City Council Approves Micro Distillery Operations in Downtown B 2 Business Zone

A proposal to establish micro distilleries in downtown Lexington is sparking significant discussion among city planners. The Planning Commission is considering adding micro distilleries as a principal use in the B2 zoning district, which encompasses the heart of downtown, known for its vibrant mix of government, entertainment, and retail spaces.

The proposed regulations would limit production to 10,000 gallons annually and require that distilleries include an associated retail or dining component, preventing them from operating as standalone entities. This move aims to integrate distilleries into the downtown landscape while promoting tourism and job creation, aligning with the city’s comprehensive development goals.

City staff initially questioned the appropriateness of distilleries in the downtown area but later found that similar operations thrive in other cities. After consulting with industry advocates and reviewing existing ordinances, they deemed the proposal suitable, albeit with the caveat of a production limit. However, to accommodate potential growth, staff suggested allowing micro distilleries to apply for conditional use permits to exceed the 10,000-gallon cap, potentially raising the limit to 50,000 gallons.

The discussion also touched on concerns about odors from distilling operations and the economic viability of such businesses at the proposed production levels. While the specifics of smell and production economics were left for the applicants to address, the overall sentiment from city staff supports the proposal, emphasizing its potential to enhance downtown Lexington's appeal.

As the Planning Commission moves forward, the decision on whether to adopt these regulations could reshape the downtown landscape, inviting a new wave of craft distilling to the area.