House File 2549 - Introduced HOUSE FILE BY DAVITT Passed House, Date Passed Senate, Date Vote: Ayes Nays Vote: Ayes Nays Approved A BILL FOR 1 An Act relating to the manufacture and sale of native distilled 2 spirits, and establishing a related permit fee. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 5052YH 81 5 ec/gg/14 PAG LIN 1 1 Section 1. Section 123.32, subsection 1, Code Supplement 1 2 2005, is amended to read as follows: 1 3 1. FILING OF APPLICATION. An application for a class "A", 1 4 class "B", class "C", or class "E" liquor control license, for 1 5 a class "A" or class "B" native distilled spirits permit, for 1 6 a retail beer permit as provided in sections 123.128 and 1 7 123.129, or for a class "B", class "B" native, or class "C" 1 8 native retail wine permit as provided in section 123.178, 1 9 123.178A, or 123.178B, accompanied by the necessary fee and 1 10 bond, if required, shall be filed with the appropriate city 1 11 council if the premises for which the license or permit is 1 12 sought are located within the corporate limits of a city, or 1 13 with the board of supervisors if the premises for which the 1 14 license or permit is sought are located outside the corporate 1 15 limits of a city. An application for a class "D" liquor 1 16 control license and for a class "A" beer or class "A" wine 1 17 permit, accompanied by the necessary fee and bond, if 1 18 required, shall be filed with the division, which shall 1 19 proceed in the same manner as in the case of an application 1 20 approved by local authorities. 1 21 Sec. 2. Section 123.41, subsection 1, Code 2005, is 1 22 amended to read as follows: 1 23 1. Upon application in the prescribed form and accompanied 1 24 by a fee of three hundred fifty dollars, the administrator may 1 25 in accordance with this chapter grant and issue a license, 1 26 valid for a one=year period after date of issuance, to a 1 27 manufacturer, other than a manufacturer of native distilled 1 28 spirits licensed pursuant to section 123.43A, which shall 1 29 allow the manufacture, storage, and wholesale disposition and 1 30 sale of alcoholic liquors to the division and to customers 1 31 outside of the state. 1 32 Sec. 3. NEW SECTION. 123.43A NATIVE DISTILLED SPIRITS == 1 33 PERMITS. 1 34 1. Subject to rules of the division, a manufacturer of 1 35 native distilled spirits holding a class "A" native distilled 2 1 spirits permit pursuant to this section may sell, keep, or 2 2 offer for sale native distilled spirits. As provided in this 2 3 section, sales may be made at retail for off=premises 2 4 consumption when sold on the premises of the manufacturer of 2 5 the native distilled spirits. Any other sale shall only be 2 6 made to the division for wholesale disposition and sale by the 2 7 division. 2 8 2. For the purposes of this section, "native distilled 2 9 spirits" means distilled spirits manufactured by a distillery 2 10 located in this state. 2 11 3. A manufacturer of native distilled spirits shall not 2 12 sell native distilled spirits other than as permitted in this 2 13 chapter and shall not allow native distilled spirits sold to 2 14 be consumed upon the premises of the manufacturer except as 2 15 provided in subsection 5. However, prior to sale, native 2 16 distilled spirits may be sampled on the premises where made, 2 17 when no charge is made for the sampling. A person may 2 18 manufacture native distilled spirits for consumption on the 2 19 manufacturer's premises, when the native distilled spirits or 2 20 any part of the native distilled spirits are not manufactured 2 21 for sale. 2 22 4. A class "A" native distilled spirits permit for a 2 23 native distilled spirits manufacturer shall be issued and 2 24 renewed annually upon payment of a fee of twenty=five dollars 2 25 which shall be in lieu of any other license fee required by 2 26 this chapter. The class "A" permit shall allow the native 2 27 distilled spirits manufacturer to sell, keep, or offer for 2 28 sale the manufacturer's native distilled spirits as provided 2 29 under this section. 2 30 5. A class "B" native distilled spirits permit for a 2 31 native distilled spirits manufacturer shall be issued and 2 32 renewed annually upon payment of a fee of twenty=five dollars 2 33 which shall be in lieu of any other license fee required by 2 34 this chapter. The class "B" permit shall allow the native 2 35 distilled spirits manufacturer to sell native distilled 3 1 spirits at retail for consumption on the premises of the 3 2 manufacturing facility, or in a retail establishment operated 3 3 by the manufacturer. A manufacturer of native distilled 3 4 spirits may be granted not more than one class "B" native 3 5 distilled spirits permit. 3 6 6. For the purposes of this section, "manufacturer" 3 7 includes only those persons who process in Iowa raw materials 3 8 consumed in the production of distilled spirits by the person. 3 9 7. For the purposes of this section, section 123.43 shall 3 10 not apply to a manufacturer of native distilled spirits. 3 11 8. The sale of native distilled spirits to the division 3 12 for wholesale disposition and sale by the division shall be 3 13 subject to the requirements of this chapter regarding such 3 14 disposition and sale. 3 15 EXPLANATION 3 16 This bill relates to the manufacture and sale of native 3 17 distilled spirits, and provides for the obtaining of specified 3 18 classes of native distilled spirit permits. 3 19 The bill provides that a manufacturer of native distilled 3 20 spirits may sell, keep, or offer for sale native distilled 3 21 spirits for off=premises consumption through sales on the 3 22 manufacturer's premises. The bill restricts any other form of 3 23 sale to sales made to the alcoholic beverages division for 3 24 wholesale disposition and sale by the division. The bill 3 25 defines "native distilled spirits" to mean distilled spirits 3 26 manufactured by a distillery located in Iowa. 3 27 The bill specifies that unless a manufacturer has obtained 3 28 a class "B" native distilled spirits permit, the manufacturer 3 29 shall not allow native distilled spirits sold to be consumed 3 30 upon the premises of the manufacturer, but that prior to sale 3 31 they may be sampled on the premises where made, when no charge 3 32 is made for the sampling. 3 33 The bill provides for two new permits applicable to native 3 34 distilled spirits, both requiring a fee of $25 for initial 3 35 issuance and annual renewal. A class "A" native distilled 4 1 spirits permit allows a manufacturer to sell, keep, or offer 4 2 for sale the manufacturer's native distilled spirits, and a 4 3 class "B" native distilled spirits permit allows a 4 4 manufacturer to sell native distilled spirits at retail for 4 5 consumption on the premises of the manufacturing facility. 4 6 The bill provides that a manufacturer may be granted not more 4 7 than one class "B" native distilled spirits permit. 4 8 The bill provides that a "manufacturer" of native distilled 4 9 spirits includes only those persons who process in Iowa raw 4 10 materials consumed in the production of distilled spirits by 4 11 the person. The bill also provides that the sale of native 4 12 distilled spirits to the alcoholic beverages division for 4 13 wholesale disposition and sale by the division shall be 4 14 subject to the requirements of Code chapter 123 relating to 4 15 liquor sales and distribution by the division. 4 16 The bill provides that a manufacturer of native distilled 4 17 spirits is not considered a manufacturer pursuant to Code 4 18 sections 123.41 and 123.43, which require a license allowing 4 19 the manufacture, storage, and wholesale disposition and sale 4 20 of alcoholic liquors to the division and to customers outside 4 21 of the state. 4 22 The bill makes conforming changes to provisions in Code 4 23 chapter 123. 4 24 LSB 5052YH 81 4 25 ec:nh/gg/14