Last Call for Bloomery Sweetshine Distillery

An Eastern Panhandle distillery decided to close its doors this week because of uncertainty about regulations the owners say are making their business unprofitable.

Distilleries must sell their liquor to the state and buy it back at a 28 percent markup under a provision of the liquor law called bailment. Bloomery Sweetshine Distillery in Jefferson County says that markup has made doing business unsustainable. Bloomery co-owner and founder Linda Losey says the bailment fee caused her to close her popular tasting room.

“So we had to make the decision to close down the tasting room operations because we, if we’re racking this money up, we won’t ever be able to pay it back.”

Losey said small distilleries like hers that sell directly to the public have been misclassified under the law and should be exempt from the bailment requirement. She says the state Alcohol Beverage Control Administration, the ABCA, promised a decision about the classification by January fifth of this year. The decision hasn’t been made yet. The distillery began a social media campaign to urge the ABCA to rule in its favor.

ABCA spokesman Gig Robinson says the distillery’s situation is a priority, but it will take time to sort out since any decision will affect the ten other distilleries in the state.

Bloomery isn’t the only distillery waiting for a ruling. Smooth Ambler, near Lewisburg, doesn’t rely as much on revenue from its tasting room, but bailment does affect its profit margin. Randi Smith, Smooth Ambler’s business manager, summed it up this way:

“If there has been a misclassification of distilleries in the state of West Virginia, and indeed we are not required to use the bailment system in order to sell retail product out of our own retail tasting rooms, you know, then we just want a ruling, we just want a clarification on that.”

Bloomery’s distillery is in West Virginia Senator John Unger’s district. He echoed ABCA’s assessment that Bloomery’s business model is unique and that any solution to its situation will affect other businesses in the state. However, he stressed that the state can’t afford to lose small businesses and must encourage their growth. 

He said he has urged the ABCA to make a decision.

“They gave me commitment that Friday they would give an answer. Now, again, the answer that they give, it will be what they interpret the law. I’m hoping it’s favorable in the sense that all parties would be okay with whatever that interpretation is.”

If the decision isn’t agreeable, Unger said legislation may be required to address the problem.

Bloomery posted a message on its website explaining the closure.