Port Chilkoot Distillery owner Heather Shade hasn’t stopped serving cocktails despite an Alaska Alcoholic Beverage Control Board ruling that orders distilleries across Alaska to “cease selling” mixed drinks.

The alcohol board voted on Sept. 13 to uphold ABC Board Director Erika McConnell’s directive to enforcement investigators that “the service and or sale of mixed drinks/cocktails must cease as it is not permitted by statute.”

McConnell’s Aug. 2 directive to enforcement agents came after the Alcohol and Marijuana Control Office received an anonymous complaint that a distillery in Juneau was serving mixed drinks and providing entertainment.

State statute allows distilleries to serve three ounces per person a day of “the distillery’s product” as long as the establishment refrains from providing live entertainment, seats at the counter or bar, and opens after 9 a.m. and closes no later than 8 p.m.

Shade said her distillery only serves alcohol it manufactures along with syrups and soda water.

In a memo for the Sept. 13 alcohol board meeting, McConnell said there’s nothing in the statutory language to “suggest that a Bloody Mary, a martini, or a margarita qualifies as ‘the distillery’s product.'”

Shade said she’s been operating under the statute for the past three years, has been inspected by alcohol board officials and has never been cited for breaking the law.

The alcohol board’s recent decision unfairly benefits traditional bars and restaurants and makes it more difficult for distilleries to compete, Shade said.

“This is a food fight between a few businesses in downtown Juneau that is affecting the whole state,” Shade said. “It’s a disservice to the state economy and I feel like it’s disingenuous of the state to change their opinion like that when we have businesses that are in the process of growing. Tasting room revenue subsidizes the high cost of manufacturing.”

Eight Alaska legislators, including House Minority Leader Chris Tuck, who worked on the state’s updated distillery law three years ago, wrote a letter to McConnell in August saying the intent of the law was to allow the serving of mixed drinks.

“We can assure you there has been no misinterpretation of the statute by the distillers and they are acting in accordance with the Legislature’s intentions,” the legislators wrote. “Considering that many of the products sold by the distillers are intended to be mixed with other ingredients before consumption, it was assumed any sales or free samples would likely be mixed with other ingredients as well.”

They cited the distilling legislation’s celebration ceremony, “when mixed drinks using Alaska’s craft spirits were provided without question.”

Hospitality lobbyist Alaska Cabaret, Hotel, Restaurants and Retailer’s Association’s executive director Dale Fox helped draft HB 309 and attended the celebration ceremony where mixed drinks were served, Shade said. CHARR represents hotels, restaurants and bars across the state, and several distilleries are members.

“I can assure you, CHARR would not have supported this bill if we thought distilleries would become de facto bars,” he told the board.

Shade said Fox acted against his own member organizations.

“My response to that is just because we are mixing our spirits with non-alcoholic ingredients does not make us act like ‘de facto bars,'” Shade said. “The statement is moot. Dale Fox was at the bill signing event where cocktails were served.”

Shade says the issue comes down to beverage license owners influencing state agencies to artificially reduce competition from distilleries.

Shade said she plans to appeal the board’s decision.

Fox and McConnell did not respond to CVN questions on the issue.