Advocacy

Along with promoting awareness Virginia’s distilled spirits industry, the Virginia Distillers Association’s purpose is to improve the regulatory and legislative landscape for distilleries in the Commonwealth. This is done by educating our legislators and consumers about the unique and excessive state-imposed policies that ultimately make Virginia craft spirits less accessible to consumers. 

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Current Alcohol Related Legislation for the 2018 General Assembly Session

Last Updated: 02/19/2017

SB/HB Bill (Title) Description Introduced by Status
HB 102 HB 102: Gourmet Shop Licensees Eliminates the requirement that gourmet shop licensees maintain each year an average monthly inventory and sales volume of at least $1,000 in products such as cheeses and gourmet food. Del. Christopher T. Head 02/13/18 House: Left in General Laws
HB 136 HB 136: Annual mixed beverage special events licenses Allows annual mixed beverage special events licenses to be issued to localities for use at museums or other facilities owned by the locality and used primarily for historic interpretation. Del. Mark H. Levine 02/16/18 Senate: Reported from Rehabilitation and Social Services (10-Y 0-N)
HB 286 HB 286: Food and drink sanitary requirements; exception for companion animals in wineries Provides that a companion animal, as defined in § 3.2-6500, may be allowed inside or on the premises of a licensed winery or farm winery, provided that the presence of the companion animal in such areas is unlikely to result in contamination of food, food contact surfaces, or food packaging materials… (click here for more) Del. John J. Bell 02/15/18 Senate: Rereferred to Finance
HB 422 HB 422: Sales by brewery on licensed premises Requires that when a brewery licensee sells at retail the brands of beer that the brewery owns, at least 20 percent of the beer sold for on-premises consumption must be manufactured on the licensed premises. Del. David L. Bulova 02/16/18 Senate: Reported from Rehabilitation and Social Services (15-Y 0-N)
HB 486 HB 486: Granting of certain mixed beverage licenses Makes two technical corrections pertaining to one of the properties to which, notwithstanding the requirement for a referendum for liquor by the drink, the Alcoholic Beverage Control Board may issue a mixed beverage license. Del. Chris L. Hurst 02/16/18 Senate: Reported from Rehabilitation and Social Services with amendments (15-Y 0-N)
HB 536 HB 536: Sales conducted at government stores established Sales conducted at government stores established by the Alcoholic Beverage Control Board on a distiller’s licensed premises; disposition of markup profits. Provides that any reasonable markup imposed by the Alcoholic Beverage Control Board pursuant to subdivision A 2 of § 4.1-235 on spirits sold at a government store established on a distiller’s licensed premises shall be retained by such distiller.  Del. Nicholas J. Freitas 02/13/18 House: Left in Appropriations
HB 547  HB 547: Brewery licensees Provides that brewery licensees, like farm winery licensees, may sell at retail the brands of beer that the brewery owns not only at its own premises but also at a maximum of five additional retail establishments of the licensee designated in the license. Del. Nicholas J. Freitas 02/13/18 House: Left in General Laws
HB 550 HB 550: Expands privileges of bed and breakfast licensees.

 Expands the privileges of bed and breakfast licensees to include the authority to sell and serve alcoholic beverages in dining areas, private guest rooms, and other designated areas to any person, with or without meals, for on-premises consumption only in such rooms and areas (click here for more)  Del. Nicholas J. Freitas 02/13/18 House: Left in General Laws
HB 571 HB 571 Alcohol; unlawful consumption, purchase, or possession. Unlawful consumption, purchase, or possession of alcohol. Clarifies that it is an affirmative defense to a charge of unlawful consumption, purchase, or possession of any alcoholic beverage if the defendant shows that such consumption, purchase, or possession was allowed under the current exemptions to licensure under the ABC law.  Del. Gregory D. Habeeb 02/16/18 Senate: Rereferred to Courts of Justice
HB 595 HB 595 Overdoses; safe reporting.  Safe reporting of overdoses. Extends to an individual experiencing a drug-related or alcohol-related overdose the affirmative defense to prosecution for (i) simple possession of a controlled substance, marijuana, or controlled paraphernalia; (ii) intoxication in public; or (iii) the unlawful purchase, possession, or consumption of alcohol… (click for more)  Del. Betsy B. Carr 02/15/18 House: Left in Courts of Justice
 HB 619 HB 619 Possession or consumption of alcoholic beverages by interdicted persons. Interdiction; possession or consumption of alcoholic beverages by interdicted persons; repeal. Repeals provisions allowing for a court to enter an order of interdiction prohibiting the sale of alcoholic beverages to any person who has (i) been convicted of driving any automobile… (click for more)  Jennifer Carroll Foy  02/15/18 House: Left in Courts of Justice
HB 654 HB 654: Distiller licensee, commission from sales on licensed premises, etc.  distiller licensee; commission from sales on licensed premises; samples; hours of operation; markup. Requires the Alcoholic Beverage Control Authority (the Authority) to pay a licensed distiller a commission of 25 percent of the retail price of any spirits sold by the distiller at a government store on his licensed premises and prohibits the Authority from imposing a markup when reselling such spirits to the licensee. The bill allows such stores to operate on Sundays after 10:00 a.m. and allows licensed distillers to include in samples mixers consisting of other alcoholic beverages not manufactured on the licensed premises. The bill also increases the number of banquet licenses for special events a licensed distiller may purchase per year from four to eight and allows the licensee to sell samples of spirits at such special events. Del. Kathleen Murphy 02/13/18 House: Left in General Laws
HB 820 HB 820: Delivery of wine or beer to retail licensee, wholesaler requirement. Delivery of wine or beer to retail licensee; wholesaler requirement. Requires that before any wine or beer may be delivered to a retail licensee for resale, such wine or beer must first be delivered to the licensed premises… (click for more) Del. Barry D. Knight 02/16/18 Senate: Reported from Rehabilitation and Social Services (15-Y 0-N)
HB 826 HB 826: Increases general license application fee Increases the alcoholic beverage general license application fee from $65 to $195. The bill also increases the application fee for mixed beverage special event licenses from $15 to $45 and increases the state tax on wine shipper’s licenses and beer shipper’s licenses from $95 to $230… (click for more) Del. Barry D. Knight 02/14/18 Senate: Referred to Committee on Rehabilitation and Social Services
HB 852  HB 852: Virginia Institutions of Higher Education Substance Use Advisory Committee; established. Substance abuse prevention; Virginia Institutions of Higher Education Substance Use Advisory Committee established. Directs the Board of Directors of the Virginia Alcoholic Beverage Control Authority (Board) to establish and appoint members to the Virginia Institutions … (click for more)  Del. Christopher K. Peace 02/16/18 Senate: Rereferred to Finance
HB 892 HB 892 Deregulates practice, abolishes Board of Barbers and Cosmetology. Deregulation of barbering, cosmetology, nail care, waxing, tattooing, body piercing, and esthetics. Abolishes the Board for Barbers and Cosmetology and deregulates the practices of barbering, cosmetology, nail care, waxing, tattooing, body piercing, and esthetics.  Del. Michael J. Webert 02/13/18 House: Left in General Laws
HB 910 HB 910: Breweries that manufacture less than 5,000 barrels of beer per year. Beer Franchise Act. Exempts the purchase of a brewery that manufactures less than 5,000 barrels of beer per year from the requirement that the purchaser become obligated to all of the terms and conditions of the selling brewery’s agreements with distributors in effect on the date of purchase. The bill reduces from 90 to 45 the number of days in which a brewery must provide a wholesaler prior written notice of any intent to amend Del. R. Steven Landes 02/13/18 House: Left in General Laws
HB 1005 HB 1005: Wine wholesaler; primary area of responsibility Removes the provision that describes the “primary area of responsibility” of a wine wholesaler that enters into an agreement with a winery to sell its wine in a certain sales territory.  Del. C. Todd Gilbert 02/16/18 Senate: Reported from Rehabilitation and Social Services (10-Y 0-N)
HB 1299 HB 1299: Increases amount of spirits that may be offered. Alcoholic beverage control; spirit samples. Del. C. Matthew Fariss 02/13/18 House: Left in General Laws
HB 1379 HB 1379: Records of retail licensees. Establishes that electronic records of retail licensees may be stored off site, provided that such records are readily retrievable and available for electronic inspection.. (click for more) Del. Roxann L. Robinson 02/16/18 Senate: Reported from Rehabilitation and Social Services with amendment (15-Y 0-N)
 HB 1400 HB 1400: Distiller licensee, commission for sales on licensed premises. Distiller licensee; commission for sales on licensed premises. Requires the Alcoholic Beverage Control Authority to pay a licensed distiller a commission of 20 percent of the retail price of any spirits sold by the distiller at a government store on the licensed premises. Del. Christopher T. Head 02/13/18 House: Left in General Laws
HB 1432 HB 1432: Definition of “day spa.” Removes the requirement that in order to qualify as a day spa for ABC purposes, a commercial establishment must offer to the public both licensed massage… (click for more)  Del. Kenneth R. Plum 02/13/18 House: Left in General Laws
HB 1484  HB 1484: Distiller’s license, remote store location and tasting room. Allows a distiller licensee who operates a government store for the sale of spirits to add to the license one additional location that is not on the licensed premises (i) to conduct tastings and (ii) for the sale of spirits. Del. Benjamin L. Cline 02/13/18 House: Left in General Laws
HB 1519 HB 1519: definition of “day spa.” Removes the requirement that in order to qualify as a day spa for ABC purposes, a commercial establishment must offer to the public both licensed massage … (click for more)  Del. Christopher T. Head 02/13/18 House: Left in General Laws
HB 1520 HB 1520: Exemptions from licensure certain nonprofit swim clubs. Provides that, under certain circumstances, a duly organized nonprofit corporation or association operating a swim club may hold private meetings … (click for more)  Del. Richard C. “Rip” Sullivan, Jr. 02/16/18 Senate: Reported from Rehabilitation and Social Services (11-Y 4-N)
HB 1541 HB 1541: Creates a new limited mixed beverage license for retail cigar shops.  Creates a new limited mixed beverage license for retail cigar shops. The bill sets out the privileges of this new license… (click for more) Del. R. Steven Landes 02/14/18 Senate: Referred to Committee on Rehabilitation and Social Services
HB 1602  HB 1602: Confectionery license Creates a confectionery license, which authorizes the licensee to prepare and sell confectionery that contains five percent or less alcohol by volume. The bill establishes state and local fees … (click for more)  Del. Christopher K. Peace 02/14/18 Senate: Referred to Committee on Rehabilitation and Social Services
 SB 61 SB 61: Confectionery license Creates a confectionery license, which authorizes the licensee to prepare and sell confectionery that contains five percent or less alcohol by volume. The bill establishes state and local fees for confectionery licenses and provides that in no event shall the sale of confectionery containing alcohol exceed 10 percent of the total annual gross sales of all confectionery and other food. Sen. Barbara A. Favola 02/15/18 House: Reported from General Laws (22-Y 0-N)
 SB 90 SB 90: Regulation of casino gaming; penalties Creates the Virginia Casino Gaming Commission (the Commission) as the licensing body for casino gaming. The bill specifies the licensing requirements for casino gaming and imposes penalties for violations of the casino gaming law… (click here for more) Sen.  L. Louise Lucas 01/22/18 Senate: Passed by indefinitely in General Laws and Technology (8-Y 7-N)
 SB 120 SB 120: Substance abuse prevention; Virginia Institutions of Higher Education Substance Use Advisory Committee established Directs the Board of Directors of the Virginia Alcoholic Beverage Control Authority (Board) to establish and appoint members to the Virginia Institutions of Higher Education Substance Use Advisory Committee (Advisory Committee) … (click here for more) Sen. Barbara A. Favola 02/15/18 House: Committee substitute printed 18107155D-H1
 SB 174 SB 174: Wine wholesaler; primary area of responsibility Removes the provision that describes the “primary area of responsibility” of a wine wholesaler that enters into an agreement with a winery to sell its wine in a certain sales territory. Sen. William M. Stanley, Jr. 02/15/18 House: Reported from General Laws (22-Y 0-N)
 SB 233 SB 233: Point-of-sale advertising limit Increases from $40 to $99 the amount per item a manufacturer or its authorized vendor and a wholesale wine and beer licensee may lend, buy for, or give to a retail licensee for alcoholic beverage advertising material. Sen. Emmett W. Hanger, Jr.  01/12/18 Senate: Stricken at request of Patron in Rehabilitation and Social Services (14-Y 0-N)
SB 306 SB 306: Sales by brewery on licensed premises. Sales by brewery on licensed premises. Requires brewery licensees, in order to sell at retail the brands of beer that the brewery owns, to have on premises the equipment necessary to manufacture not less than three barrels of beer simultaneously and requires that at least 20 percent of the beer sold for on-premises consumption be manufactured on the licensed premises. Sen. Ryan T. McDougle 02/15/18 House: Reported from General Laws with amendment (22-Y 0-N)
 SB 382  SB 382: Delivery of wine or beer to retail licensee, wholesaler requirement. Delivery of wine or beer to retail licensee; wholesaler requirement. Requires that before any wine or beer may be delivered to a retail licensee for resale, such wine or beer must first be delivered to the licensed premises of a wine or beer Sen. A. Benton “Ben” Chafin 02/15/18 House: Reported from General Laws (22-Y 0-N)
SB 467  SB 467: Creates a new limited mixed beverage license for retail cigar shops. Creates a new limited mixed beverage license for retail cigar shops. The bill sets out the privileges of this new license, including a requirement that at least … (click for more)  Sen. Bryce E. Reeves 02/02/18 Senate: Passed by indefinitely in Rehabilitation and Social Services (11-Y 4-N)
SB 482 SB 482: Increases amount of spirits that may be offered. Spirit samples. Increases the amount of spirits that may be offered as a sample at government stores and special events from one-half ounce to one ounce and the amount that can be offered in a mixed drink from one and one-half ounces to two ounces… (click for more) Sen. Bryce E. Reeves 02/02/18 Senate: Stricken at request of Patron in Rehabilitation and Social Services (13-Y 0-N)
 SB 483  SB 483: Distiller’s license, remote store location and tasting room. Allows a distiller licensee who operates a government store for the sale of spirits to add to the license one additional location that is not on the licensed premises (i) to conduct tastings and (ii) for the sale of spirits. Sen. Bryce E. Reeves 02/02/18 Senate: Stricken at request of Patron in Rehabilitation and Social Services (13-Y 0-N)
 SB 484 SB 484: Distiller licensee, commission for sales on licensed premises. Distiller licensee; commission for sales on licensed premises. Requires the Alcoholic Beverage Control Authority to pay a licensed distiller a commission of 20 percent of the retail price of any spirits sold by the distiller at a government store on the licensed premises. Sen. Bryce E. Reeves 02/06/18 Senate: Stricken at request of Patron in Finance (16-Y 0-N)
SB 486 SB 486: Distiller Licensee; commission from sales on licensed premises; samples. Distiller licensee; commission from sales on licensed premises; samples; hours of operation; markup. Requires the Alcoholic Beverage Control Authority (the Authority) to pay a licensed distiller a commission of 25 percent of the retail price of any spirits sold by the distiller at a government store … (click for more) Sen. Bryce E. Reeves 02/14/18 House: Referred to Committee on General Laws
SB 530 SB 530: Regulations to qualify for an attraction sign.  Directs the Department of Transportation to amend its regulations to exempt breweries, wineries, and distilleries from the requirement that a facility be in continuous operation for at least eight hours … (click for more)  Sen. T. Montgomery “Monty” Mason 02/07/18 Senate: Stricken at request of Patron in Transportation (13-Y 0-N)
 SB 647  SB 647: Applications for licenses, removes certain requirement. Removes the requirement that applicants for certain ABC licenses provide a statement, under oath, setting forth any information required by the Board of the Alcoholic Beverage Control Authority Sen. Jeremy S. McPike 02/14/18 House: Referred to Committee on General Laws
 SB 695 SB 695: Creates an Internet beer retailer license, definition. Creates an Internet beer retailer license, establishes the privileges of and fee for the license, and defines “Internet beer retailer.” Sen. Lynwood W. Lewis, Jr. 02/13/18 House: Assigned GL sub: Subcommittee #3
SB 756 SB 756: Conduct not prohibited, etc. Donations of beer by brewery licensees to charitable nonprofit mixed beverage special event licensees or banquet licensees. Provides that any brewery licensee may donate beer that it has manufactured and any (i) mixed beverage special events licensee … (click for more) Sen. Glen H. Sturtevant, Jr. 02/02/18 Senate: Passed by indefinitely in Rehabilitation and Social Services (13-Y 0-N)
SB 769 SB 769: Museum license privileges in Town of Front Royal. Allows museum licensees who operate a museum located in the Town of Front Royal that is dedicated to educating the consuming public about historic beer products … (click for more) Sen. Scott A. Surovell 02/13/18 House: Assigned GL sub: Subcommittee #3
SB 773  SB 773: Reduces food-to-beverage ratio for mixed beverage licensees. Reduces the current 45 percent food-to-beverage ratio for mixed beverage licensees. The bill requires that a mixed beverage restaurant, caterer’s, or limited caterer’s … (click for more) Sen. Bill R. DeSteph, Jr. 01/26/18 Senate: Continued to 2019 in Rehabilitation and Social Services (15-Y 0-N)
 SB 803  SB 803: Provides that any reasonable markup imposed by ABC on spirits sold at a government store established on a distiller’s licensed premises shall be retained by such distiller.  Alcoholic beverage control; sales conducted at government stores established by the Alcoholic Beverage Control Board on a distiller’s licensed premises; disposition of markup profits. Provides that any reasonable markup imposed by the Alcoholic Beverage Control Board pursuant to subdivision A 2 of § 4.1-235 on spirits sold at a government store established on a distiller’s licensed premises shall be retained by such distiller. The provisions of the bill are contingent on funding in a general appropriation act  Sen. Bryce E. Reeves (chief patron) 02/14/18 House: Referred to Committee on Appropriations
 SB 884  SB 884: Increases the alcoholic beverage general license application fee  Increases the alcoholic beverage general license application fee from $65 to $195. The bill also increases the application fee for mixed beverage special event licenses from $15 to $45 and … (click for more)  Sen. Ryan T. McDougle  02/15/18 House: Referred to Committee on Appropriations

 

About the Distillers Political Action Committee (DPAC)

The Distillers Political Action Committee is a legal entity that pools campaign contributions from members, corporations and private citizens that identify with the legislative agenda set by the Virginia Distillers Association; with the sole purpose of donating funds to campaigns that are for or against candidates, ballot initiatives, or legislation.

DPAC is an independent legal entity from the Virginia Distillers Association, and is managed by VDA committee members. DPAC is deemed a 527-business activity by the IRS, and donations made through the Virginia Distillers Association (VDA) website are strictly siloed to funding the Distillers Political Action Committee.

Educate. Inform. Support.

Along with promoting awareness of the Virginia distilled spirits industry, the Virginia Distillers Association’s purpose is to improve the regulatory and legislative landscape for distilleries in the Commonwealth. This is done by educating our legislators and consumers about the unique and excessive state-imposed policies and tax burdens that ultimately make Virginia craft spirits less accessible to consumers.

Virginia’s distillers are small Virginia businesses and entrepreneurs; in addition, they’re farmers, craftsmen, artisans, and flag bearers of the state’s tourism industry, rich history, and jobs that are often in rural communities. Nevertheless, they disproportionately fund state government.

Two key issues that are currently most critical to the sustainability of the Virginia Spirits Industry / Virginia Distillers are as follows (please check the above ‘Current Relative – Legislation’ chart to track the progress of our proposed legislation to address the following issues during the 2018 General Assembly Session):

  1. Disparities between traditional government ABC stores and distillery stores. This specifically relates to the state markup structure and the commission paid to distillery store operators.
  2. Virginia distilleries have to purchase their own product at full retail, which is used for sampling at their tasting rooms, events, etc.

Understanding the Key Issues.
To better identify with these issues, it is necessary to understand that Virginia is a Control State for distilled spirits. As a result, the state is the sole wholesaler and retailer for spirits, but not for wine and beer. In addition, we will use the following terms to reference the types of ABC stores Virginia distilled spirits can be sold:

  • Government Stores: These are traditional brick and mortar ABC stores. There are 365 government-run stores across the Commonwealth.  
  • Distillery Stores: Most consumers typically identify these stores as a “tasting room” when they visit a Virginia distillery. What consumers don’t realize is that the tasting room or distillery store is also considered a Virginia ABC government store. As a result, distillery stores must abide by the same markup structure, whether their product is sold at a traditional brick and mortar ABC government store or at their distillery where the product never moves from the production facility into ABC’s distribution system.

To understand the economics for products sold at an ABC government store or a distillery store, here’s a breakdown of Virginia ABC’s Markup Structure:

  • All distilled spirits are marked up by 69% of their wholesale price
  • In addition, there is a 20% excise tax, which is paid by consumers
  • Lastly, there’s the general sales tax that varies by locality between 5-5.3%

Consumers in Virginia have a unique challenge in getting access and affordable pricing for our state’s distilled spirits. As craft producers in the Commonwealth, Virginia distillers inherently have higher costs for production, on a per bottle basis. Add in Virginia’s automatic 69% markup, and it now becomes harder for consumers to choose a local product versus a larger, out-of-state product.

One-way Virginia distilleries can bring their product to market is by operating a distillery store. In 2006, the General Assembly created a law that allowed ABC to contract with distillers to operate distillery stores. In the eyes of the consumer, distillery stores allow for tastings and bottle sales on-site for consumers similar to Virginia wineries and breweries. However, most consumers do not realize that distillery stores are also ABC government stores, but operated by the distillery personnel.

Even though the distillery fronts 100% of the operational costs, distillery stores are still considered ABC government stores, and the sales proceeds are deposited into a state account, not the distillery’s. Profit transfers back to the distillery take approximately 30 – 60 days. Along with this challenge, there are numerous costs to running a distillery store such as staff, overhead, and tasting samples (part of Key Issue # 2). These costs can add up and are higher compared to a government ABC store.

Virginia distillers have greater overhead costs as small-independent businesses compared to Virginia ABC government stores because they are also paying for things like Virginia agriculture, for marketing support for Virginia tourism, for other job creating endeavors. These expenses cannot be recouped in the economics of bottle sales at a distillery store.

To deal with costs, the state’s distilling industry has one advantage: tourism. Virginians as well as out of state tourists enjoy going to Virginia wineries and breweries, conducting tastings, and purchasing product to take home (direct sales). This advantage, however, goes but so far. Distillers cannot sell in the free market like Virginia wine and beer producers, which get to keep all proceeds of their bottle sales except for the taxes and their cost of production.

For product sold at distillery stores, Virginia ABC pays distilleries an overhead allocation (i.e., commission) of 8%. As cited in ABC’s 2017 fiscal report, even with the 8% commission included, distillery stores still render a higher rate of return for the state at 40.52%, versus traditional ABC government stores which render a rate of return to the state of 35.03%.

The question then becomes, what can the state do to offer parity between its own government run stores and distillery stores, if the state is clearly receiving a higher rate of return from distillery stores? The responsible measure is to commit to a commission that provides a fair offset to additional expenses faced by distillery stores, vs. ABC gov’t stores. These Virginia businesses are supporting Virginia jobs, Virginia tourism and Virginia’s agriculture. Alternatively, the state could option to reduce the overall markup on Virginia distilled spirits for product sold at distillery stores.

This issue has a profound impact on Virginia distilleries’ operational expenses. Virginia is one of few states that require their distilleries to buy back their own product used for samples from the state, with the state-imposed markup. Most other states’ distilleries are paying cost for the liquor that they use in their tasting room.

The Virginia beer and wine industries are not treated in the same manner. Tastings for wineries and breweries are straightforward: they decide whether or not to charge you. The samples are taken out of their own stock, and wineries and breweries keep all the proceeds. If there are any costs, they relate to production and taxes. Conversely, for a distillery offering tastings, it has to buy the bottles of spirits that are poured as samples at full retail including the state imposed 69% markup from Virginia ABC. It costs Virginia distilleries a lot more to provide samples to customers, and the customer often doesn’t understand that.

The question then becomes, what can ABC do to help alleviate this burden and offset the enormous operational expense Virginia distillers face by paying full retail for their product poured as samples? The answer is simple: Completely remove the state’s markup on product poured for samples.

Supporting Virginia’s Distilleries’ Local Efforts.
Part of the state’s control system structure rationalizes that Virginia distilleries disproportionately fund general government. Virginia distillers deserve parity as it relates to the treatment of their distillery store operations compared to traditional ABC government stores, and they deserve equal treatment as received by our counterparts in the wine and beer industries.

If you identify with our causes – then please considering support by:

  • Asking for Virginia spirits at your ABC government-run stores, and at restaurants and bars in the region.
  • Visiting and patronize our distilleries.
  • And last but not least, consider making a contribution to DPAC, which is the {Virginia} Distillers Political Action Committee. Contributions can be made directly through our website.

Thank you for your time and support.

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