‘There’s Gonna Be a Backlash’: Whiskey Giant MGP Files Lawsuit Against Kentucky Communities Denying its Expansion Plans
A logo for the spirits giant, MGP Ingredients. MGP is currently suing two local communities in Kentucky. (Photo: Kristoffer Tripplaar/Sipa via AP Images)
WDRB reported on Thursday that MGP Ingredients, the whiskey giant that owns brands like Ezra Brooks, Remus and Penelope, is suing local communities in Kentucky over an alleged denial of the superproducer’s warehouse expansion plans.
“We have filed these suits seeking only to have commitments made to us honored and to protect our rights as landowners,” MGP’s spokesperson Jenell Wallace Loschke said in an email to WDRB.
The outlet reports that in early 2023, Nelson County agreed to finance a building project of five warehouses to store bourbon barrels made at the MGP’s Bardstown facilities.
MGP additionally signed an agreement to build six warehouses in the community of Williamstown.
After the communities were accused of allegedly blocking the construction of the whiskey warehouses, MGP decided to pursue legal action. Both lawsuits were filed separately in January and February.
Nelson County attempted to have the lawsuit dismissed, according to the outlet.
Distilleries and Their Communities — When Tensions Rise
Relationships between certain distilleries and their surrounding local communities have soured during the bourbon boom. It’s not surprising, because many issues can arise from living within proximity to a distillery.
Perhaps the greatest flashpoint came when Kentucky legislation voted to phase out the barrel tax in favor of the distilleries in March 2023.
The funds from the bourbon tax were allocated to support infrastructure, emergency responder services and schools. Many viewed the tax cut as a form of corporate greed favoring big business over communities.
“This is a tax cut for a booming industry,” Rep. Candy Massaroni (R-Bardstown) said. “And ultimately, this is going to put more of a tax burden upon my constituents.”
Since the phaseout began, it appears many communities are struggling to find incentives to allow distilleries to set up shop nearby.
“I’ve talked to several counties. The zoning laws — you know — it’s gonna hurt [the distillers]. There’s gonna be a backlash,” Nelson County Judge-Executive Tim Hutchins said, according to WDRB.
Hutchins is being sued by MGP and has since declined to comment on the matter, according to WDRB.
The current legal battle with MGP and local communities may be just the first incident in a broader conflict between distilleries and their neighboring communities.
“I think communities across Kentucky are looking at the cost of the warehouses, the mold that’s generated, the flammable alcohol that’s stored, the wear-and-tear from the semi trucks going up and down the road… and then you look at the tax generation that’s will not be there in the future,” City Commissioner Josh Ballard said, according to WDRB. “It’s pretty common sense for communities across Kentucky to say, ‘No, we do not want your building here. We don’t want to increase taxes on citizens to pay for your warehouses, which is what will happen.”
Other instances of communities feeling negatively affected by local distilleries have come in the form of whiskey fungus painting surrounding structures in an ashy grey substance and, according to WDRB, other hazards of living near distilleries such as fire risks because many bourbon brands house flammable wood and liquid.
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