July 27, 2013 - Diageo and Louisville’s Air Pollution Control District have reached an agreement to resolve air quality complaints filed against the drinks company in September of 2012 stemming from fungus on homes and buildings near one of the company’s whiskey maturation facilities. According to the Louisville Courier-Journal, Diageo will move around 185,000 casks of whiskey from its Millers Lane maturation warehouses on the city’s west side and vacate the facility over the next 30 months.

The original complaint against Diageo, which also included other local whiskey producers, linked alcohol vapors evaporating from the barrels stored at Millers Lane to fungus growing on homes, cars, and buildings near the site. Under the complaint, the District had threatened fines of up to $10,000 per day against Diageo, but the settlement negates those fines. A separate class-action lawsuit against Diageo and the city’s other whiskey producers is pending in U.S. District Court.

The agreement calls for Diageo to move barrels that will eventually be sold as Bulleit Kentucky Straight Bourbon to its warehouses at the Stitzel-Weller Distillery site about half a mile away, while the remaining barrels will be moved to warehouses near Diageo’s George Dickel Distillery in Tennessee. Since U.S. regulations require that a whiskey be entirely distilled and matured within a state in order to carry that state’s name, the whiskey to be moved to Tennessee is likely destined for the company’s lower-grade whiskey brands (and also means that those casks were not originally filled with spirit at Dickel).

The Courier-Journal reports that the local Metro Council member for the neighborhood is not pleased with the agreement. Mary Woolridge told the paper that the resolution doesn’t solve the problem, just moves it half a mile down the road. According to the Courier-Journal, the Air Pollution Control District’s executive director says the Stitzel-Weller site complies with air quality standards and is not under investigation in connection with the fungus problems.