SB214 By Senator Stutts RFD Tourism and Marketing Rd 1 12-MAR-15

SYNOPSIS: Under existing law, a brewery is generally not allowed to operate a restaurant on its premises and dispense alcoholic beverages.

This bill would allow a retail licensee to sell alcoholic beverages for consumption on its premises.

This bill would allow a patron of a craft brewery licensee, or brewpub licensee to exit with open containers of alcoholic beverages and consume alcoholic beverages anywhere within the confines of the entertainment district.

This bill would allow a brewpub to sell alcoholic beverages for on- and off-premises consumption.

This bill would create a license for limited production breweries that allows them to produce beer and operate a restaurant on their licensed premises and sell their beer at the brewery and restaurant.

A BILL TO BE ENTITLED AN ACT

To amend Sections 28-3A-17.1 and 28-4A-3 of the Code of Alabama 1975, relating to the sale of alcoholic beverages in an entertainment district or brewpub; to allow a retail licensee to sell alcoholic beverages for consumption on its premises and to allow a patron of a craft brewery licensee or brewpub licensee to exit with open containers of alcoholic beverages and consume alcoholic beverages anywhere within the confines of the entertainment district; and to create a new Section 28-3A-6.1, Code of Alabama 1975, to license a craft brewer to produce and package no more than 2,000,000 barrels of beer per year; to allow a craft brewer to operate a facility where food is provided on its licensed premises and sell beer on its licensed premises that it produces there.

BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:Section 1. Sections 28-3A-17.1 and 28-4A-3 of the Code of Alabama 1975, are amended to read as follows:

§28-3A-17.1.

"(a) The provisions of this section shall only apply to Class 1, Class 2, Class 3, Class 4, and Class 5 municipalities and municipalities with an incorporated arts council, main street program, or downtown development entity.

"(b) Upon compliance of the applicant with the provisions of this chapter, and the regulations made thereunder which are not in conflict with the provisions of this section, the Alabama Alcoholic Beverage Control Board may issue an entertainment district designation for any retail license authorized in this chapter which allows the retail licensee to sell alcoholic beverages for consumption on the licensed premises and which licensed premises is located in an entertainment district established as provided in subsection (d). A licensee who receives an entertainment district designation for an on-premises retail license shall comply with all laws, rules, and regulations which govern its license type, except that the patrons, guests, or members of that licensee may exit that licensed premises, or the premises of any craft brewery licensee authorized in this chapter, or the premises of any brewpub licensee authorized in Chapter 4A with open containers of alcoholic beverages and consume alcoholic beverages anywhere within the confines of the entertainment district, which shall be permitted, but may not enter another licensed premises with open containers or closed containers of alcoholic beverages acquired elsewhere.

"(c) The permission granted by subsection (b) permitting the consumption of alcoholic beverages anywhere within the confines of the entertainment district shall not extend the confines of the licensed premises.

"(d) The governing body of any Class 2, or Class 5 municipality covered by Act 2013-382, or a municipality with an incorporated arts council, main street program, or downtown development entity may establish not more than two entertainment districts within its corporate limits, each of which must have not fewer than four licensees holding a retail liquor license in that area, and each district may not exceed one-half mile by one-half mile in area, but may be irregularly shaped.

"(e) The governing body of a Class 1 municipality, Class 4 municipality, Class 3 municipality, or any municipality which is located 15 miles north of the Gulf of Mexico, may establish up to five entertainment districts within the corporate limits, each of which must have not fewer than four licensees holding a restaurant retail liquor license, an on-premises alcoholic beverage license, or other retail liquor license in that area and each district may not exceed one-half mile by one-half mile in area, but may be irregularly shaped.

"The governing body of a Class 8 municipality which is located in a county with a Class 3 municipality may establish two entertainment districts within its corporate limits which may not have fewer than four licensees holding a retail liquor license in that area and may not exceed one-half mile by one-half mile in area, but may be irregularly shaped.

"For the purposes of this subsection, the term on-premises as applied to consumption within such entertainment district shall include anywhere within the district, regardless of the terms and conditions of licensure.

"(f) All laws or parts of laws which conflict with this section are repealed. All general, local, and special laws or parts of such laws insofar as they designate or restrict the boundaries, size, or area of such entertainment districts are hereby repealed.

§28-4A-3.

"(a) In addition to the licenses authorized to be issued and renewed by the board pursuant to the Alcoholic Beverage Licensing Code codified as Chapter 3A of this title, the board, upon applicant's compliance with the provisions of this chapter and with Chapter 3A and the regulations made thereunder, is authorized to issue to a qualified applicant a brewpub license which shall authorize the licensee to manufacture or brew beer, in a quantity not to exceed 10,000 barrels in any one year and to sell beer brewed on the licensed premises in unpackaged form at retail for on-premises consumption at the licensed premises only, at the licensed premises for on-premises or off-premises consumption to sell beer brewed on the premises in original, unopened barrel or keg containers to any licensed wholesaler designated by a brewpub licensee pursuant to Sections 28-8-2 and 28-9-3 for resale to retail licensees, and to purchase beer, including draft or keg beer, in original, unopened containers from licensed wholesalers and to sell such beer at retail for on-premises consumption only, in a room or rooms or place on the licensed premises at all times accessible to the use and accommodation of the general public, subject to the following conditions:

"(1) The brewpub premises must be located in an historic building or site as defined in Section 40-8-1, or in a registered historic district, or in any economically distressed area designated as suitable by the municipal or county governing body, in a wet county or wet municipality, in which county beer was brewed for public consumption prior to the ratification of the Eighteenth Amendment to the U.S. Constitution in 1919.

"(2) The proposed location of the premises shall not, at the time of the original application, be prohibited by a valid zoning ordinance or other ordinance in the valid exercise of police power by the governing body of the municipality or county in which the brewpub is located.

"(3) Beer brewed by the brewpub licensee shall be packaged or contained in barrels from which the beer is to be dispensed only on the premises where brewed for consumption on or off the premises or sold in original, unopened barrel or keg containers to any designated wholesaler licensee for resale to retailer licensees.

"(4) The brewpub must contain and operate a restaurant or otherwise provide food for consumption on the premises.

"(5) The brewpub may not sell any alcoholic beverages if it is not actively and continuously engaged in the manufacture or brewing of alcoholic beverages on the brewpub's licensed premises.

"(b) The annual license fee levied and prescribed for a license as a brewpub issued or renewed by the board pursuant to the authority of this chapter is $1,000.

"(c) Except as provided in this subsection, the provisions of this title shall be applicable. The provisions of Section 28-3-4 and subsection (b) of Section 28-3A-6, shall not be applicable with regard to beer brewed by the brewpub and sold and dispensed on the brewpub premises. In all other respects, Section 28-3-4 and Section 28-3A-6(b) shall be applicable.

Section 2. A new Section 28-3A-6.1 is added to the Code of Alabama 1975, to read as follows:

§28-3A-6.1.

(a) The words and phrases used in this section shall have the meanings ascribed to them in Section 28-3-1, and any acts amendatory thereof, supplementary thereto, or substituted therefor or as described in subsection (b) of this section.

(b) The following words or phrases, whenever they appear in this section, unless the context clearly indicates otherwise, shall have the meaning ascribed to them in this subsection:

(1) BREW. The production and packaging of beer.

(2) CRAFT BREWER. Any person, association, or corporation that brews collectively at all of its locations, whether within or without this state, and among all of its parents, affiliates, subsidiaries, and partners, no more than 2,000,000 barrels of beer per year.

(c) Upon a craft brewer's application to the board and compliance with the provisions of this chapter and the regulations made thereunder, the board shall issue to the craft brewer a craft brewer license which shall authorize the licensee to brew no more than 2,000,000 barrels of beer per year within this state or for sale or distribution within this state.

(d) A craft brewer licensee may sell its beer in this state to only licensed wholesalers or direct to consumers on the licensed premises as set forth in subsection (i). No craft brewer licensee shall sell any beer direct to any retailer, nor sell or deliver any such beer in other than original containers approved as to capacity by the board and in accordance with standards of fill prescribed by the U. S. Treasury Department, nor maintain or operate within the state any place or places, other than the place or places covered by the craft brewer license, where beer is sold or where orders are taken.

(e) Each craft brewer licensee shall be required to file with the board, prior to making any sales in Alabama, a list of its labels to be sold in Alabama and shall file with the board its federal certificate of label approvals or its certificates of exemption as required by the U. S. Treasury Department.

(f) All such craft brewer licensees shall be required to mail to the board prior to the twentieth day of each month a consolidated report of all shipments of beer made to each wholesaler during the preceding month. Such reports shall be in such form and containing such information as the board may prescribe.

(g) Every craft brewer shall keep at its principal place of business within the state daily permanent records which shall show the quantities of raw materials received and used in the brewing of beer, and the quantities of beer brewed and stored, the quantity of beer sold, the quantities of beer stored or transported for hire, by or for the licensee, and the names and addresses of the purchasers or other recipients thereof.

(h) Every place licensed as a craft brewer shall be subject to inspection by members of the board or by persons duly authorized and designated by the board, at any and all times of the day or night as they may deem necessary, for the detection of violations of this chapter, of any law, or of the rules and regulations of the board, or for the purpose of ascertaining the correctness of the records required to be kept by the licensees. The books and records of such licensees shall, at all times, be open to inspection by members of the board, or by persons duly authorized and designated by the board. Members of the board and its duly authorized agents shall have the right, without hindrance, to enter any place which is subject to inspection hereunder, or any place where such records are kept for the purpose of making such inspections and making transcripts thereof.

(i) A craft brewer licensee actively and continuously engaged in brewing beer on the craft brewer's licensed premises in the State of Alabama may, notwithstanding any other provision of law, operate a facility where food is provided on the craft brewer's licensed premises; give away free samples of beer brewed at the licensed premises for on-premises consumption; and sell at retail on its licensed premises, for on-premises or off-premises consumption, beer brewed at that licensed premises.

(j)(1) In addition to the licenses provided for by Chapter 3A of this title, and any county or municipal license, there is levied on the craft brewer of the beer dispensed on the premises the privilege or excise tax imposed by Sections 28-3-184 and 28-3-190. Every craft brewer licensee shall file the tax returns, pay the taxes, and perform all obligations imposed on wholesalers at the times and places set forth therein. It shall be unlawful for any craft brewer licensee who is required to pay the taxes so imposed in the first instance to fail or refuse to add to the sale price and collect from the purchaser the required amount of tax, it being the intent and purpose of this provision that each of the taxes levied is in fact a tax on the consumer, with the craft brewer licensee who pays the tax in the first instance acting merely as an agent of the state for the collection and payment of the tax levied by Section 28-3-184; and as an agent for the county or municipality for the collection and payment of the tax levied by Section 28-3-190.

(2) The craft brewer licensee shall keep and maintain all records required to be kept and maintained by craft brewer, wholesaler, and retailer licensees for the tax so levied.

(k) The annual license fee levied and prescribed for a license as a craft brewer issued or renewed by the board pursuant to the authority of this chapter is five hundred dollars ($500).

Section 3. This act shall become effective on the first day of the third month following its passage and approval by the Governor, or its otherwise becoming law.

Alcoholic Beverages

Sales

Entertainment District

Brewpub

Brewery

Code Added

Code Amended