A Brief History of DISTILLERIES along Town Branch

Distilling was a significant Lexington industry in the 19th century and continued to impact Lexington into the 20th century. In the Old Frankfort Pike area, distilleries operated at three different sites. The Pepper Distillery may be the one to focus on because one of its owners, James E. Pepper, was an important business and social figure in Lexington. He was the third generation of his family engaged in distilling in Kentucky. James E. Pepper managed a successful stable of thoroughbreds and he owned the land where the Meadowthorpe subdivision is located. The drink called the “Old Fashioned” was supposedly created for him in Louisville.

His grandfather, Elijah Culpepper, came from Culpepper County, Virginia to Kentucky when it was still a county of Virginia. Legend has it that some time around 1776, Elijah Culpepper settled at what came to be known as the “Old Pepper Spring” near Lexington on the Frankfort Pike. There he supposedly built a log cabin distillery about 1780. The story goes that Elijah Culpepper, finding his name “too long and too troublesome to write,” dropped the “Cul” and became Elijah Pepper.

Elijah Pepper’s son, Oscar Pepper, operated several distilleries in Kentucky including the current Labrot and Graham’s Old Oscar Pepper Distillery and another in Versailles. He hired James C. Crow as his master distiller. James Crow is known for using his knowledge of biochemistry to introduce scientific principles into the distilling process. Together the two men brought fame to the Old Crow and Old Pepper brands. Their whiskey became a big hit with men such as Henry Clay, Andrew Jackson, John Calhoun, Ulysess S. Grant, William Henry Harrison, and Daniel Webster. Labrot and Graham’s Old Oscar Pepper Distillery is named for Oscar Pepper.

Pepper Distillery – Henry Clay Distillery, Distillery No. 5

One of the best known distilleries along the Town Branch was the Pepper Distillery located where Thompson Street crosses Old Frankfort Pike/Manchester Street. The Pepper Distillery was located on the site of the earlier Henry Clay Distillery. Headley & Farra built the Henry Clay Distillery in 1858 on the site of the Royal Mill. It was operated until 1873 when the distillery burned down.

One of the unique features of the site was a seemingly inexhaustible spring. The distillery’s pumps drew water at a rate of 700 gallons per minute and it never went dry. The spring was located on the farm of a Colonel Wilson. In the 19th century, local newspaper articles and history books played up the feature that the spring apparently had no bottom. Stories about investigations included the lowering of a 400-foot line attached to a flat iron. This spring also was surveyed with a view to constructing water-works to supply the city of Lexington, but though no reasons were given, it was found insufficient for this purpose.

After the Henry Clay Distillery burned down, Henry Gilbert & Co built the Blue Grass Pork House, a pork processing plant, on this site in 1875. It operated until 1879.

In 1879, James E. Pepper purchased the property (27.5 acres) and built a new distillery in 1880. The new distillery cost approximately $125,000. The distillery was a brick building with a tin roof and a stone foundation. It had approximately 40,400 square feet of floor space and 22,500 square feet of warehouse space. The distillery had the capacity to make 50 barrels of whiskey a day and an annual production of 11,000 barrels. It could mash approximately 550 barrels of grain per day. Forty workers were employed in the distillery and it operated 10 months of the year. The distillery stood 40 yards from the former Louisville, Cincinnati & Lexington Railroad and had property on both sides of the railroad track.

James E. Pepper put his name on the label of his bourbon. “All genuine barrels, cases, and bottles (when unbroken across the stopper) bear this signature, ‘Jas. E. Pepper.’” The purpose of the signature was to help market a brand label and to warn against fraudulent imitations and refilled bottles. He used the slogan “Born with the Republic” along with the trademark “Old 1776.” The slogan came from the family legend that his grandfather, Elijah Pepper, had been distilling whiskey in Kentucky since 1776. The distillery’s major brands were “Old Henry Clay” and “James E. Pepper.” The distillery’s business was hurt by the depression of 1893 and it went bankrupt in 1896.

After James Pepper’s death, the family sold the distillery and brands to a Chicago group, who reincorporated the distillery as the James E. Pepper Distillery Co. in 1908. In 1911, the facility expanded mashing capacity to 1,000 bushels of grain per day. During prohibition from 1920 to 1933, the distillery’s warehouses were used as concentration houses for previously made whiskey and bottling of prescription whiskey.

The Schenley Distillers Corporation of New York bought the operation in July 1933 for about $1,000,000, razed all the frame buildings, and built a new, modern plant of 1,000-bushel capacity. It employed 100 workers. The distillery brought back the James E. Pepper Bourbon brand after Prohibition.

On April 28, 1934, the distillery suffered a devastating fire. It burned four brick warehouses and destroyed an estimated $4,500,000 in barreled whiskey (approximately 15,500 barrels), $660,000 in bottled whiskey, and $100,000 in buildings. A night watchman mistakenly put gasoline instead of kerosene in a stove and started the fire. Before firemen were able to contain the blaze, the fire destroyed seven buildings including a gauging room, a bottling room, a supply house, and four warehouses. A small frame office building and a new distilling building remained. The owners continued operating the plant and immediately began rebuilding. On December 1, 1934, a new 12,000-barrel warehouse collapsed sending 250,000 gallons of whiskey into the streets, gutters, on into Town Branch.

The Schenley Corporation continued to use the distillery until 1958. The brand James E. Pepper Bourbon was discontinued in 1960. United Distillers re-established it in 1994 but it is only sold outside the United States. The buildings served as warehouses until 1976 when they were converted to other uses.

The Ashland Distillery Company – William Tarr & Co., Distillery No. 1

Turner Clay & Company established a distillery in 1866 on 11 acres of land near where Cox Street and Manchester cross (Jerry L. Beatty Auto Sales is currently located in this area). It was located approximately 80 yards from the former Louisville, Cincinnati & Lexington Railroad. The site previously held a lead works and a pork processing facility. In 1871, William Tarr of Bourbon County and T.J. Megibben of Harrison County bought the property for $115,000. Principals in the company were Tarr, Megibben, Sam Clay, Jr., and J.M. Kimbrough.

The plant burned in 1879, and a new distillery called the William Tarr & Co. was built on the site. The plant had a mashing capacity of 984 bushels and an annual production of 5,500 barrels. It manufactured about equal quantities of sweet and sour mash whisky. The distillery produced bourbon under the names “Ashland” and “Old Wm. Tarr.” The floor space of the distillery was 250,000 square feet. Three brick, metal-roofed warehouses contained a storing capacity equal to 68,000 square feet, or more than an acre and a half. The distillery operation employed 35 workers. The firm fed 500 cattle annually, and had a large cattle-shed covering one-third of an acre affording shelter to 306 head. The distillery added a cooper shop, which employed 20 workers and produced 50 barrels a week.

The Ater Spring located approximately 200 yards from the distillery provided the water supply. It supplied 200,000 gallons of cold water (57 degrees Fahrenheit) daily using two pumps and 3-inch pipes.

In 1902, Stoll & Co. purchased the Wm. Tarr Distillery along with the Lexington Distillery adjacent to it. The distillery was dismantled, but they retained the warehouses. In 1909, they built a new bottling house. In 1913, the distillery property was sold to the L&N Railroad and further operations were moved to the Nelson Distillery in Louisville. The warehouses were used for storage until 1923, when everything was moved to concentration houses in Louisville. It was not until 1966 that the warehouses were remodeled for other use, and the old bottling house burned in 1986.

Lexington Distillery, Distillery No. 93

The Lexington Distillery was located on a 3-acre site on Old Frankfort Pike. It was located adjacent to the William Tarr Distillery. The distillery had an annual production capacity of 6,500 barrels and could produce 47 barrels of whiskey a day. It was the only distillery in the country that produced sweet mash whiskey exclusively (i.e., to produce sweet mash whiskey a fresh yeast mixture is used for each new batch and no spent beer). The main building was 60 x 120 feet and had three floors. Three warehouses provided storage capacity for 13,000 barrels. Cattle sheds fed and sheltered 600 head of cattle annually. The Ater Spring, which also supplied the William Tarr & Co. Distillery, provided water. In 1882, the capital invested in the facility was estimated at $50,000. It employed 15 workers and operated 10 months per year.

Before 1833, it was operated by a Mr. Bosworth and later by Daniel and Henry McCourt. A Mr. Hines operated it and sold it to a Mr. Grotenkemper who managed it until 1869. The facility lay idle from 1869 until 1874 when it was leased to a D. A. Aiken. At that time the owner was a Mr. Temmins of Cincinnati.

William Tarr & Co purchased the property (date uncertain). Prior to the time that William Tarr bought the distillery, it had gone into receivership and among its assets were more than 10,000 barrels of bourbon in inventory. In 1902, Stoll & Co. purchased the Lexington Distillery, along with the Wm. Tarr Distillery adjacent to it. A new bottling house was built on the premises in 1910.


Consider asking the Kentucky Distillers’ Association to sponsor a sign about the history of distilling in Lexington.

Kentucky Distillers’ Association
110 West Main Street
Springfield, KY 40069
(859) 336-9612
e-mail address: kybourbon@kybourbon.com
web site: www.kybourbon.com

Need permission to use old photographs or Sanborn Fire Insurance maps to show what sites looked like at some point in its history.


The importance of good water to the area’s distilleries cannot be overlooked. One of the unique ingredients of Kentucky bourbon is the water. The water has been filtered through limestone, which removes unwanted minerals, such as iron, and adds calcium. The calcium in the water reacts favorably with the yeast during the production of whiskey.

Carson, Gerald. The Social History of Bourbon: An Unhurried Account of Our Star-Spangled American Drink. The University Press of Kentucky, pp. 33 and 154.

Coleman, J. Winston, Jr. The Squire’s Sketches of Lexington. Lexington, KY: Henry Clay Press, 1972.

Cowdery, Charles K. All American Bourbon http://home.netcom.com/~cowdery/articles/allamer.html

Cowdery, Charles K. Whiskeymen http://pw1.netcom.com/~cowdery/articles/men.html

House, Thomas M. and Lisa R. Carter. Images of America: Lafayette’s Lexington Kentucky, pp. 120-121. 1998. (Pictures of renovations to Old Pepper Distillery in February 1934, fire scenes at the Pepper Distillery on April 28, 1934, and loading bourbon into an L&N boxcar in June 1932).

Kerr, Bettie L. and John D. Wright, Jr. Lexington: A Century in Photographs. Lexington-Fayette County Historic Commission, 1984.

Lexington Leader. December 15, 1895, p.1, col. 1-3.

Lexington Leader. April 29, 1934, p. 1, col. 4.

Perrin, William Henry, ed. History of Fayette County, Kentucky. O.L. Baskin & Co. 1882.

Ranck, George Washington. History of Lexington, Kentucky. 1872.

Ranck, George Washington. A Review of Lexington, Kentucky, pp. 64-65. 1886.

Sanborn Fire Insurance Maps

Wright, John D. Jr. Lexington: Heart of the Bluegrass. Lexington-Fayette County Historic Commission. 1982.