Distillery, part 1: the adventure begins!
We have been working on a new business venture! While lately it hasn't really taken a lot of time, it has taken a lot of my mental energy, leaving me drained at the end of the day. So I haven't had the wherewithal to drag myself 5 feet from the couch to the laptop and do any posts. I have tons of pictures I took over the summer and a few craft projects I could've put on, but instead I just vegged out, watching an episode of 'Midsomer Murders' on Netflix every night!
So....this is what is draining my brain....
We have decided to open a distillery. Most people know what this is, but sometimes when we tell people we are opening a distillery, the conversation goes like this:
us: we are going to open a distillery
them: Ooh! are you going to make wine? (this would be a winery)
them: Beer? (this would be a brewery)
them: well, what are you going to make then?
them: Like moonshine?
us: Yes! exactly like moonshine! (this would be a distillery, with a still, to distill alcohol)
Why start another business at this stage of the game, you may ask? Well, we pretty much always knew that we wanted to have some sort of "retirement business". We figured we would never retire anyway, so we might as well do something that would earn a little money and be something we would enjoy.
Vince has a knowledge of distilling that has been passed down from his grandfather, to his dad, then to him. They never did it to sell, they just did it for their own use and for fun. So when New York State came out with a new distillery designation, the 'farm distillery', we did some (a LOT) of research (Vince perused the Alcohol, Tobacco and Tax Bureau (hereafter known as the TTB) website and read a bunch of stuff there and looked at options for equipment, which is all very expensive, of course!, and I looked at every NY distillery that had a website, and we went and visited a few distilleries to see their operations) and even after finding out about all the crazy rules and regulations, decided to do it anyway.
here are the basics to a farm distillery:
* your products have to be made from 75% New York State grown ingredients, i.e. corn, rye, apples (these are the 3 we will be using most of)
* you can sell the finished product on your premises, at farmers markets and fairs, and directly to bars, restaurants and liquor stores.
*you can have a tasting room where people can come and taste your product. They can have three 1/4 ounce tastings per day (this has now changed to allow us to make mixed drinks and whatever as long as we make the whiskey that goes in it). Most places were charging a $1 per taste.
still sounds cool, huh?
here are the basics to actually starting this cool business:
*you have to have a building at least 80% completely built and most of your equipment (but NOT a still, because it is illegal to own one, even if you are only making whiskey for your own use) before you can even APPLY for your federal permit from the TTB. It can't be in your house, attached to your house, in your garage, or attached to your garage. It has to be a separate, secure building.
*once you get your TTB permit, which can take 4 months, then you can acquire your still (but you can't make any whiskey yet until you get your NY State permit).
*then you can apply for your New York State permit (another 4 month wait). But NY doesn't want to give you your permit until you have your building 100% finished and ready to open for business with product to sell. But you can't legally make any whiskey to sell until you get your NY permit!
When Vince was initially researching all these things and told me this crazy ass-backwards process, I said "so what happens if after you have laid out all this money for a building and equipment, they don't give you a permit?" AAGGHHHH! Well, he did some more research and we couldn't find anywhere that a permit was denied if they met all the requirements.
Oooohkaaay... so we have to build a building. And put in another well. And another septic system. Not a big deal, we thought, until we started pricing materials, equipment, excavation costs, etc. Holy crap, we will be in debt up to our eyeballs! But even that did not deter us for long...
This is Vince's philosophy, in his words:
If you read other blogs written by some distillers, you will see them tell you that you will require millions of dollars to open a distillery. This is simply not true, though it would make purchasing big fancy buildings and fancy equipment possible. If you can build, and do things yourself, and have knowledge of the processes, you can start small and build up a business to what ever level you might be comfortable with.
So, since we can do a lot of things, like design the building, hire and oversee contractors, wire and plumb it, sheetrock and paint it, install equipment, decorate, landscape, design logos and labels, construct and paint our road sign, keep our own books, and do whatever else is needed to start and run a business, who needs millions?
so here is how we have done it:
June 2015: we start kicking around the idea, did some cost estimates and decided we could afford to take the risk (we are going to have to take out a loan, bleh!)
Talk to banks about rates.
Talk to accountant about forming an LLC and general tax info.
Come up with cool name for distillery- Dragonfyre Distillery, it will be a medieval theme with dragons and fairies, and we design a logo and come up with bottle label ideas. I get lots of inspiration for stuff watching Midsomer Murders, the pubs and buildings on that show are so cool! We want to build a castle to put the distillery in. Waaaay out of our budget! Rats!
Come up with basic building design, want to do a partially bermed, concrete walled building in the hill across the creek from our house. Can't decide on size until we get more prices for things.
July 2015: Tell family members we are going to do it. Vince's dad says "wow, you aren't wasting any time!" Vince says "I'm not getting any younger!"
Apply for loan (will take 4-6 weeks) , contractor comes out to look at site and gives us an estimate (yikes, I hope we can borrow enough money).
Town says we need engineered, stamped plans to get a permit, and we have to pay for a commercial permit because it is for a business. Finally decide that 30'x40' is the largest we can go for the money we have to use. One end will be where the still is and the other will be the tasting room/gift shop. There will be a glass door in between the 2 rooms so the process can be viewed by visitors.
Ok, now we have to find an engineer (they used to be called architects, but when we googled architect, not much came up). Don't know one. No one we know knows one. Google to the rescue!
We find one and he comes out to look at site and says it will be $3,500-$5,000 for the plans (yikes again), we had not figured that into the budget. But, oh, well. Give engineer a deposit.
Called a lawyer to see how much it costs to form LLC-$1800. Vince says @%!! , "I'm just going to do it myself online, it is no big deal!"
August 2015: Start thinking we may want a stick built construction instead of the concrete bermed one. Did some research about buying a prefab building from a place called Woodtex out of Himrod, NY, over by Seneca Lake (basically a garage that has been customized to what we want), turns out we can get one delivered and set up on our site for not much more than having Vince do the construction himself. It is just the shell, but will save us months of work. Vince will still be doing the electrical and plumbing. They will supply stamped plans for an extra $1200, but this is just for the building and we need plans for the concrete slab it is going on, so we have to pay another engineer $450 for slab plans.
Call original engineer and tell him to quit working on the plans for the bermed building.
September 2015: Vince goes online and forms LLC on the New York State department of corporations website for $235-poof! we are an LLC!
Loan comes through!
We open a business account at the bank and apply for a Visa card so we can start paying for stuff in the business name. That takes 3 weeks to get! Call 2 local newspapers to run the notice of the formation of our LLC for 6 consecutive weeks, this cost about $130. (NY is the only state that requires this. After the 6 weeks of running the ad are done, we have to send affidavits from the newspapers and $50 to the NY State dept. of corporations for our LLC to be officially recognized)
We put deposit on building (which we add 4 feet to because it was only a few grand more, at this point, what is a few grand more gonna hurt?)... so we can get stamped plans... so we can apply for building permit. Should only take 2 weeks. It takes 3.
Take plans to town hall to apply for permit, should take 2 weeks. It takes 4.
Starting to sweat out the timeline issues of trying to get the excavation done before winter hits. Sleepless nights worrying about things I have no control over.(shouldn't have worried about the weather since it has been fairly nice out every time we had work done)
October 2015: Woodtex calls and wants to set up the delivery date for the week of November 23rd (should take about 3 days to put it up). That week is perfect, we don't have anything else going on. But at that point we still don't have the building permit nor have we broke ground yet! They give us till Oct. 23rd to let them know if they can keep that delivery date.
Our excavating contractor, Daryl Cross, calls on Oct. 22nd and says he'll be there on the 23rd, and the town says the permit will be done on the 23rd also.
I call Woodtex and give the ok. Hooray, we can start! Daryl gets the road in and the site prep ready for the foundation guys (Johnson Valley Construction, Jeff and his crew which includes our UPS man, Tony) to come in and set the concrete forms.
This is the culvert for the creek to run through, it is 20' long, 8' wide and 4' tall. Daryl has the road base in and is using the vibratory roller to compact it before putting on a top layer of gravel.
We're ready for our building! It's being delivered on Monday, November 23rd. 2015
I recently saw this quote in a magazine and it really sums this whole project up for me....
"If your dreams don't scare you, then they aren't big enough"
well, let me tell you, this must be big enough, because half the time I'm terrified! But the other half I am excited and can't wait till I get to do the fun stuff.
November 2015: we are ready to pour the concrete for the slab, but still no permit.
Can't go any further because this has to be inspected by the code officer (who is supposed to approve our permit). We have been in contact with the town clerk, who can't understand why it is taking so long to get the permit! It never takes this long. She contacts the town supervisor who contacts the office of the code officer, who says he delivered the permit to the town clerk 2 weeks ago! She does not have it, so the code officer writes new permit and brings it to our house on Nov. 2nd. Which works out great because now he can inspect the site and he gives the go ahead to pour! Which gets done on Nov. 5th.
This is where the road to the distillery will be
putting the drainage pipes in
The building will be up on the hill, across the creek
looking up the road to the building site
This will be the view from the distillery with a little less shrubbery
For those of you wanting to know how this all came about, I have copied Donna's blog posts to the web site so you can follow our thought processes and time line of construction through her eyes.
this is the radiant heat system being laid down by Vince, his buddy Steve, and our heating guy, Riley
Daryl has the hillside cleaned off and Vince saw this old wheel in the dirt as Daryl was bulldozing in there.
Looks great! We call the code officer on the 6th and tell him we will be ready for the next inspection on Monday the 9th (he has to look at the slab before we can back fill around it). He says he'll be out of town till the 12th. Vince wants to know what happens if he dies while he is out of town?
Forms are off on the 7th, Daryl is coming this week to back fill and prep the areas for the entry way to the tasting room and the spot in front of the garage door on the distillery side.