Gardiner, N.Y. – Ralph Erenzo and Brian Lee keep a still in the barn to make whiskey.
No, the two are not backwoods bootleggers filling jugs with “XXX” on the side. Their shiny copper kettle cooks up whiskey that can run $40 for a half-sized bottle and vodka distilled from local Hudson Valley apples, all under the high-end Tuthilltown Spirits label.
Erenzo claims they make the first (legal) whiskey in New York since Prohibition. But they already face competition from dozens of “craft” distilleries around the country catering to consumers’ appetite for artisan and local products.
People who pay more for handcrafted cheese, bread, beer and wine are showing a willingness to do likewise for the hard stuff.
Tiny Tuthilltown – which makes bourbon, rye, corn whiskey and vodka – is selling faster than it can be bottled.
“Whiskey is what people are screaming about,” Erenzo said midway through distilling a batch of rye. A clear stream of spirits flowed from the still on the barn’s spacious second floor as he talked.
Erenzo and Lee seem to be unlikely spirit makers. Erenzo ran a climbing gym in Manhattan. Lee was a broadcast engineer. Neither business partner drinks except to taste their products. Lee jokes that his previous experience with fermenting was confined to making cinnamon buns with his kids.
But the pair display entrepreneurship typical of the new breed.
Erenzo and his wife bought the land on the Wallkill River, about 70 miles north of New York City, with plans to open a ranch for climbers visiting the famous Shawangunk Ridge nearby. After opposition foiled the ranch plan, he met Lee, who initially came to Gardiner to look at Erenzo’s 18th-century grist mill (since sold).
With Lee as a partner, Erenzo decided instead to satisfy his “innate curiosity about spirits.” They saw their chance in 2002, when New York introduced a new class of distilling license for small producers that carries a fee of $1,450, as opposed to $50,800 for the old license.
They created a wholesale liquor business from scratch. Until they landed a distributor this year, Erenzo loaded up his trunk and made the rounds to retailers from New York City to Albany.
Lee, meanwhile, learned the nuances of fermenting – things like how to retain notes of vanilla in the final product. And he relied heavily on his mechanical aptitude to install the 125-gallon still in the barn’s second floor. The unit – with its bell-shaped kettle, gauges, vapor columns, valves and pipes – looks like a science experiment, which it was.
“It took us about 2 1/2 years from a dead stop, knowing nothing about it, until ‘We can turn this thing on and make alcohol,”‘ Erenzo said.
Lee said they mostly break even, with profits going back into the business. Each man has a wife with a steady job.
While vodka is essentially ready to go right out of the still, whiskey is aged in charred oak barrels stored in the barn. After bottling, Erenzo applies labels, dips the bottle tops in wax (heated in a crock pot) and boxes them up.
Small-scale distilleries like this were common in America before Prohibition wiped the slate clean. There are some 90 craft distillers active nationwide, according to Bill Owens of the American Distilling Institute. But craft spirits remain a tiny niche in the U.S. industry, which rings up $58 billion a year in sales. Owens estimates that an average craft distiller might produce 6,000 cases a year.
Erenzo said Tuthilltown has sold 6,000 bottles since April 2006. The partners await delivery of a second, 250-gallon still that will allow them to speed up production.
