There is perhaps no single, more illustrious testament to both the storied past and rosy future of Kentucky’s bourbon industry than Log Still Distillery near Bardstown, the bourbon town about half an hour south of Louisville.

“Outside the Beams, no one can say their family has been in the business this long,” said owner and founder J.W. “Wally” Dant, great-great grandson of the pioneering whiskey maker John Washington Dant, who established the family tradition back in the 1830s by coaxing corn whiskey from a hollowed poplar log. Hence, Log Still, Wally Dant’s outstanding, 360-degree bourbon oasis. 

Since opening in late 2020 on 350 acres of Dant family property in Nelson County, Log Still has undergone a buildout that has come to include not only a premium distillery and assorted tasting rooms, but high-end lodging, a farm-to-table restaurant and now a swanky conference center. The Amp at Log Still, an outdoor arena, can hold up to 2,000 concertgoers and has hosted A-list music luminaries such as Little Big Town, Dwight Yoakam and Joan Jett. A lake for fishing, hiking trails and nascent railroad depot serve to round out what Dant hails as “an all-encompassing, immersive experience.”

Ask around the industry and people will tell you that this is where things have been headed since “the Boom.” The Bourbon Boom, that is. As to precisely when that started, opinions vary. But what’s abundantly clear is that the launch of the Kentucky Bourbon Trail in 1999 — through some combination of alchemy, marketing magic and who knows what — happened at a point at which whiskey and whiskey tourism, like the master soloists of Kentucky bluegrass music, began driving each other toward unexplored heights, unleashing a wave of innovation throughout an industry built around tradition and authenticity.

“Innovation and diversification are happening here in Kentucky, just like the rest of the country,” said Jay Erisman, co-founder of New Riff Distilling in Newport. “Here, it is filtered through a very bourbon-centric lens.”

For the Record

As evidence, look just for starters at the podcasts and social media channels that — during a year of record highs for bourbon-related investments and bourbon tourism — amassed huge followings talking about not much more than Kentucky corn whiskey. And there was plenty to talk about in 2022, beginning with the COVID-busting rebounds of the Kentucky Bourbon Trail and Kentucky Bourbon Trail Craft Tour. Both are owned by the Kentucky Distillers’ Association (KDA).

“We easily shattered our previous records,” said Jack Mazurak, KDA’s director of governmental and regulatory affairs. 

Shaking off the pandemic-induced slump felt across the hospitality industry, visits to the KDA-member distilleries topped 2 million last year, eclipsing the previous high of 1.7 million visits in 2019. It shows, Mazurak said, that “bourbon’s popularity is still going strong. We’re seeing visitors from around the world.”

Parallel to the resurgence of bourbon tourism, investment in bourbon-related businesses soared to new heights as well, hitting $2.1 billion for the calendar year. The new and expanded bourbon facilities are expected to create some 700 jobs.

“The momentum,” said Gov. Andy Beshear, “has been incredible. The demand for Kentucky bourbon just keeps growing.” 

To help meet that demand, legacy producers such as Sazerac Co., Beam Suntory, Pernod Ricard USA and Heaven Hill Distillery all announced investments in the hundreds of millions of dollars. The $600 million spend announced in November by Louisville-based Sazerac counts as the largest distilled spirits-related investment in state history. Sazerac is building more than a dozen barrel warehouses and expanding a cooperage in Laurel County, creating up to 50 full-time jobs.

Sazerac also launched production at a newly constructed still house at its flagship Buffalo Trace Distillery in Frankfort, capping a multi-year, $1.2 billion expansion that includes a new distribution and bottling center, additional cookers and fermenters, new cooling and wastewater treatment systems and a tripling of the size of the Buffalo Trace visitor center. Standing some 40 feet tall, the new still boasts a capacity of 60,000 gallons a day to allow Buffalo Trace to double its production.

“We’ve been laying down the foundation to produce more American Whiskey than we ever have before,” said Sara Saunders, Buffalo Trace Distillery’s vice president. “We are still catching up to consumer demand.”

Bourbon Town

Investments like these produce ripple effects throughout the Kentucky economy and exert a particular impact on rural communities such as Bardstown.

“You think it’s just the distilleries,” said Kim Huston, longtime president and CEO of the Nelson County Economic Development Agency. “But you’ve got the construction business that’s tied to building these multi-million-dollar facilities. You’ve got the barrel makers who can’t make enough right now. You’ve got the farmers who can’t grow enough corn. You’ve got the logistics people transporting bourbon back and forth. There’s a whole business of bourbon that people don’t even know about.”

Nelson County calls itself The Bourbon Capital of the World. 

“Bourbon,” said Huston, “is in our DNA. We were doing bourbon before it was cool.”

Within a 16-mile radius of Bardstown are 11 distilleries, including Heaven Hill and Jim Beam’s Booker Noe facility — both of which have just launched major expansions — as well as Bardstown Bourbon Company, Willett Distillery and Lux Row. These facilities, Huston said, have served as increasingly influential shapers of the Bardstown community’s character, having spurred recent investments in boutique lodgings and downtown shops that cater to the throngs of bourbon tourists.

Moreover, Huston believes that since the start of the Boom and the explosion of bourbon tourism, tradition-bound enterprises built around spirits are edging increasingly closer to the entertainment business.

“It’s not any more about coming in and walking through a distillery,” she said. “Everyone has done that. What people want is a cool, different tour that you can’t get anywhere else. People want a neat tasting, a bar and a place to eat. It’s the morphing of these facilities beyond just bourbon.” 

Innovation True to Tradition

As the spirits industry pushes toward new horizons, there remains among distillers an unshakable commitment to authenticity, the boundaries of which a growing cadre of craft and micro distilleries is likewise expanding. 

“We have inhaled the tradition,” said New Riff’s Erisman. “It’s where we come from. But we’re going to do it our own way. We’re going to play a riff on that, like a jazz riff. It’s the distiller as a musician, someone who has learned the tradition, paid their dues and studied and practiced and is ready to change things up a bit.”

New Riff is among the 24 stops on the Kentucky Bourbon Trail Craft Tour, established in 2012 to support boutique distillers. Franklin County’s Whiskey Thief Distillery is the newest addition to the Craft Tour, joining destinations with names such as The Old Pogue Distillery in Maysville, Jeptha Creed Distillery in Shelbyville, Casey Jones Distillery in Hopkinsville and Castle and Key in Frankfort. Located in historic Butchertown, Copper & Kings distills its brandies, gins and liqueurs in copper pot stills that vibrate to the pulse of rock ‘n roll music that creates a “distillate wave,” according to the distillery, that enhances the process.

New Riff launched operations in 2014 on the former parking lot of what was Kentucky’s biggest liquor store, across the Ohio River from Cincinnati. The distillery’s initial portfolio of five bourbons and gins, released in 2018, collected multiple “Double Golds,” the highest honor awarded by the prestigious San Francisco World Spirits Competition. 

New Riff rests upon its own limestone aquifer, limestone water (or “branch water”) being what some consider to be the ultimate identifier of Kentucky bourbon. Its Kentucky Wild Gin is made from a local juniper called eastern red cedar and from locally sourced red berries reminiscent of allspice.

“It comes from where we are,” Erisman said. “It’s not merely distilled in Kentucky, but more than that, it comes out of Kentucky. It is born out of our land and our native region. It’s the place where we have a heritage. The place where we grew up.” 

Trying to describe the Kentucky business climate is like trying to define the legacy of Kentucky Wildcats basketball. Sometimes it’s easier to look at the reaction of the fan base.

Big Blue Nation – the legion of fans who live and die with every shot by a University of Kentucky hoops player ^­­– is an indicator of how important roundball is in the Bluegrass State. Spoiled by the success of decades of Southeastern Conference championships and multiple national titles on the hardcourt, the fans who fill Rupp Arena to the rafters know excellence when they see it.

So too do the many companies who annually invest millions, and sometimes billions, into facilities and payroll across the commonwealth. The executives who run these firms know what it takes to be globally competitive and make a profit at the same time.

It all starts with a location that makes success possible. For tens of thousands of businesses, that location is Kentucky.

Over the last two years, the capital investment and job creation numbers have confirmed that. 

In 2022, Kentucky notched its second-best year in history for new plant investment and its fourth-best for job creation. Put 2021 and 2022 together, and you get the best two-year economic development run in state history.

Some 248 private-sector corporate facility projects committed to invest almost $10.5 billion into the state and create 16,000 new jobs during 2022. Just one year after establishing a record high for investment, Kentucky followed that up with its second-best tally.

Wages are on the rise as well. In 2022, the average hourly wage for new projects statewide was $26.78 before benefits, representing an increase of 11.5% from 2021, when the mark was $24.

“Not only does this year mark the best two-year period for economic growth in Kentucky; it also brought significantly increased wages for Kentucky families, a record high for investment in the bourbon and spirits industry, and a diverse economy that now includes the rapidly growing electric-vehicle sector that can support our workforce for generations to come,” Gov. Andy Beshear said.

Key Industries — Both Existing and New — Fuel Record Growth

During the first three years of the Beshear administration, more than 800 corporate facility projects generated over $24 billion in capital investment and created more than 42,600 new jobs. 

In 2022, record highs were set in several industries. Bourbon and spirits, for example, recorded its best year ever for investment and job growth. Also showing strong growth were projects in these sectors: electric vehicles and EV battery production, metals manufacturing, food and beverage processing, health care, logistics and distribution, and agritech.

Others took notice. S&P Global Ratings and Fitch Ratings upgraded the state’s financial outlook to positive in light of the surging state economy. Site Selection magazine ranked Kentucky No. 6 in its annual Prosperity Cup rankings, which recognizes state-level economic success based on capital investments and other criteria.

State coffers reflect this success too. For the second year in a row, the Kentucky General Fund budget surplus topped the $1 billion mark, while the state’s rainy-day fund grew to a new high of $2.7 billion — up from $129 million in December 2019.

Kristina Slattery, commissioner of business development for the Kentucky Cabinet for Economic Development, said multiple factors underpin this record run. Specifically, she cited relationship-building, site readiness, and a willingness to embrace other cultures. 

“Because of our existing relationships with people at the Ford Motor Company, we were able to compete and win the BlueOval SK $5.8 billion EV battery project,” Slattery said. “Relationships were critical in the process. When you look at the automotive industry and the way it is woven into Kentucky, we were on firm footing when the opportunity came our way.”

Kentucky also prepared to win by building a highly competitive mega-site in Glendale. 

“From a readiness standpoint, having the Glendale mega-site in build-ready condition was a big factor,” Slattery noted. “Ford was impressed with the location of the site and the work we had done on it. We had shown that site several times in prior years. This was just the right time with the right joint-venture partners.”

A cross-cultural embrace sealed the deal. 

“The project took a turn when we had SK Innovation leadership in for a visit from South Korea, and we introduced them to people in the community,” added Slattery. “They talked about what it was like to live here as a Korean American. A lot of different things came together. SK leaders felt welcomed, and they genuinely were.”

One success led to another. The Ford-SK collaboration opened the door for Japan-based Envision AESC to establish a $2 billion EV battery factory of its own just over six months later in Bowling Green. Since then, several supplier announcements have followed, including multiple investments from South Korean companies.

Site and Community Prep Puts Kentucky on Top

Slattery also cited speed to market and the presence of so many suppliers of raw materials as critical business magnets in Kentucky. 

“More and more on these projects, we have been able to meet the needs on the utility demands for water, wastewater, electric power, etc. We can meet large user requirements, and we can do it much faster than most,” she said. “This goes back to the importance of the Kentucky Product Development Initiative and preparing the infrastructure. We have utility partners who have made major investments with us.”

Finally, Kentucky’s ace in the hole is its workforce. 

“We have seen continued investments into Kentucky’s technical colleges and community colleges,” said Slattery. “Site selectors also know that companies can access the talent of exiting military at Fort Campbell, Fort Knox and the decommissioned Blue Grass Army Depot.”

John Bevington, director of business and economic development for Louisville Gas and Electric Company and Kentucky Utilities Company (LG&E and KU), said the low cost and reliability of the infrastructure in Kentucky for electricity, gas, water and sewer is a significant factor in the location choices made by industries with significant energy needs. 

“We tend to have energy-intensive industries that are located here,” Bevington said. “And as time goes on, the availability of water will continue to be a huge benefit for folks choosing to do business in Kentucky.”

Brad Thomas, manager of economic development for Kentucky’s Touchstone Energy Cooperatives, said there are still plenty of opportunities available for investors in Kentucky. 

“We are seeing record numbers and we are not seeing it slow down,” he said. “We saw $2.9 billion in investment in rural communities in our territory last year. The profile of Kentucky is definitely taking an uptick. I am eager to see what the next 10 years bring.”