Wednesday, June 24, 2009

At the TTB Expo in Kentucky

"Flight Attendant, please prepare the cabin for landing," the captain barked politely on the intercom. And then the two familiar bings, signaling our final approach. The short flight to Kentucky was nearly over.

As I was flying into Covington airport, I was struck by the beauty of the Kentucky countryside directly below me. All around were green patchwork farms, separated by lush deciduous forests. Each farm had its little farm house, barns, outbuilding, and fields. And yet, often, I would see a smaller outbuilding or shed, separated far from the main farm by a long thin dirt road and sheltered in a grove of trees. I wondered, how many of those tiny buildings below have an old pot still in them? How many of those farmers down there are still cooking up small batches of corn liquor? Probably more than you might guess. I smiled at the thought.

This week, I am in Kentucky, in the city of Covington, just south of the massive Ohio River, across the water from downtown Cincinnati. What brings me here this week is the TTB Expo. The TTB is the Tax and Trade Bureau, a post 9-11 split from the Bureau of Alcohol, Tobacco and Firearms. Frankly, I liked the old name better. It was always cool to think that you'd be getting a visit from an ATF agent. TTB just sounds too... soft, I guess. So, TTB handles trade and commerce, and ATF still gets to handle the criminals and automatic weapons.

The TTB put on this expo as a free, federally funded, forum to introduce the general public to all the details of licensing, paying taxes, marketing, paying taxes, exporting, paying taxes, laboratory analysis, and (did I mention?) paying taxes. All joking aside, the schedule is jam-packed with really useful sessions on the intricate details of getting licensed and running a clean business. There are sessions on "How to qualify for 'organic' on your label", "Laboratory techniques for the small distiller", and "Pitfalls of artisan distillers".

The expo covers each of the broad areas of the TTB's mandate: wine, beer, importing, beverage distilled spirits, industrial distilled spirits, ethanol fuel, firearms, and tobacco. The TTB have separate tracks set up for each of these disciplines with detailed presentations in each. Despite this fact, the overwhelming majority of attendees are small, craft distillers. In every distilled beverage presentation I sat in, when a show of hands was done, the vast multitude of attendees identified themselves small distillers.

Unlike other commercially run expos, there are no booths for vendors hawking their wares. Just the facts, ma'am. The TTB has really brought a large staff to this conference, over 30% of their entire TTB staff, in fact! They really try to get across the notion that they are here to collaborate, not flex their bureaucratic muscle. Every single government person I spoke with was friendly and had a "How can we help you succeed?" attitude. Each one encouraged phone calls to their direct number and gave out their personal email address. I have never seen federal government employees so responsive, and I've worked in government contracting for a long time!

Just like the microbrewery explosion in the 1990's, it feels like we're on the cusp of something big here today--a boom in new distilleries. Maybe the ghost of prohibition will finally be laid to rest.

Applications for DSP permits were up a remarkable 60% last year at the TTB. The expo is swarming with new distillery owners and wannabes like myself. And from what I can see at this expo, 2009 should be a very big year at the TTB.

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