It was the Friday before spring break. School was nearly out and the suburban soccer moms bustled into my neighborhood liquor store, filling their baskets with everything from chardonnay to schnapps. They cluttered the walkways, keeping me from my precious aisle, when one of them grabbed a bourbon from the bottom shelf and said out loud, “I don’t know what that means.” A liquor store worker heard her whiskey distress signal and replied, “Oh, it’s not small batch.” He then upsold her on a bottle three times as expensive as the $15 Heaven Hill Bottled in Bond 6 year old she’d inquired about.
I assumed she was referencing the term “bottled in bond” with her question. Outside of whiskey geeks, does anybody really know what this means; that it is a piece of historic government legislation?
Today your average liquor store’s American whiskey section is filled with labels containing unregulated terms such as small batch, single barrel, and handcrafted. The tiny words “bottled in bond” hardly stand out from the masses, not to mention there are only about 20 brands remaining on the market. It’s no wonder that the average consumer doesn’t understand bottled in bond’s guarantee: distilled at one distillery in one distilling season, at least 4 years old, bottled at 100 proof, and must have both the distilling and bottling plants listed on the label, or that the label figuratively represents the blood, sweat, and tears of 1890s-era bourbon and rye distillers.
Fortunately, bottled in bond is making a comeback and represents some of the greatest bang for your buck in all of whiskey.
For example, that ignored Heaven Hill Bottled in Bond 6 year old offers entry-level goodness, with a candy corn, caramel approach and just a hint of spice. It’s not going to win American Whiskey of the Year anytime soon, but it’s in the $15 range almost everywhere it’s available. If you’re looking for an easy-drinking, affordable bourbon, this or its younger companion—J.T.S. Brown Bottled in Bond, a 4 year old—won’t steer you wrong.
In fact, Heaven Hill Brands is the main reason bottled in bond remains relevant. Starting in the 1960s, bonded whiskey began losing market share to vodka, and 1970s inflation forced distillers to lower proofs to avoid additional taxes. By the 1980s, because they stopped pumping resources into the category, bottled in bond was no longer popular. Heaven Hill acquired the rights to multiple bottled in bond brands and put them on the shelves with zero marketing dollars.
As bourbon began to see a comeback in the mid-2000s, vintage clothing was making a comeback too, and older music was cool again. Suddenly, books, labels, and signs were trending toward yesterday’s fonts. What was old was new again, and since Heaven Hill never changed those labels, they were sitting on truly retro Mellow Corn, J.T.S. Brown, T.W. Samuels, Heaven Hill, and other bottled in bond products that were suddenly hipster-friendly. Around the same time they hired Bernie Lubbers, a former Beam ambassador and author of Bourbon Whiskey: Our Native Spirit. With Lubbers, who sports a “bottled in bond” tattoo spanning one arm, they executed an on-premise sales tactic that gave bars ‘certified bonded premises’ permits for carrying bottled in bond whiskey and taking Lubbers’s class.
Heaven Hill’s market pressure has encouraged subtle growth of the category that at the most basic level is a minimum 4 year old whiskey at 100 proof. But what makes this whiskey different from, let’s say, Rock Hill Farms or Knob Creek; both 100 proof bourbons that are not labeled as bottled in bond?
To understand why, we need to travel back in time.
The American whiskey industry began with small, farm-distillery operations delivering barrels by wagon or by flatboat to their destination. It gained widespread appeal from the 1820s to 1840s and graduated into a prominent industry. The barrels were sold directly to wholesalers and merchants, many of whom were acclaimed rectifiers, mixing the spirit with prune juice, tobacco juice, kerosene, and coloring, among other liquids, to increase the barrel’s volume and boost profits. At any given tavern, a thirsty patron could order whiskey and actually receive half whiskey and half prune juice. This practice diminished whiskey’s medicinal efficacy, making adulterated whiskey a healthcare issue, and it hurt the overall perception of the spirit. Distillers and non-rectifier merchants countered with such language as “pure” and “straight” to give consumers confidence that the whiskey was not adulterated.
Despite the unique rectifier challenge, distillers were still earning significant revenue and were often associated with the wealthy, in part because they did not pay federal excise taxes. The first U.S. whiskey tax led to the Whiskey Rebellion, where President George Washington federalized troops against Pennsylvania distillers for refusing to pay up. President Thomas Jefferson repealed the whiskey tax in 1802, and it returned only briefly to pay for the War of 1812.
American distillers did not pay federal excise taxes from December 1, 1817 to July 31, 1862, but that changed during the Civil War when Congress passed a tax act that permitted distillers to erect a warehouse of iron, stone, brick, or other fireproof material to be approved by a revenue agent as a “bonded warehouse of the United States.” Before this action, the initial tax law (enacted August 1, 1862) required that duties be paid after the first proofing (the point that the distiller cut the off-the-still spirit down to 100 proof with the addition of water).
In bond, distillers paid taxes after the barrel was sold or after the allowed bonded period of one year initially, then three years, guaranteeing its quality. By the early 1890s, as bourbon prices were going down and interest rates were going up, distillers lobbied for a bond extension. “Distillers of bourbon and rye whiskies want an extension, and they want it like the Texan wanted a revolver…. We recommend an extension of the bonded period of whiskey to at least eight years,” testified C.B. Cook, a Cynthiana, Kentucky distiller in 1894, before the Senate Finance Committee. The distillers were victorious in extending the bonded period from from three years to eight years, but the nagging rectifier problem combined with the rise of Canadian whisky forced distillers to pursue additional legislation to protect their brands.
Now they wanted to bottle whiskey in bond, which the wholesalers believed would injure their longstanding position in the industry. Even the iconic I.W. Bernheim was against distillers bottling in bond, saying Kentucky wanted to halt the growth of Canadian whisky, a friend to the wholesaler.
During hearings, wholesalers fought to bottle at lower proofs than the proposed 100 proof and continued to adulterate products. They wanted exceptions from the bottled in bond tax stamps on cases and bottles. Their most important amendment was adding the restriction of one distilling season, perhaps as a tactic to limit the distiller’s production.
When Congress passed “An Act to allow the bottling of distilled spirits in bond” on March 3, 1897, the wholesalers were still in business, but the distillers could now protect their own interests. The legislation was more than 1,700 words and narrowly tailored for the time: “And there shall be plainly burned on the side of each case, to be known as the Government side, the proof of the spirits, the registered distillery number, the State and district in which the distillery is located, the real name of the actual bona fide distiller, the year and distilling season, whether spring or fall, of original inspection or entry into bond, and the date of bottling, and the same wording shall be placed upon the adhesive engraved strip stamp over the mouth of the bottle. It being understood that the spring season shall include the months from January to July, and the fall season the months from July to January. And no trade-marks shall be put upon any bottle unless the real name of the actual bona fide distiller shall also be placed conspicuously on said bottle.”
The act would change over the years, mostly with the tax stamps, which were problematic for the distillers from the beginning.
The bulk of the modern law regulates labeling, namely the word bond itself. The federal government permits “bond,” “bonded,” “bottled in bond,” “aged in bond,” or synonymous terms to represent the category, which is why Old Grand-Dad Bonded and Jim Beam Bonded are still “bottled in bond.” With that said, today’s legal definition is certainly more condensed than the 1897 version.
…the blossoming whiskey culture has rewarded distillers for keeping bottled in bond alive and there’s new life being injected into the category.
The Modern Production
Inside Heaven Hill warehouses there are more than 1.2 million barrels aging. Each one could arguably become bottled in bond. But Heaven Hill also bottles bourbons and ryes below and above 100 proof for products that come from multiple distilling seasons. Its bottled in bond whiskeys are distilled on the same Bernheim column still and are of the same mashbills—78% corn, 10% rye, and 12% malted barley (for the traditional bourbon formula containing rye); 68% corn, 20% wheat, and 12% malted barley (for their wheated bourbons); and 51% rye, 35% corn, and 14% malted barley (for their straight rye whiskeys). All production measures are the same with the exception of the final proofing stage and record keeping.
When a product is dumped for bottling in bond, the distillery maintains logs of every barrel, including warehouse transfers. Because larger distillers have so many warehouses, it’s also fathomable that a bottled in bond Rittenhouse rye could come from multiple Heaven Hill warehouses, and that’s permitted, but there are restrictions on distance between the warehouses.
The government expects warehouses to be grouped together and doesn’t want distilleries mixing warehouses from multiple zip codes for bottled in bond. When Tom Herbruck, owner of Tom’s Foolery distillery near Cleveland, was seeking expansion, the U.S. Tax & Trade Bureau (TTB), the federal agency governing alcohol, informed him he’d need a separate spirits distilling permit because the warehouse in question was more than ten miles from his distillery. It’s possible a multiple-warehouse distiller could make the case that warehouses 30 miles apart are from the same distillery, but the ten-mile rule has not been tested for bottled in bond to my knowledge.
Herbruck just launched his Tom’s Foolery Bottled in Bond bourbon, one of the first non-Kentucky bonded bourbons since Peoria, Illinois’ Ten High Bottled in Bond in the 1950s. He produced the whiskey just like he did everything else: double pot stilled, aged in warehouse No. 1 with those bourbon barrels aging next to applejack barrels, and moving the barrels to the bottling area with a tractor.
On the label side, Herbruck had to revise his first draft. His initial label changed from “bottled in bond” to “bottled in bond under U.S. Supervision” with DSP (distilled spirits plant) numbers. In separate forms, the TTB also wanted warehouse numbers. “The government definitely paid more attention to the labeling,” Herbruck says.
If during a TTB audit the government finds the regulations were not followed, they will impose a penalty for the violation. Last year, it solicited the industry to report violators and frequently disclosed the penalties for violating the regulations, to include five years imprisonment for fraud.
That’s why you’re not likely to see anybody violating the bottled in bond laws. Who wants to risk getting caught? It’s easier to just label a product as an unregulated “small batch.”
Nonetheless, the blossoming whiskey culture has rewarded distillers for keeping bottled in bond alive and there’s new life being injected into the category. In addition to Tom’s Foolery, New York’s Kings County distillery produced a bottled in bond bourbon, Laws Whiskey House offered a limited-release bottled in bond, and multiple smaller distillers tell me that they’re just waiting for their whiskey to turn 4 years old to achieve bottled in bond status.
Larger distillers not currently producing bottled in bond products are on the fence because of the production restrictions. A little-known secret is that distillers buy and sell barrels of bourbon between each other all the time, and mixing barrels from two distilleries makes it ineligible to be bottled in bond. The larger distilling companies have also told me that one distilling season doesn’t allow for consistency. I don’t buy that, but it’s another reason for not using the one label that could solve a lot of American whiskey’s issues.
In the past few years, we’ve seen multiple lawsuits, transparency concerns over sourced whiskey, age statements being dropped, and general consumer distrust toward whiskey companies. With bottled in bond, consumers have a guarantee every time—the way it should be. ν