation of premises does not create administrative problems for TTB. TTB's guidelines on this change from time to time. I've not asked recently. The most recent public comment I've seen was in the Treasury Decision that announced the changes to Part 19 in 2011: TTB Response: In the preamble to Notice No. 83, we explained that we would not adopt a 200-mile rule and the current comment does not provide sufficient justification for any change of our position. We will continue to evaluate requests for alternate methods or procedures concerning plant continuity on a case-by-case basis, each analysis to be based upon multiple factors. Generally, we believe that the ‘‘same general location’’ must not be too large an area so that the revenue is placed at risk. Also, because a distance of 200 miles could extend over a multi- state area and would cross over into different field offices within TTB, such a distance would create administrative difficulties for TTB. I've heard urban legends that the distiance is not more than 10 miles. I do not trust urban legends.

In spite of evidence to the contrary found on many labels, unless you have a corn whiskey, which must be labeled as corn whiskey - (see 5.22((2), "Whisky conforming to the standard of identity for corn whisky must be designated corn whisky - you must age whiskey and if it is aged for less than 4 years you must state the period that it was aged. . What is corn whiskey? It's a standard of identity product. "(ii) “Corn whisky” is whisky produced at not exceeding 160° proof from a fermented mash of not less than 80 percent corn grain, and if stored in oak containers stored at not more than 125° proof in used or uncharred new oak containers and not subjected in any manner to treatment with charred wood; and also includes mixtures of such whisky." Spirits identified as "moonshine," or "white dog" are "fanciful names" used in when a prodcut does not fiit any standard found in 5.22. They are specialty items, and the rules found at 5.35(a) apply, including a the need for a truthful and accurate statement of compositon. I know that the public COLA database has many examples counter to this advice. What can I say? All I can do is tell uyou the rules and shrug in the direction of what actually goes on. Finally, someone wrote you can also refer to the TTB regulations. The best advice I can give you is that if you want to know something, you must go to the TTB regulations. What someone else says, including me, does not matter. All advice should be based on citations to which you can tunr to decide whether the persons giving the advice really knows what they are talking about.

I take it from your comments that you are familiar with TTB's requirement for determining the obscuration factor that you must use. I think there is no shortcut. For those who don't know how TTB says you must determine obscuration, here are the pertinent section from Part 19 and from the gauging manual. Sec. 19.376 Determining obscuration. Proprietors may determine the proof obsecuration as prescribed in 27 CFR Sec. 30.32 of spirits to be bottled on the basis of a representative sample taken: (a) from a storage tank incident to the transfer of the spirits to the processing account, or ( from a tank after the spirits have been dumped for processing, whether or not combined with other alcoholic ingredients. The obscuration shall be determined after the sample has been reduced to within one degree of the proof at which the spirits will be bottled. Only water may be added to a lot of spirits to be bottled for which the determination of proof obscuration is made from a sample under this section. The proof obscuration for products gauged pursuant to this section shall be frequently verified by testing samples taken from bottling tanks prior to commencement of bottling. §30.32 Determination of proof obscuration. (a) General. Proof obscuration of spirits containing more than 400 but not more than 600 milligrams of solids per 100 milliliters shall be determined by one of the following methods. The evaporation method may be used only for spirits in the range of 80-100 degrees at gauge proof. (Evaporation method. Evaporate the water and alcohol from a carefully measured 25 milliliter sample of spirits, dry the residue at 100 degrees centigrade for 30 minutes and then weigh the residue precisely. Multiply the weight of the residue by 4 to determine the weight of solids in 100 milliliters. The resulting weight per 100 milliliters multiplied by 4 will give the obscuration. Experience has shown that 0.1 gram (100 milligrams) of solids per 100 milliliters of spirits in the range of 80-100 degrees proof will obscure the true proof by 0.4 of one degree of proof. For example, if the weight of solids remaining after evaporation of 25 milliliters 0.125 gram, the amount of solids present in 100 milliliters of the spirits is 0.50 gram (4 times 0.125). The obscuration is 4 times 0.50, which is two degrees of proof. This value added to the temperature corrected hydrometer reading will give the true proof. © Distillation method. Determine the apparent proof and temperature of the sample of spirits and then distill a carefully measured sample in a small laboratory still, and collect a quantity of the distillate, 1 or 2 milliliters less than the original sample. The distillate is adjusted to the original temperature and restored to the original volume by addition of distilled water. The proof of the restored distillate is then determined by use of a precision hydrometer and thermometer in accordance with the provisions of §30.23 to the nearest 0.1 degree of proof. The difference between the proof so determined and the apparent proof of the undistilled sample is the obscuration; or (d) Pycnometer method. Determine the specific gravity of the undistilled sample, distill and restore the samples as provided in paragraph © of this section and determine the specific gravity of the restored distillate by means of a pycnometer. The specific gravities so obtained will be converted to degrees of proof by interpolation of Table 6 to the nearest 0.1 degree of proof. The difference in proof so obtained is the obscuration. Note that if you send a sample out for analysis, you want to make sure that it is prepared as required by Part 19. Good luck.

Yea - I no sooner said that when TTB made its news release. In fact, I just came here to post it and you beat me to it. But my point isall the more valid. There may be no federal prosections - they were arrested by state authorities - but TTB may be makng a trip to the bank to seize the bank accounts of the moonshiners, once they get a handle on the potential liabilities. That was the gist of the message I was trying to deliver when I posted the other day - don't take the lack of criminal cases as an indication that you are bullet proof. It is likely that TTB used IRS special agents assigned to it under a budget agreement when it investigated these cases. They will want to show something in return. And if the moonshiners were engaged in the business of making the booze for sale, they may open themselves up to asset forfeiture provisions, which allow the government to go after anything purchased with the proceeeds of the illegal activity. But I'm out of my depths here because the only time I was involved with this was contraband cigarette cases. I'nm not sure how the provisons apply to moonshiners. I think no one on this formum wants to find out. Let me add to this warning - TTB can and has required still makers to provide lists of their customers.

I think others have, or at least should have, convinced you that distilling first is a bad idea. Someone mentions felonies, and may want to argue, but who has been prosecuted for moonshining lately? That is only the criminal side. Consider this. The tax is due on production. Only a DSP can defer the tax. If you have spirits that you made before you became a DSP, they are taxable when produced -on the sport - with penalties running 5% a month up to 47.5% if they are kind and go with the leasst noxious of penalties. If you can prove you don't have the money to pay, and survive the heart attack you get when you receive the assessment in the mail, TTB might compromise the liability, but the civil side can be devastating. Did I mention forfeiture provisions? Did I mention that you would not be on their good side when you actually got around to applying? Don't even think about it.

Let me add that TTB is helpful providing information about what other countries require in order to get your products through their customs services. Contact the import export branch and talk with them. It is a service they provide.

Federal standards requre that the premises be secure, but they also allow for outside tanks that are surrounded by a chain link fence. The seperation that you propose would seem to be sufficient if the cage doors can be secured for locking in a way that provides the same security as a chain link fence.

It is all well and good to talk about traditional vodka, but vodka was not defined as a class and type of neutral spirit until 1947, or somewhere there abouts. I've not looked into it in a while. But, if you want to understand the issues, go back and see what was said at that time. The definition has not changed since then - well, there is the citric/sugar provision. If you go back to 1947 you will find that that the concern then was that vodka was lossing all meaning, so they created the standard. I hate smiley faces, but what is this discussion all about? Guess what, all of these conversations have an underlying theme - today distillers are not confining products to class and type. Unaged whiskey other than corn is an oxymoron. A statement of age about gin is by proclamation misleading and so prohibited. And vodka has no distinctive character. More and more distillers are creating "specialty products," which do not conform to a class and type. It will be interesting to see how TTB handles this when they decide someone has kicked the dog once too often. Those who say we need to re-examine the rules should take note that TTB's regulatory agenda, as published, proposes to do that. Stay tuned.

There is nothing in federal law that prohibits a person who holds an interest in a producer or supplier from also owning wholly a retailer. Look at tasting rooms where spirits are sold! The legal theory is that you cannot induce yourself. Partial ownership of the retailer presents a possible problem. I'd have to know the details of how the businesses are structured before making further comment. But if I were you, for the reasons stated below, I would not be concerned. First, the language of the law says an industry member cannot acquire an interest in a retailer, either directly or indirectly. Second, nothing prohibits a retailer from acquiring an interest in a supplier. Further, your guarantee of the loan preceded the formation of the DSP. Next, TTB has to prove, as you point out, that your acts as a supplier induced the hotel bar to purchase your products to the exclusion, in whole or in part, of products offered for sale by others in interstate commerce. Read with care, the jurisdictional clause, “or if such person engages in the practice of using such means, or any of them, to such an extent as substantially to restrain or prevent transactions in interstate or foreign commerce in any such products, or if the direct effect of such inducement is to prevent, deter, hinder, or restrict other persons from selling or offering for sale any such products to such retailer in interstate or foreign commerce.” As someone who pursued such violations in the past, let me tell you that can be a significant hurdle, even when you have big money changing hands. I'll speak personally now, there is no way in which you would ever have induced me to spend the time necessary to prove all of elements need to prove a possible tied-house violation by what is probably, if you will excuse me, a minnow in a world of whales. There are too many other, more important, issues to pursue. Imagine all of the tied-house violations that exist in say, Las Vegas, and ask, "Why would TTB want to investigate me. " So, don't worry about prohibiting the hotel bar from serving your products. Act in the best interest of the bar, which probably means the best interest of the hotel as well, and that probably means having a variety of products available for the customers. You will be fine. Oh, and I'm not an attorney and this is not legal advice and you should not rely on it as your sole source of information and you should consult your attorney before.... That is good advice. But do watch out for the state laws. Make sure North Carolina is not going to take exception. States have some really restrictive laws - the cousin of your employee is the wife of the bartender, etc.... That is ridiculous, of course, but not as farfetched as some of the state laws take things.

I would not lock in on the $10,000 minimum. Technically, it is true (actually, if you only produce or only warehouse it could be $5,000). But you have to consider youur operations and business plan when yoy arrive at the penal sum of the bond you want to purchase. $10,000 generally won't cut it. There are two sorts of bonds, operatonal and withdrawal. The withdrawal bond comes in three "flavors," production, warehousing and processing. Each of those operations carries a $5,000 minimum. Processing can mean a lot of things, and I'm not up to giving a class right now, but if you bottle you do it in processing and if you are qualifyng as a processer, you must also qualify as either a warehouseman or for production (distilling). So the minimujm operational bond for someone who bottles is indeed $10,000. You determine the amount of the operatoins bond you require by adding together the number of proof gallons you produce during 15 days, plus the maximum quantity, in proof gallons, that you will have in bulk, either in processing or the warehouse, on any one day, plus the number of proof gallons you have in cases waiting to be shipped. Multiple the proof gallons by $13.50 and you have the amount of the bond you require. Next, unless you want to pay taxes every time you remove product from bond, you will also need a withdrawal bond and the mininmum there is $1,000, which doesn't go very far at about $26 a case for 750/12 80 proof cases. Remember, it has to cover a months removals - the first half of the month for which you are defering the tax, plus the second half of the month, the period of deferral, during which you are adding to the amount under bond each time you make a removal. If you chose to make quarterly payments, the amount you need is obviously more. Use $26 a case on your projected removals at the end of a year's time - bonds are cheap enough that you don't want to be constantly increasing them. Now, I've talked about a lot of different sorts of bonds, but you do not need to get separate bonds. The best way is to get a unit bond, which combines the operations and withdrawal bonds. With the $10,000 minimum operations bond and the $1,000 minimum withdrawals, the minimum becomes $11,000, but if you produce, store and bottle, it is $16,000. My advice is always to look at what you think you will be doing at the end of the year and go with that amount. Remember that if you are aging product, every month when you put some more into barrels, the total in the storage account increases. Minimums quickly become not enough. The cost of the bonds is not prohibitive. It depends on the company you chose. The cost is reasonable enough that you shuld be able to buy too much bond for not much more than you would pay for too little. Is $16,000 enough? Only you can answer that based on what you think you will be doing 12 months down the road. Please excuse any typos. It is late, it has been a busy day, and I am tired.

It is a state issue only. TTB would allow you to employ a six year old, although I'm sure there are some general federal laws dealing with child laws. But 18 is simply not an issue federally. Call your local ABC and ask.

Sure you can do it. But you will wait an average of 109 days to get approval, and that was the figure last November, before the effects of the lockout of TTB employees kicked into effect. Then you would have another 90 days or so to wait for formulas and labels if both are needed, or 45 days if all you need is label approval. I do not have a good estimate of how long it takes TTB to approve a change of location. I have heard 45 days, but I cannot vouch for that. My experience is that one persons story is just that. There really is no telling how long TTB will take to process an application, even if it is flawless. If you do get the small still and do your testing in a small area, since you would have a permit, you could apply for and receive formula and label approval. That way, when TTB approved the move, you would be "good to go." If you want to talk about this - I consult, but I would not charge harge for a talk about things like this - write me at dhdunbar1@gmail.com. If you follow posts, you will see that I share a lot of info here at no charge. Is it advertising? Sure it is, but its still free to anyone who wants to read it, whether they would ever consider hiring me as a consultant or not.

I will hop into this late. I consult and if anyone calls me and asks about help with a federal application, I tell them they do not want to get involved with a federal application until they have ALL of the local and state issues worked out. Everyone who says they work "backwards" are actually working "forwards" as far as I am concerned. Any reaonable plan begins with local zoning and development and goes down the list from there. Generally, we can find a solution to any TTB problem that might arise with a location - unless you propose locating it in a tent. So I tell clients pay me nothing until you have your ducks in a row. And you are correct, you are not contemplating an experimental DSP within the intent of TTB's regulations.

You can ignore the citric acid - sugar rulings. They relate to whether there is a change of class and type as a result of the additions of those items. You are talking about flavored vodka, which is not vodka. It is its own class and type. Class 9; flavored brandy, flavored gin, flavored rum, flavored vodka, and flavored whisky. “Flavored vodka,” is ...vodka ... to which has been added natural flavoring materials, with or without the addition of sugar, and bottled at not less than 60° proof. The name of the predominant flavor shall appear as a part of the designation. If the finished product contains more than 21/2percent by volume of wine, the kinds and precentages by volume of wine must be stated as a part of the designation, except that a flavored brandy may contain an additional 121/2percent by volume of wine, without label disclosure, if the additional wine is derived from the particular fruit corresponding to the labeled flavor of the product. You were correct in obtaining a formula, because they are required for all flavored distilled spirits products. Here is the basic reqwuirement: §5.26 Formula requirements.(a) General. An approved formula is required to blend, mix, purify, refine, compound, or treat spirits in a manner which results in a change of character, composition, class or type of the spirits. Form 5110.38 (27-B Supplemental) shall be filed in accordance with the instructions on the form and shall designate all ingredients and, if required, the process used. Any approved formula on Form 27-B Supplemental or Form 5110.38 shall remain in effect until revoked, superseded, or voluntarily surrendered. Any existing qualifying statements as to the rate of tax or the limited use of drawback flavors appearing on a Form 27-B Supplemental are obsolete. (Change in formula. Any change in an approved formula shall require the filing of a new Form 5110.38. After a change in a formula is approved, the original formula shall be surrendered to the appropriate TTB officer. If you did not include sugar in the original formula, it would appear that you would need to file a new formula to use sugar. If your exisitng formula includes sugar, then you would need to file a new formula if the quantity you now want to use falls outside of the range that you may have shown on the approved formula. I recommend that you call TTB's formulation division and aks them. You can reach them at 202-453-2250 (tol free 866-927-2533 or by e-mail at alfd@ttb.gov. They are the authoritative source. I am not.

The ruling to which you link is the only ruling I have ever found on the matter and it is obviously out of date. I think the models they list are no longer avaiable. I wrote TTB about six months ago - prbably more like a year - asking them for a position on density meters and got no response. I did not pursue it. I am not sure that they do not want to ignore the question rather than take a stance. I note that in 2008 TTB issued a document discussing determining fill/headspace by weight. You can find it at http://www.ttb.gov/ssd/pdf/tm517.pdf. The equipement they use includes a density meter with 0.0001 gms/cm3 accuracy or better set at 20 degrees centigrade. I have no idea what import this may have. Here is the basic requirement: §30.21 Requirements.(a) General. The proof of distilled spirits shall be determined by the use of gauging instruments as prescribed in this part. (Proprietors. Proprietors shall use only accurate hydrometers and thermometers that show subdivisions or graduations of proof and temperature which are at least as delimitated as the instruments described in §30.22. © Appropriate TTB officers. Appropriate TTB officers shall use only hydrometers and thermometers furnished by the Government. However, where this part requires the use of a specific gravity hydrometer, TTB officers shall use precision grade specific gravity hydrometers conforming to the provisions of §30.24, furnished by the proprietor. However, the appropriate TTB officer may authorize the use of other instruments approved by the appropriate TTB officer as being equally satisfactory for determination of specific gravity and for gauging. From time to time appropriate TTB officers shall verify the accuracy of hydrometers and thermometers used by proprietors. The appropriate officer, in this case, is the Director, Scientific Services Division who has authorority to approve other methods for determination of specific gravity and for gauging. Those who are interested in what has been approved should write to the Director, Scientific Services Division at: Beverage Alcohol Laboratory, Telephone: 240-264-1596, Email: Laboratory@ttb.gov. If enough persons ask, they may answer. But I want to add that sometimes when I received questions while employed by ATF - TTB's predecessor agency, as TTB is fond of calling it - I would ask, in response, "Do you really want me to answer that question?" Often it turned out they would prefer I not answer it because if I did they were presumably on notice.

Are you asking about the "rules" that would cover this, or do you know the rules and so are asking only for names of businesses?

sdjowne's advice is correct. The above reference is in fact the link to which you want to go. And if you are selling to the utlimate consumer, as you would be if you sold for events like a birthday or wedding, it is in fact a personal label and the rules in that link apply. TTB issues a word of caution in that circular and you should take heed; You should not confuse personalized labels with customized private labels created for purchasers other than the ultimate consumer. Such private labels may bear a brand name or artwork that is specific to the purchaser who is buying the product in order to sell it to consumers. For example, a distilled spirits, wine, or malt beverage industry member may create private labels for customers who may include other permittees, retail stores or restaurants. This guidance document does not apply to such private labels, which are subject to the same requirements as other labels. If you are selling out of your gift retail space, at retail, to consumers, you are good to go under the rules for personal labels. If you are selling to someone for resale, it is a “private label” and all the normal rules apply. I think that you propose the personal, rather than the private, label and that djowne's reference is spot on, but I did want to bring to your attention the difference between a "personal label" and a “private” label, if only for future reference. It is easy to get confused.

Just stumbled across this thread from some time ago, but see that it gets an occasional entry still, so I'll comment too. Google may be a friend, but friends don't always know. If anyone in the future is looking for information about organic labeling of distilled spirits, or any other alcoholic beverage, the place to visit is TTB's website. Organic claims come under the Department of Agriculture’s purview, but TTB has zn MOA with USDA about NOA's and.... I'm just jokingly giving a warning about the acronyms you will encounter. TTB wants you to know what is required, so they include this information on their website. Here is a link: http://www.ttb.gov/alfd/alfd_organic.shtml That is TTB's website with links to other information, FAQ's, etc. For example, it links to: http://www.ttb.gov/pdf/spirits.pdf which is a pamphlet that TTB and USDA put together showing sample label for distilled spirits. It raises some questions by the acronyms it uses, but gives you a good idea of the questions you should ask. Then you can go back to the FAQ's and see if they answer them. My reference to acronyms is a real warning. Gird your loins. The documents are full of them. Good luck