I have always found it odd that American distillers are prohibited from re-using barrels. It’s not as if the practice of “secondary aging” with used barrels isn’t completely commonplace today! The facade that straight bourbon should come “straight from the barrel” went straight out the window during the last decade. The laws regulating the TTB’s standards of identity state that bourbon must meet the following requirements:
1. Source: Fermented mash of not less than 51%, respectively: Corn, Rye, Wheat, Malted Barley, Malted Rye Grain, [Other grain]
2. Distillation proof: 160° or less
3. Storage: Charred new oak barrels at 125° or less
4. Neutral Spirits Permitted: No
5. Allowable coloring, flavoring, blending materials permitted: Yes, except for bourbon whisky.
While there are no specific laws related to secondary aging or finishes, it is generally understood that TTB regulations dictate ONLY the primary aging process, and that the laws do not restrict secondary finishing…which is confusing for consumers that have always understood that bourbon should never be rectified. (And, to be clear, adding bourbon to a barrel that once contained another spirit IS a form of rectification.) So…bourbon CAN be rectified as long as the producer clearly labels that the bourbon has been “finished”. Case closed…I guess? It’s a strange distinction to make, isn’t it? You can use “used barrels” to flavor or “finish” a bourbon, but a used barrel can’t be involved in the creation of the initial bourbon! It’s an odd distinction to make when there is no specific amount of time that bourbon distillate must be matured in charred new oak to be called “bourbon” in the first place! Removing the “no coloring, flavoring, or blending materials allowed” aspect of bourbon kind of negates the category, doesn’t it? And honestly, I’m not sure it matters- because clinging to arbitrary regulations imposed on American whiskeys that were made long before Prohibition can be stifling for innovation. It IS odd. So- Why are American distillers prohibited from re-using barrels again?
Using a brand-new charred oak barrel was not always a necessity for American whiskeys, of course. Early distillers (late 18th-early 19th century) were under no obligation to use brand-new barrels to mature their whiskeys. While new whiskey was typically going into new barrels at larger production facilities, that had more to do with how much product was being manufactured and how quickly it was being shipped out than from any desire to use fresh barrels. Larger facilities often had their own cooperages on site and simply required more barrels which necessitated large quantities of new oak. Of course, by the late 19th century, these large distilleries began to advertise their use of new barrels by emphasizing the purity and value of their whiskey for never having touched another barrel. Used barrels, in time, became associated with rectifiers and blending houses. Unfortunately, through the propaganda of straight whiskey makers, the used barrel’s association with rectifiers led to their own association with unscrupulous distilling companies looking to cut costs.
The Office of Internal Revenue began to prohibit the reuse of barrels in 1889. But why? To understand why the reuse of barrels became a concern for the U.S. Treasury Department, we should look at how distilleries did business in the late 1800s.
Distilleries had been prohibited from selling their products at retail and on premises since 1867- just after the Civil War. The U.S. Treasury Department appointed gaugers and inspectors which were assigned to each of America’s distilleries. Distilleries became highly scrutinized production facilities and their owners were limited in how they could sell their whiskey directly to the public. On April 10, 1869, a new law was passed stating that “Every person who sells or offers for sale foreign or domestic distilled spirits, wines or malt liquors, in quantities of not less than 5 gallons at the same time, shall be regarded as a wholesale liquor dealer.” The line had been drawn between retail sellers and wholesalers. By 1872, stricter rules were placed on rectifiers. Tighter regulations were placed on record keeping and the issuing of tax stamps. There was a lot of funny business going on within the trade to trick the tax man into undervaluing the contents of barrels, and the government was trying to limit tax evasion by distilling companies. Reused barrels and reused tax stamps had been consistently creating problems for gaugers, so it was thought that eliminating the reuse of barrels would help increase (or at least help eliminate losses in) tax revenue.
Rectifiers bought large quantities of whiskey (at wholesale) in large barrels from the distilleries they did contract business with. Distilleries often sold very young whiskey or “high-wine spirits” in bulk to rectifiers, so packages/barrels were regularly going back and forth between businesses. Distilleries repeatedly filled orders for the same liquor firms over the course of many years, so together, distillers and rectifiers often found creative ways to evade taxes, conveniently saving heaps of money for both parties in the process. They cheated the revenue collectors in many ways- often manipulating the construction of the barrels to trick gaugers into misreading their contents. The battered state of the reused barrels and the constant re-stamping with new tax-paid certificates often made them difficult to assess properly. So, in the end, the government decided that the only way to avoid these issues was to insist that distillers only use NEW packages each time they were filled. New stamps would be affixed to the barrel only once to avoid any confusion for the government’s gaugers. While this did not put an end to creative tax evasion, it certainly made tricking the Internal Revenue officers more difficult.
Brand new barrels became associated with pure, unadulterated products. The government liked new, unused barrels because they were more reliable containers for gaugers taking measurements and assessing taxes on their contents. After Prohibition, used barrels threatened the timber and cooperage industry, so legislation insisting upon the use of “new barrels” was lobbied for. While there was no mention of “new charred oak” at all in the Federal Alcohol Administration Act of 1935, it was added in 1938 after those lobbying efforts by the cooperage industry. But today? There are no government gaugers and tax stamps aren’t applied anymore. Distilleries are using used barrels all the time for secondary aging. New oak is now a limited resource, and that limited availability is being used as a wedge to drive out new competition within the whiskey industry. Big distilleries have their own access to oak, but new distilleries do not. If the TTB’s regulations continue to favor these outdated and arbitrary limitations placed on new charred oak barrels, how long will the craft industry be able to keep up? Seems to me that used cooperage is already a hot commodity. Why not allow American whiskey producers the same freedom the rest of the world takes for granted? Shouldn’t American distillers and blenders be allowed to choose how they mature their whiskeys, too?
