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Craft distilleries raise a glass to growing political support
B.C.'s craft distillery industry hopes to see changes to provincial liquor laws that would even the playing field with wine producers sooner rather than later now that the NDP has publicly thrown its support behind the call.
Tyler Dyck, CEO of Okanagan Spirits, which operates out of Kelowna and Vernon, and who acts as spokesman for the Artisan Distillers' Guild, said the guild has been working with the government on the changes but it was good news to hear the Opposition NDP are also now on side.
"We love support from anyone," said Dyck, referring to Wednesday's announcement in Kelowna by NDP leader Adrian Dix that his party now supports extending the following measures to B.C. artisan distillers:
• Adjusting the Liquor Distribution Branch mark up to 129 per cent from 170, and exempting storefront sales from commission.
• Direct sales to restaurants and licensees, in addition to sales through the Liquor Distribution Branch,
• On-site lounges and event areas.
Dyck said the three moves are part of what the guild has been asking the B.C. government for.
"And we have heard that the changes could come in six to eight weeks," said Dyck.
As it stands now, craft distillers—there are just seven in the province—have to pay a 70 per cent mark-up fee to the province for every bottle of their product sold and cannot sell direct to bars and restaurants. Meanwhile, wineries only pay a 29 per cent mark-up fee per bottle and can sell direct to bars and restaurants. And, they can have lounges on site as well.
Dyck, whose other job is being a physiotherapist and co-owner of Sun City Physiotherapy in Kelowna—said without that work, it is unlikely he would be in the distillery business because he could not afford to keep it afloat given the current rules.
He said the reason he and his family have stuck with the business for the last nine years is because of their passion for it and because they are gambling that "common sense will prevail."
And he said after the work the guild has done with provincial Liberal government and the new support from the NDP, it appears that gamble may be about to pay off.
He credited local Liberal MLAs Norm Letnick (Kelowna-Lake Country) and Ben Stewart (Westside-Kelowna) as being instrumental in helping push the issue in Victoria. The two MLAs are now in cabinet, with Letnick being named agriculture minister last week and Stewart, whose family owns and operates Quail's Gate Winery in West Kelowna, now the province's citizen's services minister.
On Wednesday, Dix said the same measures used to deal with wineries should be extended to help grow B.C.'s burgeoning artisan distillery industry, including lowering the mark-up distilleries have to pay the government.
“There is a viable business case that the same provisions that past governments put in place to build the wine industry can help artisan distilleries flourish, boosting agriculture, tourism and Liquor Distribution Branch sales in the process," said Dix. "These boutique spirits are already earning B.C. international acclaim and awards, and represent a new opportunity in value-added manufacturing for B.C."
The NDP says a specialized manufacturing agreement would extend the provisions granted to the wine industry to producers that fit the craft artisan distillery designation. That classification entails producing less than 50,000 litres annually in an artisan pot still, using at least 50 per cent local agriculture products.
NDP agriculture critic Lana Popham said the measures would also benefit B.C. agriculture, tourism and value-added manufacturing.
“Growth in craft distilling will create a new secondary market for B.C. farmers and fruit growers," she said. "This is especially important, given the struggles the latter have faced in recent years."
“Distillers in the Interior use apples, cherries and other berries for their eaux de voie, liqueurs and absinthe. These crops might otherwise go to waste."
The seven artisan distilleries include Okanagan Spirits in Vernon and Kelowna, which makes gin and fruit-based spirits; Urban Distilleries of Kelowna, which makes rum and spirits; Island Spirits Distillery on Hornby Island, which makes vodka, gin, brandies and liqueurs; Pemberton Distillery, which makes vodka using local, organic potatoes; Victoria Spirits, which makes gin; Penticton's Maple Leaf Spirits, which makes maple liqueur and the Cowichan Valley's Merridale Estate Cidery, which make fortified ciders.