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Jim McKee- Iler & Company's Willow Springs' distillery complex.

This steel engraving is from about 1882, when Willow Springs, Iler & Company's roughly 10-acre distillery complex, was at its peak at Fourth and Pierce streets in Omaha. (Courtesy photo)

Peter E. Iler was born in Wooster, Ohio, in 1840. As a young man, he moved to Tiffin, Ohio, with his brother Joseph, where he worked in a bank, as commission agent, a cigar manufacturer and warehouse operator.

While operating as a wagon peddler, he discovered the magic of bitters, which he advertised "as a cure for dyspepsia and all diseases of the stomach and bowels" at a dollar a bottle. As an adjunct to the sale of bitters, he created a distillery and a wholesale liquor business.

In the spring of 1865, the Ilers bought and prepaid for a shipment of bourbon from Kentucky. Through an unexplained stroke of luck, the federal tax on alcohol changed while the bourbon was in transit, which somehow magically increased the value of the shipment by a breathtaking $36,000, instantly making Iler a wealthy man.

Meanwhile, in 1866 the short-lived Willow Springs Distillery of Council Bluffs was closed by the federal government for nonpayment of taxes.

Iler, along with James Megeath and John McCormick, bought Willow Springs at auction and moved it across the Missouri River to Omaha to 209 Hickory St., making it the first distiller in Nebraska. The Iler brothers moved to Omaha the next year, set up their offices at 233 Farnam St. and by 1871 were making 6,000 to 7,000 gallons of alcohol per day or 1,250,000 gallons a year.

Still advertising Iler & Co. as "importers, compounders and wholesale dealers in wines, liquors and cigars," their shipments were making it to both coasts by 1874. The same year they also became the Omaha representatives for Anheuser-Busch, which they would continue for five years when the brewer moved a facility to the Old Market area.

In the early 1880s, a fire forced the office to move to 1112 Harney St., where they built a 66- by 182-foot masonry building for Willow Springs. Metz Brewery took over their building at 209 Hickory while Iler's production facility at Fourth and Pierce streets grew to over 10 buildings covering four square blocks.

By that time, it was said that Willow Springs produced 90 percent of Nebraska's tax revenue. With the labor riots of 1882, troops were even dispatched to protect Willow Springs, causing rumors of an unholy alliance with the government.

In 1883, Iler and a number of Omaha businessmen formed a syndicate that bought up a number of nearby farms and land totaling 1,875 acres for $312,980. This area was the nucleus for the creation of stockyards, packing houses and the town of South Omaha. Much of the same group then formed and became directors of the Union Stockyards Bank in 1886.

Peter Iler, then living at 602 S. 16th St., issued a release saying they would not produce denatured alcohol and was strictly relying on the manufacture of Kennedy's East India Bitters, "whiskies, gins, spirits and pure grain alcohol" including bourbon, rye and gin.

By 1887 the Ilers had become the third largest distiller in the U.S., producing 12,000 gallons of alcohol per day, which amounted to $3 million in sales, employed 125 men with an $80,000 payroll and were paying over $200,000 in federal taxes.

Willow Springs was obviously an important part of the local economy as well, purchasing 700,812 bushels of grain one year and cleverly feeding the spent mash to cattle, which they were fattening right on their grounds.

Perhaps surprising some, Iler argued in January of 1888 for higher license fees for selling alcohol, saying it relieved taxation of the "poor and laboring classes," supported the local schools and led to fewer and higher class establishments.

Along with a number of other Omaha, Nebraska and California investors, Iler pushed formation of another syndicate, which purchased 3,500 acres on San Francisco Bay that they developed as South San Francisco, Calif.

In July of 1898, Willow Springs was sold, becoming part of the Standard Distilling and Distributing Co. With Prohibition, its manufacturing changed to "near beer, soda pop and malt" for use in home brewing.

Little evidence of the once huge company and its facilities remain, but in 1900 Iler built a $40,000, six-story, wood-beamed, masonry building at 1113 Howard St. in Omaha's Old Market.

Today that building, with Iler's name still in stone just under the cornice and now on the National Register of Historic Places, has been remodeled and converted to luxury apartments on its upper floors. There's no mention of its connection to the once third largest distiller in the U.S.

Historian Jim McKee, who still writes with a fountain pen, invites comments or questions. Write to him in care of the Journal Star or at jim@leebooksellers.com.

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