For the last several weeks, House Bill 400 — aka “Bourbon Without Borders” — has made its way through the legislature and finally was passed by the Kentucky General Assembly on Monday, April 2. Once Gov. Matt Bevin signs the bill into law, it will open up many doors for Kentucky distilleries and wineries in terms of being able to now ship bottles home to those visiting from out-of-state.
And what does it mean for Kentucky residents? According to the bill, residents can now ship bottles home when visiting wineries and distillers in other states, and it totally opens the doors to online retail within the state.
However, there is some fine print to sort through.
Insider turned to Eric Gregory, president of the Kentucky Distillers’ Association (KDA), for guidance on what exactly this bill means for residents, tourists and distilleries. After all, the KDA, a nonprofit organization that champions the industry, helped put HB 400 in motion.
Gregory explains that the No. 1 question from bourbon tourists has always been, “Why can’t I ship my bottles home?”
And with more than 1.2 million visits to Kentucky distilleries each year — 70 percent of which came from outside of Kentucky — it was an issue that needed to be addressed and involved some antiquated laws that needed to be revised, he says.
“We figured since we produce 95 percent of the world’s bourbon, Kentucky should be the first big domino to fall to allow shipping to begin,” says Gregory. “This is a big step for the Kentucky Bourbon Trail to reach Napa Valley potential.”
He points out that Kentucky is now in the position California’s wine country was 40 years ago in trying to set up trade between states and getting legislation passed to allow the shipment of alcohol. The wine industry now can ship to and from 44 states — not Kentucky (yet) — thanks to tireless efforts by winemakers and organizations like Free the Grapes.
According to Gregory, HB 400 will allow the shipment of liquor and wine to and from Kentucky’s reciprocal states, which are Arizona, Hawaii, Nebraska, Nevada, New Hampshire, North Dakota, Rhode Island and Washington, D.C.
Why not all 50 states? Well, because the government is slow and tedious, and not all of them are aware of Kentucky’s status.
Gregory is hopeful, though, that more states will join the bourbon bandwagon soon.
“I think it’s just a matter of time,” he says. “I think once other states realize Kentucky has broken the ice, so to speak, I think we’re going to see a lot of movement with other states coming on board.”
So, before you book a trip to Sonoma, you may want to wait until California joins the cause.
But let’s get back to the bill and what it allows.
Tourists visiting a distillery can ship home up to 4.5 liters (six 750ml bottles) per day. Also, they can sign up for “bourbon of the month” promotions distilleries may add, which will allow the shipment of a case over the span of a year.
That could mean one bottle a month, or 12 bottles on your birthday — the scenarios are endless.
“That’s part of the fun of it,” says Gregory. “I think distilleries will come up a lot of different creative ways to run their clubs. I think it’s a great add to the bill — to help extend the marketing reach for Kentucky bourbon.”
And, of course, Kentucky residents can join those clubs as well.
When it comes to wineries, the tourist also has to visit the winery in person, but if she finds a wine she can’t live without, she can ship four cases of it per day, and a “wine of the month” club could ship out 12 cases per year per person.
Finally, when it comes to retailers — stores like Liquor Barn or Westport Whiskey & Wine — HB 400 will allow the exact same shipments noted above, however, you do not need to visit the store in person. Gregory hopes this e-commerce legislation further opens up the ways consumers purchase their liquor.
It’ll also allow liquor stores to get creative with “spirit of the month”-type clubs, just like the distilleries.
And the last thing HB 400 put in place, according to Gregory, was the license structure for UPS and FedEx to now ship alcohol in and out of the state. (It is still illegal to ship alcohol through the U.S. Postal Service.) However, it may take a while for UPS and FedEx to sort through the bill.
In the end, it’s a positive for the state (taxes from increased revenue), the distilleries/wineries (more product sold) and the residents (access to clubs, online retail, shipping back bottles from other states).
HB 400 was passed with an emergency clause, meaning once Bevin signs it into law, it takes effect immediately. He has 10 days, from April 2, to do so.
In other words, bourbon could be flooding mailboxes by next week — but we’re guessing it might take longer while distilleries, wineries, liquor stores and delivery services sort through the legislation.