Drinking on the Last Frontier: High marks for High Mark — Distillery toasts law change in tasting room reopening

Photo by Elaine Howell. Visitors sample the spirits at High Mark Distillery at its grand reopening Saturday in Sterling.

Photo by Elaine Howell. Visitors sample the spirits at High Mark Distillery at its grand reopening Saturday in Sterling.

By Bill Howell, for the Redoubt Reporter

It’s said that all things come to he who waits. In this case, it could be more accurately said that they come to she who waits, with the lady in question being Felicia Keith-Jones, the owner of High Mark Distillery in Sterling.

As I mentioned in my monthly column earlier this year, Keith-Jones and the four other artisanal distillers in the state banded together and worked hard to convince the Legislature to pass HB 309, a measure to allow distilleries the same privileges granted to wineries and breweries in Alaska — i.e., to have a tasting room in their production facility and to be able to sell their products directly to the public.

While the distillers only had about three weeks to draft and push the bill through before the end of the session, they received excellent support from their representatives and senators, and HB 309 passed with wide margins in both bodies before the end of April. Gov. Sean Parnell delayed signing it in to law until mid-July, which meant that it would not go into effect until Oct. 12, thereby ensuring that the distilleries would miss out on the entire 2014 tourism season. Still, better late than never.

So it’s been a long time coming, but last Saturday, Nov. 15, High Mark Distillery was finally able to celebrate the grand reopening of its tasting room at 37200 Thomas St. in Sterling. All of its bottles were on sale for $25, which represented a substantial savings for many of them. Besides its Nickel Back Apple Jack (36 or 50 proof), its High Mark Vodka (80 proof) and its Blind Cat Moonshine (90 proof), there was a new product on sale, Blueberry Cobbler Shine (58 proof). As it is my duty as a reporter to be extremely thorough, I sampled the new product, and I can report that it is quite delicious, with a wonderful berry flavor and none of the alcohol heat of the higher-proof Blind Cat.

In between customers stopping in to sample and purchase bottles, Keith-Jones told me about a couple of soon-to-be released new products, as well as her hopes for the future of her business.

“We will be releasing our homemade vanilla extract in time for Thanksgiving,” she said. “I did extensive research comparing vanilla pods from all over the world — Tonga, Tahiti, Uganda, Indian, Hawaii, Mexico and Madagascar. In the end, I settled on a blend of Hawaii and Madagascar,” she said. “I’m also excited to be finally producing something that my mother, who is a nondrinker, can enjoy.”

Photo by Elaine Howell. Jeannie Brewer, left, and Felicia Keith-Jones, right, of High Mark Distillery, in Sterling.

Photo by Elaine Howell. Jeannie Brewer, left, and Felicia Keith-Jones, right, of High Mark Distillery, in Sterling.

After the vanilla extract, the next new release from High Mark will be vanilla-flavored vodka, if federal approval for the label is received in time. Keith-Jones hopes to have it on sale before the end of 2014.

When asked about her long-term goals, Keith-Jones stated that she has plans to open a new tasting room closer to Soldotna, in addition to maintaining the one at her current location. The Alaska Department of Commerce has identified craft distilleries as among the attractions that it wants to highlight to visitors, especially cruise ship passengers. A location nearer to town, along the Sterling Highway, would make it easier for tour buses traveling to and from cruise ships in Homer to add High Mark to their itinerary. She still hopes to one day turn the barn on her Sterling property into a climate-controlled bourbon house to allow the proper aging of whiskey in barrels.

With regards to her experience working with the Legislature, Keith-Jones came away impressed with how responsive and supportive its members were, especially her own representative, House Speaker Mike Chenault. “Our legislators truly are accessible, and they do want to help our local businesses,” she said.

Asked if she had any hopes for the next session of the Legislature, Keith-Jones said that she hoped Alaska might alter its method of calculating the excise tax on spirits to bring it into line with how the federal excise tax is calculated. The federal tax is $13.50 per proof gallon. A proof gallon is a gallon of liquid that is 100 proof, or 50 percent alcohol. The tax is adjusted depending on the percentage of alcohol of the product. By contrast, Alaska charges $12.80 per gallon of all distilled spirits, regardless of the actual alcohol content. Since the state calculates its tax differently from the federal government, this requires Alaska distilleries to keep two completely different sets of records and submit two totally different reports to each level of government. Furthermore, since the state tax structure is different, the Alaska Department of Revenue must maintain an office staffed with auditors and inspectors to ensure the state is getting the taxes it is owed, rather than relying of the Bureau of Alcohol, Tobacco and Firearms to do its enforcement for it, as do most other states.

“I don’t mind paying these taxes,” Keith-Jones said. “But as a small business owner, I’d like to spend as little time on government paperwork as possible, not to mention that it seems wasteful in these times of state budget deficits for Alaska to be spending money to duplicate enforcement and tax collection that the federal government is already doing.”

Despite the struggles and challenges of trying to run a small business in one of the most highly regulated and taxed industries in the country, Keith-Jones remains optimistic about her chances. Judging by the number of enthusiastic visitors who came to the grand reopening Saturday, it seems her optimism may indeed be well-founded, and that the High Mark Distillery has a bright future ahead of it.

Bill Howell is a homebrewer, teaches a beer appreciation class at Kenai Peninsula College’s Kenai River Campus and was named the 2010 Beerdrinker of the Year by Wynkoop Brewing Company in Denver. He and his wife, Elaine, have authored “Beer on the Last Frontier: The Craft Breweries of Alaska,” available via Amazon.

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