'90s MOONSHINERS ADD DRUGS AND GUNS TO RECIPE

ROCKY MOUNT, Va. -- At the first sound of baying watchdogs, Jay Calhoun, a
special agent of the Virginia Alcohol Beverage Control Commission Liquor
Task Force, crouched in a thicket of mountain laurel and waited. In
camouflage, Calhoun and two other agents remained motionless, their eyes
focused on a corrugated-steel building less than 50 yards away through the
trees, where they believed moonshine was being manufactured.

As soon as the dogs lost interest, Calhoun said, "Let's go, the gig's up."
The agents were on their feet, moving toward the building, a still house, as
it is called. They arrived just in time to capture one suspect who was
trying to escape through the woods and another who was trying to flee in a
pickup.

With their hands in their pockets, the suspects watched as the agents used
axes to break up the stills, four 800-gallon fermenting tanks, or black
pots, that resemble home heating-oil tanks.

Moonshining, which endures in numerous Southern rural towns, is not as
widespread as it was during Prohibition. But law-enforcement officials say
the illegal manufacture and sale of whisky remains a multimillion-dollar
business, with ties to gun trafficking and drugs and established markets as
far north as New York.

"I would say that 60 percent of the moonshine being produced here is headed
for Philadelphia, D.C. and other cities up north," said Jimmy Beheler,
assistant special agent in charge of the state's five-member liquor task
force, the lone squad in the country dedicated solely to combating
moonshiners.

Beheler estimated that each year 500,000 gallons of moonshine are distilled
in Virginia, much of it here in Franklin County, widely considered the
moonshine capital of the South, about an hour south of Roanoke, in the
foothills of the Blue Ridge Mountains. With a street value of $25 or more a
gallon, the moonshine industry in Virginia is a $12.5 million enterprise.

"There's still a big demand out there for it, or else moonshiners wouldn't
be making hundreds of gallons a week," said Randy Knight, deputy director
for operations at the Alcohol Law Enforcement division of the North Carolina
Department of Crime Control and Public Safety. Last year, North Carolina
officials seized almost 7,000 gallons of moonshine and destroyed almost
60,000 gallons of mash, a syrupy fermented concoction of sugar or corn,
water, yeast and grain that moonshiners distill into whisky.

Some modern moonshiners have built air-conditioned stills outfitted with
electric pumps and other gadgets. But the process is not so different from
the distilling that Scotch-Irish immigrants introduced to this region in the
early 1700s.

Steam from a near-boiling vat of mash is drawn off and condensed into a
liquid through a coil of 3-inch copper tubing called a worm or sometimes
through an old car radiator submerged in cold water. An 800-gallon tank of
mash produces around 100 gallons of moonshine.

The harsh 80- to 90-proof clear liquor, also called white lightning, is
similar in flavor to low-grade tequila. Because moonshining is unregulated,
rust from radiators or lead from soldered pipes can contaminate the liquor.

Stills are usually run by hired help called still hands, who are paid $100 a
run, or batch, which takes six to eight hours to produce. "For a lot of
these people, this is all they've ever done," said Chet Bryant, director of
the Alcohol and Tobacco Division of Georgia. "It's a way of life and a way
of making money."

Agents in Georgia said they seize about 15 stills a year.

The stills are often owned by investors who cover the costs of the
operation, which including ingredients and distilling, run about $1,200 a
pot. The pots are typically sheet metal wrapped around a wood frame. Added
to those expenses are transportation costs.

According to the federal Bureau of Alcohol, Tobacco and Firearms, moonshine
makes its way to metropolitan markets in Southern and Northern cities hidden
in trucks or campers. Bootleggers pay moonshiners $35 to $100 for a 6-gallon
case. The bootleggers, in turn, sell the whisky to the operators of "shot
houses," unlicensed after-hours bars where customers can also buy drugs and
firearms, law officials say.

"As far as we've determined, these kinds of establishments are probably the
main consumer of illicit alcohol," said Charles Thomson, special agent in
charge of the Washington Field Division of the ATF.

The possession of illegal spirits is a misdemeanor here, and possession of
or operating a still is a felony. The crime of moonshining is basically one
of tax evasion, and moonshiners and government agents have been at odds
since the days of Washington and Jefferson, both of whom owned stills.

To help pay Revolutionary War debts, the new federal government imposed the
first tax on whisky in March 1791, leading to the Whisky Rebellion. In 1862,
the government established the Office of Internal Revenue to collect taxes
on spirits and empowered agents, known to moonshiners as revenuers, to
arrest those who tried to evade the 20-cent-a-gallon tax.

Today the federal tax is about $20, and state taxes are usually less than
$5. "It can all add up to a fairly large tax loss," said David Wilson, chief
of enforcement in the Mississippi Division of Alcohol Beverage Control.
Wilson calculated that the federal and Mississippi governments had lost
almost $1 billion in revenue over 30 years just from illegal operations in
Mississippi.

Today's operators are a far cry from the old-time moonshiner who kept a
20-gallon copper still behind the henhouse and a jug on the shelf. "The
majority of the moonshiners we deal with today are felons who've been
convicted of everything from drug selling to murder and manslaughter,"
Beheler said.

Yet, in other ways, moonshiners, who still hide in remote mountain hollows,
are every bit as crafty as they were during the days of Prohibition.

"They know all the tricks," said Bev Whitmer, an alcohol agent here who is a
former police officer, "such as doubling back or having other cars as
lookouts. In terms of surveillance, they're definitely more skilled at
eluding capture than any drug dealers I ever dealt with."

Copyright 1998 The New York Times Company