Senate Study Bill 1007 - Introduced SENATE/HOUSE FILE _____ BY (PROPOSED GOVERNOR’S OFFICE OF DRUG CONTROL POLICY BILL) A BILL FOR An Act increasing the tax applicable to the manufacture or sale 1 of beer, making an appropriation, and including effective 2 date provisions. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 1322DP (3) 84 rn/sc

S.F. _____ H.F. _____ Section 1. Section 123.130, subsection 2, Code 2011, is 1 amended to read as follows: 2 2. All class “A” premises shall be located within the state. 3 All beer received by the holder of a class “A” permit from 4 the holder of a certificate of compliance before being resold 5 must first come to rest on the premises licensed by the class 6 “A” permit holder, must be inventoried, and is subject to the 7 barrel beer gallonage tax when resold as provided in section 8 123.136 . A class “A” permittee shall not store beer overnight 9 except on premises licensed under a class “A” permit. 10 Sec. 2. Section 123.136, Code 2011, is amended to read as 11 follows: 12 123.136 Barrel Beer gallonage tax. 13 1. In addition to the annual permit fee to be paid by all 14 class “A” permittees under this chapter there shall be levied 15 and collected from the permittees on all beer manufactured 16 for sale or sold in this state at wholesale and on all beer 17 imported into this state for sale at wholesale and sold in this 18 state at wholesale, and from special class “A” permittees on 19 all beer manufactured for consumption on the premises, a tax 20 of five and eighty-nine hundredths dollars seventy-three cents 21 for every barrel containing thirty-one gallons each gallon , and 22 at a like rate for any other quantity or for the fractional 23 part of a barrel gallon . However, no tax shall be levied or 24 collected on beer shipped outside this state by a class “A” 25 permittee or sold by one class “A” permittee to another class 26 “A” permittee. 27 All revenue derived from the barrel tax shall accrue to the 28 state general fund. 29 2. All of the provisions of this chapter relating to the 30 administration of the barrel tax on beer gallonage tax shall 31 apply to this section . 32 Sec. 3. Section 123.143, Code 2011, is amended to read as 33 follows: 34 123.143 Distribution of funds. 35 -1- LSB 1322DP (3) 84 rn/sc 1/ 3

S.F. _____ H.F. _____ The revenues obtained from permit fees and the barrel beer 1 gallonage tax collected under the provisions of this chapter 2 shall be distributed as follows: 3 1. All retail beer permit fees collected by any local 4 authority at the time application for the permit is made shall 5 be retained by the local authority. A certified copy of the 6 receipt for the permit fee shall be submitted to the division 7 with the application and the local authority shall be notified 8 at the time the permit is issued. Those amounts collected for 9 the privilege authorized under section 123.134, subsection 6 , 10 shall be deposited in the beer and liquor control fund. 11 2. All permit fees and taxes collected by the division under 12 this division shall accrue to the state general fund, except 13 as otherwise provided. 14 3. Barrel Beer gallonage tax revenues collected on beer 15 manufactured in this state from a class “A” permittee which 16 owns and operates a brewery located in Iowa shall be credited 17 to the barrel beer gallonage tax fund hereby created in the 18 office of the treasurer of state. Moneys deposited in the 19 barrel beer gallonage tax fund shall not revert to the general 20 fund of the state without a specific appropriation by the 21 general assembly. Moneys in the barrel beer gallonage tax 22 fund are appropriated to the department of economic development 23 for purposes of section 15E.117 . 24 4. An amount equal to fifty-four cents of the tax paid on 25 every gallon, and at a like rate for any other quantity or 26 for the fractional part of a gallon, is appropriated annually 27 from beer gallonage tax revenues that are not required to be 28 deposited in the beer gallonage tax fund pursuant to subsection 29 3 to the governor’s office of drug control policy for use 30 in coordinating, funding, and administering programs in the 31 categories of substance abuse prevention, substance abuse 32 treatment, and drug enforcement. Notwithstanding section 8.33, 33 moneys appropriated in this subsection that remain unencumbered 34 or unobligated at the close of the fiscal year shall not revert 35 -2- LSB 1322DP (3) 84 rn/sc 2/ 3

S.F. _____ H.F. _____ but shall remain available for expenditure for the purposes 1 designated until the close of the succeeding fiscal year. 2 Sec. 4. EFFECTIVE UPON ENACTMENT. This Act, being deemed of 3 immediate importance, takes effect upon enactment. 4 EXPLANATION 5 This bill relates to the barrel tax imposed on the 6 manufacture and sale of beer as provided in Code section 7 123.136. 8 The bill changes the name of the tax from the barrel tax to 9 the beer gallonage tax, and increases the rate of the tax from 10 $5.89 per 31-gallon barrel of beer sold to 73 cents per gallon, 11 and a like rate for any other quantity or for the fractional 12 part of a gallon. The bill provides that an amount equal to 54 13 cents of the tax paid on every gallon is appropriated annually 14 from beer gallonage tax revenues to the governor’s office of 15 drug control policy for use in coordinating, funding, and 16 administering programs in the categories of substance abuse 17 prevention, substance abuse treatment, and drug enforcement. 18 The bill provides that this amount is not subject to reversion. 19 The bill makes conforming changes and eliminates a 20 duplicative provision. 21 The bill takes effect upon enactment. 22 -3- LSB 1322DP (3) 84 rn/sc 3/ 3