ADVERTISEMENT Welcome to Passport to Innovation Passport to Innovation is a monthly ROCNext series that gives D&C readers an exclusive, insider look of some of the area’s most innovative companies. Every month, we invite readers to join us behind the scenes as we visit some of the Rochester area’s most innovative businesses. Our next visit is to the Gleason Works at 1 p.m. Feb. 21. If you would like to participate, please contact us.

If ever there was an example of old meets new, it's inside the 135-year-old Genesee Brewery.

In one part of the plant, employees are fermenting beer in giant vats that have been in use since the Summer of Love in the 1960s. And they're using yeast that has been growing since at least the repeal of Prohibition in 1933.

In another section, brewmasters are using cutting-edge equipment to capture and use every last drop of alcohol from the brewery's malt beverage process.

They start with something that looks like pancake batter: old, spent yeast in a boozy liquid. They finish with a clear, potent drink that puts the pop in the fruity-flavored malt beverages sold under the Seagram's Escapes label. The $1.1 million system, installed at the end of last year, not only saves money, but also is more environmentally friendly than pouring alcohol down the drain.

Mixing equal parts of tradition and innovation, North American Breweries has turned around a brewery that nearly went extinct, reclaimed customer loyalty to its heritage labels and started developing new kinds of beers and malt beverages. And all in five years and after an investment of more than $50 million.

"It's not the old brewery that sat on the river," said Dan Bresnahan, sales and marketing director for Wright Beverages, a distributor of beer and other drinks. Bresnahan also worked for Genesee Brewery earlier in his career, when it was under different ownership. Today, he said, "It's this neat, fun place. They've got the best view in all of Rochester. It's a place to go to experience the history, the heritage of the brand."

Tours of the brewery were rare in all the years Genesee Brewery existed, and they're still not generally open to the public.

"It was like Willie Wonka and the Chocolate Factory before. You couldn't get in, and half the people didn't survive the tour," joked Dean Jones. He's the brewmaster at the Genesee Brew House, the popular restaurant, museum and microbrewery that opened 17 months ago. In addition to being a tourist magnet — tours of the microbrewery are given on the hour — the microbrewery develops new varieties of specialty beers for North American Breweries.

Those who did get into the main plant on St. Paul Street encountered a labyrinthine factory painted in a dusty shade of mustard yellow. Today, the 30-acre factory is bigger but still labyrinthine. Multiple floors of operations are connected with metal stairways and walkways, and pipes seem to flow everywhere. In the winter, coats are necessary in some parts of the plant. In the summer, temperatures can exceed 100 degrees in those same rooms.

"It's just a giant up-and-down place, carefully planned over 135 years," said Mike Mueller, the brewery's chief brewmaster.

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About Genesee Brewing CEO Rich Lozyniak, left, and COO Kenneth Yartz Genesee Brewing is the fifth company to be featured in our Passport to Innovation series. It’s noteworthy because: The company has invested almost $50 million in renovations, installing state-of-the-art packaging and brewing equipment. Its microbrewery in the Genesee Brew House is not just for show; it’s an R&D lab where new varieties of beer are created and refined. Genesee Brewery Genesee Brewery began in 1878 amid a number of breweries on St. Paul Street overlooking the Genesee River. It remains one of the oldest continuously operating breweries in the country. The Genesee buildings include some of those former neighboring breweries, along with new buildings, for a total of 30 acres of beer manufacturing and storage. Key players: Rich Lozyniak, CEO; Kenneth Yartz, COO; Mike Mueller, brewmaster. Location: 445 St. Paul St. Employees: 380 now, but expected to reach more than 500 when a canning line is finished and warm weather hits again. How Genesee measures success: On the taste buds, literally, and in volume growth. Production and sales nearly doubled since North American Breweries took over in 2009. Genesee Brewery in a word: Wonka-like.

But the place is growing, with multimillion-dollar upgrades and more modernized processes. Construction underway now is replacing a canning line, where signature 12-ounce and 16-ounce cans of Genesee Cream Ale and others brands will be filled. And the building exterior's yucky yellow is gone, covered over in richer tones of dark green and barn red.

The resulting investment in processes, facilities and marketing has turned around the venerable Genesee Beer brand, which many a baby boomer in the Northeast recalls as the first beer that whetted his or her lips. The green-and-white cans and "stubby" brown bottles are once again in the hands of new drinkers.

"The brand resonates with the younger consumer today," Bresnahan said.

Just a decade ago, the old High Falls Brewing Co. made most of its money making beers for other breweries; Genny and Genny Light were a small portion of the total. Today, officials say, North American Breweries brands account for about 80 percent of production.

Between Genesee products, the Dundee craft line, beers made for sister breweries Magic Hat and Pyramid, the Seagram's line of flavored malt beverages and a range of contract products, the brewery makes a total of 300 recipes. A small fraction is made at one time, though.

Even while losing some contract business, the company's annual volume grew from 1.1 million barrels in 2009 to nearly 2 million today. The Genny brands have doubled in volume, while the Seagram's products have tripled.

"We've seen a really nice level of organic growth," said NAB Chief Operating Officer Kenneth W. Yartz. The expanded volume of company-owned brands made it easier to ask investors for money to upgrade the brewery, Yartz said. And it helped add jobs.

Because of the temporary hold on canning while the new line is being built, and this being a low-production time of year, employment now stands at an unusual low of 383. But that's still about 80 jobs more than before NAB arrived. And hiring will pick up again in April. At peak times, the brewery employs more than 500.

North American Breweries was a new company formed in 2009 by a private equity firm, KPS Capital Partners in New York. Genesee Brewery was its first acquisition, followed by the U.S. distribution of Labatt's and regional and craft breweries in Portland, Ore., and Burlington, Vt.

In 2012, KPS sold the beer company to Florida Ice and Farm Co., a Costa Rican food and beverage conglomerate that started as a brewery more than 100 years ago. Despite all the corporate-level changes, the staff remains remarkably stable, although CEO Richard Lozyniak announced last month he would step down once his successor is named. Many of the workers have been there for decades.

"The formation of North American Breweries gave us a tremendous advertising and sales team," Yartz said. "People young and old, men and women, are rediscovering Genesee."

One of the changes was a higher price for Genesee beer, so consumers wouldn't view it as a bottom-of-the-barrel brew.

"It's still priced very competitively," said Bresnahan. "but I don't think it's viewed as just a budget beer anymore."

The changes have resulted in greater distribution business for Wright's, Bresnahan said. "Our volume has grown dramatically over the past three years."

Key brands, including Seagram's, grew in the double-digit percentages in 2011 and 2012, he said. "Last year, the whole beer industry had a tough year," he said. Genesee beer "didn't lose share, but (its) brands maintained a healthy position within the industry."

"Everything they've done behind the scenes and getting the word out to the consumer has made a huge difference," he said.

Different. And the same.

What does $50 million buy?

Since North American Breweries was formed in 2009, these improvements have been made to the Genesee Brewery on St. Paul Street: A repainted, refreshed plant with giant outdoor tanks redecorated to look like beer cans.

A canning line for 24-ounce cans.

A re-lit Genesee Beer sign at the brewery.

State-of-the art, $1.5 million yeast-growing operation, ensuring a more consistent product.

Consolidation of Seagram’s Escapes production in Rochester, allowing better development and promotion of that malt beverage brand that was being produced in several locations across the country.

A state-of-the-art alcohol recovery system.

A brew pub that brings people to the site and, with the pilot brewery inside, allows them to witness the brewing process.

A pilot brewery that serves as a research and development lab, and is already responsible for new craft brews available on site and packaged for Magic Hat.

A stronger presence in the local market, where Genesee had all but been replaced by Labatt’s until a few years ago.

A taste for imperfection

Members of Genesee Brewery's 'sensory panel' trained to detect flaws in beer

It can seem like the dream job, being required to take 45 minutes out of your work day to sit down and sip beer with some co-workers.

But becoming a member of the "sensory panel" at Genesee Brewery - the folks who taste the beer - each day at 11:45 a.m., takes practice and training. And, reveals assistant brewmaster James McDermott, it also requires drinking a lot of bad beer.

"We do all of this stuff, ultimately, to make great beer," McDermott said.

Training takes about a year of weekly taste tests. Panelists are introduced to samples of beer spiked with flavors, or attributes, that signify the good and bad of beer. They discuss what the attribute tastes like and try to draw comparisons to tastes the drinkers are familiar with.

The tasters drink samples knowing what they're looking for, and then they're given similar samples without knowing what attribute they contain. Over time, McDermott said, the concentration of the attribute is diminished so that tasters can pick it up even in tiny amounts.

The attribute might be something that went wrong, or something that is supposed to be in the beer. And, sometimes it's both.

Take isoamyl acetate, for instance. It's a natural product of fermentation that calls to mind artificial banana flavor, such as in marshmallow circus peanuts. The flavor is a characteristic of German wheat beer, but if you find it in a can of Genesee Beer, that might mean your can of Genny was brewed at too high a temperature.

"We need to be able to identify it either way," McDermott said. "If something's happening in fermentation, we need to be able to react to it."

Two panels convene each day. One at mid-morning samples flavored malt beverages. The 11:45 panel focuses on traditional beer.

"We're using people as an instrument," McDermott said during a recent tasting, as a group crowded around a bar-height table covered with bottles and glasses. Human taste buds can catch trends that the lab in the room next door or even a visual inspection of the beer won't reveal, he said.

On this recent morning nothing seemed amiss. Tasters sniffed and sipped quietly, entering their thoughts on each sample into tablet computers that have taken the place of paper tasting charts.

Tasters can sample more than 20 beers in a setting, usually swallowing only a sip of each. They also taste water added into the beer-making process, and water used to flush pipelines, as it's equally important to catch anything going wrong in those liquids.

Only brewmasters and assistant brewmasters comprise the beer-tasting panel, McDermott said, and they all happen to be men. The alternative beverage panel, though, is about half men and half women, selected from a wider range of brewery workers.

Once an employee attains a seat on the panel, he or she continues to receive training, McDermott said. The downside of the job is Tuesdays, when beers that have been spoiled on purpose are tested to see how much can be done to a beer before its flavors change.

"We drink this awful beer, every week. When something comes across that's not right, the whole tenor of the panel changes," McDermott said.