Liquor regulations force distillery out of business

To The Eagle:

Eagle Cliffs Distillery, maker of Exalt Vodka, will cease operations effective Dec. 31. We ceased production of our high quality potato vodka and will sell as much stock as possible. Interested consumers and liquor licensees may call the distillery for special offers through the end of the month. Consumers may continue to buy Exalt Vodka after Dec. 31 from both Cowlitz Co. liquor stores until supplies run out. One is located in the Triangle Shopping Mall, the other on Ocean Beach Highway across from Walmart.

The distillery, located in Cowlitz County, is perhaps best known for its support of Stella Historical Society entries in the last three Fourth of July Cardboard Regattas and as the supplier of hand sanitizer at the start of the pandemic for the local emergency relief efforts in Cowlitz and Wahkiakum counties. It might also be remembered, in more optimistic times, for its investigation of locating its operations at the port in Cathlamet.

While covid-19 was a contributing factor, state regulation was the biggest obstacle that the distillery failed to overcome. The distillery’s sales plan was lauded by the state liquor control board before the initiative eliminated state liquor stores. Recent legislation prohibited the distillery from selling at the Farmer’s Market this last summer. The distillery was left with virtually no wholesale or retail outlets.

The worst problem was distribution. The initiative and subsequent regulations adopted by WSLCB established one distributor with about 85 percent of the state market and another distributor with about 15 percent. All other distribution, including craft distillery self-distribution, amounts to a rounding error. The high regulation of the industry is supposedly intended to prevent any monopoly. Washington regulations mandate a monopoly. With once over 200 licensed craft distilleries in the state, there is no distribution channel available for these businesses. WSLCB has driven untold numbers of small liquor establishments out of business and will drive dozens more out of business in the future. The Washington Attorney General's Office needs to take a look at the industry. For our little craft distillery, it is too late.

John Koehler, CEO, Eagle Cliffs Distillery

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