Wednesday, July 08, 2009

Be 'Still My Beating Heart

One of the many laws which took effect on July 1st in Tennessee was a law that allows counties which have liquor by the drink to have legal distilleries operating in their community. Many of us who are opposed to dry laws have rejoiced in this development:

Several entrepreneurs are interested in opening legal distilleries in East Tennessee counties, according to Nashville developer Jim Massey, who plans to open a distillery in Nashville and possibly start a side business helping other distillers with the startup process.

Under the new law, about 44 counties are now eligible for distilleries. Manufacturers will be allowed in any county where both retail package sales of liquor and liquor-by-the-drink sales have been locally approved.

Since liquor, like cigarettes, is considered a sin tax, there will be tax revenue from the new spirit producers, he noted.

Whether proponents of dry laws want to admit it or not, the new distillery law is the beginning of the end for widescale county and community dry laws in Tennessee. The process may take awhile to play out, but those counties who simply refuse to go wet will lose out on millions in annual tax revenue from the ability to tax the sale of spirits. Many consumers, after all, will come to prefer a spirit made locally and will likely display a preference for whiskies and other spirits made close to home. Not every county eligible will have a distillery, but nearly all counties could reap the economic benefits of having legal stills nearby, but far moreso if those counties go wet.

The opposition to making more Tennessee counties wet comes from the predictable quarters, most notably the Tennessee Baptist Convention. Oddly enough, we don't hear a huge demand from their sister body in Kentucky to shut down the Commonwealth's myriad of whiskey distilleries. One has to wonder if that might have something to do with the thousands of jobs that would be lost not only at the stills, but at package stores, candymakers, farms, factories, warehouses, and certainly the State of Kentucky itself. Entire towns in certain parts of Kentucky would become ghost towns without the stills, Bardstown being the chief example. Even the Cistercian monks at the Trappist Abbey of Gethsemani outside of Bardstown would likely need to close their doors, since the distilleries provide the whiskey they need to make the famous fruitcakes and bourbon fudge that provides the monastery with more than 2/3rds of its independent income.

(As a side note, if the Bishop of Knoxville has given this issue more than five minutes of thought, he may be chomping at the bit over this new law. One of Bishop Stika's goals is to bring contemplative religious communities into the Diocese of Knoxville. For such communities to survive, they need to be self-sustaining and have a source of income free of other Church support. This law would conceivably allow a religious community either to open their own distillery or to produce a product that uses locally made spirits and sell it, and they could do so tax free. This law provides, perhaps unwittingly, the Church with the means to open multiple monasteries and friaries in Tennessee should She wish.)

Kentucky is clearly the model for this law. While a number of Kentucky counties are dry, that number is far fewer by percentage than Tennessee, and Kentucky law allows for the sale of wine (and watered-down spirits) in grocery stores in wet counties. Those in the liquor lobby have to know that the day is coming when Tennessee will have wine in grocery stores as part of the natural legal evolution of the State going wet which this distillery law has begun.

Meanwhile, Cocke County Mayor Ileff McMahan Jr. doesn't understand why Cocke County was exempted, and he doesn't like it:

"At the last minute, Cocke County has been taken out. Nobody asked me," Cocke County Mayor Iliff McMahan Jr. said.

McMahan is in favor of legalized distilleries and would like to see them in Cocke County. He didn't know his county has been exempted from the law and thought as county mayor no one had the authority to opt out Cocke County without his approval.

"For better or for worse Cocke County has the reputation of being the moonshine capital of the world. At some time, someone might want to capitalize on that," McMahan said.

As someone who lives about five minutes from the Cocke County line, that county's moonshining reputation is well-earned. Most of us who live around here know how to get white lightning if we want it. I'd venture to say that it is possible that Rep. Eddie Yokley was "convinced" by someone other than McMahan to exempt Cocke County. You can probably guess the reason why, and it wasn't the Baptists.

At a time when Tennessee is struggling to meet its budget, this new law could bring millions in tax revenue in the coming years, and has the potential to put a lot of Tennesseans to work. It will also give Kentucky a run for its money as the whikey capital of the world, because we all know that Tennessee whiskey tastes better anyway.

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