In New York, a Microdistillery Brings Cheer to the Local Economy

Ralph Erenzo didn't want to make booze. But he didn't have much choice.

As Tuthilltown Spirits' spokesperson Robin Hayes tells it, the distillery's story began in 2001, when Erenzo bought 36 acres of land in Gardiner, N.Y. Located near the Hudson River and Minnewaska State Park, the small farm was well situated for hikers and mountain climbers, and Erenzo planned to open a bed and breakfast. Unfortunately, his neighbors weren't eager to see their tiny town overrun by outdoorsmen and took him to court. Two years later, his bank account had dwindled, and he was down to the last eight acres, having sold the rest to pay his lawyers.

Desperate to turn a profit on the rapidly shrinking farm, Erenzo asked the town's enforcement officer what he could legally do with the property. New York state law allows farms to operate small wineries, so the officer suggested that Erenzo try his hand at winemaking.

Ultimately, though, Erenzo did him one better: A 2002 New York State law, based on the winemaking license, allowed farms to operate small distilleries with a maximum yearly output of 35,000 proof-gallons of liquor. Partnering with former engineer Brian Lee, Erenzo became one of the first New Yorkers to take advantage of the new law, and Tuthilltown Spirits was born.

Being Neighborly

One requirement of the farm distiller's license is that 50% of the distillery's raw materials have to be grown in New York state. Given Erenzo's disputes with the neighbors, one might think that Tuthilltown wouldn't be eager to work with local farmers, but the opposite was true. In the seven years that it has been in business, the company has formed a very close relationship with nearby growers, and Tuthilltown Production Manager Joel Elder estimates that 85% of the company's raw materials -- including corn, potatoes, wheat, rye and apples -- come from farms located within three miles of the distillery.

The only major item that Tuthilltown doesn't locally source is malted barley, a problem that Elder laments: "It's nearly impossible to find a good malted barley source in the U.S., and shipping from American farms is expensive." In fact, Elder notes that the cheapest, most local supplier is in Canada: "It's closer than American producers, costs less to ship and has a comparable price."

The barley problem has thrown a serious wrench in Tuthilltown's plans to locally source all of its ingredients, but Elder has a solution: "We want to start growing our own barley or encourage a nearby farmer to start growing it." Not only will this help maintain the company's "locavore" ideal but it'll also help the surrounding economy, an issue that's very important to Tuthilltown.

Elder emphasizes that "Our heart is with local agriculture. Any development at our company is tied to local agriculture and the local economy."

Building a Distillery, Expanding an Economy

Elder insists that "involvement with local growers isn't a marketing strategy. It's a survival strategy." In addition to cutting shipping costs and increasing freshness, it has given the distillery an amazing level of control over its ingredients. For example, when Tuthilltown wanted to experiment with open-pollinated heirloom grain, it contracted a local farmer, agreeing to absorb the costs of the attempt. "By subsidizing the experiment," Elder notes, "we gave them enough confidence to try a project that might not pan out."

These types of relationships have had a long-term effect on both the distillery and its neighbors. While Tuthilltown makes liquor from local apples, Elder notes that the McIntosh, Gala and Empire apples that nearby farmers grow aren't ideal for its uses. When a local orchard expressed an interest in developing an organic, self-picking operation, Tuthilltown convinced it to start growing heirloom apple species that were more suitable for its spirits.

Elder notes that the move "Helped the farmers and helped us. We got the apples we wanted, and they were able to develop a lucrative operation."

A Deep-Pocketed Partner From Scotland

Tuthilltown has also brought outside capital into the region. Recognizing that it needed to improve its cash flow if it hoped to grow, it agreed to partner with William Grant and Sons, the Scotland-based premium liquor company that owns Hendrick's gin, Glenfiddich Scotch and Stolichnaya vodka. Impressed with Grant's lineup and struck by its commitment to quality, Tuthilltown sold its popular "Hudson whiskey" line to the larger company. Under the terms of the agreement, Grant owns the brands, but Tuthilltown will continue to produce them.

While the Grant deal helped Tuthilltown to slightly upgrade its facilities, Elder points out that its biggest impact has been the massive increase in cash flow. "Previously, we were able to work when we could afford to procure ingredients," he notes. "Now we can distill constantly."

On a larger scale, the relationship between Grant and Tuthilltown has also poured money into the local economy. It has funded Tuthilltown's experiments with local farmers, and the distillery's increased production has been a boon for the area's growers, whose grains feed the company's cookers and stills.

Stop By and Visit

Now a significant economic force in the area, Tuthilltown has also built a stronger relationship with its neighbors. Perhaps the greatest sign of this increased friendliness lies in the distillery's growing popularity as a tourist site. In 2009, following years of lobbying, the New York state legislature passed a law allowing microdistilleries to host tasting rooms and offer tours. To celebrate, Tuthilltown invited the public to the distillery, where fans had the opportunity to harvest rye and see where the grain is transformed into liquor.

In the year-and-a-half since the tasting room law passed, Tuthilltown has drawn whiskey afficionadoes from around the world. But what effect has this stream of tourists had on the sleepy town that once fought against Ralph Erenzo's small bed and breakfast? "So far," spokesperson Hayes laughs, "There has been no word from the neighbors."
See the full Special Report:
From Prohibition to Microdistilleries: Changing How America Drinks
How New York's Microdistillery Law Is Building a New Industry
Pennsylvania's Small Liquor Makers Bottle a Heritage
Colorado's Microdistilleries Follow an All-American Path View all Articles » Bruce Watson is a features writer for DailyFinance, focusing on the political and cultural effects of economic events. A contributor to Military Lessons of the Persian Gulf War, A Chronology of the Cold War at Sea, the Journal of American Philosophy, A Cafe in Space, and the forthcoming Peanut Butter, Gooseberries, and Latkes! He has also worked as a research assistant in the British House of Commons and at the United States Naval Institute.

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The Big Society Bail-In brings protest to your local bank | Ruth Griffiths

UK Uncut has launched the Big Society Bail-In and will be targetting banks. Photograph: Chris Ratcliffe/Rex Features

Look through the newspapers this month and two points will become immediately clear. First, the government is cutting, privatising and changing the very nature of social security and public goods that were won through the 20th century. Every aspect of what was fought for by generations seems under threat – from selling off the forests, privatising health provision, closing the libraries and swimming pools, and scrapping rural bus routes.

Second, the banks are doing just fine. February is bankers' bonus month; Barclays announces their gifts to themselves on the 15th, with its chief executive, Bob Diamond, expecting £9m just for him. While RBS is due to transfer its £900m bonus pool into the pockets of high-earning bankers on the 25th. These bonuses should make the disgrace of the MPs' expenses scandal look like chicken feed and are another demonstration of just how much we really are not all in this together.

The two, of course, are linked. Because it was our broken banking system, with its greed and reckless gambling, that caused the crash. The National Audit Office has reported that at its peak, the amount of support provided to the banks reached nearly £1tn. In 2009 alone, £131bn of public money was spent keeping the banking industry afloat – and taxpayers continue to spend money supporting the banking system. But instead of asking the banks to pay for their crisis, it is the public who were asked to support the banks that are now being made to pay a further price.

The £2.5bn so-called "raid" on the banks is a levy of around 0.075% of their balance sheets. That's pathetic. Since 2007 and the Northern Rock crash, it's been abundantly obvious that the banking system is unjust to the core: from exorbitant bankers' bonuses to gambling on debt, from massive tax loopholes to holding the country to ransom with their threats of moving to Zurich. Before the crisis, after the crisis, it's as if we've learned nothing: the banks still serve themselves, not the public.

Over the past four months UK Uncut has grown from a meeting in a pub to hundreds of high-street acts of protest against tax avoiders, highlighting the £25bn dodged in taxes every single year by some of the most wealthy individuals and profitable corporations. Combine this clamping down on tax avoidance with truly tough action on the banks and you've got a genuine alternative to the cuts agenda. It is simply a lie to say that the only way to reduce the deficit is to sacrifice essential public services, which support some of the poorest in our society. There is an alternative, but the government doesn't want to talk about it because they have got the same agenda as the banks: making the poor pay the way for the rich.

This is an outrage and it has to be stopped. UK Uncut has launched the Big Society Bail-In. On 19 February we will be targeting Barclays, and on 26 February we will turn to RBS. Civil disobedience is back in Britain, and it is on your local high streets. Just like with Vodafone and Topshop, anyone can get involved, because tax-avoiding corporations and banks have put their outlets and branches everywhere. Every time a library is closed, every time a hospital is privatised, there's somewhere nearby where people can protest – your friendly local high street.

Together, we're going to change those high-street branches into schools, libraries, gyms and forests. We're going to show that it's our society that is too big to fail, not our broken banking system. It's going to be fun, but it's also going to be hard work, because this isn't just about Twitter – it never was. It's about on the street, grassroots, getting-in-the-way politics, the same politics that won women suffrage, defeated the poll tax and could stop the cuts.

It's about telling your friends, your co-workers, your children, your mum. It's about knowing why our welfare state is being attacked and targeting the right people in response. Everyone should do what they can do to make this happen. Come on the UK Uncut protests this month, and also make sure you're taking to the streets on 26 March. Let's make the banks pay for their crisis.

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Lottery scheme brings films to rural communities

Alex North of White Horse Pictures with councillor John Lawton at Malmesbury town hall, where a mobile cinema is bringing multiplex technology to rural areas. Photograph: Sam Frost for the Guardian

The venue could hardly be less like a multiplex: a small town hall dating back to the 19th century, rather than a vast building on an anonymous leisure park.

What Malmesbury town hall in Wiltshire and the nearest multiplex do now have in common, thanks to a National Lottery-funded pilot scheme, is the ability to show the latest releases in a cinema-style digital format with booming surround sound.

Across the country, there has been a huge increase in the number of village and town halls putting on screenings, but they usually have to wait for the DVD release of a film.

At Malmesbury town hall, and other small venues in Wiltshire and Hampshire, the White Horse Pictures project is using state-of-the-art digital equipment to draw in audiences with the latest releases.

"It's gone down incredibly well," said Malmesbury town councillor John Lawton.

"People are coming expecting a low-quality, grainy kind of picture and are quite astonished to get a perfect picture on a large screen with surround sound."

Ticket sales went well for Harry Potter and the Deathly Hallows and for the George Clooney film The American and all 500 tickets for the run of The King's Speech have been sold.

Black Swan, the 50th anniversary revival of Breakfast at Tiffany's and Burlesque will also be screened and the town hall is hoping to be able to show 3-D films before the end of the year.

"People are really pleased they don't have to travel into Swindon or Bristol to see these films at the multiplexes," said Lawton. "We could have sold double the number of tickets we had for The King's Speech, which isn't bad for a town of 3,500 or 4,000 people."

Nursery nurse Anne Gould, a cinemagoer and volunteer, said: "You get all ages there from youngsters, who don't have to rely on their parents to take them to Swindon, to older people without transport who would have to try to get a bus to the cinema. It's wonderful to see these films sitting alongside your neighbours."

The official launch of the project took place on Friday night, with Oscar-winning film-maker Julian Fellowes as guest of honour to introduce a screening of his film From Time to Time, a ghost story starring Maggie Smith.

Fellowes, a champion of rural cinema projects, said some mobile cinemas suffered from poor projection: "Here people are getting clear and brilliant sound and vision without having to slog off to some huge multiplex.

"This sort of venue also provides a very friendly ambience. It's lovely to see a film in the local community where you are among friends."

White Horse Pictures is one of three rural projects