O.Z. Tyler Distillery is building new rickhouses, warehouses used for the storage of bourbon barrels, in Ohio County after an unsuccessful attempt to find space in Daviess County. The local distillery will build nine rickhouses on 50 acres of farmland on Country Club Road in Hartford.
While O.Z. Tyler and its business partner Crown Investment Group LLC were hoping to build the rickhouses in Daviess County, Master Distiller Jacob Call said, after a months-long attempt to keep the distillery’s operations local, he’s settled into the idea that Ohio County will become the home to the distillery’s newest expansion.
“We worked with local officials, but we were left with no choice but to work outside of Daviess County,” Call said.
After a second failed attempt to secure land near the Owensboro-Daviess County Regional Airport, and a negotiation that fell on bad timing between the distillery and Owensboro Planning & Zoning, Call said multiple people reached out to O.Z. Tyler with offers to sell their land, just so the rickhouses could be kept on local ground.
“A lot of people tried to sell us their land, but zoning didn’t work out,” Call said. “That, coupled with acreage we needed — 30 to 50 acres — it just couldn’t happen.”
The Owensboro Metropolitan Planning Commission (OMPC) denied the distillery’s rezoning request in January after it was discovered new rickhouses would fall into an I-2 heavy industrial zone, making it difficult to build storage warehouses for bourbon barrels inside county boundaries.
OMPC director Brian Howard told Owensboro Times the commission wasn’t able to make zoning amendments for O.Z. Tyler because of the high hazard risks.
Economically speaking, Daviess County does lose out on a substantial amount of tax revenue because of its inability to find space for the rickhouses. Had the nine rickhouses been built locally, Daviess County could have benefitted from an additional $500,000 in inventory taxes that O.Z. Tyler would have paid on their stored bourbon barrels, Call said. Now, Ohio County will reap the benefits from that inventory tax, but Call said Daviess County will still see $600,000 in tax revenue from existing warehouses in the local area.
According to the Kentucky Distillers Association, distilleries are in the middle of a $2.3 billion building boom. The next wave of investments will create 1,800 new jobs, $70 million in payroll and $8.4 million in tax revenue.
Last year, distillers paid more than $23 million in state and local barrel taxes alone — a new record for the state. Locally, that tax revenue funds schools, libraries and public safety.
While Daviess County will lose out on hundreds of thousands of dollars, it will continue to see economic benefits from the seven, soon to be eight, O.Z. Tyler rickhouses that reside in the area. The approximately $600,000 in tax revenue will go toward the local government and the school system because of the local rickhouses that will continue to store around 160,000 barrels of bourbon.
“Our distillery is still here,” Call said. “We’ve got 26 acres here. We’ve got seven warehouses, and we’re working on our eighth.”
According to Call, the decision to build in Ohio County came because there wasn’t enough time to wait any longer. Call said the distillery waited until the last possible moment to make a firm decision, with hopes that a rezoning ordinance could come to fruition. However, with the expansion that O.Z. Tyler has been planning over the last several months, the distillery was going to be completely out of space before June.
In the end, something had to give.
“You know, in a way, it probably would’ve been smart for us to look to Ohio County [from the beginning],” Call said. “Even though the land was higher in Daviess County, and the taxes were higher, we still wanted to keep everything here. I think [Daviess County Fiscal Court] is probably disappointed. It really just came down to planning and zoning. We have a really good relationship with Al Mattingly and the mayor. There’s no animosity there.”
Call said he hopes as long as OMPC can successfully amend the zoning issue that befell O.Z. Tyler in this round, the distillery can continue to expand locally in the future.
For now, Call said those at O.Z. Tyler are relieved that the rickhouse debate is behind them.
“We’re just kind of glad to have some closure,” Call said.