House File 342 - Introduced HOUSE FILE 342 BY WINDSCHITL A BILL FOR An Act allowing the issuance of joint permits to manufacture 1 various types of alcoholic beverages and providing for fees. 2 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 3 TLSB 2404YH (2) 84 rn/nh

H.F. 342 Section 1. Section 123.45, Code 2011, is amended to read as 1 follows: 2 123.45 Limitations on business interests. 3 1. Except as provided in section 123.6 , a commission 4 member or division employee shall not, directly or indirectly, 5 individually, or as a member of a partnership or shareholder 6 in a corporation, have any interest in dealing in or in the 7 manufacture of alcoholic liquor, wine, or beer, and shall 8 not receive any kind of profit nor have any interest in the 9 purchase or sale of alcoholic liquor, wine, or beer by persons 10 so authorized under this chapter . However, this provision does 11 not prohibit any member or employee from lawfully purchasing 12 and keeping alcoholic liquor, wine, or beer in the member’s or 13 employee’s possession for personal use. 14 2. A person engaged in the business of manufacturing, 15 bottling, or wholesaling alcoholic beverages, wine, or beer, or 16 any jobber, representative, broker, employee, or agent of such 17 a person, shall not directly or indirectly supply, furnish, 18 give, or pay for any furnishings, fixtures, or equipment used 19 in the storage, handling, serving, or dispensing of alcoholic 20 beverages, wine, beer, or food within the place of business of 21 a licensee or permittee authorized under this chapter to sell 22 at retail; nor shall the person directly or indirectly extend 23 any credit for alcoholic beverages or beer or pay for any such 24 license or permit , ; nor directly or indirectly be interested in 25 the ownership, conduct, or operation of the business of another 26 licensee or permittee authorized under this chapter to sell at 27 retail , ; nor hold a retail liquor control license or retail 28 wine or beer permit. However, a 29 3. The limitations contained in subsection 2 shall be 30 subject to the following exceptions: 31 a. A person engaged in the wholesaling of beer or wine 32 may sell only disposable glassware, which is constructed of 33 paper, paper laminated, or plastic materials and designed 34 primarily for personal consumption on a one-time usage 35 -1- LSB 2404YH (2) 84 rn/nh 1/ 3

H.F. 342 basis, to retailers for use within the premises of licensed 1 establishments, for an amount which is greater than or equal 2 to an amount which represents the greater of either the amount 3 paid for the disposable glassware by the supplier or the amount 4 paid for the disposable glassware by the wholesaler. Also, a 5 b. A person engaged in the business of manufacturing beer 6 may sell beer at retail for consumption on or off the premises 7 of the manufacturing facility and, notwithstanding any other 8 provision of this chapter or the fact that a person is the 9 holder of a class “A” beer permit, may be granted not more than 10 one class “B” beer permit as defined in section 123.124 for 11 that purpose. 12 c. A permit to manufacture any combination of native 13 wine, micro-distilled spirits, or beer may be issued to the 14 same person or group of persons, and the person or group of 15 persons may operate the businesses out of the same physical 16 location, provided the required permits have been issued for 17 each respective entity, as provided in section 123.151. 18 4. A licensee or permittee who permits or assents to or is a 19 party in any way to a violation or infringement of this section 20 is guilty of a violation of this section . 21 Sec. 2. NEW SECTION . 123.151 Joint permits —— joint 22 physical locations. 23 The division shall by rule develop a procedure for the 24 issuance of a joint permit to manufacture any combination of 25 native wine, micro-distilled spirits, or beer to the same 26 person or group of persons, and the person or group of persons 27 may operate the businesses out of the same physical location, 28 provided the person or group of persons qualifies for issuance 29 of individual permits for each respective business. The 30 total annual permit fees and any other applicable fees or 31 charges shall be the cumulative total of the fees applicable 32 if individual permits for the manufacture of native wine, 33 micro-distilled spirits, or beer were obtained. 34 EXPLANATION 35 -2- LSB 2404YH (2) 84 rn/nh 2/ 3

H.F. 342 This bill directs the alcoholic beverages division of the 1 department of commerce to develop a procedure for the issuance 2 of a joint permit to manufacture any combination of native 3 wine, micro-distilled spirits, or beer to the same person 4 or group of persons, and the person or group of persons may 5 operate the businesses out of the same physical location, 6 provided the person or group of persons qualifies for issuance 7 of individual permits for each respective business. The bill 8 provides that the total annual permit fees and any other 9 applicable fees or charges shall be the cumulative total of 10 the fees applicable if individual permits for each entity were 11 obtained. The bill adds a corresponding provision to Code 12 section 123.45, as an exception to current provisions which 13 restrict or limit potentially conflicting business interests 14 among alcoholic beverage, wine, or beer licensees under Code 15 chapter 123. 16 -3- LSB 2404YH (2) 84 rn/nh 3/ 3