S.F. 240 Section 1. Section 22.7, subsection 24, Code 2011, is 1 amended by striking the subsection. 2 Sec. 2. Section 123.3, Code 2011, is amended by adding the 3 following new subsection: 4 NEW SUBSECTION . 014A. “Grape brandy” means brandy produced 5 by the distillation of fermented grapes or grape juice. 6 Sec. 3. Section 123.41, Code 2011, is amended to read as 7 follows: 8 123.41 Manufacturer’s license. 9 1. Upon application in the prescribed form and accompanied 10 by a fee of three hundred fifty dollars, the administrator may 11 in accordance with this chapter grant and issue a license, 12 valid for a one-year period after date of issuance, to a 13 manufacturer which shall allow the manufacture, storage, and 14 wholesale disposition and sale of alcoholic liquors to the 15 division and to customers outside of the state. 16 2. As a condition precedent to the approval and granting of 17 a manufacturer’s license, an applicant shall file a statement 18 under oath with the division that the applicant is a bona fide 19 manufacturer of alcoholic liquors, and that the applicant 20 will faithfully observe and comply with all laws, rules, and 21 regulations governing the manufacture and sale of alcoholic 22 liquor. 23 2. 3. A person who holds an experimental distilled spirits 24 plant permit or its equivalent issued by the federal bureau 25 of alcohol, tobacco and firearms alcohol and tobacco tax and 26 trade bureau of the United States department of the treasury 27 may produce alcohol for use as fuel without obtaining a 28 manufacturer’s license from the division. 29 4. A violation of the requirements of this section shall 30 subject the licensee to the general penalties provided in this 31 chapter and shall constitute grounds for imposition of a civil 32 penalty or suspension or revocation of the license after notice 33 and opportunity for a hearing pursuant to section 123.39 and 34 chapter 17A. 35 -1- LSB 1243SV (3) 84 rn/nh 1/ 6

S.F. 240 Sec. 4. Section 123.43A, subsection 8, Code 2011, is amended 1 to read as follows: 2 8. Micro-distilled spirits purchased at a micro-distillery 3 shall not be consumed within three hundred feet of a 4 micro-distillery or on any property owned, operated, or 5 controlled by a micro-distillery. 6 Sec. 5. NEW SECTION . 123.46A Delivery of alcoholic 7 beverages by retailers. 8 1. Licensees and permittees authorized to sell alcoholic 9 liquor, wine, or beer in original unopened containers for 10 consumption off the licensed premises may deliver alcoholic 11 liquor, wine, or beer to a home or other designated location in 12 this state. Deliveries shall be limited to alcoholic beverages 13 authorized by the licensee’s or permittee’s license or permit. 14 2. All deliveries of alcoholic liquor, wine, or beer shall 15 be subject to the following requirements and restrictions: 16 a. Payment for the alcoholic liquor, wine, or beer shall be 17 received on the licensed premises at the time of order. 18 b. Alcoholic liquor, wine, or beer delivered to a person 19 shall be for personal use and not for resale. 20 c. Deliveries shall only be made to persons in this state 21 who are twenty-one years of age or older. 22 d. Deliveries shall not be made to a person who is 23 intoxicated or is simulating intoxication. 24 e. Deliveries shall occur during the hours in which 25 alcoholic liquor, wine, or beer may be lawfully sold. 26 f. Delivery of alcoholic liquor, wine, or beer shall be made 27 by the licensee or permittee, or the licensee’s or permittee’s 28 employee, and not by a third party. 29 g. Delivery personnel shall be eighteen years of age or 30 older. 31 h. Deliveries shall be made in a vehicle owned, leased, or 32 under the control of the licensee or permittee. 33 i. Valid proof of the recipient’s identity and age shall 34 be obtained at the time of delivery, and the signature of a 35 -2- LSB 1243SV (3) 84 rn/nh 2/ 6

S.F. 240 person twenty-one years of age or older shall be obtained as a 1 condition of delivery. 2 j. Licensees and permittees shall maintain records 3 of deliveries which include the quantity delivered, the 4 recipient’s name and address, and the signature of the 5 recipient of the alcoholic liquor, wine, or beer. The records 6 shall be maintained on the licensed premises for a period of 7 three years. 8 3. A violation of this section or any other provision of 9 this chapter shall subject the licensee or permittee to the 10 penalty provisions of section 123.39. 11 4. Nothing in this section shall impact the direct shipment 12 of wine as regulated by section 123.187. 13 Sec. 6. Section 123.56, subsections 1, 2, and 3, Code 2011, 14 are amended to read as follows: 15 1. Subject to rules of the division, manufacturers of 16 native wines from grapes, cherries, other fruits or other fruit 17 juices, vegetables, vegetable juices, dandelions, clover, 18 honey, or any combination of these ingredients, holding a 19 class “A” wine permit as required by this chapter , may sell, 20 keep, or offer for sale and deliver the wine. Sales may be 21 made at retail for off-premises consumption when sold on the 22 premises of the manufacturer, or in a retail establishment 23 operated by the manufacturer. Sales may also be made to class 24 “A” or retail wine permittees or liquor control licensees as 25 authorized by the class “A” wine permit. Notwithstanding any 26 other provision of this chapter, manufacturers of native wine 27 may purchase and possess grape brandy from the division for the 28 sole purpose of manufacturing wine. 29 2. Native wine may be sold at retail for off-premises 30 consumption when sold on the premises of the manufacturer, 31 or in a retail establishment operated by the manufacturer. 32 Sales may also be made to class “A” or retail wine permittees 33 or liquor control licensees as authorized by the class “A” 34 wine permit. A manufacturer of native wines shall not sell 35 -3- LSB 1243SV (3) 84 rn/nh 3/ 6

S.F. 240 the wines other than as permitted in this chapter and shall 1 not allow wine sold to be consumed upon the premises of the 2 manufacturer. However, prior to sale native wines may be 3 sampled on the premises where made, when no charge is made 4 for the sampling. A person may manufacture native wine for 5 consumption on the manufacturer’s premises, when the wine or 6 any part of it is not manufactured for sale. 7 3. A manufacturer of native wines may ship wine in closed 8 containers to individual purchasers inside and outside this 9 state by obtaining a wine direct shipper license pursuant to 10 section 123.187 . The manufacturer shall label the package 11 containing the wine with the words “deliver to adults only”. 12 Sec. 7. Section 123.57, Code 2011, is amended to read as 13 follows: 14 123.57 Examination of accounts. 15 The financial condition and transactions of all offices, 16 departments, warehouses, and depots of the division shall be 17 examined at least once each year by the state auditor and at 18 shorter periods if requested by the administrator, governor, 19 commission, or executive council the general assembly’s 20 standing committees on government oversight . 21 Sec. 8. REPEAL. Section 123.43, Code 2011, is repealed. 22 EXPLANATION 23 This bill makes changes regarding matters under the purview 24 of the alcoholic beverages division of the department of 25 commerce. 26 The bill deletes an exception to the open records law in 27 Code chapter 22 which currently provides that records of 28 purchases of alcoholic liquor from the division which would 29 reveal purchases made by an individual class “E” liquor control 30 licensee shall be kept confidential, unless required to be 31 revealed for law enforcement purposes or for the collection of 32 payments due the division pursuant to Code section 123.24. 33 The bill provides that prior to the approval and granting 34 of a manufacturer’s license, which allows the manufacture, 35 -4- LSB 1243SV (3) 84 rn/nh 4/ 6

S.F. 240 storage, and wholesale disposition and sale of alcoholic 1 liquors to the division and to customers outside of the state, 2 an applicant must file a statement under oath with the division 3 that the applicant is a bona fide manufacturer of alcoholic 4 liquors, and that the applicant will faithfully observe and 5 comply with all laws, rules, and regulations governing the 6 manufacture and sale of alcoholic liquor. The bill subjects 7 a licensee violating the requirements for issuance of a 8 manufacturer’s license, in addition to any other applicable 9 penalty contained in Code chapter 123, to the civil penalty and 10 suspension or revocation provisions contained in Code section 11 123.39. The civil penalty is in an amount not to exceed $1,000 12 per violation. The bill repeals Code section 123.43, which 13 requires the posting of a $5,000 bond by applicants for a 14 manufacturer’s license. 15 The bill deletes a current provision prohibiting 16 micro-distilled spirits purchased at a micro-distillery from 17 being consumed within 300 feet of a micro-distillery. 18 The bill authorizes the home delivery of alcoholic beverages 19 by retailers. The bill provides that a licensee or permittee 20 authorized to sell liquor, wine, or beer in original unopened 21 containers for consumption off the licensed premises may 22 deliver it to a home or other designated location in Iowa. 23 Deliveries shall be limited to alcoholic beverages authorized 24 by the licensee’s or permittee’s license or permit. 25 The bill states that deliveries shall be subject to several 26 requirements and restrictions. Specifically, payment for 27 the liquor, wine, or beer shall be received on the licensed 28 premises at the time of order; liquor, wine, or beer shall be 29 for personal use and not for resale; deliveries shall only 30 be made to persons in this state who are 21 or older; and 31 deliveries shall not be made to a person who is intoxicated or 32 is simulating intoxication. Additionally, deliveries shall 33 occur during the hours in which liquor, wine, or beer may be 34 lawfully sold and shall be made by the licensee or permittee, 35 -5- LSB 1243SV (3) 84 rn/nh 5/ 6

S.F. 240 or the licensee’s or permittee’s employee. Delivery personnel 1 are required to be 18 or older. Further, deliveries shall 2 be made in a vehicle owned, leased, or under the control of 3 the licensee or permittee, valid proof of the recipient’s 4 identity and age shall be obtained at the time of delivery and 5 the signature of an adult shall be obtained as a condition 6 of delivery, and licensees and permittees are required to 7 maintain records of deliveries which include the quantity 8 delivered, recipient’s name and address, and the signature of 9 the recipient of the liquor, wine, or beer. 10 Additionally, the bill makes specified changes relating 11 to the manufacture of native wine. The bill states that 12 manufacturers of native wine may purchase and possess grape 13 brandy, as defined in the bill, for the sole purpose of 14 manufacturing wine, provided that the grape brandy is purchased 15 from the division. The bill clarifies that a manufacturer of 16 native wine shall obtain a wine shipper’s license pursuant to 17 Code section 123.187 and makes the manufacturer subject to the 18 provisions of the Code section. 19 -6- LSB 1243SV (3) 84 rn/nh 6/ 6