The state of North Carolina has been in the liquor business for almost 80 years, ever since it established the Alcoholic Beverage Control Commission in 1937.

Lately, local governments around North Carolina have bellied up to the bar to get a taste of this booming market. It’s also gone down easy for county boards, who have offered up grants and incentive packages in hopes of attaching their respective wagons to the burgeoning industry.

The state didn’t get its first distillery until 2005. The industry started slowly but gained momentum after lawmakers in 2015 passed the one-bottle law, which allowed on-site sales limited to one bottle per customer per year.

Some 45 distilleries in North Carolina are producing spirits, according to the latest look at the ABC’s quarterly price list. The state government and local entities want in on the whiskey business and, by association, they’re dragging taxpayers with them.

Former Gov. Pat McCrory, before he left office, was quoted in a news release touting a planned distillery in Kinston, made possible — in part — by a performance-based grant, of up to $68,000, from the One North Carolina Fund.

The Social Beverage Company, according to the release, will create 34 new jobs and invest $5.8 million to revitalize a historic property in Kinston over the next three years. Positions at the distillery will include management, production, and sales. Salaries will vary by position, but the average annual salary will be $50,071. The average wage in Lenoir County is $33,142.

The distillery has sold $400,000 in equity securities from 13 investors, according to a filing with the Securities and Exchange Commission. It also got $200,000 from the North Carolina Rural Infrastructure Authority to refurbish a building. Social Beverage Company has little online presence, and a call the the number listed on the SEC filing was not immediately returned.

Mother Earth Brewing of Kinston, which makes some of the best beer and spirits in North Carolina, is getting a similar grant worth $62,500 grant to support the reuse of a building that will accommodate a five-job expansion, a news release said.

Kinston is re-emerging, and Mother Earth and its owners Stephen Hill and Trent Mooring, along with Chef Vivian Howard, as I write in my upcoming book, Still & Barrel: Craft Spirits in the Old North State, are largely responsible for the city’s continued evolution.

“The more the merrier,” says Mother Earth head distiller Kevin “Big Shooter” Graham, who expects Social Beverage Company to produce on a much larger scale than Mother Earth, which makes a line of spirits that, by and large, Graham produces himself. In other words, he doesn’t have a lot of help.

“They’re not going to do the same kind of things that we’re doing,” Graham told Carolina Journal. “I think it’s good for the area.”

Social Beverage Company will, of course, start out by making vodka. It’s an unaged grain-neutral spirit that can be produced fairly quickly. Mother Earth makes a vodka, too, as do several other North Carolina distilleries. The numbers of vodka brands, including imports and national offerings, are infinite.

As other media are cheering the new distillery and praising the state involvement as an initiative that will bring jobs and spur economic development, a couple of problems emerge. First, the state controls alcohol sales and distribution, it’s a tough and crowded market — which, in my mind, will eventually reach a saturation point — and the funding has the appearance of government picking winners and losers.

The state has already gotten into the beer business. North Carolina gave New Belgium of Colorado a cool million bucks to open a brewery in Asheville. Sierra Nevada of California got $1.25 million to open a beer-themed amusement park in Mills River. Both were grants from the One N.C. Fund, and both came under the administration of former Gov. Bev Perdue.

“The One North Carolina Fund helps the state land new business or expand existing business as long as the economic development project is considered competitive with locations outside North Carolina,” Kim Genardo, spokeswoman for the state Department of Commerce, said in an email.

The fund amount is based on the number of jobs created, level of investment, project location, and economic impact. By statute, OneNC requires that a local government provide an incentive to match the OneNC funding,” among other things.

“If the jobs are not created, the grantee does not get reimbursed. The OneNC fund is a performance-based reimbursement economic development tool.”

In the release, Raleigh developer Cary Joshi, president of Social Beverage Company, said, “North Carolina has created a welcoming environment for craft breweries and distilleries, and we are pleased to be a part of this growing industry in the state.”

Welcoming environment? The state can surely do much better, particularly in the case of distilleries. The Byzantine rules and regulations governing North Carolina liquor frustrate distillers individually and inhibit the industry in general.

And the state money comes with strings, which Jeremy Norris, who owns Broadslab Distillery in Benson, is happy to avoid.

“I like to be a free operator,” says Norris, who makes excellent whiskey and rum. One of the state’s first distillers, it has taken him years to break even and begin making a profit. He plans to open a restaurant at his picturesque farm distillery this spring.

“If I can’t make it on my own, I don’t participate in anything like that. Never have,” Norris told CJ. “It’s all me, win or fail. If we do make it and it’s a success, I want to be able to take all the credit.”