SB381 By Senators Albritton, Waggoner, Ward, Stutts and McClendon RFD Fiscal Responsibility and Economic Development Rd 1 14-APR-15

SYNOPSIS: This bill would establish a farm winery license for the manufacture and sale of farm wine produced in Alabama.

This bill would provide that farm wine may be sold for export and sold at wholesale under certain circumstances.

This bill would require the Alcoholic Beverage Control Board to promulgate rules regarding the collection of revenue from the excise tax on farm wine.

A BILL TO BE ENTITLED AN ACT

To establish a farm winery license for the manufacture and sale of farm wine produced in Alabama; to provide that the farm wine be sold for export and sold at wholesale under certain circumstances; and to require the Alcoholic Beverage Control Board to promulgate rules regarding the collection of revenue from the excise tax on farm wine.

BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:

Section 1. (a) As used in this act, the following words shall have the following meanings:

(1) BOARD. The Alabama Alcoholic Beverage Control Board.

(2) FARM WINE. Any wine product which is produced by a farm winery, and made in accordance with the revenue laws of the United States, which is produced on a farm winery and so labeled as "Produced and Bottled by" the farm winery.

(3) FARM WINERY. A wine manufacturer licensed under Title 28 of the Code of Alabama 1975, with the total annual production of 50,000 gallons or less, and is principally a wine producer, with facilities and equipment for conversion of grapes, fruit, or fruit equivalents into wine, and further ferments at least 50 percent of all wine sold from all the licensed locations.

(4) PERSON. One or more natural persons, or a corporation, partnership, or association.

Section 2. (a) It shall be lawful to produce farm wine in the State of Alabama and to sell farm wine within or without the state. Every farm winery in the State of Alabama shall first be a holder of a wine manufacturer's license and be in operation for a full calendar year, and further have annual production of less than 50,000 gallons the previous year.

(b) The holder of a farm winery license exceeding 50,000 gallons in the previous year shall be allowed to renew the farm winery license one additional year.

Section 3. (a) Every farm winery may make sales to the board, directly to consumers for off-premises and on-premises consumption, to alcoholic beverage permit holders of the board, including, but not limited to, wholesale dealers and distributors, stores, hotels, restaurants, clubs, dining cars, and to any producer, manufacturer, wholesaler, retailer, or consumer located outside of the state.

(b) The holder of a farm winery license may obtain licenses for two additional retail premise locations apart from the location where wine is produced. The additional premise locations are limited to sales of farm wine produced by a farm winery. The holder of the licenses may conduct all activities allowed at the manufacturing location, other than the manufacturing or bottling of wine.

(c) The holder of a farm winery license may obtain a special event license to be used for wine festival events. Approval of the local governing body and participation of a minimum of two farm winery licensees is required to obtain a special event license for a festival. A participating farm winery is allowed to provide free tastings of farm wine and off-premise sales of farm wine at a licensed wine festival.

Section 4. (a) The board shall impose no additional privilege tax or fee for the issuance of a farm winery license.

(b) Holders of a farm winery license shall be considered as engaging in the production of farm products as described in Section 11-51-105 of the Code of Alabama 1975.

(c) The excise tax collected by a farm winery shall be reported monthly by the farm winery to the board on all sales made in Alabama to the board, retailers, consumers, or any alcoholic beverage permit holder of the board, and the farm winery shall remit the tax due and owing with each report. The excise tax rate shall be that prevailing for the appropriate class of table wine.

(d) All table wine excise taxes collected under this section shall be deposited in the same manner as are other taxes collected by the board.

(e) All state table wine excise taxes collected and deposited under this section shall be directed to viticulture research specific to increasing and expanding wine grape cultivation in Alabama. The Department of Agriculture and Industries shall gather input from winery and vineyard associations of this state, prioritize project funding, and direct these activities through the agriculture research university system of this state.

Section 5. The Alcoholic Beverage Control Board shall promulgate rules as needed to protect the revenue of Alabama derived from the excise tax on farm wine from licensees who sell small farm wine or to consumers who purchased small farm wine.

Section 6. 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

Alcoholic Beverage Control Board

Wine

Licenses and Licensing