The Highs and Lows of Regulations in the Bluegrass State

By Joe Knilans, Rural Affairs Advocate

The Other Kentucky Distilleries

Recently, I visited Kentucky to conduct business forums throughout the state. One of the small businesses that I visited was the Casey Jones Distillery in Hopkinsville, KY. While Kentucky is well-known for its distilleries of bourbons, like Maker’s Mark, Kentucky is also well-known for its moonshine. Casey Jones makes authentic Golden Pond moonshine and uses the method and recipe that has been in the family for generations. Actually, the name Casey Jones came from a family reputation with roots in Golden Pond, KY, well-known around the country as the capitol of moonshine. Alfred Jones lived in the area and produced moonshine himself. He had a reputation of building more than 125-foot-high production quality stills. When he delivered his moonshine, it was in a case; for that reason, he was given the nickname “Casey,” and it has stuck with the family to this day. Presently, the distillery is owned and operated by Peg Hays and her husband Arlon Jones.

Today the Jones family is distilling moonshine better known as distilled spirits specialty (DSS). They have created a small business that not only distills spirits but also offers a location for special events and a gift shop. As a small business, Casey Jones Distillery employs one full-time and five to ten part-time employees. As owners, they work there full-time as well. During my visit, a new building was under construction. They told me that they could afford the expansion of their building because of the new Craft Beverage Modernization and Tax Cuts and Jobs Act of 2017. The Act reduces the federal excise tax from $7.00 per barrel to $3.50 per barrel for the first sixty thousand barrels. That is an average savings of $3.50 per barrel sold by craft brewers, allowing them to buy new equipment, expand operations and hire additional employees.

The story of Casey Jones and the benefits of the Act also impacted many other distilleries across the country, causing a ripple effect in business expansion. Ms. Hays attended the Kentucky Distillers Association convention and the American Craft Convention earlier this year. The topics of discussion included the new tax reforms by Congress and the administration and what they have meant to other distillers. They stated that the reforms have allowed them to reinvest in their businesses, increase staffing, expand their businesses, fund retirements and offer scholarships. The reinvestment of tax savings demonstrates how businesses can benefit from regulatory reform.

Medical Imaging and the Affordable Care Act

Although tax reform has helped these businesses and their bottom line, many businesses in Kentucky are struggling with the Affordable Care Act (ACA). For example, I spoke with a medical imaging business that has been severely impacted by the ACA. Lundberg Medical Imaging has been in business for 50 years. They are a small business that worked with independent physicians who sent patients to their business to preform CAT scans and MRI scans on clients. According to Terri Lundberg, since the enforcement of the ACA, many small independent doctors have been absorbed by many big hospital conglomerates, forcing doctors to utilize the hospital CAT scans and MRI scans. As a result, not only has Lundberg Imaging lost business but also this has increased the cost to the patients. For example, the cost to the patient utilizing the conglomerates’ CAT scans and MRI scans is approximately five times more expensive than Lundberg Imaging for insured clients. Unfortunately, this is not affordable for the patients.

Although we are making strides with reducing regulations for some small businesses, we must continue our efforts each day to tackle the problems that face every small business so that they can continue to be the backbone that keeps America’s workers and communities growing.

Joe Knilans serves as the Rural Affairs Advocate for the SBA Office of Advocacy, representing small businesses in rural America. Knilans works with small business owners, state and local governments, and small business associations to bring the voice of rural America to Washington DC. He can be reached at


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