HB365 By Representatives Collins, Ellis, Simpson, Fridy, Rowe, Moore (P), Baker, Estes, Wadsworth, Marques, Blackshear, Warren, Drummond, Brown (C), Rafferty, McCampbell, Daniels, Lovvorn, Whitt, Shiver, Meadows, Sullivan, Wilcox, Oliver, Lipscomb, Scott, Faulkner, Stadthagen, Hall, Wood (D), Nordgren, Ball, Gaston, Faust, England and Brown (K) RFD Economic Development and Tourism Rd 1 03-MAR-20

SYNOPSIS: Under existing law, a producer of alcoholic beverages may only sell its product to distributors or wholesalers, or directly to consumers in limited quantities at its licensed premises.

This bill would allow a licensed wine manufacturer to obtain a wine direct shipper permit from the Alcoholic Beverage Control Board to allow the permittee to ship limited quantities of table wine directly to Alabama residents who are at least 21 years of age for their personal use.

This bill would impose certain duties on an Alabama winery that ships wine directly to consumers, including the collection and remittance of certain taxes.

Also under existing law, common carriers may only make delivery of alcoholic beverages to the Alcoholic Beverage Control Board or licensees of the board.

This bill would allow common carriers to make delivery of alcoholic beverages to residents who are at least 21 years of age, and places certain requirements on a common carrier making a delivery of alcoholic beverages.

This bill would provide for the permitting process and establish certain restrictions and requirements for wine direct shipment permittees.

This bill would require common carriers to report certain information regarding shipments and deliveries of alcoholic beverages made directly to consumers to the Alcoholic Beverage Control Board and the Department of Revenue.

This bill would provide that a person who ships wine directly to a resident without a permit is guilty of a Class C misdemeanor. This bill would also provide for revocation of a direct wine shipper permit or imposition of fines by the Alcoholic Beverage Control Board for violations of the terms of that permit.

This bill would authorize the Alcoholic Beverage Control Board to adopt rules.

Amendment 621 of the Constitution of Alabama of 1901, now appearing as Section 111.05 of the Official Recompilation of the Constitution of Alabama of 1901, as amended, prohibits a general law whose purpose or effect would be to require a new or increased expenditure of local funds from becoming effective with regard to a local governmental entity without enactment by a 2/3 vote unless: it comes within one of a number of specified exceptions; it is approved by the affected entity; or the Legislature appropriates funds, or provides a local source of revenue, to the entity for the purpose.

The purpose or effect of this bill would be to require a new or increased expenditure of local funds within the meaning of the amendment. However, the bill does not require approval of a local governmental entity or enactment by a 2/3 vote to become effective because it comes within one of the specified exceptions contained in the amendment.

A BILL TO BE ENTITLED AN ACT

Relating to wine; to amend Section 28-1-4, Code of Alabama 1975; to add Section 28-3A-6.1 to the Code of Alabama 1975; to authorize common carriers to make delivery of alcoholic beverages to Alabama residents; to further provide for restrictions on a common carrier making a delivery of alcoholic beverages to an Alabama resident; to provide for a direct wine shipper permit that authorizes a licensed wine manufacturer or a manufacturer who holds a federal basic wine manufacturing permit to ship its table wine directly to Alabama residents who are at least 21 years of age for their personal use; to require these permittees to collect and remit certain taxes; to provide for criminal penalties for certain violations, including the direct shipment of wine without a permit; to authorize the Alcoholic Beverage Control Board to adopt rules; and in connection therewith could have as its purpose or effect the requirement of a new or increased expenditure of local funds within the meaning of Amendment 621 of the Constitution of Alabama of 1901, now appearing as Section 111.05 of the Official Recompilation of the Constitution of Alabama of 1901, as amended.

BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:Section 1. Section 28-1-4, Code of Alabama 1975, is amended to read as follows:

§28-1-4.

"(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.

"(b)(a) It shall be unlawful for Any common or permit carriers, operators of trucks, buses or other conveyances or out-of-state manufacturers or suppliers to make carrier that ships or makes delivery of any alcoholic beverage from without the State of Alabama to any person, association or corporation within the state, except to the Alabama Alcoholic Beverage Control Board and to manufacturers, importers, wholesalers and warehouses licensed by the Alabama Alcoholic Beverage Control Board to receive the alcoholic beverages so delivered within the state is not required to maintain in the vehicle a bill of lading, consignment, or any other documentary evidence of the cargo being transported other than information available on the package shipping label.

"(b)(1) A common carrier that delivers alcoholic beverages to a resident of the state shall confirm that any individual physically receiving a shipment of alcoholic beverages is at least 21 years of age and shall require the individual's signature before releasing the shipment to that individual. Any failure by a common carrier, upon receipt of the shipment, to verify the age of the individual receiving the alcoholic beverages may result in the suspension of the common carrier's license to operate in the state or the imposition of any other penalty the relevant licensing authority in the state is authorized to impose.

"(2) A common carrier that ships or delivers alcoholic beverages to a resident of the state shall maintain a copy of the signature of the individual who physically received the shipment for at least three years following the date of completion of that shipment or delivery, and, upon request, shall provide a copy of that signature to the Tax and Trade Practices Division of the board and the Sales and Use Tax Division of the Department of Revenue. Failure by a common carrier to maintain a copy of the signature of the individual receiving the alcoholic beverages pursuant to this section, or failure to provide a copy of that signature to the board or the Department of Revenue upon request, may result in the suspension of the common carrier's license to operate in the state or the imposition of any other penalty the relevant licensing authority in the state is authorized to impose.

"(c) A common carrier that delivers alcoholic beverages to a resident of the state shall file quarterly reports with the Tax and Trade Practices Division of the board and the Sales and Use Tax Division of the Department of Revenue of all alcoholic beverage shipments and deliveries during the reporting period that report all of the following with regard to each shipment and delivery:

"(1) The name and business address of the person who directed the common carrier to ship wine.

"(2) The weight of the shipment.

"(3) The name and address of the consumer to whom the wine was shipped.

"(4) A unique tracking number.

"(5) The date of delivery.

"(d) Reports made under subsection (c) shall be considered public records for purposes of Article 3, commencing with Section 36-12-40, of Chapter 12 of Title 36, and shall be made available to law enforcement officers.

"(e) A willful failure by a common carrier to comply with the reporting requirements in this section which continues for more than 90 days after receiving notice by the board or Department of Revenue of the failure may result in the suspension of the common carrier's license to operate in the state or the imposition of any other penalty the relevant licensing authority in the state is authorized to impose.

"(c) Any violation of subsection (a) of this section shall be a misdemeanor, punishable as provided in paragraph (1) of subsection (b) of Section 28-3A-25.

"(d) All laws or parts of law which conflict or are inconsistent with this section are hereby repealed, provided, however, the provisions of Section 28-1-3 are excluded."

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

§28-3A-6.1. Direct shipment of wine by a manufacturer.

(a) Any person licensed in this state as a wine manufacturer or who holds a federal basic wine manufacturing permit may obtain a wine direct shipper permit from the board as provided in this section, and may ship annually up to 12 cases of wine to any one Alabama resident in a 12-month period, each case not exceeding nine liters of wine. The wine shall be shipped directly to a resident of Alabama who is at least 21 years of age for the resident's personal use and not for resale.

(b) In order to receive a permit to ship wine to an Alabama resident, the applicant for a wine direct shipper permit shall do all of the following:

(1) File an application with the board.

(2) Pay a filing fee of two hundred dollars ($200).

(3) Provide to the board a true copy of its current manufacturer license issued in this state or its federal basic wine manufacturing permit.

(c) A wine direct shipper permittee:

(1) May not ship more wine than is specified in subsection (a) to any one consumer in a 12-month period.

(2) May not ship any wine to any premises licensed by the board.

(3) Shall ensure that all containers of wine shipped directly to a resident in this state are conspicuously labeled with the words: "CONTAINS ALCOHOL: SIGNATURE OF PERSON AGE 21 OR OLDER REQUIRED FOR DELIVERY."

(4) Shall report to the board the total amount of wine directly shipped to consumers in the state during the preceding calendar year, including the amount of wine shipped to each residential address in the state.

(5) Whether located within or outside of this state, shall collect and properly remit all state and local sales or use taxes and excise taxes due on sales to Alabama residents.

(6) Shall permit the board or the Department of Revenue to perform an audit of the wine direct shipper permittee's records upon request.

(7) Shall obtain from the customer an attestation that he or she is at least 21 years of age at the time the order is placed.

(8) Shall be deemed to have consented to the jurisdiction of the board or any law enforcement agency and the Alabama courts concerning enforcement of this section and any related laws or administrative rules.

(d) A wine direct shipper permittee may renew its permit with the board by paying annually a renewal fee of one hundred dollars ($100) and providing the board a true copy of its current manufacturer license issued in this state.

(e) The board may adopt rules pursuant to the Administrative Procedure Act to implement this section.

(f) The board may enforce the requirements of this section to suspend or revoke a wine direct shipper permit by the same administrative proceedings that apply to alcoholic beverage licenses, and the board may accept payment of a fine in lieu of suspension or revocation. Payments of fines shall be determined by rule adopted by the board.

(g) Shipments of wine direct to consumers in Alabama from persons who do not possess a current wine direct shipper permit pursuant to this section are prohibited, and any person who knowingly makes, participates in, or transports such a shipment is guilty of a Class C misdemeanor.

Section 3. Although this bill would have as its purpose or effect the requirement of a new or increased expenditure of local funds, the bill is excluded from further requirements and application under Amendment 621, now appearing as Section 111.05 of the Official Recompilation of the Constitution of Alabama of 1901, as amended, because the bill defines a new crime or amends the definition of an existing crime.

Section 4. 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

Common Carriers

Manufacturers

Code Added

Code Amended