S.F. 2120 Section 1. Section 123.30, subsection 3, paragraph c, 1 subparagraph (3), Code 2022, is amended to read as follows: 2 (3) A class “C” native distilled spirits liquor control 3 license may be issued to a native distillery but shall be 4 issued in the name of the individuals who actually own the 5 business and shall only be issued to a native distillery which, 6 combining all production facilities of the business, produces 7 and manufactures not more than one hundred thousand proof 8 gallons of distilled spirits on an annual basis. The license 9 shall authorize the holder to sell native distilled spirits 10 manufactured on the premises of the native distillery , beer 11 manufactured by a native brewery, and native wine, to patrons 12 by the individual drink for consumption on the premises and . 13 The license shall also authorize the holder to sell mixed 14 drinks or cocktails for consumption off the premises subject 15 to the requirements of section 123.49, subsection 2 , paragraph 16 “d” . All native distilled spirits sold by a native distillery 17 for on-premises consumption and mixed drinks or cocktails 18 sold for consumption off the premises shall be purchased from 19 a class “E” liquor control licensee in original unopened 20 containers. 21 Sec. 2. Section 123.43A, subsections 2 and 6, Code 2022, are 22 amended to read as follows: 23 2. A native distillery shall not sell more than one and 24 one-half nine liters per person per day, of native distilled 25 spirits on the premises of the native distillery. However, a 26 native distillery which, combining all production facilities 27 of the business, produces and manufactures not more than one 28 hundred thousand proof gallons of native distilled spirits on 29 an annual basis, may sell not more than nine liters per person 30 per day, of native distilled spirits. In addition, a native 31 distillery shall not directly ship native distilled spirits for 32 sale at retail. The native distillery shall maintain records 33 of individual purchases of native distilled spirits at the 34 native distillery for three years. 35 -1- LSB 5848XS (2) 89 ec/rn 1/ 3

S.F. 2120 6. Notwithstanding any provision of this chapter to the 1 contrary or the fact that a person is the holder of a class “A” 2 native distilled spirits license, a native distillery which, 3 combining all production facilities of the business, produces 4 and manufactures not more than one hundred thousand proof 5 gallons of native distilled spirits on an annual basis may sell 6 beer manufactured by a native brewery, native wine, and those 7 native distilled spirits manufactured on the premises of the 8 native distillery for consumption on the premises by applying 9 for a class “C” native distilled spirits liquor control license 10 as provided in section 123.30 . A native distillery may be 11 granted not more than two class “C” native distilled spirits 12 liquor control licenses. All native distilled spirits sold 13 by a native distillery for on-premises consumption and mixed 14 drinks or cocktails sold for consumption off the premises shall 15 be purchased from a class “E” liquor control licensee. A 16 manufacturer of native distilled spirits may be issued a class 17 “C” native distilled spirits liquor control license regardless 18 of whether the manufacturer is also a manufacturer of beer 19 pursuant to a class “A” beer permit or a manufacturer of native 20 wine pursuant to a class “A” wine permit. 21 Sec. 3. Section 137F.1, subsection 8, Code 2022, is amended 22 by adding the following new paragraph: 23 NEW PARAGRAPH . o. Premises covered by a current class “C” 24 native distilled spirits liquor control license as provided in 25 chapter 123. 26 EXPLANATION 27 The inclusion of this explanation does not constitute agreement with 28 the explanation’s substance by the members of the general assembly. 29 This bill relates to native distilleries. 30 Code section 123.30 is amended to allow a holder of a class 31 “C” native distilled spirits liquor control license to sell 32 beer manufactured by a native brewery and native wine for 33 consumption on the premises of the licensee. A corresponding 34 change is made in Code section 123.43A concerning native 35 -2- LSB 5848XS (2) 89 ec/rn 2/ 3

S.F. 2120 distilleries. 1 Code section 123.43A is also amended to allow native 2 distilleries the ability to sell not more than nine liters per 3 person per day of native distilled spirits on the premises 4 of the native distillery and to apply for a class “C” native 5 distilled spirits liquor control license. Under current law, 6 a native distillery that produces and manufactures more than 7 100,000 proof gallons of native distilled spirits on an annual 8 basis may sell no more than 1.5 liters per person per day and 9 is not authorized to apply for a class “C” native distilled 10 spirits liquor control license. 11 Code section 137F.1 is amended to provide that a food 12 establishment, subject to licensure under Code chapter 137, 13 does not include premises covered by a current class “C” native 14 distilled spirits liquor control license. 15 -3- LSB 5848XS (2) 89 ec/rn 3/ 3