Telling Whiskey History in Tell City (Part 3)

 

Krogman made many different products post-Prohibition.

So well regarded was the Krogman name that, after Prohibition, a group of Tell City businesspeople decided to revive the distillery and its brands. Tell City had affection for the Krogman and Voelke families and felt Will and Claudina had been unfortunate victims of an even more unfortunate failed public policy. Moreover, the investors believed the Krogman name could still sell whiskey. They formed a corporation and issued stock. Ed Schultz was president; William Gerber was vice president. His son, Will Junior, was secretary and plant manager. The Krogman family was not involved. 

The distiller was John Striewe, Krogman’s pre-Prohibition distiller. The distillery was projected to consume 500 bushels of grain daily. They announced willingness to buy 2,000 bushels of apples per day in the fall for brandy. 

Because of the robbery and fire, there wasn’t much left of the plant in 1933. It took $130,000 to rebuild and get distilling going in December of 1934. Another $40,000 was spent the next year to build a new 15,000-barrel maturation warehouse. They produced 55 barrels of whiskey a day and used 520 bushels of grain to do it. The brandy business never quite materialized. In the end they put in about $300,000 (about $6.5M today).

In fall of 1935, Krogman released its first bourbons. Obviously, they were very young. Lincoln Trail was 8 months old and 100° proof, Brushy Fork was 8 months old and 93° proof, Duchess was 6 months old and 90° proof, Deer Creek was 4 months old and 93° proof, and Millstone was 4 months old and 90° proof. Those last two, Deer Creek and Millstone, were aged in half barrels (24 gallons) in heated warehouses, an experiment in rapid aging. 

Selling whiskey at such young ages was not unusual in the immediate aftermath of Prohibition. People wanted something to drink, were happy to get it, and the distillers needed income. The nuances of aging and proof in the portfolio suggest a customer base that understood the significance of each. These were inexpensive whiskeys aimed at savvy but cost-conscious consumers. They could have drunk vodka or gin, but they preferred whiskey. Properly made four-month-old bourbon was still better than vodka, in the estimation of Kroman's customers.

Krogman distilled on-and-off for about three years. After that, selling the whiskey in its warehouses as it matured kept the company nominally in business until 1941, when it was sold to a national company. The Tell City News tried to put the best possible face on the local ownership’s failure. The sale, “will probably prove to be beneficial for the city of Tell City,” it opined. “The plant has not been running for several years and very little labor has been employed.” They reported that the new owners promised to operate the plant and “employ local labor as much as possible.” 

The journal could not, however, gloss over the fact that, “from the standpoint of investors who put up money to build and start this plant in Tell City, this move will not be so good for they will lose much of their original investment but from the standpoint of the city generally, there is little doubt but that it will be a benefit.”

Mostly, the local newspaper was just happy “our little plant” would be “in the hands of a reputable concern.”

Not so fast.

Joseph Park and John Mason Tilford opened a small grocery store in New York City in 1840. They built it into a large, successful chain of stores that sold wine and liquor as well as groceries and tobacco products, especially cigars. Their sons succeeded them in the business. 

The loss of alcohol sales hit the company hard when Prohibition took effect; that left cigars as their big moneymaker. 

In 1923, Park and Tilford was sold to David A. Schulte, a competitor in the cigar trade. Cigars were still a huge business despite growing competition from cigarettes. Schulte considered Park and Tilford “the best retail merchandising name in the country.” He merged the two companies under the Park and Tilford brand and kept most of the existing organization in place. He even married the widow of the company’s treasurer. 

Park and Tilford became Schulte’s vehicle for acquisitions in medicinal alcohol and fragrances, two Prohibition loopholes he exploited. 

In 1925, Schulte bought Pennsylvania’s Old Overholt Distillery. The seller was U.S. Treasury Secretary Andrew Mellon, who had been partners in the distillery with Henry Clay Frick. Best known as a steel industrialist, Frick happened to be Abraham Overholt’s grandson. Mellon was Frick’s banker and had owned the distillery outright since Frick’s death. He gave it one of the six medicinal whiskey licenses, but since the Treasury was responsible for Prohibition enforcement, it didn’t look good for the Secretary to own a distillery, even a legal one, so he sold it to Schulte.

Well, it looks like this is at least a four-parter. More to come.