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From YouTube: Bourbon Barrel Taxation Task Force (6-24-22)
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A
Nelson
county
50th
district,
I'm
going
to
just
briefly
say,
welcome.
We
have
no
preconceived
notions
at
all.
We
are
simply
here
to
to
investigate
and
look
and
learn
and
try
to
figure
out
if
there's
a
way
at
all
that
we
can
do
something
positive
for
one
of
our
signature
industries,
while
at
the
same
time
I
want
to
make
sure
everybody
hears
this
at
the
same
time,
doing
no
harm
to
our
counties
and
local
governments.
There's
nobody
up
here,
that's
interested
in
hurting
anybody.
A
B
Thank
you,
representative
mccoy.
Yes,
you
know
I
want
I'm
going
to
call
him
chad
we're
a
little
bit
informal.
Everybody
knows
who
we
are
here.
We
had
a
good
discussion
about
this
on
the
phone
earlier
in
the
week
and
truly
we
want
to
see
how
we
can
grow
this
pie
to
create
more
opportunities
without
any
fiscal
impact,
to
the
negative
on
anybody.
I
want
to
go
back
to
2014..
B
B
The
old
black
acre
saw
several
billion
dollars
worth
of
investment.
Then
black
acres
then
paying
higher
property
taxes
increased
jobs
in
this
state
direct
that
created
more
occupational
tax.
So
we
want
to
try
to
take
that
theory
of
good
economics,
good
fiscal
policy
to
where
we
don't
hurt
any
local
entities.
We
don't
be
it
school
boards,
libraries,
county
governments,
but
how
do
we
create
a
bigger,
broader
base
of
industry
to
where
we
are
competitive
and
continue
with?
What
I
believe
is
you
know
damon.
B
There
gets
mad
at
me
when
I
say
this
that
truly
the
bourbon
industry
is
a
signature
industry.
The
horse
industry
is
an
image
industry.
They
don't
have
the
physical
impact,
but
I
think
representative,
mccoy
and
myself
are
on
the
same
page
about
where
we
want
to
go.
I
think
we
have
a
good
agenda
laid
out
for
the
next
three
meetings.
A
And
with
that
does
any
of
the
committee
members
have
anybody
they
want
to
introduce
or
say
hi
to
or
anything
like
that
before
we
get
started,
go
ahead,
representative.
A
A
E
Just
a
bit
of
introduction
for
those
who
may
not
know
me
yet
jennifer
hayes,
I'm
committee
staff
administrator
for
the
appropriations
and
revenue
committee
and
I'm
also
staff
to
this
task
force
today
we're
going
to
talk
about
kentucky
taxation,
what
else
from
a
r
staff
and
we're
going
to
talk
about
some
recent
history,
some
american
history,
some
ancient
history,
as
we
move
through
the
various
taxes
and
and
describe
each
one
of
those.
E
So
here's
a
little
bit
of
history
about
the
alcohol
distribution.
Remember
back
to
1919
and
the
18th
amendment
to
the
u.s
constitution
that
created
prohibition
and
it
wasn't
prohibition
to
drink.
It
was
prohibition
to
to
not
manufacture
to
not
transport
or
not
to
sell
alcohol
products,
and
there
was
also
a
requirement
to
denature
that
product
thousands
of
individuals
died
because
they
didn't
realize
that
the
alcohol
that
they
once
were
consuming
had
been
required
to
be
changed
in
a
way
that
chemicals
were
added.
E
Quinine
was
added,
various
products
were
added
to
the
alcohol,
and
thousands
of
people
died
because
of
that
fast
forward
to
1933
the
21st
amendment
repealed
that
18th
amendment
and
section
2
of
the
21st
amendment
stated
that
power
to
control
alcohol
resides
with
the
states,
and
so
the
power
shifted
from
the
u.s
government
to
the
states
to
control
alcohol
states.
Desi
decided
on
two
basic
methods
of
how
to
control
alcohol,
alcohol
beverage
control
states
were
created
in
some
states.
These
were
are
where
the
state
controls
the
sale
of
the
alcohol.
E
You
have
to
physically
go
to
a
state-run
retail
outlet
as
a
consumer
to
purchase
alcohol.
17
states
today
still
do
it
that
way,
and
then,
in
the
other
states
the
three-tier
system
was
created
and
kentucky
was
one
of
those
states
that
began
with
the
normal
three
tiers.
Those
tiers
are
manufacturer,
wholesaler
retailer,
three
tiers
and
those
three
tiers
were
established
as
silos
manufacturers
did
nothing
but
manufacturer
wholesalers
did
nothing,
but
wholesale
retailers
did
nothing
but
sell
that
product
to
the
end
consumer.
E
But
what
we
have
seen
since
the
30s
is
the
industry
starting
to
evolve.
We
have
today
micro,
breweries,
small
farm
wineries
and
we
have
direct
consumer
sales
where
the
lines
the
distinct
lines
between
those
three
tiers
are
starting
to
blur.
Now
our
statute
says
we
still
maintain
a
three-tier
system,
but
I
often
get
calls
to
say
well.
Do
you
really
and
that's
a
question?
I
can't
really
answer.
E
Maybe
it's
going
to
take
a
court
to
decide
that
I'm
not
sure,
but
the
whole
point
here
in
this
discussion
is
that
the
industry
over
time
has
evolved.
Our
tax
system
has
not
evolved
very
much
at
all.
E
We've
made
tweaks,
but
evolution
has
not
really
occurred,
and
so
today
I'm
going
to
talk
about
various
and
sundry
taxes,
all
across
kentucky's
array
of
taxes
to
include
three,
the
first
three
taxes
are
all
on
the
wholesale
tier
of
the
three-tier
system,
the
wholeseller
and
that's
the
alcohol
excise
tax,
the
wholesale
sales
tax
and
the
distilled
spirits
case
sales
tax
and
then
we're
going
to
talk
a
little
bit
about
sales
tax
and
how
there's
an
interplay
there,
the
property
tax
we're
going
to
touch
on
income
tax
a
little
bit
and
then
the
various
local
taxes.
B
E
E
This
our
statute
says
it's
levied
upon
the
use,
sale
or
distribution
by
seller
gift,
so
use
sale
or
distribution
in
the
state.
The
wholesaler
becomes
taxable-
and
this
is
a
tax
that
is
based
on
volume,
gallons
sold
excise
taxes
based
on
gallons,
so
wholesalers
of
distilled
spirits
pay.
This
tax
wholesalers
of
wine
distributors
of
malt
beverage
see
we
started
with
that
wholesale
person
in
our
statute
that
that
wholesale
tier,
but
look
what
we've
done
over
time.
E
We've
had
to
add
to
wholesalers
that,
where
that
product
might
transfer
from
a
wholesaler
to
a
retailer
or
maybe
even
to
a
consumer,
we've
had
to
maybe
jump
over
that
that
a
tear
there,
distributors
of
malt
beverage
or
retailers
of
malt
beverage
who
purchase
malt
beverage
directly
from
a
brewer.
E
But
when
I
was
in
the
revenue
cabinet,
as
it
was
called
then
now
the
department
of
revenue
as
a
tax
administrator,
I
can
tell
you
that
ensuring
compliance
on
a
small
group
of
similar,
similar
taxpayers
is
much
easier
than
ensuring
compliance
on
every
other
person
selling
or
transferring
distributing
whatever
so
the
charge
to
the
department.
These
days
is,
is
much
greater
than
the
charge
of
the
1930s
and
to
ensure
compliance.
E
E
The
we're
still
on
the
first
tax
alcohol,
excise
tax,
it's
a
dollar
and
92
cents
on
each
wine
gallon
and
I've
recently
had
a
question
about
well.
Is
wine
gallon
different
from
gallons
of
wine
and
you'll
see
that
in
the
next
slide,
when
we
talk
about
the
excise
hat
tax
on
wine,
and
so
through
that
research
here
comes
your
ancient
history.
E
One
gallon
is
an
undefined
term
in
kentucky
revised
statutes.
It's
only
used
in
this
one
place
here
related
to
this
tax
on
distilled
spirits,
and
so
I
think,
if
that
question
came
before
the
court,
they
would
look
to
the
general
meaning
of
wine
gallon
over
the
entire
history,
and
it
really
dates
back
to
england
as
far
back
as
the
14th
century,
and
it
actually
entered
britain's
statutes
under
queen
anne
in
1707.,
and
but
britain
abandoned
that
measure
of
a
wine
gallon
when
the
imperial
units
came
into
play.
E
You'll
notice
here
that
there's
a
statement
in
the
statute
about
re
retail
containers
of
one
half
pint
shall
be
12
cents
and
there
is
that
proportional
rate
that
if
you
sell
more
or
less
than
a
gallon,
it's
a
proportional
rate
of
tax.
Well,
if
you
do
the
math
eight
points
to
a
gallon
16
half
points
to
a
gallon,
divided
dollar
92
by
16,
that's
12
cents,
so
you're
not
really
getting
a
break
here.
E
It's
just
a
further
statement
about
the
proportional
rate,
but
we
do
have
a
reduced
rate
25
cents
on
each
gallon
of
distilled
spirits,
when
the
volume
of
the
distilled
spirits
within
the
retail
container
is
six
percent
or
less
now
put
back
on
my
department
of
revenue
hat.
I
didn't
know
of
any
taxpayer
that
paid
that
reduced
rate.
Then
I
think
the
industry
has
recently
checked
with
the
department
of
revenue.
They
don't
see
that
rate
being
used.
E
Is
the
industry
continuing
to
evolve
into
ready
to
drink
rtds
and
just
note
that
on
june
13th
I
saw
a
kentucky.com
article
that
jack
daniels
tennessee
whiskey
launches
new
ready
to
drink
cocktail
with
coke,
so
you're
going
to
be
able
to
buy
a
can
with
jack
and
coke
in
it,
and
that
article
said
that
that
drink
will
be
5
alcohol
to
beverage
volume,
which
is
about
10
proof,
and
it's
going
to
be
available
in
the
market
soon
whether
it
comes
to
kentucky-
I
don't
know,
but
maybe
so
I
have
asked
the
department
recently.
E
I
asked
the
department
of
revenue:
would
this
type
of
alcohol
qualify
as
a
distilled
spirits
for
that
reduced
rate?
I
have
not
gotten
a
response
yet
just
recently
asked
that,
though,
so
that
might
be
something
that
you
I'll
follow
up
with
the
task
force.
If
I
do
get
a
response,
but
it's
something
you
might
want
to
consider
at
a
future
meeting.
A
Great
jennifer,
can
I
ask
quick
questions:
yeah
the
dollar
92,
I'm
gonna
ignore
the
word
wine,
so
it's
1.92
a
gallon
of
distilled
spirits,
given
that
the
next
part
talks
about
six
percent
or
less
any
idea,
whether
it
has
to
be
a
hundred
percent
distilled
spirit
to
be
taxed.
At
that
rate,
is
this
a
graduated
rate
depending
upon
the
alcohol
per
volume,
or
is
it
just
if
it
has
distilled
spirits
in
it
greater
than
six?
It's
at
that
higher
rate.
A
E
E
I
can
look
into
that,
but
but
statutory
words,
the
department
of
revenue,
doesn't
have
a
lot
of
guidance
in
regulation
form
out
there.
Yeah.
A
E
C
E
And
let
me
say
no,
unless
it's
contained
in
that
distilled
spirits
definition
and
I'm
not
that's
a
that's
a
abc
definition
over
separate
from
you
know
the
tax
statutes
yeah.
So
we
could
come
back
with
information
on
that
definition.
E
Okay,
now
we're
going
to
move
from
distilled
spirits
to
wine,
still
the
same
tax,
the
excise
tax,
but
on
one
now,
just
briefly:
it's
50
cents
on
each
gallon
of
wine.
There
is
a
proportional
rate
again,
and
there
is
a
statement
in
the
statute
that
the
tax
shall
not
be
less
than
four
cents
on
the
sale
or
distribution
of
any
retailer.
A
retail
container
of
wine.
E
The
next
is
the
excise
tax
on
malt
beverages.
The
language
is
a
little
bit
different
here,
two
dollars
and
fifty
cents
on
each
barrel
of
31
gallons.
That
equates
to
eight
cents
per
gallon.
Do
the
math
31
into
250
8
cents
per
gallon,
and
there
is
once
again
a
proportional
rate.
So
if
you
sell
anything
more
than
or
less
than
31
gallons,
then
that
rate
is
adjusted
based
upon
the
product
as
it
sold.
E
There
is
a
credit
allowed
to
each
brewer
producing
beverages
in
this
state
of
50
of
the
tax
that
they
get
a
reduction
of
50
percent
of
the
tax
on
the
first
300
thousand
barrels
each
year,
and
one
other
thing
to
note
is
there
is
a
malt
beverage
educational
fund.
One
percent
of
the
total
tax
collected
is
deposited
into
that
separate
fund
from
the
general
fund
over
to
that
other
fund.
A
E
F
E
Oh
wrong
way:
sorry
exemptions
from
the
tax,
so
if
wine
is
used
for
sacramental
purposes,
the
tax
is
not
imposed
on
that
and
then
any
type
of
licensee,
where
the
the
product
that
is
produced
is
unfit
to
drink.
So
medicinal
pharmaceutical
extracts
or
service
food
products
or
scientific,
chemical,
mechanical
industrial
type,
products.
D
E
So
here
is
a
10-year
history
of
the
alcohol
excise
tax
receipts
and
you
can
see
beer
there
is
the
blue
bar.
The
orange
bar
is
distilled
spirits
and
the
gray
bar
is
wine.
All
excise
tax
receipts.
The
first
of
the
three
taxes
that
we're
going
to
talk
about.
We
can
see
that
from
fiscal
fiscal
year
12
to
fiscal
year,
21
beer
grew
from
6.1
receipts
to
6.2,
pretty
flat
distilled
spirits
went
from
11.4
thereabouts
to
17.5,
and
wine
went
from
2.7
to
3.5
their
bats.
C
G
B
E
Wrong
way,
okay,
so
leaving
the
first
tax
we're
now
moving
to
the
second
tax.
This
tax
wholesale
sales
tax
is
based
upon
the
value
moving
from
volume
to
value.
Now
the
statute
says
that
it
is
a
tax
for
the
privilege
of
making
wholesale
sales
of
beer
wine
or
distilled
spirits
in
this
state.
So
it's
a
privilege
for
the
privilege
of
making
those
sales.
You
must
pay
this
tax
and
once
again
we
started
with
a
very
narrow
list
of
who
pays
the
tax
and
over
time
that
has
gradually
gotten
bigger
and
bigger.
E
The
same
rates
apply
for
direct
shippers,
so
distilled
spirits
still
11
beer
and
wine
10..
There
is
a
reimbursement
provision
just
like
there
is
for
the
retail
sales
tax
reimbursement
for
the
collection
and
remitting
of
that
tax.
E
It
is
equal
to
one
percent
of
the
tax
due
so
here's
the
tax
due
I
get
one
percent.
I
get
to
keep
that
as
a
taxpayer
here,
but
there
are
exceptions.
Microbreweries
and
distillers
are
not
allowed
to
be
reimbursed
for
the
collection
and
remittance
of
the
tax.
E
Here
is
the
10-year
history
for
the
three
products
for
this
type
tax,
wholesale
sales
tax
you
can
see
beer
is
the
blue
column.
This
time
distilled
spirits.
The
orange
one
is
the
gray.
Once
again,
you
can
see
the
the
volume
of
receipts,
the
value
of
those
receipts
coming
in
for
beer.
It
was
54
million
back
in
2012,
it's
63
and
21.
E
distilled
spirits
started
at
29.7
back
in
2012
and
today
they've
almost
caught
up
with
beer
at
62.7,
so
you
see
the
two
bars
almost
equal
and
then
one
14
million
versus
right
at
20
million
for
that
product.
E
E
One
slide
here
just
to
show
you
the
receipts:
it's
a
very
small
tax.
It
began
in
not
began,
but
in
2012
receipts
were
right
at
116,
117
000
2021
we're
at
202
thousand
dollars.
E
A
D
E
D
B
Can
because,
as
I've
been
to
some
distributors,
they
will
get
an
order
and
they'll
put
together
a
box
that
may
have
six
knob
creeks
and
five
tangares
and
whatever
their
retailer
has.
They
won't
sell
by
sorry
I'll,
say,
wood
for
whoever
I
don't
offend
anybody,
but
but
they
they
won't
do
case
by
case
they'll,
break
it
down
in
a
lot
of
situations.
Don't
they
for
smaller
retail
operations,.
F
D
A
A
E
Okay,
so
let's
leave
the
powerpoint
slide
in
your
folder.
You
should
have
a
document
that
is
three
pages
stapled
together,
the
top
page
should
say
state
tax
rates
on
distilled
spirits.
E
E
So
when
you
asked
about
each
state,
let's
look
at
that
first
column,
so
you
have
the
column
of
states
and
then
the
next
column
says
exci
state
excise
tax
rates,
so
you
will
see
a
number
there
for
each
state
or
you
will
see
a
footnote.
The
footnote
is
the
17
states,
it's
related
to
those
17
states.
So
there
is
not
a
tax
rate
in
those
states.
They
control
the
sale,
so
they
control
the
price
of
that.
E
But
for
the
other
states,
these
are
the
states
within
the
three-tier
system.
And
one
note
I
will
show
you
down
on
washington
state
at
the
very
bottom.
You'll
see
footnote
three,
so
they
in
2012
privatized
the
sale,
so
they
have
gone
from
a
state
controlled
to
private
control
of
alcohol
sales.
In
washington
and
you
can
see
their
rate
14.27,
that's
the
highest
rate
of
all
the
states.
E
Number
two
is
alaska,
twelve
dollars
and
eighty
cents
number
three
is
illinois
at
eight
dollars
and
fifty
five
cents,
and
then
they
trail
off
from
that
from
those
top.
Three,
so
remember
distilled
spirits
kentucky
a
dollar.
Ninety
two,
so
this
is
the
first
that
first
tax
that
we
talked
about
the
excise
tax.
E
E
Let's
talk
about
the
wholesale
sales
tax,
our
second
tax
that
we
just
discussed
and
representative
mccoy
you're
correct
kentucky
at
11,
you'll
see
there
in
the
note
11
wholesale
tax
related
to
kentucky
the
only
other
state
is
south
dakota.
E
A
Jennifer,
do
you
know
if
any
of
these
other
states
on
there
sorry
on
their
excise
tax
rate?
It's
the
same
question
that
representative
decker
was
sort
of
alluding
to
in
presidency.
Divers
are
any
of
them
proof
gallon
versus
just
volume,
gallon.
E
So
I
don't
know
that
it's
it's
proof
per
se,
but
it's
you'll
see
many
states
say
under
certain.
E
A
B
E
B
B
F
F
E
So
so,
let's
talk
about
this
slide
that
senator
higdon
is
is
discussing
right
now,
so
three
three
time
periods
that
we
need
to
look
at
so
prior
to
june,
1st
1982.
E
There
was
no
wholesale
sales
tax
justice,
senator
higdon,
said
june
1
1982,
the
wholesale
sales
tax
comes
into
play,
you'll
see
that
in
the
white
box
there
so
prior
to
1982,
we
only
had
two
taxes:
the
excise
tax.
In
the
the
case,
distilled
spirits
case
tax
on
packaged
alcohol.
There
was
the
retail
sales
tax
alcohol
sold
by
the
drink
retail
sales
tax.
E
Then,
when
you
move
down
to
that
white
block
in
the
middle
june,
1
1982
to
march
31st
2009,
you
see
the
wholesale
sales
tax
is
implemented,
created
and
implemented,
and
senator
higdon
is
right.
The
sales
tax
on
packaged
alcohol
is
removed.
There
is
an
exemption
created,
the
alcohol
sowed
by
the
drink
remained
the
sales
tax
remained
on
that.
E
C
E
So,
let's
move
to
sales
tax.
Now
with
that
little
bit
of
history
in
2021,
remember
house,
bill
249..
E
The
definition
for
machinery
for
new
and
expanded
industry
was
expanded
to
include
machinery
directly
used
in
manufacturing
of
distilled
spirits,
wine
or
malt
beverages
at
a
plant
facility.
That's
a
defined
term
for
sales
tax
purposes.
That
includes
a
retail
establishment,
so
think,
back
to
our
three
tiers
that
we
were
discussing
here,
we
have
a
manufacturer.
E
There
is
an
exemption
today
for
for
that
equipment
prior
to
prior
to
house,
bill,
249
and
related
to
other
industries
who
might
have
a
manufacturing
and
a
retail
establishment
at
the
same
location.
E
E
E
Many
turn
to
internet
sales
for
the
purchase
of
goods,
everyday
goods
that
they
were
buying,
and
that
is
one
one
of
the
reasons
that
we
came
through
the
pandemic,
with
such
good
receipts
all
across
the
states.
They're.
Seeing
that,
but
just
a
reminder
about
the
what
the
supreme
court
said
in
wayfair,
they
bless
the
streamlined
sales
tax
approach
and
that
approach
sets
thresholds
for
sales
at
one
hundred
thousand
dollars.
E
E
Additionally,
those
local
taxes
are
required
to
be
centrally
collected
and
distributed
to
those
local
jurisdictions
and
then
finally,
the
the
biggest
thing
was
there
are
similar
definitions
of
products
and
terms
throughout
all
the
streamlined
states
that
have
adopted
that
agreement.
So
you
know
if
it
were
to
apply
to
two
distilled
spirits.
Distilled
spirits
in
kentucky
would
be
the
same
as
distilled
spirits,
in
whatever
other
state
and
the
supreme
court
has
said
that
relieves
the
burden
on
interstate
commerce
by
all
the
states
coming
together
and
and
creating
this
simplified
way
to
impose
sales
tax.
E
When
that
retailer
does
not
have
fiscal
presence
in
the
state,
so
the
burden
has
been
lifted,
and
so
just
keep
that
in
mind,
as
we
continue
to
talk
about
expansion
of
taxation
outside
the
borders
of
kentucky.
E
Now,
let's
move
to
the
property
tax
on
distilled
spirits
in
bonded
warehouses.
This
is
the
tax.
I
think
that
this
task
force
is
named
after
bourbon
barrels,
we're
talking
about
the
bourbon,
that
is
in
those
barrels
and
the
property
tax
that
is
imposed
upon
that
bourbon,
but
just
like
sales
tax.
I
would,
I
feel,
compelled
to
give
you
a
little
lesson
on
property
tax
in
kentucky
very
high
level
lesson
here:
property
tax
in
kentucky
is
in
the
constitution.
E
Section
171
of
kentucky's
constitution
says
taxes
on
property
shall
be
uniform
upon
all
property
of
the
same
class
subject
to
taxation.
So
you
see
there
property
and
there
are
classes
of
property
and
section
171
continues
by
stating
the
general
assembly
shall
have
the
power
to
divide
property
into
classes
and
to
determine
what
class
or
classes
of
property
shall
be
subject
to
local
taxation.
E
E
So
you
have
the
ability
to
say
yes
or
no
to
local
taxation
or
yes,
or
no
related
to
state
and
local
on
any
class
of
property
constitutionally.
You
have
that
authority
now.
What
is
a
bonded
warehouse?
That's
the
next
question
that
keeps
coming
up.
It's
a
federal
provision,
not
a
state
provision,
and
it
dates
back
to
the
tax
that
was
imposed
at
the
federal
level
back
at
the
civil
war
to
pay
for
that
war.
E
The
the
tax
originally
was,
as
as
the
the
product
came
out
of
the
steel,
the
tax,
the
federal
tax
was
employed.
It
was
imposed,
but
there's
problems
with
that
think
about
what
happens
when
that
product
goes
into
a
barrel.
The
wood
of
the
barrel
immediately
absorbs
that
product.
So
you
might
start
with
you
know:
55
gallons,
like
you
said
in
a
barrel
immediately
though
it's
absorbed,
and
so
you
might
lose
three
gallons
just
immediately
and
then
think
about
over
time
that
product
evaporates,
it's
liquid.
It
evaporates.
E
E
E
E
Distilled
spirits
has
what
we
call
a
reduced
rate,
5
cents,
so
lower
than
a
desk
or
a
chair,
or
you
know,
whatever
five
cents
per
100
and
generally
all
inventory
is
for
whatever
business
it
receives,
that
five
cent
reduced
rate.
So
while
it's
a
reduced
rate,
it's
generally
a
rate
for
all
types
of
businesses
that
have
inventory,
and
then
the
tax
becomes
due
september.
15
following
that
assessment
date
on
january
1st.
E
They
have
an
annual
open
records
request
to
the
department
of
revenue
where
they
are
receiving
the
assessed
values
of
distilled
spirits,
and
so
this
is
the
history
that
was
provided
by
kda,
so
you
can
see
2012
it's
1.7
billion
dollars
of
assessed
value
and
2021,
it's
4.4
billion,
so
you
can
see
increasing
overtime,
assessed
value,
not
tax
receipts.
So
don't
don't
get
this
slide
confused
with
the
other.
This
is
assessed,
value.
E
B
Okay,
well,
I'm
not
following
it
at
all!
So
there's
like
4
million
barrels
in
2012.
B
B
B
G
So
it's
a
complicated
formula,
but
jennifer
is
exactly
right
so
that
we,
by
february
1st
of
every
year,
provide
a
breakdown,
it's
all
based
on
53,
gallon
equivalent
barrels.
G
Okay,
and
then
they
also.
What
to
your
question,
though
they
also
have
what's
called
it's
a
part.
Two.
It's
a
schedule:
it's
neutral
spirits.
So
if
you
have
spirits
in
a
tank,
let's
say
a
vodka
or
something
like
that
that
doesn't
age
in
a
barrel,
you
convert
those
to
53
gallon
equivalents.
As
well
and
those
are
considered,
another
price
value.
G
B
B
G
Or
value
it's
both
right
now,
you're,
absolutely
correct!
So
right
now
we
have
about
11
million
barrels
aging.
As
of
january
1st
2021,
the
2000
and
the
last
year,
statistics
will
be
available
until
august
or
september
according
to
dor,
based
on
the
open
records
request
that
we
filed.
So
yes,
we
have
quadrupled
or
tripled
on
the
number
of
barrels
in
the
last
10
years
and
also,
as
you
saw
through
the
wholesale
tax,
which
is
a
value
tax.
What's
driving
a
lot
of
the
bourbon
industry,
these
days
is
the
primarization
of
alcohol.
G
C
You
know
what
the
valuation
this
assessed
value
is
in
comparison.
Do
you
know
the
the
true
value,
the
market
value
of
all
of
the
barrels.
G
No
ma'am,
I'm
not
sure,
there's
any
way.
We
could
calculate
that
quite
frankly,
because
each
brand
is
different.
Each
brand
is
aged
differently.
G
We
don't
have
anything
from
ourselves
and
it's
we
were.
We
were
talking
about
this
earlier
with
with
judge
eisen
right
now,
a
bottle
of
blanton's
in
kentucky
can
go
for
99
in
new
york
city.
It's
linked
for
400.
right
right,
you
know!
So
it's
it's
supply.
C
C
G
E
Okay,
so
keep
in
mind
we're
still
talking
about
the
property
tax
here,
but
we're
going
to
shift
to
an
income
tax
provision
related
to
that
property
tax.
E
E
Now
the
credit
is
non-refund
fundable.
That
means
that
if
you
have
no
tax
liability
in
the
year
that
year,
then
you
really
don't
have
a
benefit
from
the
income
tax
credit
and
when
you
think
about
how
income
tax
works,
it
it
it's
a
little
confusing
sitting
here.
As
an
accountant
trying
to
understand
the
interplay
here
between
the
property
tax
paid
and
that
construction
or
those
purchases
that
have
to
be
made,
because
you
have
all
your
income,
then
you
have
your
business
expenses.
E
These
construction
and
purchases
of
items
are
business
expenses
which
reduce
your
income,
but
then
you
get
a
credit
on
that
reduced
income,
so
it
you
know
there.
There
is
reason
why
that
credit
is
not
routinely
used
just
based
upon
the
income
tax
that
and
how
it
works.
E
C
E
E
So
that
is
the
income
tax
portion
related
to
distilled
spirits
and
then,
let's
move
on
to
local
property
taxes
and
I'll
point
you
to
the
one
pager
in
your
folder
and
I
apologize
up
front
for
the
very
small
print,
but
I
was
trying
to
get
it
on
one
page
and
once
again,
this
is
information
that
is
provided
by
the
kentucky
distillers
association
and
I
just
wanted
to
walk
through
the
columns
here.
To
make
sure
you
understand.
The
first
column,
of
course,
is
the
county,
so
these
counties
impose
a
local
property
tax.
E
On
that
distilled
spirit
in
that
bonded
warehouse
that
we're
talking
about
the
next
three
columns
are
related
to
school
districts.
So
if
you
were
to
that
second
column,
if
you
were
to
repeal
the
distilled
spirits,
tax
school
districts
would
be
impacted,
a
total
of
18.5
million
dollars
through
the
loss
of
the
property
tax.
On
that
the
second
column
shows
you
that
school
districts
would
be
able
to
recoup
some
of
that
money
through
the
seek
formula
and
and
kda
has
gone
through
the
seek
calculation
and
and
made
those
calculations.
E
So,
let's
just
look
at
anderson
county,
my
home
county
right
up
there
top
line.
We
we
in
anderson
county
would
lose
1.1
million,
but
through
for
schools,
but
then
through
the
seek
formula.
961
000
of
that
would
be
replaced
through
the
sikh
formula,
but
we
would
still
lose
a
hundred
and
sixty
thousand
hundred
sixty
two
thousand
three
hundred
nineteen
dollars
to
schools
and,
as
you
look
down
through
the
column
that
net
gain
or
loss,
almost
all
counties
would
lose
money
or,
let's
say
schools.
Almost
all
school
districts
would
lose
money.
E
E
Okay,
so
now,
let's
look
at
the
next
column.
Cities
may
impose
a
tax
on
this
distilled
spirits.
E
You
can
see
the
total
1.2
million
dollars
would
be
lost,
there's
no
way
to
recoup
that
through
any
other
formula,
county
fiscal
courts
would
lose
3.5
or
so
million.
We
have
one
ambulance,
district,
special,
taxing
districts.
A
And
if
I
understand
these
numbers,
some
of
it's
based
on
like
last
year's,
yes,.
E
E
Yes
and
and
it
it
all
revolves
around
the
property
tax
calendar
and
that's
what
this
slide.
I
think
points
to
that.
These
are
estimates
and
they
can
only
be
estimates
at
any
point
in
time
other
than
the
the
actual
calculation
at
the
city
or
county
level
or
the
seek
calculation,
because
they
use
one
year
of
tax
data,
assessed
values
and
another
year
of
rates,
but
in
each
situation
that
each
item
that
is
applied,
it's
using
the
most
current
data
for
that
item
at
that
point
in
time
and
you
think
about
the
property
tax
calendar.
E
Let's
talk
about
that
a
little
bit.
The
assessment
begins
january
1st.
The
value
is
established
as
of
january
1st
each
year.
There
is
a
time
where
taxpayers
can
protest
and
and
question
that
assessed
value,
so
a
very
short
window
of
time,
but
a
window
of
time.
Then
there
is
the
process
where
that
those
values
are
certified
by
the
department
of
revenue
and
sent
back
to
counties.
E
You
know,
and
then
there
is
the
rate
setting
process
that
occurs
based
upon
that
certified
value,
and
so,
when
you
look
at
the
entire
calendar,
it
takes
from
january
1
until
november,
when
real
property
tax
bills
are
sent
out
september
15th.
When
this
this
type
of
property
tax
bill
is
sent
out,
it
takes
the
entire
year
practically
for
the
entire
process
to
culminate
in
the
value
for
that
year
and
the
tax
due
for
that
year,
and
so
at
any
point
other
than
at
that
specific
point
in
time.
It
can
be
nothing
but
an
estimate.
C
C
Okay,
but
what
I'm
saying
is,
could
you
have
is?
Did
everything
come
back
down?
Is
my
question?
Is
the
amount
you
receive
equal
to
what
comes
to
the
counties
or
is
it
used
for
any
other
purpose
than
these
things?
So
this
amount
that
is
on
here
is
the
total
that
you
received,
and
then
it
all
went
back
to
the
counties.
E
What
you're
asking
these
are
property
tax
is
assessed
at
the
local
level
right,
so
they
just
report
it.
So
so
when
the
bill
goes
out
from
the
county
clerk
to
the
taxpayer,
it
comes
back
to
the
local
jurisdiction.
It
doesn't
come
to.
C
Yeah,
it
doesn't
come
up
to
the
state
and
back
down
right,
okay,
but
is
that
so
then
that
probably
answers
the
question
it?
It's
not.
I
think
that
answers
it.
It
all
stays
in
the
county,
except
that
the
the
seek
formula
is
greater.
For
so
does
does
some
of
it
leave
to
go
to
another
county
for
seek
funding.
E
C
E
C
G
B
B
What's
there
sure
and,
however
many
barrels,
the
sheriff
would
send
that
to
them
and
then
million
dollars
is
paid
back,
I'm
just
assuming,
for
example,
that's
their
tax
bill
on
all
the
barrels
sitting
there
as
a
local
property
tax
about
then
the
sheriff
gets
that
check
back
of
that
million
dollars.
In
this
example
52,
then
he
cuts
a
check
to
the
local
school
board
and
then
the
others
break
down
to
these
respective
taxing
entities
to
be
equaling.
One
million
dollars
of
tax
receipts
on
the
tax
on
the
bourbon
barrels.
Yes,.
B
G
F
I'm
just
going
to
help
represent
decker
on
on
and
some
other
people.
The
seek
formula
is
as
clear
as
mud.
It's
one
of
those
things
that
you
won't
find
too
many
people
in
in
government
or
in
frankfurt.
That
really
fully
understand
it,
and
I
don't.
But
I
can
give
you
a
layman's
4100.
F
I
think,
as
a
seek
seek
that's
per
pupil
every
year,
so
a
county
like
marion
county
that
that
gets
quite
a
bit
of
avalonium
tax
brand
county
only
might
get
3500
and
seek
money
because
there's
an
offset
for
those
counties
who
have
increased
property
tax,
a
county
like
casey
county
that
doesn't
have
that
property
value
might
get
forty
four
hundred
dollars,
because
the
seek
formula
tries
to
balance
out
that
that
revenue
in
counties.
So
but
it
again
it's
clear
as
mud.
D
B
E
B
F
I
had
an
email
from,
I
think
from
jeffrey
hayes
that
for
2021
the
the
steelers
stated
the
pipe
our
steelers
were
slated
to
pay
more
than
33
million
in
the
amphilorium
tax
for
2021.,
so
31
32,
33
million.
You
know
give
or
take
a
few
cents.
B
B
E
Well
and
the
receipts
that
you're
talking
about
for
fiscal
year
21
those
are
actual
receipts.
So
that's.
D
B
D
E
Okay,
let's
move
past
the
local
property
tax
to
the
alcohol
license
fee
that
is
assessed
at
the
local
level,
243.070
krs
243,
oh
six
out.
First,
I'm
sorry
allows
a
county
or
a
consolidated
local
government
in
which
alcohol
is
trafficked
to
impose
a
license
fee.
This
is
a
maximum
annual
amount
for
the
license
in
that
year
and
a
county
shall
not
impose
upon
any
person
who
holds
a
city
license.
So
there's
that
if
you're
in
the
both
city
and
county,
then
you
just
do
the
city.
E
Tax
243.07
is
the
same
thing
for
cities,
cities
or
a
consolidated
local
government
that
that
the
rates
are
a
little
bit
different
and
the
licenses
are
a
little
bit
different.
But
it's
based
upon
that
activity
of
business
done
in
that
jurisdiction.
E
And
then
there
is
moving
from
the
license
fee.
There
is
a
regulatory
license
fee
that
is
allowed
at
the
local
level.
E
243
075
subsection
1
talks
about
cities
with
a
20,
000
or
less
population
county,
that
without
a
city
that
has
population
over
20
000,
so
still
within
that
20
000,
20,
000
or
less
population,
or
if
you
were
grandfathered
in
january
prior
to
january
1
2019..
E
This
is
a
regulatory
license
fee
that
can
be
imposed
at
a
maximum
rate
of
five
percent
on
the
gross
receipts
of
the
sale
of
alcoholic
beverages
at
each
licensed
establishment,
and
there
are
strings
associated
with
this
tax.
The
local
jurisdiction
must
use
these
funds
separate
from
their
general
fund,
specifically
related
to
the
policing
or
regulatory
or
administrative
expenses
associated
with
the
sale
of
alcohol.
Within
that
jurisdiction.
E
That
is
all
that
I
have,
and
I
know
we've
had
questions
throughout,
but
I'll
be
glad
to
take
any
additional
questions
and
do
additional
research.
C
C
C
D
D
F
Thank
you,
mr
chairman,
and
I
just
want
to
I
guess
a
little
history
lesson
since
senator
stivers-
and
I
were
were
here
in
in
2014-
and
that
was
that
was
this
was
a
a
bill
that
centers
divers
worked
very
hard
on
in
the
industry
and
and
basically
what
we
did
we
at
that
time
we
thought
we
had
eliminated
the
avalorium
tax
and
we
made
a
commitment
to
the
bourbon
industry
to
do
so.
F
At
the
same
time,
we
made
a
commitment
to
local
governments
and
school
districts
that
they
would
continue
to
get
their
money
by
the
way
we
set
it
up.
We
set
it
up
as
a
tax
credit
where
the
distilleries
paid
their
money
paid
their
taxes
and
they
were
going
to
receive
it,
get
it
back
in
that
tax
credit
that
worked
out
very
well.
F
E
F
E
It
creates
one
thing
to
think
about:
is
it
cr?
It
would
require
the
industry
to
pay
the
tax
and
then
get
it
back
from
the
state.
B
On
your
page,
26
local
taxes,
regulatory
license
fee
you're,
going
to
have
cities
and
counties,
and
I
think
virtually
every
county
I
represent,
no
county
is
wet,
but
every
city
is
wet.
So
that's
is
that
moist
or
is
that
just
by
the
drink.
G
Sorry,
eric
gregory
again,
if
the
county
I'll
look
at
my
judge.
If
the
county
has
something
in
the
in
its
boundaries
that
allows
alcohol,
it
is
considered
moist.
So
if
it
has
a
golf
course,
that's
a
moist
precinct
in
that
county.
If
it
has
a
city
with
by
the
drink
sales,
have
restaurants
and
bars-
that's
considered
a
moist
area
within
that
county,
okay,
so
it's
so
it
is.
B
Wet
if
it's
county-wide,
if
it's
county-wide,
it
would
be
considered
wet.
Do
we
and
there's
no
stacking
of
of
the
fees,
so
you
can't
get
the
city
can't
put
theirs
on
and
then
the
county,
but
so
no
stacking
do.
We
know-
and
I
I
find
this
interesting-
a
county
without
a
city
with
a
population
of
less
than
20
thousand,
what
a
description.
B
E
B
I
understand
is
kind
of
like
the
transient
room
tax
or
the
restaurant
tax.
It
has
a
statutory
purpose
for
which
you
are
not
to
deviate
correct,
but
my
my
question
was:
is
how
much
does
that
generate.
D
I
I
will
tell
you
for
our
county:
it
generates
about
a
hundred
thousand
a
year,
we're
in
a
county
of
about
16
000
people,
just
a
couple
of
two
or
three
restaurants,
and
it's
mainly
convenience
stores,
selling
beer,
and
we
have
one
city
that
is
excluded
and
they
have
their
own
abc
officer
and
collect
their
own
taxes
on
that
and
it's
a
small
city
thanks
jay.
A
Great,
thank
you.
Thank
you
for
the
information,
so
I
I
want
to
just
add
one
one
final
thought
and
we'll
we'll
get
out
of
here
for
this
friday.
You
know
this.
This
is
a
I'm
from
bardstown.
We're
the
bourbon
cap
of
the
world
trademark.
Right
and
what's
important
to
remember,
is
a
lot
of
our
distilleries.
Right
now
are
doing
great.
I
mean
we're
having
we're
having
record
profits,
we're
having
record
years
we're
having
record
production.
Everything
seems
to
be
going
well,
but
this
is
a
this
barrel
tax.
A
What
I'm
referring
to
keep
in
perspective
the
barrier
to
entry.
This
is
causing
for
new
distilleries
right
now
in
my
law,
job
I've
got
clients
that
want
to
open
new
distilleries
you're,
looking
at
a
two
year
window
to
to
build,
but
you've
got
to
lay
down
20
30
million
bucks.
Then
you
start
producing
your
distillate
and
you're.
Not
gonna
have
a
product.
You
can
sell
for
another
four
years,
so
you're
about
six
years
in
on
investment,
but
during
that
time
the
state
of
kentucky
starts
to
tax
you
on
a
product.
A
A
We
are
the
only
one
that
taxes
it
in
this
product
at
this
place,
and
I
just
want
to
point
out
that
kentucky
used
to
have
43
percent
of
all
distilling
jobs
we
now
have
30.
kentucky
has
now
fallen
to
the
12th
in
number
of
distilleries
in
the
nation
and
we're
falling
and
jennifer.
If
you
could
go
to
the
next
slide-
and
this
is
some
crap-
I
got
on
instagram
this
popped
up
on
my
instagram
two
days
ago.
A
A
There
are
many
ingredients
that
it
takes
to
have
a
great
bourbon,
but
kentucky's,
not
one
of
them
guys.
This
is
this.
Industry
is
so
important
for
our
tourism
and
for
my
little
town
in
bardstown
for
my
county,
I
mean
I
know
we
we
make
a
lot
of
money
on
that
barrel,
tax
and
that's
great,
but
we
have.
If
we
don't
do
something
about
it.
We
we
will
lose
all
of
this,
so
we've
really
got
to
get
creative
work
together.
A
D
Yeah,
I
just
wanted
to
add
that
the
the
first
two
years,
the
bourbon,
is
not
what's
not
considered
bourbon,
so
it's
not
taxed
for
the
first
two
years
in
a
day,
we've
mentioned
a
lot
of
today
about
how
we
tax
it
all
along
really
it's
after
two
years
and
a
day
so.
A
A
Oh
thank
you
hold
on.
I
do
have
one
other
thing
before
that
meeting
guys
we
passed
out
today
as
a
part
of
the
materials,
the
county
information
that
broke
down
by
all
the
taxing
districts.
I
I
am
looking
to
everybody
out
there,
whether
you're
from
the
bourbon
industry
or
one
of
our
county
partners
or
or
school
district,
if
you're
out
there
listening.
A
A
A
We
may
be
off
a
little
bit
here
and
there,
given
the
fact
that
we
don't
it's
all
estimates
until
taxing
day,
if
you
will,
but
if
you
that's
sort
of
my
charge
to
everyone
when
we
come
back,
I
want
us
to
have
agreed
so
if
you've
got
different
numbers,
maybe
get
them
to
our
staff
so
that
we
have
all
that
before
the
next
meeting
president's
divers.
That's
all
I
was
going
to
add
all
right,
then
we're
adjourned.