Tuesday, May 28, 2013

State Whiskey Law: Kentucky & California

Whiskey is mostly regulated by the federal government, but some states have their own whiskey regulations.  A few weeks ago, I wrote about the passage of a Tennessee state bill defining Tennessee Whiskey.  That bill has since been signed into law and will regulate how Tennessee companies can use the term "Tennessee Whiskey." 

Kentucky also has a law on the books regulating the use of its name on whiskey labels.  For years I had heard about a special rule in Kentucky but had never seen it or had anyone provide a citation, so when some folks swore to me that it existed, I went searching for it.  Kentucky Revised Statutes (KRS) section 244.370  requires that to use the name Kentucky on a whiskey label (as in "Kentucky Bourbon" or "Kentucky Whiskey") the whiskey must have been aged in oak for at least one year in Kentucky.  If it's not aged a year, the company can still bottle it, but they can't use the name "Kentucky" or even say that it was made there except in the name and address of the distiller.  The only exception to the aging requirement is for corn whiskey.

Of course, this doesn't really have much practical application these days, since most Kentucky whiskey is sold as straight whiskey, which means it is required to be aged for at least two years.

California has its own laws defining whiskey.  California Business & Professions Code section  25175 makes it a misdemeanor to sell any product labeled at whiskey that has not been aged for three years in charred oak barrels.  There are exceptions for corn whiskey, spirit whiskey and Scotch.  Unlike the regulations in Kentucky and Tennessee which cover activity and label information not regulated by the federal government, the California law directly contradicts the federal regulations, which do not provide any age requirement for non-straight whiskeys.  In fact, even many straight whiskeys, which have a two year age requirement, would not be permitted to be called "whiskey" under the California law.  State laws that conflict with federal laws are preempted by virtue of the Constitutional Supremacy Clause, though preemption is a rather complex issue with many nuances. (See also, Chuck Cowdery's post on this law from a few years ago).

Given the plethora of young whiskey on California shelves as well as the lack of any case law interpreting this provision, I can only assume it is not being enforced. 

There may well be other state laws regulating whiskey which exist alongside or even conflict with federal regulations.  If you know of any others, let me know.


EllenJ said...

Every state has its own alcohol beverage laws, not just California and Kentucky. In fact, in Kentucky (and elsewhere) alcohol regulations are written on the county level! I'm not positive about this, but I believe that there are more dry counties in Kentucky than wet! As with California, many of these state and regional ordinances conflict with federal law. One can only imagine the level of potential graft that might accompany such discrepancies.

The California laws are just... weird. But then again, that's California. It's probably not alone, either. This topic ought to bring out lots of distillers' and bottlers' nightmares about trying to distribute and label their products in different states.

As for Kentucky's requirements for calling a bourbon "Kentucky Bourbon", it's actually one year and one day. However, you are neglecting a very important point. Nowhere in the law does it state that the whiskey has to be aged for its FIRST year in Kentucky. It's perfectly legal to distill and age bourbon whiskey (or purchase existing stock) in, say, Indiana, for three or four years, and then move it to a warehouse in Kentucky for a year and a day and label it "Kentucky straight bourbon". I don't want to pop anyone's fantasy balloons (well, yes, actually I LOVE doing that) but this is commonly done, much more often that industry folks will admit publicly.

sku said...

EllenJ, thanks for the comments. You raise some interesting points.

First, I've heard the "year and a day" rule before, but it doesn't appear in the law, which just says the that the whiskey must age for "not less than one full year." It may be that a year and a day is how people talk about it, but technically, it appears that a year and 30 seconds would fulfill the requirement.

As to moving barrels from other states, the law only applies to whiskey "produced in Kentucky," so depending on how they interpret "produced," it's not clear that there would be any restriction at all on whiskey distilled elsewhere and then brought into the state, though they may well have interpreted as you describe.

The specific statute can be found here.