S.F. 2350 DIVISION I 1 RETAIL ALCOHOL LICENSES 2 Section 1. Section 123.30, Code 2022, is amended by striking 3 the section and inserting in lieu thereof the following: 4 123.30 Retail alcohol licenses —— classes. 5 1. a. A retail alcohol license may be issued to any person 6 who is of good moral character as defined by this chapter. 7 b. As a condition for issuance of a retail alcohol license 8 or wine or beer permit, the applicant must give consent 9 to members of the fire, police, and health departments and 10 the building inspector of cities; the county sheriff or 11 deputy sheriff; members of the department of public safety; 12 representatives of the division and of the department of 13 inspections and appeals; certified police officers; and 14 any official county health officer to enter upon areas of 15 the premises where alcoholic beverages are stored, served, 16 or sold, without a warrant during business hours of the 17 licensee or permittee to inspect for violations of this 18 chapter or ordinances and regulations that cities and boards 19 of supervisors may adopt. However, a subpoena issued under 20 section 421.17 or a warrant is required for inspection of 21 private records, a private business office, or attached living 22 quarters. Persons who are not certified peace officers shall 23 limit the scope of their inspections of licensed premises 24 to the regulatory authority under which the inspection is 25 conducted. All persons who enter upon a licensed premises to 26 conduct an inspection shall present appropriate identification 27 to the owner of the establishment or the person who appears 28 to be in charge of the establishment prior to commencing 29 an inspection; however, this provision does not apply to 30 undercover criminal investigations conducted by peace officers. 31 c. As a further condition for the issuance of a class “E” 32 retail alcohol license, the applicant shall post a bond in 33 a sum of not less than five thousand nor more than fifteen 34 thousand dollars as determined on a sliding scale established 35 -1- LSB 5045SV (1) 89 ec/rn 1/ 77

S.F. 2350 by the division; however, a bond shall not be required if all 1 purchases of alcoholic liquor from the division by the licensee 2 are made by means that ensure that the division will receive 3 full payment in advance of delivery of the alcoholic liquor. 4 d. A class “E” retail alcohol license may be issued to a 5 city council for premises located within the limits of the city 6 if there are no class “E” retail alcohol licensees operating 7 within the limits of the city and no other applications for a 8 class “E” license for premises located within the limits of 9 the city at the time the city council’s application is filed. 10 If a class “E” retail alcohol license is subsequently issued 11 to a private person for premises located within the limits of 12 the city, the city council shall surrender its license to the 13 division within one year of the date that the class “E” retail 14 alcohol licensee begins operating, liquidate any remaining 15 assets connected with the liquor store, and cease operating the 16 liquor store. 17 2. A retail alcohol license shall not be issued for premises 18 which do not constitute a safe and proper place or building 19 and which do not conform to all applicable laws, ordinances, 20 resolutions, and health and fire regulations. A licensee 21 shall not have or maintain any interior access to residential 22 or sleeping quarters unless permission is granted by the 23 administrator in the form of a living quarters permit. 24 3. Retail alcohol licenses issued under this chapter shall 25 be of the following classes: 26 a. Class “B”. 27 (1) (a) A class “B” retail alcohol license may be 28 issued and shall authorize the holder to purchase wine from 29 a class “A” wine permittee only and beer from a class “A” 30 beer permittee only, and to sell wine and beer in original 31 unopened containers at retail to patrons for consumption off 32 the licensed premises. 33 (b) The holder of a class “B” retail alcohol license may 34 sell wine to class “C”, special class “C”, class “D”, and class 35 -2- LSB 5045SV (1) 89 ec/rn 2/ 77

S.F. 2350 “F” retail alcohol licensees for resale for consumption on 1 the premises. Such wine sales shall be in quantities of less 2 than one case of any wine brand but not more than one such 3 sale shall be made to the same retail alcohol licensee in a 4 twenty-four-hour period. 5 (2) A special class “B” retail native wine license shall 6 authorize the holder to purchase wine from a native winery 7 holding a class “A” wine permit and to sell native wine only at 8 retail for consumption off the licensed premises. 9 b. Class “C”. 10 (1) A class “C” retail alcohol license may be issued to 11 a commercial establishment but must be issued in the name of 12 the individuals who actually own the entire business and shall 13 authorize the holder to purchase alcoholic liquors in original 14 unopened containers from class “E” retail alcohol licensees 15 only, wine from class “A” wine permittees, class “B” retail 16 alcohol licensees, or class “E” retail alcohol licensees only 17 as provided in this section and section 123.177, and to sell 18 alcoholic beverages to patrons by the individual drink for 19 consumption on the premises only. However, alcoholic liquor, 20 wine, and beer in original unopened containers may also be sold 21 for consumption off the premises. In addition, mixed drinks 22 or cocktails may also be sold for consumption off the premises 23 subject to the requirements of section 123.49, subsection 2, 24 paragraph “d” . The holder of a class “C” retail alcohol license 25 may also hold a special class “A” beer permit for the premises 26 licensed under a class “C” retail alcohol license for the 27 purpose of operating a brewpub pursuant to this chapter. 28 (2) A special class “C” retail alcohol license may be issued 29 to a commercial establishment and shall authorize the holder 30 to purchase wine from class “A” wine permittees, class “B” 31 retail alcohol licensees, or class “E” retail alcohol licensees 32 only as provided in this section and section 123.177, and to 33 sell wine and beer to patrons by the individual drink for 34 consumption on the premises only. However, wine and beer in 35 -3- LSB 5045SV (1) 89 ec/rn 3/ 77

S.F. 2350 original unopened containers may also be sold for consumption 1 off the premises. The license issued to holders of a special 2 class “C” retail alcohol license shall clearly state on its 3 face that the license is limited. 4 c. Class “D”. 5 (1) A class “D” retail alcohol license may be issued 6 to a railway corporation, to an air common carrier, and to 7 passenger-carrying boats or ships for hire with a capacity of 8 twenty-five persons or more operating in inland or boundary 9 waters, and shall authorize the holder to sell or furnish 10 alcoholic beverages to passengers for consumption only on 11 trains, watercraft as described in this section, or aircraft, 12 respectively. Each license is valid throughout the state. 13 Only one license is required for all trains, watercraft, or 14 aircraft operated in the state by the licensee. However, if a 15 watercraft is an excursion gambling boat licensed under chapter 16 99F, the owner shall obtain a separate class “D” retail alcohol 17 license for each excursion gambling boat operating in the 18 waters of this state. 19 (2) A class “D” retail alcohol licensee who operates a train 20 or a watercraft intrastate only, or an excursion gambling boat 21 licensed under chapter 99F, shall purchase alcoholic liquor in 22 original unopened containers from a class “E” retail alcohol 23 licensee only, wine from a class “A” wine permittee, class “B” 24 retail alcohol licensees, or class “E” retail alcohol licensee 25 only as provided in this section and section 123.177, and beer 26 from a class “A” beer permittee only. 27 d. Class “E”. 28 (1) A class “E” retail alcohol license may be issued and 29 shall authorize the holder to purchase alcoholic liquor in 30 original unopened containers from the division only, wine 31 from a class “A” wine permittee only, and beer from a class 32 “A” beer permittee only; to sell alcoholic liquor, wine, and 33 beer in original unopened containers at retail to patrons for 34 consumption off the licensed premises; and to sell alcoholic 35 -4- LSB 5045SV (1) 89 ec/rn 4/ 77

S.F. 2350 liquor and high alcoholic content beer at wholesale to other 1 retail alcohol licensees, provided the holder has filed with 2 the division a basic permit issued by the alcohol and tobacco 3 tax and trade bureau of the United States department of the 4 treasury. 5 (2) A holder of a class “E” retail alcohol license may hold 6 other retail alcohol licenses, but the premises licensed under 7 a class “E” retail alcohol license shall be separate from other 8 licensed premises, though the separate premises may have a 9 common entrance. 10 (3) The holder of a class “E” retail alcohol license may 11 sell wine to class “C”, special class “C”, class “D”, and class 12 “F” retail alcohol licensees for resale for consumption on 13 the premises. Such wine sales shall be in quantities of less 14 than one case of any wine brand but not more than one such 15 sale shall be made to the same retail alcohol licensee in a 16 twenty-four-hour period. 17 (4) The division may issue a class “E” retail alcohol 18 license for premises covered by a retail alcohol license 19 for on-premises consumption under any of the following 20 circumstances: 21 (a) If the premises are in a county having a population 22 under nine thousand five hundred in which no other class “E” 23 retail alcohol license has been issued by the division, and no 24 other application for a class “E” retail alcohol license has 25 been made within the previous twelve consecutive months. 26 (b) If, notwithstanding any provision of this chapter to the 27 contrary, the premises covered by a retail alcohol license is a 28 grocery store that is at least five thousand square feet. 29 e. Class “F”. A class “F” retail alcohol license may be 30 issued to a club and shall authorize the holder to purchase 31 alcoholic liquors in original unopened containers from class 32 “E” retail alcohol licensees only, beer from class “A” beer 33 permittees only, wine from class “A” wine permittees, class “B” 34 retail alcohol licensees, or class “B” retail alcohol licensees 35 -5- LSB 5045SV (1) 89 ec/rn 5/ 77

S.F. 2350 only as provided in this section and section 123.177, and to 1 sell alcoholic beverages to bona fide members and their guests 2 by the individual drink for consumption on the premises only. 3 4. Notwithstanding any provision of this chapter to the 4 contrary, a person holding a retail alcohol license to sell 5 alcoholic beverages for consumption on the licensed premises 6 may permit a customer to remove one unsealed bottle of wine 7 for consumption off the premises if the customer has purchased 8 and consumed a portion of the bottle of wine on the licensed 9 premises. The licensee or the licensee’s agent shall securely 10 reseal such bottle in a bag designed so that it is visibly 11 apparent that the resealed bottle of wine has not been tampered 12 with and provide a dated receipt for the resealed bottle of 13 wine to the customer. A wine bottle resealed pursuant to the 14 requirements of this subsection is subject to the requirements 15 of sections 321.284 and 321.284A. A person holding a retail 16 alcohol license to sell alcoholic beverages for consumption on 17 the licensed premises may permit a customer to carry an open 18 container of wine from the person’s licensed premises into 19 another immediately adjacent licensed premises that is covered 20 by a license or permit that authorizes the consumption of wine, 21 a temporarily closed public right-of-way, or a private place. 22 Sec. 2. Section 123.31, Code 2022, is amended by striking 23 the section and inserting in lieu thereof the following: 24 123.31 Retail alcohol licenses —— application. 25 1. A person applying for a retail alcohol license shall 26 submit a completed application electronically, or in a manner 27 prescribed by the administrator, which shall set forth under 28 oath the following: 29 a. The name and place of residence of the applicant. 30 b. The names and addresses of all persons or, in the case of 31 a corporation, limited liability company, or any other similar 32 legal entity, the officers, directors, and persons owning or 33 controlling ten percent or more of the capital stock thereof, 34 having a financial interest, by way of loan, ownership, or 35 -6- LSB 5045SV (1) 89 ec/rn 6/ 77

S.F. 2350 otherwise, in the business. 1 c. The location of the premises where the applicant intends 2 to operate. 3 d. The name of the owner of the premises and if the owner of 4 the premises is not the applicant, whether the applicant is the 5 actual lessee of the premises. 6 e. When required by the administrator, and in such form and 7 containing such information as the administrator may require, 8 a description of the premises where the applicant intends to 9 use the license, to include a sketch or drawing of the premises 10 and, if applicable, the number of square feet of interior floor 11 space which comprises the retail sales area of the premises. 12 f. Whether any person specified in paragraph “b” has ever 13 been convicted of any offense against the laws of the United 14 States, or any state or territory thereof, or any political 15 subdivision of any such state or territory. 16 g. Any other information as required by the administrator. 17 2. The retail alcohol license shall only be issued to an 18 applicant who establishes all of the following: 19 a. That the applicant has submitted a completed application 20 as required by subsection 1. 21 b. That the applicant is a person of good moral character as 22 provided in section 123.3, subsection 40. 23 c. That the applicant is a citizen of the state of Iowa 24 or, if a corporation, that the applicant is authorized to do 25 business in the state. 26 d. That the premises where the applicant intends to use the 27 license conforms to all applicable laws, health regulations, 28 and fire regulations, and constitutes a safe and proper place 29 or building and that the applicant shall not have or maintain 30 any interior access to residential or sleeping quarters unless 31 permission is granted by the administrator in the form of a 32 living quarters permit. 33 e. That the applicant gives consent to a person, pursuant 34 to section 123.30, subsection 1, to enter upon the premises 35 -7- LSB 5045SV (1) 89 ec/rn 7/ 77

S.F. 2350 without a warrant during the business hours of the applicant 1 to inspect for violations of the provisions of this chapter or 2 ordinances and regulations that local authorities may adopt. 3 Sec. 3. NEW SECTION . 123.31A Authority under class “B”, 4 class “C”, special class “C”, and class “E” retail alcohol 5 license. 6 1. The holder of a class “B”, class “C”, special class “C”, 7 or class “E” retail alcohol license shall be allowed to sell 8 beer and wine to consumers at retail for consumption off the 9 premises. The sales made pursuant to this section shall be 10 made in original containers except as provided in subsection 3. 11 2. Every person holding a class “B”, class “C”, special 12 class “C”, or class “E” retail alcohol license having more 13 than one place of business where beer and wine is sold which 14 places do not constitute a single premises within the meaning 15 of section 123.3, subsection 29, shall be required to have a 16 separate license for each separate place of business, except as 17 otherwise provided by this chapter. 18 3. Subject to the rules of the division, sales made pursuant 19 to this section may be made in a container other than the 20 original container only if all of the following requirements 21 are met: 22 a. The beer or wine is transferred from the original 23 container to the container to be sold on the licensed premises 24 at the time of sale. 25 b. The person transferring the beer or wine from the 26 original container to the container to be sold shall be 27 eighteen years of age or older. 28 c. The container to be sold shall be no larger than 29 seventy-two ounces. 30 d. The container to be sold shall be securely sealed by 31 a method authorized by the division that is designed so that 32 if the sealed container is reopened or the seal tampered with, 33 it is visibly apparent that the seal on the container of beer 34 or wine has been tampered with or the sealed container has 35 -8- LSB 5045SV (1) 89 ec/rn 8/ 77

S.F. 2350 otherwise been reopened. 1 4. A container of beer or wine other than the original 2 container that is sold and sealed in compliance with the 3 requirements of subsection 3 and the division’s rules shall 4 not be deemed an open container subject to the requirements 5 of sections 321.284 and 321.284A if the sealed container is 6 unopened and the seal has not been tampered with, and the 7 contents of the container have not been partially removed. 8 5. a. The holder of a class “C” or special class “C” retail 9 alcohol license, or the licensee’s agents or employees, shall 10 not sell beer or wine to other retail alcohol license holders 11 knowing or having reasonable cause to believe that the beer 12 will be resold in another licensed establishment. 13 b. A holder of any retail alcohol permit shall not sell wine 14 except wine which is purchased from a person holding a class 15 “A” wine permit and on which the tax imposed by section 123.183 16 has been paid. 17 Sec. 4. NEW SECTION . 123.31B Authority under special class 18 “B” retail native wine license. 19 1. A person holding a special class “B” retail native wine 20 license may sell native wine only at retail for consumption off 21 the premises. Native wine shall be sold for consumption off 22 the premises in original containers. 23 2. A special class “B” retail native wine licensee having 24 more than one place of business where wine is sold shall obtain 25 a separate license for each place of business. 26 Sec. 5. REPEAL. Sections 123.128, 123.129, 123.131, 27 123.132, 123.140, 123.178, 123.178A, and 123.178B, Code 2022, 28 are repealed. 29 DIVISION II 30 ALCOHOLIC BEVERAGE CONTROL FEES 31 Sec. 6. Section 123.23, subsection 1, Code 2022, is amended 32 to read as follows: 33 1. Any manufacturer, distiller, or importer of alcoholic 34 liquors shipping, selling, or having alcoholic liquors brought 35 -9- LSB 5045SV (1) 89 ec/rn 9/ 77

S.F. 2350 into this state for resale by the state shall, as a condition 1 precedent to the privilege of so trafficking in alcoholic 2 liquors in this state, annually make application for and hold 3 a distiller’s certificate of compliance which shall be issued 4 by the administrator for that purpose. No brand of alcoholic 5 liquor shall be sold by the division in this state unless 6 the manufacturer, distiller, importer, and all other persons 7 participating in the distribution of that brand in this state 8 have obtained a certificate. The certificate of compliance 9 shall expire at the end of one year from the date of issuance 10 and shall be renewed for a like period upon application to the 11 administrator unless otherwise suspended or revoked for cause. 12 Each completed application for a certificate of compliance 13 or renewal shall be submitted electronically, or in a manner 14 prescribed by the administrator, and shall be accompanied by 15 a fee of fifty two hundred dollars payable to the division. 16 However, this subsection need not apply to a manufacturer, 17 distiller, or importer who ships or sells in this state no more 18 than eleven gallons or its case equivalent during any fiscal 19 year as a result of “special orders” which might be placed, 20 as defined and allowed by divisional rules adopted under this 21 chapter . 22 Sec. 7. Section 123.36, Code 2022, is amended by striking 23 the section and inserting in lieu thereof the following: 24 123.36 Retail alcohol license fees. 25 1. The following fees shall be paid to the division annually 26 for retail alcohol licenses issued under section 123.30: 27 a. Class “B” retail alcohol license fees shall be determined 28 as follows: 29 (1) For premises located within the corporate limits of a 30 city with a population of two thousand five hundred or less, a 31 fee determined as follows: 32 (a) For a premises with a square footage of one thousand 33 five hundred or less, seventy-five dollars. 34 (b) For a premises with a square footage of more than one 35 -10- LSB 5045SV (1) 89 ec/rn 10/ 77

S.F. 2350 thousand five hundred but not more than two thousand, one 1 hundred fifty dollars. 2 (c) For a premises with a square footage of more than two 3 thousand but not more than five thousand, two hundred fifty 4 dollars. 5 (d) For a premises with a square footage over five thousand, 6 three hundred fifty dollars. 7 (2) For premises located within the corporate limits of a 8 city with a population of more than two thousand five hundred 9 but less than fifteen thousand, a fee determined as follows: 10 (a) For a premises with a square footage of one thousand 11 five hundred or less, one hundred fifty dollars. 12 (b) For a premises with a square footage of more than one 13 thousand five hundred but not more than two thousand, two 14 hundred fifty dollars. 15 (c) For a premises with a square footage of more than two 16 thousand but not more than five thousand, three hundred fifty 17 dollars. 18 (d) For a premises with a square footage over five thousand, 19 five hundred dollars. 20 (3) For premises located within the corporate limits of 21 a city with a population of fifteen thousand or more, a fee 22 determined as follows: 23 (a) For a premises with a square footage of one thousand 24 five hundred or less, two hundred fifty dollars. 25 (b) For a premises with a square footage of more than one 26 thousand five hundred but not more than two thousand, three 27 hundred fifty dollars. 28 (c) For a premises with a square footage of more than two 29 thousand but not more than five thousand, five hundred dollars. 30 (d) For a premises with a square footage over five thousand, 31 seven hundred fifty dollars. 32 (4) For premises located outside the corporate limits of 33 any city, a fee equal to that charged to a premises with the 34 same square footage in the incorporated city located nearest 35 -11- LSB 5045SV (1) 89 ec/rn 11/ 77

S.F. 2350 the premises to be licensed. If there is doubt as to which 1 of two or more differing corporate limits is the nearest, the 2 license fee which is the largest shall prevail. However, if 3 the premises is located in an unincorporated town, for purposes 4 of this paragraph, the unincorporated town shall be treated as 5 if it is a city. 6 b. Special class “B” retail native wine license fees shall 7 be one hundred twenty-five dollars. 8 c. Class “C” retail alcohol license fees shall be determined 9 as follows: 10 (1) Commercial establishments located within the corporate 11 limits of cities of two thousand five hundred population or 12 less, five hundred fifty dollars. 13 (2) Commercial establishments located within the corporate 14 limits of cities of over two thousand five hundred and less 15 than fifteen thousand population, nine hundred dollars. 16 (3) Commercial establishments located within the corporate 17 limits of cities of fifteen thousand population and over, one 18 thousand two hundred fifty dollars. 19 (4) Commercial establishments located outside the corporate 20 limits of any city, a fee equal to that charged in the 21 incorporated city located nearest the premises to be licensed, 22 and in case there is doubt as to which of two or more differing 23 corporate limits is the nearest, the license fee which is the 24 largest shall prevail. However, if a commercial establishment 25 is located in an unincorporated town, for purposes of this 26 paragraph, the unincorporated town shall be treated as if it 27 is a city. 28 d. Special class “C” retail alcohol license fees shall be 29 determined as follows: 30 (1) Commercial establishments located within the corporate 31 limits of cities of two thousand five hundred population or 32 less, one hundred fifty dollars. 33 (2) Commercial establishments located within the corporate 34 limits of cities of over two thousand five hundred and less 35 -12- LSB 5045SV (1) 89 ec/rn 12/ 77

S.F. 2350 than fifteen thousand population, three hundred dollars. 1 (3) Commercial establishments located within the corporate 2 limits of cities of fifteen thousand population and over, four 3 hundred fifty dollars. 4 (4) Commercial establishments located outside the corporate 5 limits of any city, a fee equal to that charged in the 6 incorporated city located nearest the premises to be licensed, 7 and in case there is doubt as to which of two or more differing 8 corporate limits is the nearest, the license fee which is the 9 largest shall prevail. However, if a commercial establishment 10 is located in an unincorporated town, for purposes of this 11 paragraph, the unincorporated town shall be treated as if it 12 is a city. 13 e. Class “D” retail alcohol license fees shall be determined 14 as follows: 15 (1) For watercraft, one hundred fifty dollars. 16 (2) For trains, five hundred dollars. 17 (3) For air common carriers, each company shall pay five 18 hundred dollars. 19 f. Class “E” retail alcohol license fees shall be determined 20 as follows: 21 (1) For premises located within the corporate limits of a 22 city with a population of two thousand five hundred or less, a 23 fee determined as follows: 24 (a) For a premises with a square footage of one thousand 25 five hundred or less, seven hundred fifty dollars. 26 (b) For a premises with a square footage of more than one 27 thousand five hundred but not more than two thousand, one 28 thousand five hundred dollars. 29 (c) For a premises with a square footage of more than two 30 thousand but not more than five thousand, two thousand five 31 hundred dollars. 32 (d) For a premises with a square footage over five thousand, 33 three thousand five hundred dollars. 34 (2) For premises located within the corporate limits of a 35 -13- LSB 5045SV (1) 89 ec/rn 13/ 77

S.F. 2350 city with a population of more than two thousand five hundred 1 but less than fifteen thousand, a fee determined as follows: 2 (a) For a premises with a square footage of one thousand 3 five hundred or less, one thousand five hundred dollars. 4 (b) For a premises with a square footage of more than one 5 thousand five hundred but not more than two thousand, two 6 thousand five hundred dollars. 7 (c) For a premises with a square footage of more than two 8 thousand but not more than five thousand, three thousand five 9 hundred dollars. 10 (d) For a premises with a square footage over five thousand, 11 five thousand dollars. 12 (3) For premises located within the corporate limits of 13 a city with a population of fifteen thousand or more, a fee 14 determined as follows: 15 (a) For a premises with a square footage of one thousand 16 five hundred or less, two thousand five hundred dollars. 17 (b) For a premises with a square footage of more than one 18 thousand five hundred but not more than two thousand, three 19 thousand five hundred dollars. 20 (c) For a premises with a square footage of more than 21 two thousand but not more than five thousand, five thousand 22 dollars. 23 (d) For a premises with a square footage over five thousand, 24 seven thousand five hundred dollars. 25 (4) For premises located outside the corporate limits of 26 any city, a fee equal to that charged to a premises with the 27 same square footage in the incorporated city located nearest 28 the premises to be licensed. If there is doubt as to which 29 of two or more differing corporate limits is the nearest, the 30 license fee which is the largest shall prevail. However, if 31 the premises is located in an unincorporated town, for purposes 32 of this paragraph, the unincorporated town shall be treated as 33 if it is a city. 34 g. Class “F” retail alcohol license fees shall be six 35 -14- LSB 5045SV (1) 89 ec/rn 14/ 77

S.F. 2350 hundred dollars, except that for class “F” licenses in cities 1 of less than two thousand population, and for clubs of less 2 than two hundred fifty members, the license fee shall be four 3 hundred dollars; however, the fee shall be two hundred dollars 4 for any club which is a post, branch, or chapter of a veterans 5 organization chartered by the Congress of the United States, if 6 the club does not sell or permit the consumption of alcoholic 7 beverages on the premises more than one day in any week or 8 more than a total of fifty-two days in a year, and if the 9 application for a license states that the club does not and 10 will not sell or permit the consumption of alcoholic beverages 11 on the premises more than one day in any week or more than a 12 total of fifty-two days in a year. 13 2. The division shall credit all fees to the beer and liquor 14 control fund. The division shall remit to the appropriate 15 local authority a sum equal to sixty-five percent of the fees 16 collected for each class “B”, class “C”, or class “F” license 17 except special class “C” licenses or class “E” licenses, 18 covering premises located within the local authority’s 19 jurisdiction. The division shall remit to the appropriate 20 local authority a sum equal to seventy-five percent of the fees 21 collected for each special class “C” license covering premises 22 located within the local authority’s jurisdiction. Those fees 23 collected for each class “E” retail alcohol license shall be 24 credited to the beer and liquor control fund. 25 3. There is imposed a surcharge on the fee for each class 26 “C”, special class “C”, or class “F” retail alcohol license 27 equal to thirty percent of the scheduled license fee. The 28 surcharges collected under this subsection shall be deposited 29 in the beer and liquor control fund, and notwithstanding 30 subsection 2, no portion of the surcharges collected under this 31 subsection shall be remitted to the local authority. 32 Sec. 8. Section 123.41, subsection 1, Code 2022, is amended 33 to read as follows: 34 1. Each completed application to obtain or renew a 35 -15- LSB 5045SV (1) 89 ec/rn 15/ 77

S.F. 2350 manufacturer’s license shall be submitted to the division 1 electronically, or in a manner prescribed by the administrator, 2 and shall be accompanied by a fee of three hundred fifty 3 dollars payable to the division. The administrator may in 4 accordance with this chapter grant and issue to a manufacturer 5 a manufacturer’s license, valid for a one-year period after 6 date of issuance, which shall allow the manufacture, storage, 7 and wholesale disposition and sale of alcoholic liquors to the 8 division and to customers outside of the state. 9 Sec. 9. Section 123.43, subsection 3, Code 2022, is amended 10 to read as follows: 11 3. A class “A” native distilled spirits license for a native 12 distillery shall be issued and renewed annually upon payment of 13 a fee of five three hundred dollars. 14 Sec. 10. Section 123.134, Code 2022, is amended by striking 15 the section and inserting in lieu thereof the following: 16 123.134 Beer permit fees. 17 1. The annual permit fee for a class “A” beer permit is 18 seven hundred fifty dollars. 19 2. The annual permit fee for a class “A” beer permit for a 20 native brewery is three hundred dollars. 21 3. The annual permit fee for a special class “A” beer permit 22 is three hundred dollars. 23 Sec. 11. Section 123.135, subsection 1, Code 2022, is 24 amended to read as follows: 25 1. A manufacturer, brewer, bottler, importer, or vendor of 26 beer, or any agent thereof, desiring to ship or sell beer, or 27 have beer brought into this state for resale by a class “A” 28 beer permittee, shall first make application for and be issued 29 a brewer’s certificate of compliance by the administrator for 30 that purpose. The certificate of compliance expires at the 31 end of one year from the date of issuance and shall be renewed 32 for a like period upon application to the administrator unless 33 otherwise revoked for cause. Each completed application for 34 a certificate of compliance or renewal of a certificate shall 35 -16- LSB 5045SV (1) 89 ec/rn 16/ 77

S.F. 2350 be submitted electronically, or in a manner prescribed by the 1 administrator, and shall be accompanied by a fee of five two 2 hundred dollars payable to the division. Each holder of a 3 certificate of compliance shall furnish the information in a 4 manner the administrator requires. 5 Sec. 12. Section 123.179, Code 2022, is amended by striking 6 the section and inserting in lieu thereof the following: 7 123.179 Wine permit and license fees. 8 1. The annual permit fee for a class “A” wine permit that 9 is not issued to a native wine manufacturer is seven hundred 10 fifty dollars. 11 2. The annual permit fee for a class “A” wine permit issued 12 to a native wine manufacturer is one hundred dollars. 13 3. The fee for a charity beer, spirits, and wine special 14 event license is one hundred dollars. 15 Sec. 13. Section 123.180, subsection 1, Code 2022, is 16 amended to read as follows: 17 1. A manufacturer, vintner, bottler, importer, or vendor of 18 wine, or an agent thereof, desiring to ship, sell, or have wine 19 brought into this state for sale at wholesale by a class “A” 20 permittee shall first make application for and shall be issued 21 a vintner’s certificate of compliance by the administrator 22 for that purpose. The vintner’s certificate of compliance 23 shall expire at the end of one year from the date of issuance 24 and shall be renewed for a like period upon application to 25 the administrator unless otherwise revoked for cause. Each 26 completed application for a vintner’s certificate of compliance 27 or renewal of a certificate shall be submitted electronically, 28 or in a manner prescribed by the administrator, and shall be 29 accompanied by a fee of one two hundred dollars payable to the 30 division. Each holder of a vintner’s certificate of compliance 31 shall furnish the information required by the administrator in 32 the form the administrator requires. A vintner or wine bottler 33 whose plant is located in Iowa and who otherwise holds a class 34 “A” wine permit to sell wine at wholesale is exempt from the 35 -17- LSB 5045SV (1) 89 ec/rn 17/ 77

S.F. 2350 fee, but not the other terms and conditions. The holder of a 1 vintner’s certificate of compliance may also hold a class “A” 2 wine permit. 3 DIVISION III 4 ALCOHOLIC BEVERAGE CONTROL 5 Sec. 14. Section 123.3, subsections 9, 22, 29, and 30, Code 6 2022, are amended to read as follows: 7 9. “Brewpub” means a commercial establishment authorized to 8 sell beer at retail for consumption on or off the premises that 9 is operated by a person who holds a class “C” liquor control or 10 special class “C” retail alcohol license or a class “B” beer 11 permit and who also holds a special class “A” beer permit that 12 authorizes the holder to manufacture and sell beer pursuant to 13 this chapter . 14 22. “High alcoholic content beer” means beer which contains 15 more than six and twenty-five hundredths percent of alcohol by 16 volume, but not more than fifteen nineteen percent of alcohol 17 by volume, that is made by the fermentation of an infusion 18 in potable water of barley, malt, and hops, with or without 19 unmalted grains or decorticated and degerminated grains. Not 20 more than one and five-tenths percent of the volume of a “high 21 alcoholic content beer” may consist of alcohol derived from 22 added flavors and other nonbeverage ingredients containing 23 alcohol. The added flavors and other nonbeverage ingredients 24 may not include added caffeine or other added stimulants 25 including but not limited to guarana, ginseng, and taurine. 26 29. “Licensed premises” or “premises” means all rooms, 27 enclosures, contiguous areas, or places susceptible of precise 28 description satisfactory to the administrator where alcoholic 29 beverages, wine, or beer is sold or consumed under authority of 30 a liquor control retail alcohol license, wine permit, or beer 31 permit. A single licensed premises may consist of multiple 32 rooms, enclosures, areas, or places if they are wholly within 33 the confines of a single building or contiguous grounds. 34 30. “Local authority” means the city council of any 35 -18- LSB 5045SV (1) 89 ec/rn 18/ 77

S.F. 2350 incorporated city in this state, or the county board of 1 supervisors of any county in this state, which is empowered by 2 this chapter to approve or deny applications for retail beer or 3 wine permits and liquor control alcohol licenses; empowered to 4 recommend that such permits or licenses be granted and issued 5 by the division; and empowered to take other actions reserved 6 to them by this chapter . 7 Sec. 15. Section 123.3, subsection 40, paragraph b, Code 8 2022, is amended to read as follows: 9 b. The person is not prohibited by section 123.40 from 10 obtaining a liquor control retail alcohol license or a wine or 11 beer permit. 12 Sec. 16. Section 123.3, subsection 45, Code 2022, is amended 13 by striking the subsection and inserting in lieu thereof the 14 following: 15 45. “Retail alcohol license” means a class “B”, class “C”, 16 special class “C”, class “D”, class “E”, or class “F” retail 17 alcohol license, or a special class “B” retail native wine 18 license issued under this chapter. 19 Sec. 17. Section 123.3, subsection 46, Code 2022, is amended 20 by striking the subsection. 21 Sec. 18. Section 123.9, subsections 5 and 7, Code 2022, are 22 amended to read as follows: 23 5. To grant and issue beer permits, wine permits, liquor 24 control retail alcohol licenses, and other licenses; and to 25 suspend or revoke all such permits and licenses for cause under 26 this chapter . 27 7. To accept alcoholic liquors ordered delivered to the 28 alcoholic beverages division pursuant to chapter 809A , and 29 offer for sale and deliver the alcoholic liquors to class 30 “E” liquor control retail alcohol licensees, unless the 31 administrator determines that the alcoholic liquors may be 32 adulterated or contaminated. If the administrator determines 33 that the alcoholic liquors may be adulterated or contaminated, 34 the administrator shall order their destruction. 35 -19- LSB 5045SV (1) 89 ec/rn 19/ 77

S.F. 2350 Sec. 19. Section 123.10, subsections 3, 6, and 14, Code 1 2022, are amended to read as follows: 2 3. Regulating the purchase of alcoholic liquor generally 3 and the furnishing of the liquor to class “E” liquor control 4 retail alcohol licensees under this chapter , and determining 5 the classes, varieties, and brands of alcoholic liquors to be 6 kept in state warehouses. 7 6. Providing for the issuance and electronic distribution 8 of price lists which show the price to be paid by class “E” 9 liquor control retail alcohol licensees for each brand, 10 class, or variety of liquor kept for sale by the division, 11 providing for the filing or posting of prices charged in sales 12 between class “A” beer and class “A” wine permit holders and 13 retailers, as provided in this chapter , and establishing or 14 controlling the prices based on minimum standards of fill, 15 quantity, or alcoholic content for each individual sale of 16 alcoholic beverages as deemed necessary for retail or consumer 17 protection. However, the division shall not regulate markups, 18 prices, discounts, allowances, or other terms of sale at which 19 alcoholic liquor may be purchased by the retail public or 20 liquor control retail alcohol licensees from class “E” liquor 21 control retail alcohol licensees or at which wine may be 22 purchased and sold by class “A” and retail wine permittees, or 23 change, nullify, or vary the terms of an agreement between a 24 holder of a vintner certificate of compliance and a class “A” 25 wine permittee. 26 14. Prescribing the uniform fee to be assessed against 27 a class “B” beer permittee, class “C” native wine permittee, 28 or liquor control retail alcohol licensee, except a class 29 “B”, special class “B”, or class “E” liquor control retail 30 alcohol licensee, to cover the administrative costs incurred 31 by the division resulting from the failure of the licensee or 32 permittee to maintain dramshop liability insurance coverage 33 pursuant to section 123.92, subsection 2 , paragraph “a” . 34 Sec. 20. Section 123.15, Code 2022, is amended to read as 35 -20- LSB 5045SV (1) 89 ec/rn 20/ 77

S.F. 2350 follows: 1 123.15 Favors from licensee or permittee. 2 A person responsible for the administration or enforcement 3 of this chapter shall not accept or solicit donations, 4 gratuities, political advertising, gifts, or other favors, 5 directly or indirectly, from any liquor control retail alcohol 6 licensee, wine permittee, or beer permittee. 7 Sec. 21. Section 123.16, subsections 6 and 7, Code 2022, are 8 amended to read as follows: 9 6. The number of liquor control retail alcohol licenses, 10 wine permits, and beer permits issued, by class, the number in 11 effect on the last day included in the report, and the number 12 which have been suspended or revoked during the period covered 13 by the report. 14 7. Amount of fees paid to the division from liquor control 15 retail alcohol licenses, wine permits, and beer permits, in 16 gross, and the amount of liquor control retail alcohol license 17 fees returned to local subdivisions of government as provided 18 under this chapter . 19 Sec. 22. Section 123.22, subsection 1, Code 2022, is amended 20 to read as follows: 21 1. The division has the exclusive right of importation 22 into the state of all forms of alcoholic liquor, except as 23 otherwise provided in this chapter , and a person shall not 24 import alcoholic liquor, except that an individual of legal age 25 may import and have in the individual’s possession an amount of 26 alcoholic liquor not exceeding nine liters per calendar month 27 that the individual personally obtained outside the state. 28 Alcoholic liquor imported by an individual pursuant to this 29 subsection shall be for personal consumption only in a private 30 home or other private accommodation. A distillery shall not 31 sell alcoholic liquor within the state to any person but only 32 to the division, except as otherwise provided in this chapter . 33 This section vests in the division exclusive control within the 34 state as purchaser of all alcoholic liquor sold by distilleries 35 -21- LSB 5045SV (1) 89 ec/rn 21/ 77

S.F. 2350 within the state or imported, except beer and wine, and except 1 as otherwise provided in this chapter . The division shall 2 receive alcoholic liquor on a bailment system for resale by the 3 division in the manner set forth in this chapter . The division 4 shall act as the sole wholesaler of alcoholic liquor to class 5 “E” liquor control retail alcohol licensees. 6 Sec. 23. Section 123.24, Code 2022, is amended to read as 7 follows: 8 123.24 Alcoholic liquor sales by the division —— dishonored 9 payments —— liquor prices. 10 1. The division shall sell alcoholic liquor at wholesale 11 only. The division shall sell alcoholic liquor to class “E” 12 liquor control retail alcohol licensees only. The division 13 shall offer the same price on alcoholic liquor to all class “E” 14 liquor control retail alcohol licensees without regard for the 15 quantity of purchase or the distance for delivery. 16 2. The price of alcoholic liquor sold by the division shall 17 consist of the following: 18 a. The manufacturer’s price. 19 b. A markup of up to fifty percent of the wholesale price 20 paid by the division for the alcoholic liquor. The division 21 may increase the markup on selected kinds of alcoholic liquor 22 sold by the division if the average return to the division on 23 all sales of alcoholic liquor does not exceed the wholesale 24 price paid by the division and the fifty percent markup. 25 c. A split case charge in an amount determined by the 26 division when alcoholic liquor is sold in quantities which 27 require a case to be split. 28 d. A bottle surcharge in an amount sufficient, when added 29 to the amount not refunded to class “E” liquor control retail 30 alcohol licensees pursuant to section 455C.2 , to pay the costs 31 incurred by the division for collecting and properly disposing 32 of the liquor containers. The amount collected pursuant to 33 this paragraph, in addition to any amounts not refunded to 34 class “E” liquor control retail alcohol licensees pursuant 35 -22- LSB 5045SV (1) 89 ec/rn 22/ 77

S.F. 2350 to section 455C.2 , shall be deposited in the beer and liquor 1 control fund established under section 123.17 . 2 3. a. The division may accept from a class “E” liquor 3 control retail alcohol licensee electronic funds transferred 4 by automated clearing house, wire transfer, or another method 5 deemed acceptable by the administrator, in payment of alcoholic 6 liquor. If a payment is subsequently dishonored, the division 7 shall cause a notice of nonpayment and penalty to be served 8 upon the class “E” liquor control retail alcohol licensee or 9 upon any person in charge of the licensed premises. The notice 10 shall state that if payment or satisfaction for the dishonored 11 payment is not made within ten days of the service of notice, 12 the licensee’s liquor control retail alcohol license may be 13 suspended under section 123.39 . The notice of nonpayment and 14 penalty shall be in a form prescribed by the administrator, and 15 shall be sent by certified mail. 16 b. If upon notice and hearing under section 123.39 and 17 pursuant to the provisions of chapter 17A concerning a 18 contested case hearing, the administrator determines that the 19 class “E” liquor control retail alcohol licensee failed to 20 satisfy the obligation for which the payment was issued within 21 ten days after the notice of nonpayment and penalty was served 22 on the licensee as provided in paragraph “a” of this subsection , 23 the administrator may suspend the licensee’s class “E” liquor 24 control retail alcohol license for a period not to exceed ten 25 days. 26 4. The administrator may refuse to sell alcoholic liquor 27 to a class “E” liquor control retail alcohol licensee who 28 tenders a payment which is subsequently dishonored until the 29 outstanding obligation is satisfied. 30 Sec. 24. Section 123.26, Code 2022, is amended to read as 31 follows: 32 123.26 Restrictions on sales —— seals —— labeling. 33 Alcoholic liquor shall not be sold by a class “E” liquor 34 control retail alcohol licensee except in a sealed container 35 -23- LSB 5045SV (1) 89 ec/rn 23/ 77

S.F. 2350 with identifying markers as prescribed by the administrator 1 and affixed in the manner prescribed by the administrator, and 2 no such container shall be opened upon the premises of a state 3 warehouse. The division shall cooperate with the department 4 of natural resources so that only one identifying marker or 5 mark is needed to satisfy the requirements of this section and 6 section 455C.5, subsection 1 . Possession of alcoholic liquors 7 which do not carry the prescribed identifying markers is a 8 violation of this chapter except as provided in section 123.22 . 9 Sec. 25. Section 123.28, subsections 2 and 5, Code 2022, are 10 amended to read as follows: 11 2. The division shall deliver alcoholic liquor purchased by 12 class “E” liquor control retail alcohol licensees. Class “E” 13 liquor control retail alcohol licensees may deliver alcoholic 14 liquor purchased by class “A”, class “B”, class “C”, class “C” 15 native distilled spirits, or class “D” liquor control , or class 16 “F” retail alcohol licensees, and class “A”, class “B”, class 17 “C”, class “C” native distilled spirits, or class “D” liquor 18 control , or class “F” retail alcohol licensees may transport 19 alcoholic liquor purchased from class “E” liquor control retail 20 alcohol licensees. 21 5. This section does not affect the right of a liquor 22 control retail alcohol license holder to purchase, possess, or 23 transport alcoholic liquors subject to this chapter . 24 Sec. 26. Section 123.32, Code 2022, is amended to read as 25 follows: 26 123.32 Action by local authorities and division on 27 applications for liquor control retail alcohol licenses, native 28 distilled spirits licenses, and wine and beer permits. 29 1. Filing of application. 30 a. A completed application for a class “A”, class “B”, class 31 “C”, special class “C”, class “C” native distilled spirits, or 32 class “E” liquor control retail alcohol license as provided 33 in section 123.31 , for a retail beer permit as provided in 34 sections 123.128 and 123.129 , or for a class “B”, class “B” 35 -24- LSB 5045SV (1) 89 ec/rn 24/ 77

S.F. 2350 native, or class “C” native retail wine permit as provided in 1 section 123.175 except a class “D” retail alcohol license , 2 shall be filed with the appropriate city council if the 3 premises for which the license or permit is sought are located 4 within the corporate limits of a city, or with the board of 5 supervisors if the premises for which the license or permit is 6 sought are located outside the corporate limits of a city. 7 b. A completed application for a class “D” liquor 8 control retail alcohol license and for any of the following 9 certificates, licenses, or permits shall be submitted to the 10 division electronically, or in a manner prescribed by the 11 administrator, which shall proceed in the same manner as in the 12 case of an application approved by local authorities: 13 (1) A certificate of compliance as provided in sections 14 123.23 , 123.135 , and 123.180 . 15 (2) A class “D” liquor control retail alcohol license as 16 provided in section 123.31 . 17 (3) A manufacturer’s license as provided in section 123.41 . 18 (4) A broker’s permit as provided in section 123.42 . 19 (5) A class “A” native distilled spirits license as provided 20 in section 123.43 . 21 (6) A class “A” or special class “A” beer permit as provided 22 in section 123.127 . 23 (7) A charity beer, spirits, and wine auction permit special 24 event license as provided in section 123.173A . 25 (8) A charity beer, spirits, and wine event permit as 26 provided in section 123.173B . 27 (9) (8) A class “A” wine permit as provided in section 28 123.175 . 29 (10) (9) A wine direct shipper’s permit as provided in 30 section 123.187 . 31 (11) (10) A wine carrier permit as provided in section 32 123.188 . 33 2. Action by local authorities. The local authority shall 34 either approve or disapprove the issuance of a liquor control 35 -25- LSB 5045SV (1) 89 ec/rn 25/ 77

S.F. 2350 retail alcohol license, a retail wine permit, or a retail 1 beer permit, shall endorse its approval or disapproval on 2 the application, and shall forward the application with the 3 necessary fee and bond, if required, to the division. There 4 is no limit upon the number of liquor control retail alcohol 5 licenses , retail wine permits, or retail beer permits which may 6 be approved for issuance by local authorities. 7 3. Licensed premises for local events. A local authority 8 may define, by motion of the local authority, licensed premises 9 which shall be used by holders of liquor control retail alcohol 10 licenses , beer permits, and wine permits at festivals, fairs, 11 or celebrations which are sponsored or authorized by the local 12 authority. The licensed premises defined by motion of the 13 local authority shall be used by the holders of five-day or 14 fourteen-day class “A”, class “B”, class “C”, special class 15 “C”, or class “D” liquor control , or class “F” retail alcohol 16 licenses , or five-day or fourteen-day class “B” or class “C” 17 native wine permits, or class “B” beer permits only . 18 4. Security employee training. A local authority, as a 19 condition of obtaining and holding a license or permit for 20 on-premises consumption, may require a designated security 21 employee as defined in section 123.3 to be trained and 22 certified in security methods. The training shall include but 23 is not limited to de-escalation techniques, anger management 24 techniques, civil rights or unfair practices awareness as 25 provided in section 216.7 , recognition of fake or altered 26 identification, information on laws applicable to the serving 27 of alcohol at a licensed premises, use of force and techniques 28 for safely removing patrons, and instruction on the proper 29 physical restraint methods used against a person who has become 30 combative. 31 5. Occupancy rates. A local authority located in a county 32 with a population that exceeds three hundred thousand persons, 33 as a condition of obtaining and holding a license or permit 34 for on-premises consumption, shall require the applicant , or 35 -26- LSB 5045SV (1) 89 ec/rn 26/ 77

S.F. 2350 licensee , or permittee to provide, and update if necessary, the 1 occupancy rate of the licensed premises. 2 6. Action by administrator. 3 a. Upon receipt of an application having been disapproved 4 by the local authority, the administrator shall notify the 5 applicant that the applicant may appeal the disapproval of 6 the application to the administrator. The applicant shall 7 be notified by certified mail or personal service, and the 8 application, the fee, and any bond shall be returned to the 9 applicant. 10 b. Upon receipt of an application having been approved by 11 the local authority, the division shall make an investigation 12 as the administrator deems necessary to determine that 13 the applicant complies with all requirements for holding a 14 license or permit , and may require the applicant to appear 15 to be examined under oath to demonstrate that the applicant 16 complies with all of the requirements to hold a license 17 or permit . If the administrator requires the applicant to 18 appear and to testify under oath, a record shall be made of 19 all testimony or evidence and the record shall become a part 20 of the application. The administrator may appoint a member 21 of the division or may request an administrative law judge 22 of the department of inspections and appeals to receive the 23 testimony under oath and evidence, and to issue a proposed 24 decision to approve or disapprove the application for a license 25 or permit . The administrator may affirm, reverse, or modify 26 the proposed decision to approve or disapprove the application 27 for the license or permit . If the application is approved 28 by the administrator, the license or permit shall be issued. 29 If the application is disapproved by the administrator, the 30 applicant shall be so notified by certified mail or personal 31 service and the appropriate local authority shall be notified 32 electronically, or in a manner prescribed by the administrator. 33 7. Appeal to administrator. An applicant for a liquor 34 control retail alcohol license , wine permit, or beer permit may 35 -27- LSB 5045SV (1) 89 ec/rn 27/ 77

S.F. 2350 appeal from the local authority’s disapproval of an application 1 for a license or permit to the administrator. In the appeal 2 the applicant shall be allowed the opportunity to demonstrate 3 in an evidentiary hearing conducted pursuant to chapter 17A 4 that the applicant complies with all of the requirements for 5 holding the license or permit. The administrator may appoint 6 a member of the division or may request an administrative law 7 judge from the department of inspections and appeals to conduct 8 the evidentiary hearing and to render a proposed decision to 9 approve or disapprove the issuance of the license or permit. 10 The administrator may affirm, reverse, or modify the proposed 11 decision. If the administrator determines that the applicant 12 complies with all of the requirements for holding a license 13 or permit, the administrator shall order the issuance of the 14 license or permit. If the administrator determines that the 15 applicant does not comply with the requirements for holding 16 a license or permit, the administrator shall disapprove the 17 issuance of the license or permit. 18 8. Judicial review. The applicant or the local authority 19 may seek judicial review of the action of the administrator 20 in accordance with the terms of the Iowa administrative 21 procedure Act, chapter 17A . Notwithstanding the terms of the 22 Iowa administrative procedure Act, chapter 17A , petitions 23 for judicial review may be filed in the district court of 24 the county where the premises covered by the application are 25 situated. 26 9. Suspension by local authority. A liquor control retail 27 alcohol licensee or a wine or beer permittee whose license 28 or permit has been suspended or revoked or a civil penalty 29 imposed by a local authority for a violation of this chapter 30 or suspended by a local authority for violation of a local 31 ordinance may appeal the suspension, revocation, or civil 32 penalty to the administrator. The administrator may appoint 33 a member of the division or may request an administrative law 34 judge from the department of inspections and appeals to hear 35 -28- LSB 5045SV (1) 89 ec/rn 28/ 77

S.F. 2350 the appeal which shall be conducted in accordance with chapter 1 17A and to issue a proposed decision. The administrator may 2 review the proposed decision upon the motion of a party to the 3 appeal or upon the administrator’s own motion in accordance 4 with chapter 17A . Upon review of the proposed decision, the 5 administrator may affirm, reverse, or modify the proposed 6 decision. A liquor control retail alcohol licensee , wine or 7 beer permittee, or a local authority aggrieved by a decision 8 of the administrator may seek judicial review of the decision 9 pursuant to chapter 17A . 10 Sec. 27. Section 123.34, Code 2022, is amended to read as 11 follows: 12 123.34 Expiration of licenses, permits, and certificates 13 of compliance —— seasonal Seasonal , fourteen-day, and five-day 14 licenses and permits —— fees. 15 1. All licenses, permits, and certificates of compliance, 16 unless sooner suspended or revoked, expire one year from date 17 of issuance. The administrator shall notify a license, permit, 18 or certificate holder electronically, or in a manner prescribed 19 by the administrator, sixty days prior to the expiration of 20 each license, permit, or certificate. 21 2. 1. a. The administrator may issue six-month or 22 eight-month seasonal class “A”, class “B”, class “C”, special 23 class “C”, and class “D” liquor control and class “F” retail 24 alcohol licenses , class “B” wine permits, class “B” or class 25 “C” native wine permits, or class “B” beer permits . 26 b. The fee for a six-month or an eight-month seasonal 27 license or permit issued pursuant to this subsection shall be 28 for a proportionate part fifty percent of the license or permit 29 fee for that class of license or permit . However, the fee for 30 a seasonal class “B” native wine permit shall be the permit fee 31 provided in section 123.179, subsection 4 , and the fee for a 32 seasonal class “C” native wine permit shall be the permit fee 33 provided in section 123.179, subsection 5 . 34 3. 2. a. The administrator may issue fourteen-day class 35 -29- LSB 5045SV (1) 89 ec/rn 29/ 77

S.F. 2350 “A”, class “B”, class “C”, special class “C”, and class “D” 1 liquor control and class “F” retail alcohol licenses , and 2 fourteen-day class “B” beer permits, class “B” native wine 3 permits, and class “C” native wine permits . 4 b. A fourteen-day retail alcohol license or permit , if 5 granted, is valid for fourteen consecutive days , but the holder 6 shall not sell on the two Sundays in the fourteen-day period 7 unless the holder qualifies for and obtains the privilege to 8 sell on Sundays contained in section 123.36, subsection 6 , and 9 section 123.134, subsection 4 . 10 c. (1) The fee for a fourteen-day liquor control retail 11 alcohol license or beer permit is one quarter of the annual fee 12 for that class of liquor control retail alcohol license or beer 13 permit . The fee for the privilege to sell on the two Sundays in 14 the fourteen-day period is twenty percent of the price of the 15 fourteen-day liquor control license or beer permit. 16 (2) The fee for a fourteen-day class “B” native wine permit 17 shall be the permit fee provided in section 123.179, subsection 18 4 , and the fee for a fourteen-day class “C” native wine permit 19 is the permit fee provided in section 123.179, subsection 5 . 20 4. 3. a. The administrator may issue five-day class “A”, 21 class “B”, class “C”, special class “C”, and class “D” liquor 22 control , and class “F” retail alcohol licenses , and five-day 23 class “B” beer permits, class “B” native wine permits, and 24 class “C” native wine permits . 25 b. A five-day retail alcohol license or permit is valid for 26 five consecutive days , but the holder shall not sell alcoholic 27 beverages on Sunday in the five-day period unless the holder 28 qualifies for and obtains the privilege to sell on Sunday 29 pursuant to section 123.36, subsection 6, and section 123.134, 30 subsection 4 . 31 c. (1) The fee for the five-day liquor control retail 32 alcohol license or beer permit is one-eighth of the annual fee 33 for that class of license or permit. The fee for the privilege 34 to sell on a Sunday in the five-day period is ten percent of the 35 -30- LSB 5045SV (1) 89 ec/rn 30/ 77

S.F. 2350 price of the five-day liquor control license or beer permit. 1 (2) The fee for a five-day class “B” native wine permit 2 shall be the permit fee provided in section 123.179, subsection 3 4 , and the fee for a five-day class “C” native wine permit is 4 the permit fee provided in section 123.179, subsection 5 . 5 5. 4. A refund of fees paid shall not be made for seasonal 6 licenses or permits , or for fourteen-day or five-day liquor 7 control retail alcohol licenses , native wine permits, or beer 8 permits . In addition, a seasonal, fourteen-day, or five-day 9 license or permit shall not be renewed. 10 Sec. 28. NEW SECTION . 123.35 Expiration of licenses, 11 permits, and certificates of compliance —— automatic renewals. 12 1. Except as otherwise provided by this chapter, all 13 licenses, permits, and certificates of compliance, unless 14 sooner suspended or revoked, expire one year from date of 15 issuance. 16 2. Notwithstanding section 123.31 and any other provision 17 of this chapter to the contrary, a class “E” retail alcohol 18 license shall automatically renew without the endorsement 19 of a local authority or approval by the administrator upon 20 collection of the annual fee by the division, provided all of 21 the following conditions are met since the preceding license 22 was issued: 23 a. The licensee has given written consent to the division 24 to have the license automatically renewed as provided in this 25 section. 26 b. The license has not been suspended or revoked. 27 c. A civil penalty has not been imposed against the 28 licensee. 29 d. An administrative proceeding is not pending against the 30 licensee to suspend or revoke the license or to impose a civil 31 penalty under this chapter. 32 e. The licensee has not submitted payment for alcoholic 33 liquor to the division that was subsequently dishonored. 34 f. The licensee and all persons associated with the licensee 35 -31- LSB 5045SV (1) 89 ec/rn 31/ 77

S.F. 2350 as described in section 123.3, subsection 40, paragraph “e” , 1 have not been convicted of a violation of this chapter. 2 g. The licensed premises constitutes a safe and proper place 3 or building and conforms with all applicable federal, state, 4 and local laws, orders, ordinances, rules, resolutions, and 5 health and fire regulations. 6 3. Notwithstanding sections 123.23, 123.135, 123.180, 7 and any other provision of this chapter to the contrary, a 8 distiller’s, brewer’s, or vintner’s certificate of compliance 9 shall automatically renew without approval by the administrator 10 upon collection of the annual fee by the division, provided 11 all of the following conditions are met since the preceding 12 certificate was issued: 13 a. The certificate holder has given written consent to 14 the division to have the certificate automatically renewed as 15 provided in this section. 16 b. The certificate has not been suspended or revoked. 17 c. A civil penalty has not been imposed against the 18 certificate holder. 19 d. An administrative proceeding is not pending against the 20 certificate holder to suspend or revoke the certificate or to 21 impose a civil penalty under this chapter. 22 e. The certificate holder and all persons associated 23 with the certificate holder as described in section 123.3, 24 subsection 40, paragraph “e” , have not been convicted of a 25 violation of this chapter. 26 4. Notwithstanding section 123.187 and any other provision 27 of this chapter to the contrary, a wine direct shipper’s permit 28 shall automatically renew without approval by the administrator 29 upon collection of the annual fee by the division, provided all 30 of the following conditions are met since the preceding permit 31 was issued: 32 a. The permittee has given written consent to the division 33 to have the permit automatically renewed as provided in this 34 section. 35 -32- LSB 5045SV (1) 89 ec/rn 32/ 77

S.F. 2350 b. The permit has not been suspended or revoked. 1 c. A civil penalty has not been imposed against the 2 permittee. 3 d. An administrative proceeding is not pending against the 4 permittee to suspend or revoke the permit or to impose a civil 5 penalty under this chapter. 6 e. The permittee has filed all required reports and remitted 7 all wine gallonage tax owed pursuant to section 123.183. 8 f. The permittee and all persons associated with the 9 permittee as described in section 123.3, subsection 40, 10 paragraph “e” , have not been convicted of a violation of this 11 chapter. 12 Sec. 29. Section 123.38, subsection 1, Code 2022, is amended 13 to read as follows: 14 1. A liquor control retail alcohol license, wine permit, 15 or beer permit is a personal privilege and is revocable for 16 cause. It is not property nor is it subject to attachment 17 and execution nor alienable nor assignable, and it shall 18 cease upon the death of the permittee or licensee. However, 19 the administrator of the division may in the administrator’s 20 discretion allow the executor or administrator of the estate of 21 a permittee or licensee to operate the business of the decedent 22 for a reasonable time not to exceed the expiration date of the 23 permit or license. Every permit or license shall be issued in 24 the name of the applicant and no person holding a permit or 25 license shall allow any other person to use it. 26 Sec. 30. Section 123.38, subsection 2, paragraph a, 27 subparagraph (4), Code 2022, is amended to read as follows: 28 (4) No refund shall be made for any liquor control retail 29 alcohol license, wine permit, or beer permit surrendered more 30 than nine months after issuance. 31 Sec. 31. Section 123.39, subsection 1, paragraph a, Code 32 2022, is amended to read as follows: 33 a. (1) The administrator or the local authority may suspend 34 a class “A”, class “B”, special class “B” native wine, class 35 -33- LSB 5045SV (1) 89 ec/rn 33/ 77

S.F. 2350 “C”, special class “C”, class “C” native distilled spirits, or 1 class “E” liquor control , or class “F” retail alcohol license , 2 or retail wine or beer permit charity beer, spirits, and wine 3 special event license for a period not to exceed one year, 4 revoke the license or permit , or impose a civil penalty not to 5 exceed one thousand dollars per violation. 6 (2) The administrator may suspend a certificate of 7 compliance, a class “D” liquor control retail alcohol license, 8 a manufacturer’s license, a broker’s permit, a class “A” native 9 distilled spirits license, a class “A” or special class “A” 10 beer permit, a charity beer, spirits, and wine auction permit, 11 a class “A” wine permit, a wine direct shipper’s permit, or a 12 wine carrier permit for a period not to exceed one year, revoke 13 the license, permit, or certificate, or impose a civil penalty 14 not to exceed one thousand dollars per violation. 15 Sec. 32. Section 123.39, subsection 1, paragraph b, 16 subparagraph (3), Code 2022, is amended to read as follows: 17 (3) Any change in the ownership or interest in the business 18 operated under a liquor control retail alcohol license , or any 19 wine or beer permit, which change was not previously reported 20 in a manner prescribed by the administrator within thirty days 21 of the change and subsequently approved by the local authority, 22 when applicable, and the division. 23 Sec. 33. Section 123.39, subsections 2 and 3, Code 2022, are 24 amended to read as follows: 25 2. Local authorities may suspend any liquor control retail 26 alcohol license or retail wine or beer permit for a violation 27 of any ordinance or regulation adopted by the local authority. 28 Local authorities may adopt ordinances or regulations for the 29 location of the premises of liquor control retail alcohol 30 licensed and retail wine or beer permitted establishments 31 and local authorities may adopt ordinances, not in conflict 32 with this chapter and that do not diminish the hours during 33 which alcoholic beverages may be sold or consumed at retail, 34 governing any other activities or matters which may affect the 35 -34- LSB 5045SV (1) 89 ec/rn 34/ 77

S.F. 2350 retail sale and consumption of alcoholic beverages and the 1 health, welfare and morals of the community involved. 2 3. When a liquor control retail alcohol license or retail 3 wine or beer permit is suspended after a hearing as a result 4 of violations of this chapter by the licensee , permittee 5 or the licensee’s or permittee’s agents or employees, the 6 premises which were licensed by the license or permit shall 7 not be relicensed for a new applicant until the suspension 8 has terminated or time of suspension has elapsed, or ninety 9 days have elapsed since the commencement of the suspension, 10 whichever occurs first. However, this section does not 11 prohibit the premises from being relicensed to a new applicant 12 before the suspension has terminated or before the time of 13 suspension has elapsed or before ninety days have elapsed from 14 the commencement of the suspension, if the premises prior to 15 the time of the suspension had been purchased under contract, 16 and the vendor under that contract had exercised the person’s 17 rights under chapter 656 and sold the property to a different 18 person who is not related to the previous licensee or permittee 19 by marriage or within the third degree of consanguinity or 20 affinity and if the previous licensee or permittee does not 21 have a financial interest in the business of the new applicant. 22 Sec. 34. Section 123.40, Code 2022, is amended to read as 23 follows: 24 123.40 Effect of revocation. 25 Any liquor control retail alcohol licensee, wine permittee, 26 or beer permittee whose license or permit is revoked under this 27 chapter shall not thereafter be permitted to hold a liquor 28 control retail alcohol license, wine permit, or beer permit in 29 the state of Iowa for a period of two years from the date of 30 revocation. A spouse or business associate holding ten percent 31 or more of the capital stock or ownership interest in the 32 business of a person whose license or permit has been revoked 33 shall not be issued a liquor control retail alcohol license, 34 wine permit, or beer permit, and no liquor control retail 35 -35- LSB 5045SV (1) 89 ec/rn 35/ 77

S.F. 2350 alcohol license, wine permit, or beer permit shall be issued 1 which covers any business in which such person has a financial 2 interest for a period of two years from the date of revocation. 3 If a license or permit is revoked, the premises which had been 4 covered by the license or permit shall not be relicensed for 5 one year. 6 Sec. 35. Section 123.43A, subsection 6, Code 2022, is 7 amended to read as follows: 8 6. Notwithstanding any provision of this chapter to the 9 contrary or the fact that a person is the holder of a class 10 “A” native distilled spirits license, a native distillery 11 which, combining all production facilities of the business, 12 produces and manufactures not more than one hundred thousand 13 proof gallons of native distilled spirits on an annual basis 14 may sell those native distilled spirits manufactured on the 15 premises of the native distillery for consumption on the 16 premises by applying for a class “C” native distilled spirits 17 liquor control retail alcohol license as provided in section 18 123.30 . A native distillery may be granted not more than 19 two class “C” native distilled spirits liquor control retail 20 alcohol licenses. All native distilled spirits sold by a 21 native distillery for on-premises consumption and mixed drinks 22 or cocktails sold for consumption off the premises shall be 23 purchased from a class “E” liquor control retail alcohol 24 licensee. A manufacturer of native distilled spirits may be 25 issued a class “C” native distilled spirits liquor control 26 retail alcohol license regardless of whether the manufacturer 27 is also a manufacturer of beer pursuant to a class “A” beer 28 permit or a manufacturer of native wine pursuant to a class “A” 29 wine permit. 30 Sec. 36. Section 123.45, subsection 1, paragraph d, Code 31 2022, is amended to read as follows: 32 d. Hold a retail liquor control alcohol license or retail 33 wine or beer permit, unless the licensee or permittee holding a 34 retail liquor control alcohol license or retail wine or beer 35 -36- LSB 5045SV (1) 89 ec/rn 36/ 77

S.F. 2350 permit does not purchase or sell the alcoholic beverages of 1 the person engaged in the business of manufacturing, bottling, 2 or wholesaling alcoholic beverages. However, a person engaged 3 in the business of manufacturing wine that is not native wine 4 may purchase and sell the person’s wine under the authority 5 of a special class “C” liquor control retail alcohol license 6 and a class “B” wine permit retail alcohol license provided 7 the licensed premises is the principal office, as defined in 8 section 490.140 , of the person. 9 Sec. 37. Section 123.45, subsection 3, Code 2022, is amended 10 to read as follows: 11 3. A person engaged in the wholesaling of beer or wine 12 may sell only disposable glassware, which is constructed of 13 paper, paper laminated, or plastic materials and designed 14 primarily for personal consumption on a one-time usage 15 basis, to retailers for use within the premises of licensed 16 establishments, for an amount which is greater than or equal 17 to an amount which represents the greater of either the amount 18 paid for the disposable glassware by the supplier or the amount 19 paid for the disposable glassware by the wholesaler. Also, a 20 person engaged in the business of manufacturing beer may sell 21 beer at retail for consumption on or off the premises of the 22 manufacturing facility and, notwithstanding any other provision 23 of this chapter or the fact that a person is the holder of 24 a class “A” beer permit, may be granted not more than two 25 class “B” beer permits “C” or special class “C” retail alcohol 26 licenses as defined in section 123.124 123.30 for that purpose 27 regardless of whether that person is also a manufacturer 28 of native distilled spirits pursuant to a class “A” native 29 distilled spirits license or a manufacturer of native wine 30 pursuant to a class “A” wine permit. 31 Sec. 38. Section 123.46, subsection 2, Code 2022, is amended 32 to read as follows: 33 2. A person shall not use or consume alcoholic liquor, wine, 34 or beer upon the public streets or highways. A person shall 35 -37- LSB 5045SV (1) 89 ec/rn 37/ 77

S.F. 2350 not use or consume alcoholic liquor in any public place except 1 premises covered by a liquor control retail alcohol license. 2 A person shall not possess or consume alcoholic liquors, 3 wine, or beer on public school property or while attending a 4 public or private school-related function. A person shall not 5 be intoxicated in a public place. A person violating this 6 subsection is guilty of a simple misdemeanor. 7 Sec. 39. Section 123.46A, Code 2022, is amended to read as 8 follows: 9 123.46A Delivery of alcoholic beverages by retailers. 10 1. Licensees and permittees authorized to sell alcoholic 11 liquor, wine, or beer in original unopened containers for 12 consumption off the licensed premises may deliver alcoholic 13 liquor, wine, or beer to a home, another licensed premises if 14 there is identical ownership of the premises by the licensee 15 or permittee , or other designated location in this state. 16 Deliveries shall be limited to alcoholic beverages authorized 17 by the licensee’s or permittee’s license or permit . Orders 18 delivered to another licensed premises shall contain only 19 those alcoholic beverages authorized for sale by the liquor 20 control retail alcohol license or retail wine or beer permit 21 covering the premises to which the alcoholic beverages will 22 be delivered. Orders delivered to another licensed premises 23 shall be fulfilled using the alcoholic beverages inventory 24 owned by the licensee or permittee who will receive the order 25 for delivery. If the recipient refuses or fails to pick up 26 the delivery, or is ineligible to receive the delivery, the 27 alcoholic beverages shall be returned to the licensee or 28 permittee who fulfilled the order. 29 2. Licensees and permittees authorized to sell wine, beer, 30 or mixed drinks or cocktails for consumption off the licensed 31 premises in a container other than the original container may 32 deliver the wine, beer, or mixed drinks or cocktails to a 33 home or other designated location in this state only if the 34 container other than the original container has been sold and 35 -38- LSB 5045SV (1) 89 ec/rn 38/ 77

S.F. 2350 securely sealed in compliance with this chapter or the rules 1 of the division. Deliveries shall be limited to alcoholic 2 beverages authorized by the licensee’s or permittee’s license 3 or permit. 4 3. All deliveries of alcoholic liquor, wine, beer, or 5 mixed drinks or cocktails shall be subject to the following 6 requirements and restrictions: 7 a. Payment for the alcoholic liquor, wine, beer, or mixed 8 drinks or cocktails shall be received by the licensee or 9 permittee at the time of order. 10 b. Orders for deliveries may be taken by the licensee or 11 permittee between the hours of 2:00 a.m. and 6:00 a.m. 12 on a day other than Sunday, and orders for deliveries may 13 be taken between the hours of 2:00 a.m. and 6:00 a.m. on a 14 Sunday provided the licensee or permittee has been granted 15 the privilege of selling alcoholic liquor, wine, beer, or 16 mixed drinks or cocktails on Sunday on any day of the week , 17 notwithstanding any provision of section 123.49, subsection 2 , 18 paragraph “b” , to the contrary. 19 c. Alcoholic liquor, wine, beer, or mixed drinks or 20 cocktails delivered to a person shall be for personal use and 21 not for resale. 22 d. Deliveries shall only be made to persons in this state 23 who are twenty-one years of age or older. 24 e. Deliveries shall not be made to a person who is 25 intoxicated or is simulating intoxication. 26 f. Deliveries shall occur between 6:00 a.m. and 10:00 p.m. 27 Monday through Sunday on the same day the order for alcoholic 28 liquor, wine, beer, or mixed drinks or cocktails is removed 29 from the licensed premises . 30 g. Delivery of alcoholic liquor, wine, beer, or mixed drinks 31 or cocktails shall be made by the licensee or permittee , the 32 licensee’s or permittee’s employee, or a third party, provided 33 the licensee or permittee has entered into a written agreement 34 with the third party that authorizes the third party to act 35 -39- LSB 5045SV (1) 89 ec/rn 39/ 77

S.F. 2350 as an agent of the licensee or permittee for the purpose of 1 delivering alcoholic liquor, wine, beer, or mixed drinks or 2 cocktails. Each licensee or permittee shall submit to the 3 division electronically, or in a manner prescribed by the 4 administrator, a list of names and addresses of all third 5 parties it has authorized to act as its agent for the purpose 6 of delivering alcoholic liquor, wine, beer, or mixed drinks 7 or cocktails. The licensee or permittee shall provide the 8 division with amendments to the list as necessary to ensure the 9 division possesses an accurate, current list. 10 h. Delivery personnel shall be twenty-one years of age or 11 older. 12 i. Valid proof of the recipient’s identity and age shall 13 be obtained at the time of delivery, and the signature of a 14 person twenty-one years of age or older shall be obtained as a 15 condition of delivery. 16 j. Licensees and permittees shall maintain records 17 of deliveries which include the quantity delivered, the 18 recipient’s name and address, and the signature of the 19 recipient of the alcoholic liquor, wine, beer, or mixed drinks 20 or cocktails. The records shall be maintained on the licensed 21 premises for a period of three years. 22 4. A violation of this section or any other provision 23 of this chapter shall subject the licensee or permittee to 24 the penalty provisions of section 123.39 . If the licensee 25 or permittee , an employee of the licensee or permittee , or 26 a person delivering alcoholic liquor, wine, beer, or mixed 27 drinks or cocktails for a third party acting on behalf of the 28 licensee or permittee pursuant to a written agreement violates 29 this section , the licensee or permittee shall not be assessed 30 a penalty under section 123.39 if the licensee or permittee 31 establishes all of the following: 32 a. The violation was committed off of the licensee’s 33 or permittee’s premises after the liquor, wine, beer, or 34 mixed drinks or cocktails was removed from the licensee’s or 35 -40- LSB 5045SV (1) 89 ec/rn 40/ 77

S.F. 2350 permittee’s premises in fulfillment of a delivery order. 1 b. (1) If the person who committed the violation is an 2 employee of the licensee or permittee , that no other violation 3 of this section was committed by any employee of the licensee 4 or permittee within the two-year period immediately preceding 5 the date of violation. 6 (2) If the person who committed the violation is a person 7 delivering for a third party acting on behalf of the licensee 8 or permittee , that no other violation of this section was 9 committed by any person delivering for the same third party 10 while the third party was acting on behalf of the licensee or 11 permittee within the two-year period immediately preceding the 12 date of violation. 13 5. Nothing in this section shall impact the direct shipment 14 of wine as regulated by section 123.187 . 15 Sec. 40. Section 123.47, subsection 3, Code 2022, is amended 16 to read as follows: 17 3. A person or persons under legal age shall not purchase 18 or attempt to purchase, consume, or individually or jointly 19 have alcoholic beverages in their possession or control; except 20 in the case of any alcoholic beverage given or dispensed to 21 a person under legal age within a private home and with the 22 knowledge, presence, and consent of the parent or guardian, for 23 beverage or medicinal purposes or as administered to the person 24 by either a physician or dentist for medicinal purposes and 25 except to the extent that a person under legal age may handle 26 alcoholic beverages during the regular course of the person’s 27 employment by a liquor control retail alcohol licensee, or wine 28 or beer permittee under this chapter . 29 Sec. 41. Section 123.48, subsections 1 and 3, Code 2022, are 30 amended to read as follows: 31 1. If a liquor control retail alcohol licensee or wine or 32 beer permittee or an employee of the licensee or permittee 33 has a reasonable belief based on factual evidence that a 34 driver’s license as defined in section 321.1, subsection 35 -41- LSB 5045SV (1) 89 ec/rn 41/ 77

S.F. 2350 20A , or nonoperator’s identification card issued pursuant to 1 section 321.190 offered by a person who wishes to purchase 2 an alcoholic beverage at the licensed premises is altered 3 or falsified or belongs to another person, the licensee , 4 permittee, or employee may retain the driver’s license or 5 nonoperator’s identification card. Within twenty-four hours, 6 the license or card shall be delivered to the appropriate 7 city or county law enforcement agency of the jurisdiction in 8 which the licensed premises is located. When the license or 9 card is delivered to the appropriate law enforcement agency, 10 the licensee shall file a written report of the circumstances 11 under which the license or card was retained. The local law 12 enforcement agency may investigate whether a violation of 13 section 321.216 , 321.216A , or 321.216B has occurred. If an 14 investigation is not initiated or a probable cause is not 15 established by the local law enforcement agency, the driver’s 16 license or nonoperator’s identification card shall be delivered 17 to the person to whom it was issued. The local law enforcement 18 agency may forward the license or card with the report to the 19 department of transportation for investigation, in which case, 20 the department may investigate whether a violation of section 21 321.216 , 321.216A , or 321.216B has occurred. The department of 22 transportation shall return the license or card to the person 23 to whom it was issued if an investigation is not initiated or a 24 probable cause is not established. 25 3. A liquor control retail alcohol licensee or wine or 26 beer permittee or an employee of the licensee or permittee 27 is not subject to criminal prosecution for, or to civil 28 liability for damages alleged to have resulted from, the 29 retention and delivery of a driver’s license or a nonoperator’s 30 identification card which is taken pursuant to subsections 31 1 and 2 . This section shall not be construed to relieve a 32 licensee , permittee, or employee of the licensee or permittee 33 from civil liability for damages resulting from the use of 34 unreasonable force in obtaining the altered or falsified 35 -42- LSB 5045SV (1) 89 ec/rn 42/ 77

S.F. 2350 driver’s license or nonoperator’s identification card or the 1 driver’s license or nonoperator’s identification card believed 2 to belong to another person. 3 Sec. 42. Section 123.49, subsection 2, unnumbered paragraph 4 1, Code 2022, is amended to read as follows: 5 A person holding a liquor control retail alcohol license or 6 retail wine or beer permit under this chapter , and the person’s 7 agents or employees, shall not do any of the following: 8 Sec. 43. Section 123.49, subsection 2, paragraph b, Code 9 2022, is amended to read as follows: 10 b. Sell or dispense any alcoholic beverage on the premises 11 covered by the license or permit , or permit its consumption 12 thereon between the hours of 2:00 a.m. and 6:00 a.m. on a 13 weekday, and between the hours of 2:00 a.m. on Sunday and 6:00 14 a.m. on the following Monday, however, a holder of a liquor 15 control license or retail wine or beer permit granted the 16 privilege of selling alcoholic liquor, wine, or beer on Sunday 17 may sell or dispense alcoholic liquor, wine, or beer between 18 the hours of 6:00 a.m. on Sunday and 2:00 a.m. on the following 19 Monday any day of the week . 20 Sec. 44. Section 123.49, subsection 2, paragraph d, 21 subparagraphs (1) and (3), Code 2022, are amended to read as 22 follows: 23 (1) Keep on premises covered by a liquor control retail 24 alcohol license any alcoholic liquor in any container except 25 the original package purchased from the division, and except 26 mixed drinks or cocktails mixed on the premises for immediate 27 consumption on the licensed premises or as otherwise provided 28 by this paragraph “d” . This prohibition does not apply to 29 holders of a class “D” liquor control retail alcohol license 30 or to alcoholic liquor delivered in accordance with section 31 123.46A . 32 (3) Mixed drinks or cocktails mixed on premises covered by 33 a class “C” liquor control retail alcohol license or a class 34 “C” native distilled spirits liquor control retail alcohol 35 -43- LSB 5045SV (1) 89 ec/rn 43/ 77

S.F. 2350 license for consumption off the licensed premises may be 1 sold if the mixed drink or cocktail is immediately filled in 2 a sealed container and is promptly taken from the licensed 3 premises prior to consumption of the mixed drink or cocktail. 4 A mixed drink or cocktail that is sold in a sealed container in 5 compliance with the requirements of this subparagraph and rules 6 adopted by the division shall not be deemed an open container 7 subject to the requirements of sections 321.284 and 321.284A 8 if the sealed container is unopened and the seal has not been 9 tampered with, and the contents of the container have not been 10 partially removed. 11 Sec. 45. Section 123.49, subsection 2, paragraphs g and j, 12 Code 2022, are amended to read as follows: 13 g. Allow any person other than the licensee , permittee, 14 or employees of the licensee or permittee, to use or keep 15 on the licensed premises any alcoholic liquor in any bottle 16 or other container which is designed for the transporting of 17 such beverages, except as permitted in section 123.95 . This 18 paragraph does not apply to the lodging quarters of a class 19 “B” liquor control licensee or wine or beer permittee hotel 20 or motel holding a retail alcohol license , or to holders of a 21 class “D” liquor control retail alcohol license. 22 j. Knowingly permit or engage in any criminal activity 23 on the premises covered by the license or permit . However, 24 the absence of security personnel on the licensed premises 25 is insufficient, without additional evidence, to prove that 26 criminal activity occurring on the licensed premises was 27 knowingly permitted in violation of this paragraph “j” . For 28 purposes of this paragraph “j” , “premises” includes parking lots 29 and areas adjacent to the premises of a liquor control retail 30 alcohol licensee or wine or beer permittee authorized to sell 31 alcoholic beverages for consumption on the licensed premises 32 and used by patrons of the liquor control retail alcohol 33 licensee or wine or beer permittee . 34 Sec. 46. Section 123.49, subsection 3, Code 2022, is amended 35 -44- LSB 5045SV (1) 89 ec/rn 44/ 77

S.F. 2350 to read as follows: 1 3. A person under legal age shall not misrepresent the 2 person’s age for the purpose of purchasing or attempting 3 to purchase any alcoholic beverage from any liquor control 4 retail alcohol licensee or wine or beer permittee . If any 5 person under legal age misrepresents the person’s age, and 6 the licensee or permittee establishes that the licensee or 7 permittee made reasonable inquiry to determine whether the 8 prospective purchaser was over legal age, the licensee or 9 permittee is not guilty of selling alcoholic beverages to a 10 person under legal age. 11 Sec. 47. Section 123.49, subsection 4, Code 2022, is amended 12 by striking the subsection. 13 Sec. 48. Section 123.50, subsections 1, 2, 4, and 5, Code 14 2022, are amended to read as follows: 15 1. Any person who violates any of the provisions of section 16 123.49 , except section 123.49, subsection 2 , paragraph “h” , 17 or who fails to affix upon sale, defaces, or fails to record 18 a keg identification sticker label or produce a record of keg 19 identification stickers labels pursuant to section 123.138 , 20 shall be guilty of a simple misdemeanor. A person who violates 21 section 123.49, subsection 2 , paragraph “h” , commits a simple 22 misdemeanor punishable as a scheduled violation under section 23 805.8C, subsection 2 . 24 2. The conviction of any liquor control retail alcohol 25 licensee or wine or beer permittee for a violation of any of 26 the provisions of section 123.49 , subject to subsection 3 of 27 this section , is grounds for the suspension or revocation of 28 the license or permit by the division or the local authority. 29 However, if any liquor control retail alcohol licensee is 30 convicted of any violation of section 123.49, subsection 2 , 31 paragraph “a” , “d” , or “e” , or any wine or beer permittee retail 32 alcohol licensee, excluding a special class “B” or class “D” 33 retail alcohol licensee, is convicted of a violation of section 34 123.49, subsection 2 , paragraph “a” or “e” “d” , the liquor 35 -45- LSB 5045SV (1) 89 ec/rn 45/ 77

S.F. 2350 control retail alcohol license or wine or beer permit shall be 1 revoked and shall immediately be surrendered by the holder, 2 and the bond, if any, of the license or permit holder shall be 3 forfeited to the division. However, the division shall retain 4 only that portion of the bond equal to the amount the division 5 determines the license or permit holder owes the division. 6 4. In addition to any other penalties imposed under this 7 chapter , the division shall assess a civil penalty up to 8 the amount of five thousand dollars upon a class “E” liquor 9 control retail alcohol licensee when the class “E” liquor 10 retail alcohol license is revoked for a violation of section 11 123.59 . Failure to pay the civil penalty as required under 12 this subsection shall result in forfeiture of the bond to the 13 division. However, the division shall retain only that portion 14 of the bond equal to the amount the division determines the 15 license or permit holder owes the division. 16 5. If an employee of a liquor control retail alcohol 17 licensee or wine or beer permittee violates section 123.49, 18 subsection 2 , paragraph “h” , the licensee or permittee shall 19 not be assessed a penalty under subsection 3 , and the violation 20 shall be deemed not to be a violation of section 123.49, 21 subsection 2 , paragraph “h” , for the purpose of determining 22 the number of violations for which a penalty may be assessed 23 pursuant to subsection 3 , if the employee holds a valid 24 certificate of completion of the alcohol compliance employee 25 training program pursuant to section 123.50A at the time of the 26 violation, and if the violation involves selling, giving, or 27 otherwise supplying any alcoholic beverage to a person between 28 the ages of eighteen and twenty years of age. A violation 29 involving a person under the age of eighteen years of age 30 shall not qualify for the bar against assessment of a penalty 31 pursuant to subsection 3 , for a violation of section 123.49, 32 subsection 2 , paragraph “h” . A licensee or permittee may assert 33 only once in a four-year period the bar under this subsection 34 against assessment of a penalty pursuant to subsection 3 , for a 35 -46- LSB 5045SV (1) 89 ec/rn 46/ 77

S.F. 2350 violation of section 123.49, subsection 2 , paragraph “h” , that 1 takes place at the same place of business location. 2 Sec. 49. Section 123.50, subsection 3, unnumbered paragraph 3 1, Code 2022, is amended to read as follows: 4 If any liquor control retail alcohol licensee , wine or 5 beer permittee, or employee of a licensee or permittee is 6 convicted or found in violation of section 123.49, subsection 7 2 , paragraph “h” , the administrator or local authority shall, 8 in addition to criminal penalties fixed for violations by this 9 section , assess a civil penalty as follows: 10 Sec. 50. Section 123.92, subsection 2, paragraphs a and c, 11 Code 2022, are amended to read as follows: 12 a. Every liquor control retail alcohol licensee, class “B” 13 beer permittee, and class “C” native wine permittee, except 14 a class “B”, special class “B”, or class “E” liquor control 15 retail alcohol licensee, shall furnish proof of financial 16 responsibility by the existence of a liability insurance 17 policy in an amount determined by the division. If an insurer 18 provides dramshop liability insurance at a new location to 19 a licensee or permittee who has a positive loss experience 20 at other locations for which such insurance is provided by 21 the insurer, and the insurer bases premium rates at the new 22 location on the negative loss history of the previous licensee 23 or permittee at that location, the insurer shall examine and 24 consider adjusting the premium for the new location not less 25 than thirty months after the insurance is issued, based on the 26 loss experience of the licensee or permittee at that location 27 during that thirty-month period of time. 28 c. The purpose of dramshop liability insurance is to provide 29 protection for members of the public who experience damages 30 as a result of licensees or permittees serving patrons any 31 alcoholic beverage to a point that reaches or exceeds the 32 standard set forth in law for liability. Minimum coverage 33 requirements for such insurance are not for the purpose of 34 making the insurance affordable for all licensees or permittees 35 -47- LSB 5045SV (1) 89 ec/rn 47/ 77

S.F. 2350 regardless of claims experience. A dramshop liability 1 insurance policy obtained by a licensee or permittee shall meet 2 the minimum insurance coverage requirements as determined by 3 the division and is a mandatory condition for holding a license 4 or permit . 5 Sec. 51. Section 123.92, subsection 3, paragraphs a and b, 6 Code 2022, are amended to read as follows: 7 a. Notwithstanding section 123.49, subsection 1 , any 8 person who is injured in person or property or means of 9 support by an intoxicated person who is under legal age or 10 resulting from the intoxication of a person who is under 11 legal age, has a right of action for all damages actually 12 sustained, severally or jointly, against a person who is 13 not a licensee or permittee and who dispensed or gave any 14 alcoholic beverage to the intoxicated underage person when the 15 nonlicensee or nonpermittee who dispensed or gave the alcoholic 16 beverage to the underage person knew or should have known the 17 underage person was intoxicated, or who dispensed or gave any 18 alcoholic beverage to the underage person to a point where the 19 nonlicensee or nonpermittee knew or should have known that the 20 underage person would become intoxicated. 21 b. If the injury was caused by an intoxicated person who is 22 under legal age, a person who is not a licensee or permittee 23 and who dispensed or gave the alcoholic beverage to the 24 underage person may establish as an affirmative defense that 25 the intoxication did not contribute to the injurious action of 26 the underage person. 27 Sec. 52. Section 123.95, subsection 2, paragraphs a and c, 28 Code 2022, are amended to read as follows: 29 a. The holder of an annual class “B” liquor control license 30 or an annual class “C” liquor control retail alcohol license 31 may act as the agent of a private social host for the purpose 32 of providing and serving alcoholic beverages as part of a food 33 catering service for a private social gathering in a private 34 place, provided the licensee has applied for and been granted a 35 -48- LSB 5045SV (1) 89 ec/rn 48/ 77

S.F. 2350 catering privilege by the division. The holder of an annual 1 special class “C” liquor control retail alcohol license shall 2 not act as the agent of a private social host for the purpose of 3 providing and serving wine and beer as part of a food catering 4 service for a private social gathering in a private place. 5 An applicant for a class “B” or class “C” liquor control 6 retail alcohol license shall state on the application for the 7 license that the licensee intends to engage in catering food 8 and alcoholic beverages for private social gatherings and the 9 catering privilege shall be noted on the license. 10 c. Section 123.92 does not apply to a liquor control retail 11 alcohol licensee who acts in accordance with this section when 12 the liquor control retail alcohol licensee is providing and 13 serving food and alcoholic beverages as an agent of a private 14 social host at a private social gathering in a private place 15 which is not on the licensed premises. 16 Sec. 53. Section 123.122, subsection 1, Code 2022, is 17 amended to read as follows: 18 1. A person shall not cause the manufacture, importation, 19 or sale of beer in this state unless a certificate or permit as 20 provided in this subchapter , or a liquor control retail alcohol 21 license as provided in subchapter I of this chapter , is first 22 obtained which authorizes that manufacture, importation, or 23 sale. 24 Sec. 54. Section 123.124, Code 2022, is amended to read as 25 follows: 26 123.124 Beer permits —— classes. 27 Permits for the manufacture and sale , or sale, of beer shall 28 be divided into four classes, known as class “A” , and special 29 class “A” , class “B”, or class “C” beer permits . A holder of 30 a class “A” or special class “A” beer permit shall have the 31 authority as provided in section 123.130 . A holder of a class 32 “B” beer permit shall have the authority as provided in section 33 123.131 , and a holder of a class “C” beer permit shall have the 34 authority as provided in section 123.132 . 35 -49- LSB 5045SV (1) 89 ec/rn 49/ 77

S.F. 2350 Sec. 55. Section 123.125, Code 2022, is amended to read as 1 follows: 2 123.125 Issuance of beer permits. 3 The administrator shall issue class “A” , and special class 4 “A” , class “B”, and class “C” beer permits and may suspend or 5 revoke permits for cause as provided in this chapter . 6 Sec. 56. Section 123.127, subsection 2, paragraph h, Code 7 2022, is amended to read as follows: 8 h. If the person is applying for a special class “A” beer 9 permit, that the applicant holds or has applied for a class “C” 10 liquor control retail alcohol license or class “B” beer permit . 11 Sec. 57. Section 123.130, subsection 1, paragraph a, Code 12 2022, is amended to read as follows: 13 a. Any person holding a class “A” beer permit issued by 14 the division shall be authorized to manufacture and sell, or 15 sell at wholesale, beer for consumption off the premises, such 16 sales within the state to be made only to persons holding a 17 subsisting class “A” , “B”, or “C” beer permits permit , both 18 a class “C” native wine permit and a class “A” wine permit 19 pursuant to section 123.178B, subsection 4 , or liquor control 20 retail alcohol licenses , excluding a special class “B” retail 21 native wine license, issued in accordance with the provisions 22 of this chapter . However, a person holding a class “A” beer 23 permit issued by the division who also holds a brewer’s notice 24 issued by the alcohol and tobacco tax and trade bureau of the 25 United States department of the treasury shall be authorized 26 to sell, at wholesale, no more than thirty thousand barrels of 27 beer on an annual basis for consumption off the premises to a 28 licensee or permittee authorized under this chapter to sell 29 beer at retail. 30 Sec. 58. Section 123.130, subsections 2 and 4, Code 2022, 31 are amended to read as follows: 32 2. Pursuant to section 123.45, subsection 3 , a native 33 brewery may be granted not more than two class “B” beer permits 34 as defined in section 123.124 for the purpose of selling 35 -50- LSB 5045SV (1) 89 ec/rn 50/ 77

S.F. 2350 beer at retail for consumption on or off the premises of the 1 manufacturing facility class “C” or special class “C” retail 2 alcohol permits . 3 4. All special class “A” premises shall be located within 4 the state. A person who holds a special class “A” beer 5 permit for the same location at which the person holds a 6 class “C” liquor control retail alcohol license or class “B” 7 beer permit for the purpose of operating as a brewpub may 8 manufacture and sell beer to be consumed on the premises, 9 may sell beer at retail at the manufacturing premises for 10 consumption off the premises beer that is transferred at the 11 time of sale to another container subject to the requirements 12 of section 123.131, subsection 2 , may sell beer to a class 13 “A” beer permittee for resale purposes, and may sell beer to 14 distributors outside of the state that are authorized by the 15 laws of that jurisdiction to sell beer at wholesale. The 16 permit issued to holders of a special class “A” beer permit 17 shall clearly state on its face that the permit is limited. 18 Sec. 59. Section 123.135, subsection 4, Code 2022, is 19 amended to read as follows: 20 4. It shall be unlawful for any holder of a certificate 21 of compliance or the holder’s agent, or any class “A” beer 22 permit holder or the beer permit holder’s agent, to grant to 23 any retail beer permit alcohol license holder, directly or 24 indirectly, any rebates, free goods, or quantity discounts on 25 beer which are not uniformly offered to all retail permittees 26 alcohol licensees . 27 Sec. 60. Section 123.138, subsection 1, Code 2022, is 28 amended to read as follows: 29 1. Each class “A” or special class “A” beer permittee 30 shall keep proper records showing the amount of beer sold 31 by the permittee, and these records shall be at all times 32 open to inspection by the administrator and to other persons 33 pursuant to section 123.30, subsection 1 . Each class “B” 34 beer permittee, class “C” beer permittee, or retail liquor 35 -51- LSB 5045SV (1) 89 ec/rn 51/ 77

S.F. 2350 control alcohol licensee as described in section 123.30 shall 1 keep proper records showing each purchase of beer made by the 2 permittee or licensee, and the date and the amount of each 3 purchase and the name of the person from whom each purchase 4 was made, which records shall be open to inspection pursuant 5 to section 123.30, subsection 1 , during normal business hours 6 of the permittee or licensee. 7 Sec. 61. Section 123.138, subsection 2, paragraph a, Code 8 2022, is amended to read as follows: 9 a. Each class “B”, “C”, or special class “C” liquor control 10 retail alcohol licensee and class “B” or “C” beer permittee who 11 sells beer for off-premises consumption shall affix to each 12 keg of beer an identification sticker label provided by the 13 administrator. The sticker label provided shall allow for its 14 full removal when common external keg cleaning procedures are 15 performed. For the purposes of this subsection , “keg” means 16 all durable and disposable containers with a liquid capacity 17 of five gallons or more. Each class “B”, “C”, or special class 18 “C” liquor control retail alcohol licensee and class “B” or “C” 19 beer permittee shall also keep a record of the identification 20 sticker label number of each keg of beer sold by the licensee 21 or permittee with the name and address of the purchaser and 22 the number of the purchaser’s driver’s license, nonoperator’s 23 identification card, or military identification card, if the 24 military identification card contains a picture and signature. 25 This information shall be retained by the licensee or permittee 26 for a minimum of ninety days. The records kept pursuant to 27 this subsection shall be available for inspection by any law 28 enforcement officer during normal business hours. 29 Sec. 62. Section 123.138, subsection 2, paragraph b, Code 30 2022, is amended to read as follows: 31 b. (1) The division shall provide the keg identification 32 stickers labels described in paragraph “a” and shall, prior to 33 utilizing a sticker label , notify licensed brewers and licensed 34 beer importers of the type of sticker label to be utilized. 35 -52- LSB 5045SV (1) 89 ec/rn 52/ 77

S.F. 2350 Each sticker label shall contain a number and the following 1 statement: 2 It is unlawful to sell, give, or otherwise supply any 3 alcoholic beverage, wine, or beer to any person under legal 4 age. Any person who defaces this sticker label shall be guilty 5 of criminal mischief punishable pursuant to section 716.6 and 6 shall cause the forfeiture of any deposit, if applicable . 7 (2) The identification sticker label shall be placed on 8 the keg at the time of retail sale. The licensee or permittee 9 shall purchase obtain the stickers labels referred to in this 10 subsection from the division and shall remit to the division 11 deposits forfeited pursuant to this lettered paragraph due to 12 defacement . The cost of the stickers labels to licensees and 13 permittees shall not exceed the division’s cost of producing 14 and distributing the stickers labels . The moneys collected by 15 the division relating to the sale of stickers and forfeited 16 deposits shall be credited to the beer and liquor control fund. 17 Sec. 63. Section 123.138, subsection 2, paragraph d, Code 18 2022, is amended by striking the paragraph. 19 Sec. 64. Section 123.141, Code 2022, is amended to read as 20 follows: 21 123.141 Keeping liquor where beer is sold. 22 No alcoholic liquor for beverage purposes shall be used, 23 or kept for any purpose in the place of business of a special 24 class “B” beer permittees “C” retail alcohol licensee , or on 25 the premises of such special class “B” beer permittees “C” 26 retail alcohol licensee , at any time. A violation of any 27 provision of this section shall be grounds for suspension or 28 revocation of the beer permit pursuant to section 123.50, 29 subsection 3 . This section shall not apply in any manner or 30 in any way to the premises of any hotel or motel for which a 31 special class “B” beer permit “C” retail alcohol license has 32 been issued, other than that part of such premises regularly 33 used by the hotel or motel for the principal purpose of selling 34 beer or food to the general public, to a premises for which 35 -53- LSB 5045SV (1) 89 ec/rn 53/ 77

S.F. 2350 both a special class “B” beer permit “C” retail alcohol license 1 and a class “A” native distilled spirits license have been 2 issued, or to keep a pharmacy from having alcohol in stock for 3 medicinal and compounding purposes. 4 Sec. 65. Section 123.142, subsection 1, Code 2022, is 5 amended to read as follows: 6 1. It is unlawful for the holder of a class “B” or class “C” 7 beer permit retail alcohol license issued under this chapter 8 to sell beer, except beer brewed on the premises covered by a 9 special class “A” beer permit or beer purchased from a person 10 holding a class “A” beer permit issued in accordance with this 11 chapter , and on which the tax provided in section 123.136 has 12 been paid. However, this section does not apply to class “D” 13 liquor control retail alcohol licensees as provided in this 14 chapter . 15 Sec. 66. Section 123.143, subsection 1, Code 2022, is 16 amended by striking the subsection. 17 Sec. 67. Section 123.171, subsection 1, Code 2022, is 18 amended to read as follows: 19 1. A person shall not cause the manufacture, importation, 20 or sale of wine in this state unless a certificate or permit as 21 provided in this subchapter , or a liquor control retail alcohol 22 license as provided in subchapter I of this chapter , is first 23 obtained which authorizes that manufacture, importation, or 24 sale. 25 Sec. 68. Section 123.173, Code 2022, is amended to read as 26 follows: 27 123.173 Wine permits permit —— classes class “A” —— 28 authority. 29 1. Except as provided in section 123.187 , permits a permit 30 exclusively for the sale or manufacture and sale of wine shall 31 be divided into four classes, and shall be known as a class 32 “A” , “B”, “B” native, or “C” native wine permits permit . 33 2. A class “A” wine permit allows the holder to manufacture 34 and sell, or sell at wholesale, in this state, wine. The 35 -54- LSB 5045SV (1) 89 ec/rn 54/ 77

S.F. 2350 holder of a class “A” wine permit may manufacture in this state 1 wine having an alcoholic content greater than seventeen percent 2 by weight or twenty-one and twenty-five hundredths percent of 3 alcohol by volume for shipment outside this state. All class 4 “A” premises shall be located within the state. A class “B” or 5 class “B” native wine permit allows the holder to sell wine at 6 retail for consumption off the premises. A class “B” or class 7 “B” native wine permittee who also holds a class “E” liquor 8 control license may sell wine to class “A”, class “B”, class 9 “C”, special class “C”, and class “D” liquor control licensees 10 for resale for consumption on the premises. Such wine sales 11 shall be in quantities of less than one case of any wine brand 12 but not more than one such sale shall be made to the same liquor 13 control licensee in a twenty-four-hour period. A class “B” or 14 class “B” native wine permittee shall not sell wine to other 15 class “B” or class “B” native wine permittees. A class “C” 16 native wine permit allows the holder to sell native wine for 17 consumption on or off the premises. 18 3. A class “A” wine permittee shall be required to deliver 19 wine to a retail wine permittee alcohol licensee , and a retail 20 wine permittee alcohol licensee shall be required to accept 21 delivery of wine from a class “A” wine permittee, only at 22 the licensed premises of the retail wine permittee alcohol 23 licensee . Except as specifically permitted by the division 24 upon good cause shown, delivery or transfer of wine from an 25 unlicensed premises to a licensed retail wine permittee’s 26 alcohol licensee’s premises, or from one licensed retail wine 27 permittee’s alcohol licensee’s premises to another licensed 28 retail wine permittee’s alcohol licensee’s premises, even if 29 there is common ownership of all of the premises by one retail 30 permittee, is prohibited. A class “B” or class “B” native wine 31 permittee who also holds a class “E” liquor control license 32 shall keep and maintain records for each sale of wine to liquor 33 control licensees showing the name of the establishment to 34 which wine was sold, the date of sale, and the brands and 35 -55- LSB 5045SV (1) 89 ec/rn 55/ 77

S.F. 2350 number of bottles sold to the liquor control licensee. 1 4. When a class “B” or class “B” native wine permittee who 2 also holds a class “E” liquor control license sells wine to a 3 liquor control licensee, the liquor control licensee shall sign 4 a report attesting to the purchase. The class “B” or class “B” 5 native wine permittee who also holds a class “E” liquor control 6 license shall submit a report to the division electronically, 7 or in a manner prescribed by the administrator, not later than 8 the tenth of each month stating each sale of wine to liquor 9 control licensees during the preceding month, the date of each 10 sale, and the brands and numbers of bottles with each sale. 11 A class “B” permittee who holds a class “E” liquor control 12 license may sell to class “A”, class “B”, or class “C” liquor 13 control licensees only if the licensed premises of the liquor 14 control licensee is located within the geographic territory of 15 the class “A” wine permittee from which the wine was originally 16 purchased by the class “B” or class “B” native wine permittee. 17 Sec. 69. Section 123.173A, Code 2022, is amended by striking 18 the section and inserting in lieu thereof the following: 19 123.173A Charity beer, spirits, and wine special event 20 license. 21 1. For purposes of this section: 22 a. “Authorized nonprofit entity” includes a nonprofit 23 entity which has a principal office in the state, a nonprofit 24 corporation organized under chapter 504, or a foreign 25 corporation as defined in section 504.141, whose income is 26 exempt from federal taxation under section 501(c) of the 27 Internal Revenue Code. 28 b. “Charity auction” means an auction conducted by an 29 authorized nonprofit entity which includes beer, spirits, and 30 wine. 31 c. “Charity event” means an event at which an authorized 32 nonprofit entity may serve the event’s attendees beer, 33 spirits, and wine for consumption on the premises of the event, 34 regardless of whether the entity charges an admission fee to 35 -56- LSB 5045SV (1) 89 ec/rn 56/ 77

S.F. 2350 the event or otherwise collects the cost of the beer, spirits, 1 and wine served from the event’s attendees. 2 d. “Charity special event” means a charity auction, charity 3 event, or a combined charity auction and charity event. 4 2. Upon application to the division and receipt of a charity 5 beer, spirits, and wine special event license, an authorized 6 nonprofit entity may conduct a charity special event subject to 7 the requirements of this section. 8 3. A charity auction conducted by a charity beer, spirits, 9 and wine special event licensee shall comply with the following 10 requirements: 11 a. The authorized nonprofit entity conducting the charity 12 auction shall obtain the beer, spirits, and wine to be 13 auctioned at the charity auction from an Iowa retail alcohol 14 licensee, or may receive donations of beer, spirits, or wine to 15 be auctioned at the charity auction from persons who purchased 16 the donated beer, spirits, or wine from an Iowa retail alcohol 17 licensee or an Iowa class “A” native distilled spirits licensee 18 and who present a receipt documenting the purchase at the 19 time the beer, spirits, or wine is donated. The authorized 20 nonprofit entity conducting the charity auction shall retain a 21 copy of the receipt for a period of one year from the date of 22 the charity beer, spirits, and wine auction. 23 b. The beer, spirits, and wine sold at the charity auction 24 shall be in original containers for consumption off of the 25 premises where the charity auction is conducted. No other 26 alcoholic beverage may be sold by the charity beer, spirits, 27 and wine special event licensee at the charity auction. A 28 purchaser of beer, spirits, or wine at a charity auction shall 29 not take possession of the beer, spirits, or wine until the 30 person is leaving the event. A purchaser of beer, spirits, 31 or wine at a charity auction shall not open the container or 32 consume or permit the consumption of the beer, spirits, or 33 wine purchased on the premises where the charity auction is 34 conducted. A purchaser of beer, spirits, or wine at a charity 35 -57- LSB 5045SV (1) 89 ec/rn 57/ 77

S.F. 2350 auction shall not resell the beer, spirits, or wine. 1 c. A retail alcohol licensee or class “A” native distilled 2 spirits licensee shall not purchase beer, spirits, or wine at 3 a charity auction. The charity auction may be conducted on 4 a premises for which a class “B” or class “C” retail alcohol 5 license has been issued, provided that the retail alcohol 6 licensee does not participate in the charity auction, supply 7 beer, spirits, or wine to be auctioned at the charity auction, 8 or receive any of the proceeds of the charity auction. 9 4. A charity event conducted by a charity beer, spirits, 10 and wine special event licensee shall comply with the following 11 requirements: 12 a. The charity event shall be conducted on a premises 13 covered by a valid retail alcohol license issued by the 14 division. 15 b. The authorized nonprofit entity conducting a charity 16 event shall have a written agreement with the retail alcohol 17 licensee covering the premises where the charity event is to be 18 conducted specifying that that licensee shall act as the agent 19 of the authorized nonprofit entity for the purpose of providing 20 and serving alcoholic beverages to the attendees of the charity 21 event. 22 c. The retail alcohol licensee covering the premises where 23 the charity event is to be conducted shall supply all alcoholic 24 beverages served to the attendees of the charity event. 25 d. Only those types of alcoholic beverages as are authorized 26 to be sold by the retail alcohol license covering the premises 27 where the charity event is to be conducted are to be served to 28 the attendees of the charity event. 29 5. An application for a charity beer, spirits, and wine 30 special event license to conduct a charity special event shall 31 include all of the following information: 32 a. The date and time when the charity special event is to be 33 conducted and the location of the premises in this state where 34 the charity special event is to be physically conducted. 35 -58- LSB 5045SV (1) 89 ec/rn 58/ 77

S.F. 2350 b. The retail alcohol license number issued by the division 1 for the premises where a charity event is to be conducted, if 2 applicable. 3 c. A certification that the objective of the charity special 4 event is to raise funds solely to be used for educational, 5 religious, or charitable purposes and that the entire proceeds 6 from the charity special event are to be expended for any of 7 the purposes described in section 423.3, subsection 78. 8 6. An authorized nonprofit entity shall be eligible to 9 receive no more than two charity beer, spirits, and wine 10 special event licenses during a calendar year and each charity 11 beer, spirits, and wine special event license shall be valid 12 for a period not to exceed thirty-six consecutive hours. 13 7. Any violation of the requirements of this chapter or 14 the rules adopted pursuant to this chapter shall subject 15 the charity beer, spirits, and wine special event license 16 holder to the general penalties provided in this chapter and 17 shall constitute grounds for imposition of a civil penalty, 18 suspension of the license, or revocation of the permit after 19 notice and opportunity for a hearing pursuant to section 123.39 20 and chapter 17A. 21 Sec. 70. Section 123.175, subsection 1, unnumbered 22 paragraph 1, Code 2022, is amended to read as follows: 23 A person applying for a class “A” or retail wine permit shall 24 submit a completed application electronically, or in a manner 25 prescribed by the administrator, which shall set forth under 26 oath the following: 27 Sec. 71. Section 123.175, subsection 1, paragraph e, Code 28 2022, is amended to read as follows: 29 e. When required by the administrator, and in such form and 30 containing such information as the administrator may require, 31 a description of the premises where the applicant intends to 32 use the permit, to include a sketch or drawing of the premises 33 and, if applicable, the number of square feet of interior floor 34 space which comprises the retail sales area of the premises . 35 -59- LSB 5045SV (1) 89 ec/rn 59/ 77

S.F. 2350 Sec. 72. Section 123.175, subsection 2, unnumbered 1 paragraph 1, Code 2022, is amended to read as follows: 2 The administrator shall issue a class “A” or retail wine 3 permit to any applicant who establishes all of the following: 4 Sec. 73. Section 123.175, subsection 2, paragraphs d and g, 5 Code 2022, are amended to read as follows: 6 d. That , in the case of a class “A” wine permit, the 7 applicant has filed with the division a basic permit issued 8 by the alcohol and tobacco tax and trade bureau of the United 9 States department of the treasury, and that the applicant will 10 faithfully observe and comply with all the laws, rules, and 11 regulations governing the manufacture and sale of wine. 12 g. That the applicant has submitted , in the case of a class 13 “A” wine permit, a bond in the amount of five thousand dollars 14 in a manner prescribed by the administrator with good and 15 sufficient sureties to be approved by the division conditioned 16 upon compliance with this chapter . 17 Sec. 74. Section 123.176, subsections 2, 5, and 7, Code 18 2022, are amended to read as follows: 19 2. Native wine may be sold at retail for off-premises 20 consumption when sold on the premises of the manufacturer, or 21 in a retail establishment operated by the manufacturer. Sales 22 may also be made to class “A” or retail wine permittees or 23 liquor control alcohol licensees as authorized by sections 24 123.173 123.30 and 123.177 . A manufacturer of native wines 25 shall not sell the wines other than as permitted in this 26 chapter and shall not allow wine sold to be consumed upon the 27 premises of the manufacturer. However, prior to sale, native 28 wines may be tasted pursuant to the rules of the division 29 on the premises where made, when no charge is made for the 30 tasting. 31 5. Notwithstanding any other provision of this chapter , a 32 person engaged in the business of manufacturing native wine may 33 sell native wine at retail for consumption on the premises of 34 the manufacturing facility by applying for a class “C” native 35 -60- LSB 5045SV (1) 89 ec/rn 60/ 77

S.F. 2350 wine permit retail alcohol license as provided in section 1 123.178B 123.31 . A manufacturer of native wine may be granted 2 not more than two class “C” native wine permits retail alcohol 3 licenses . A manufacturer of native wine may be issued a class 4 “C” native wine permit retail alcohol license regardless 5 of whether the manufacturer is also a manufacturer of beer 6 pursuant to a class “A” beer permit or a manufacturer of native 7 distilled spirits pursuant to a class “A” native distilled 8 spirits license. 9 7. A manufacturer may use the space and equipment of another 10 manufacturer for the purpose of manufacturing native wine, 11 provided that such an alternating proprietorship arrangement 12 is approved by the alcohol and tobacco tax and trade bureau 13 of the United States department of the treasury. A separate 14 class “A” wine permit shall be issued to each manufacturer, 15 and each manufacturer shall be subject to the provisions of 16 this chapter and the rules of the division. Notwithstanding 17 subsection 5 , not more than one class “C” native wine permit 18 retail alcohol license shall be issued to a premises with 19 alternating proprietorships. 20 Sec. 75. Section 123.177, subsection 1, Code 2022, is 21 amended to read as follows: 22 1. A person holding a class “A” wine permit may manufacture 23 and sell, or sell at wholesale, wine for consumption off the 24 premises. Sales within the state may be made only to persons 25 holding a class “A” or “B” wine permit and to persons holding a 26 retail liquor control alcohol license. However, if the person 27 holding the class “A” permit is a manufacturer of native wine, 28 the person may sell only native wine to a person holding a 29 retail wine permit or a retail liquor control alcohol license. 30 A person holding a class “A” wine permit may sell wine to 31 distributors outside of the state that are authorized by the 32 laws of that jurisdiction to sell wine at wholesale. A class 33 “A” wine permittee having more than one place of business shall 34 obtain a separate permit for each place of business where wine 35 -61- LSB 5045SV (1) 89 ec/rn 61/ 77

S.F. 2350 is to be manufactured, stored, warehoused, or sold. 1 Sec. 76. Section 123.177, subsection 3, Code 2022, is 2 amended by striking the subsection. 3 Sec. 77. Section 123.180, subsection 4, Code 2022, is 4 amended to read as follows: 5 4. It is unlawful for a holder of a vintner’s certificate 6 of compliance or the holder’s agent, or any class “A” wine 7 permittee or the permittee’s agent, to discriminate between 8 class “B” wine permittees retail alcohol licensees authorized 9 to sell wine at retail. 10 Sec. 78. Section 123.181, subsection 1, Code 2022, is 11 amended by striking the subsection. 12 Sec. 79. Section 123.181, subsection 2, Code 2022, is 13 amended to read as follows: 14 2. A class “A” wine permittee shall not sell wine on 15 credit to a retail alcohol licensee or permittee for a period 16 exceeding thirty days from date of delivery. 17 Sec. 80. Section 123.187, subsection 2, paragraph a, Code 18 2022, is amended to read as follows: 19 a. Only a wine manufacturer that holds a wine direct shipper 20 permit issued pursuant to this section shall sell wine at 21 retail for direct shipment to any person within this state. 22 This section shall not prohibit an authorized retail licensee 23 or permittee from delivering wine pursuant to section 123.46A . 24 Sec. 81. Section 123.187, subsection 2, paragraph d, Code 25 2022, is amended by striking the paragraph. 26 Sec. 82. Section 125.59, unnumbered paragraph 1, Code 2022, 27 is amended to read as follows: 28 The treasurer of state, on each July 1 for that fiscal 29 year, shall transfer the estimated amounts to be received from 30 section 123.36, subsection 8 and section 123.143, subsection 1 31 for purposes of this section to the department. 32 Sec. 83. REPEAL. Sections 123.97, 123.123, 123.150, 33 123.172, 123.173B, and 123.185, Code 2022, are repealed. 34 DIVISION IV 35 -62- LSB 5045SV (1) 89 ec/rn 62/ 77

S.F. 2350 CONFORMING CHANGES 1 Sec. 84. Section 7D.16, Code 2022, is amended to read as 2 follows: 3 7D.16 Alcoholic beverages in state capitol or on complex 4 grounds. 5 Notwithstanding any contrary provision of law prohibiting 6 the use and consumption of alcoholic beverages in a public 7 place, the executive council may authorize, by resolution, 8 the temporary use and consumption of alcoholic beverages, 9 as defined in section 123.3 , in the state capitol or on the 10 state capitol complex grounds, as if the state capitol or 11 state capitol complex grounds were a private place. The 12 authorization by resolution shall be limited to the use and 13 consumption of alcoholic beverages as an accompaniment to food 14 at a single award ceremony, social event, or other occasion 15 deemed appropriate by the executive council. The authorization 16 shall require that the person providing the food and alcoholic 17 beverages possess an appropriate liquor control retail alcohol 18 license in accordance with section 123.95 . The secretary 19 of the executive council shall inform the secretary of the 20 legislative council and the director of the department of 21 administrative services of the approval of any such resolution. 22 Sec. 85. Section 12.43, subsection 5, paragraph e, Code 23 2022, is amended to read as follows: 24 e. Liquor, beer, and wine sales must not exceed twenty 25 percent of annual sales for establishments holding a class 26 “C” liquor retail alcohol license issued pursuant to section 27 123.30 . 28 Sec. 86. Section 99B.3, subsection 2, Code 2022, is amended 29 to read as follows: 30 2. A person whose license is revoked under this section 31 who is a person for whom a class “A”, class “B”, class “C”, or 32 class “D” liquor control retail alcohol license has been issued 33 pursuant to chapter 123 shall have the person’s liquor control 34 retail alcohol license suspended for a period of fourteen days 35 -63- LSB 5045SV (1) 89 ec/rn 63/ 77

S.F. 2350 in the same manner as provided in section 123.50, subsection 1 3 , paragraph “a” . 2 Sec. 87. Section 99B.3, subsection 3, Code 2022, is amended 3 by striking the subsection. 4 Sec. 88. Section 99B.43, subsection 1, unnumbered paragraph 5 1, Code 2022, is amended to read as follows: 6 Social gambling is lawful on the premises of an 7 establishment for which a class “A”, class “B”, class “C”, 8 special class “C”, or class “D” liquor control , class “E”, or 9 class “F” retail alcohol license , or class “B” beer permit 10 has been issued pursuant to chapter 123 when, subject to the 11 provisions of section 99B.42 , all of the following requirements 12 are met: 13 Sec. 89. Section 99B.43, subsection 1, paragraph a, Code 14 2022, is amended to read as follows: 15 a. The liquor control retail alcohol licensee or beer 16 permittee has submitted an application for a social gambling 17 license and a license fee of one hundred fifty dollars to the 18 department, and a license has been issued. 19 Sec. 90. Section 99B.43, subsection 2, unnumbered paragraph 20 1, Code 2022, is amended to read as follows: 21 A liquor control retail alcohol licensee or beer permittee 22 with a social gambling license issued pursuant to this section 23 may conduct a sports betting pool if all of the requirements of 24 this subsection are met. 25 Sec. 91. Section 99B.43, subsection 3, Code 2022, is amended 26 to read as follows: 27 3. An establishment issued a social gambling license under 28 this section that is required to obtain a new liquor retail 29 alcohol license or permit under chapter 123 due to a change in 30 ownership shall be required to obtain a new social gambling 31 license under this section to conduct social gambling. 32 Sec. 92. Section 99B.53, subsections 2, 3, 4, and 13, Code 33 2022, are amended to read as follows: 34 2. Except as provided in subsection 3 , an electrical or 35 -64- LSB 5045SV (1) 89 ec/rn 64/ 77

S.F. 2350 mechanical amusement device requiring registration may be 1 located on premises for which a class “A”, class “B”, class 2 “C”, special class “C”, or class “D” liquor control , class “E”, 3 or class “F” retail alcohol license has been issued pursuant 4 to chapter 123 . 5 3. a. An electrical or mechanical amusement device 6 requiring registration may be located on premises for which a 7 class “B” or class “C” beer permit “E” retail alcohol license 8 has been issued pursuant to chapter 123 , but the department 9 shall not initially register an electrical or mechanical 10 amusement device to an owner or distributor for a location for 11 which a class “B” or class “C” beer permit “E” retail alcohol 12 license has been issued pursuant to chapter 123 on or after 13 April 28, 2004. 14 b. A distributor that owns an amusement device at a location 15 for which only a class “B” or class “C” beer permit “E” retail 16 alcohol license has been issued pursuant to chapter 123 shall 17 not relocate an amusement device registered as provided in 18 this section to a location other than a location for which a 19 class “A”, class “B”, class “C”, special class “C”, or class 20 “D” liquor , class “E”, or class “F” retail alcohol license has 21 been issued and shall not transfer, assign, sell, or lease an 22 amusement device registered as provided in this section to 23 another person for which only a class “B” or class “C” beer 24 permit “E” retail alcohol license has been issued pursuant to 25 chapter 123 after April 28, 2004. 26 c. If ownership of the location changes, the class “B” 27 or class “C” beer permit “E” retail alcohol license does not 28 lapse, and the device is not removed from the location, the 29 device may remain at the location. 30 4. An electrical or mechanical amusement device required 31 to be registered and at a location for which only a class “B” 32 or class “C” beer permit “E” retail alcohol license has been 33 issued pursuant to chapter 123 shall include on the device 34 a security mechanism which prevents the device from being 35 -65- LSB 5045SV (1) 89 ec/rn 65/ 77

S.F. 2350 operated by a person until action is taken by the owner or 1 owner’s designee to allow the person to operate the device. 2 13. A person owning or leasing an electrical or mechanical 3 amusement device required to be registered by this section 4 shall not relocate and place into operation an amusement 5 device in any location other than a location which has been 6 issued an appropriate liquor control retail alcohol license in 7 good standing and to which the device has been appropriately 8 registered with the department. 9 Sec. 93. Section 99B.55, subsection 2, Code 2022, is amended 10 to read as follows: 11 2. a. A person who commits an offense of awarding a cash 12 prize of fifty dollars or less in violation of section 99B.52, 13 subsection 3 , pursuant to rules adopted by the department, 14 shall be subject to a civil penalty in the amount of two 15 hundred fifty dollars. Additional sanctions beyond the civil 16 penalty prescribed by this paragraph, including but not limited 17 to the suspension or revocation of any liquor control retail 18 alcohol license issued pursuant to chapter 123 or registration 19 issued pursuant to section 99B.53 or 99B.56 , shall not be 20 applicable. 21 b. A person who commits, within two years, a second offense 22 of awarding a cash prize of fifty dollars or less in violation 23 of section 99B.52, subsection 3 , or a person who commits an 24 offense of awarding a cash prize of more than fifty dollars in 25 violation of section 99B.52, subsection 3 , pursuant to rules 26 adopted by the department, shall be subject to revocation of 27 the person’s registration and the following: 28 (1) If the person whose registration is revoked under this 29 paragraph “b” is a person for which a class “A”, class “B”, 30 class “C”, special class “C”, or class “D” liquor control , 31 class “E”, or class “F” retail alcohol license has been 32 issued pursuant to chapter 123 , the person’s liquor control 33 retail alcohol license shall be suspended for a period of 34 fourteen days in the same manner as provided in section 123.50, 35 -66- LSB 5045SV (1) 89 ec/rn 66/ 77

S.F. 2350 subsection 3 , paragraph “a” . 1 (2) If the person whose registration is revoked under this 2 paragraph “b” is a person for which only a class “B” or class 3 “C” beer permit “E” retail alcohol license has been issued 4 pursuant to chapter 123 , the person’s class “B” or class “C” 5 beer permit “E” retail alcohol license shall be suspended for 6 a period of fourteen days in the same manner as provided in 7 section 123.50, subsection 3 , paragraph “a” . 8 (3) If a person owning or employed by an establishment 9 having a class “A”, class “B”, class “C”, special class “C”, 10 or class “D” liquor control , class “E”, or class “F” retail 11 alcohol license issued pursuant to chapter 123 commits an 12 offense as provided in this paragraph “b” , the liquor control 13 retail alcohol license of the establishment shall be suspended 14 for a period of fourteen days in the same manner as provided in 15 section 123.50, subsection 3 , paragraph “a” . 16 (4) If a person owning or employed by an establishment 17 having a class “B” or class “C” beer permit “E” retail alcohol 18 license issued pursuant to chapter 123 commits an offense as 19 provided in this paragraph “b” , the beer permit retail alcohol 20 license of the establishment shall be suspended for a period of 21 fourteen days in the same manner as provided in section 123.50, 22 subsection 3 , paragraph “a” . 23 Sec. 94. Section 137F.1, subsection 9, paragraph c, Code 24 2022, is amended to read as follows: 25 c. A premises covered by a class “A” wine permit or a class 26 “B” wine permit as provided in chapter 123 . 27 Sec. 95. Section 331.303, subsection 4, Code 2022, is 28 amended to read as follows: 29 4. Act upon applications for liquor control retail alcohol 30 licenses and retail beer permits in accordance with section 31 123.32 . 32 Sec. 96. Section 455C.4, subsection 4, Code 2022, is amended 33 to read as follows: 34 4. A class “E” liquor control retail alcohol licensee 35 -67- LSB 5045SV (1) 89 ec/rn 67/ 77

S.F. 2350 may refuse to accept and to pay the refund value on an empty 1 alcoholic liquor container from a dealer or a redemption center 2 or from a person acting on behalf of or who has received empty 3 alcoholic liquor containers from a dealer or a redemption 4 center. 5 DIVISION V 6 TRANSITION PROVISIONS —— EFFECTIVE DATE 7 Sec. 97. TRANSITION PROVISIONS. Any license or permit 8 issued by the alcoholic beverages division of the department 9 of commerce that is repealed, merged, or altered in this Act, 10 and in effect on the effective date of this Act, shall continue 11 in full force and effect with the authority granted by that 12 license or permit until expiration or renewal. 13 Sec. 98. EFFECTIVE DATE. This Act takes effect January 1, 14 2023. 15 EXPLANATION 16 The inclusion of this explanation does not constitute agreement with 17 the explanation’s substance by the members of the general assembly. 18 This bill relates to alcoholic beverage control. The bill is 19 organized by divisions. 20 DIVISION I —— RETAIL ALCOHOL LICENSES. Code section 123.30, 21 establishing liquor control licenses, is stricken and rewritten 22 by the bill. The bill replaces liquor control licenses with 23 retail alcohol licenses and modifies the classes within the 24 new category of retail alcohol licenses. The current class 25 “A” liquor control license and class “D” liquor control 26 license are renamed a class “F” and a class “D” retail alcohol 27 license, respectively. The current class “B” liquor control 28 license that may be issued to a hotel or motel is eliminated. 29 Instead, the bill establishes a new class “B” retail alcohol 30 license and special class “B” retail alcohol license. The 31 new class “B” retail alcohol license allows the holder to 32 purchase wine from a class “A” wine permittee and beer from a 33 class “A” beer permittee and to sell wine and beer in original 34 unopened containers at retail to patrons for consumption off 35 -68- LSB 5045SV (1) 89 ec/rn 68/ 77

S.F. 2350 the licensed premises. The bill also allows a holder of the 1 new class “B” retail alcohol license to sell wine in limited 2 quantities to class “C”, special class “C”, class “D”, and 3 class “F” retail alcohol licensees for resale for consumption 4 on the premises. This new license combines, in part, the 5 authority granted under the current class “C” beer permit for 6 beer and the class “B” wine permit for wine. The new special 7 class “B” retail native wine license authorizes the holder to 8 purchase wine from a native winery holding a class “A” wine 9 permit and to sell native wine only at retail for consumption 10 off the licensed premises. The authority under this new 11 special class “B” retail alcohol license is similar to the 12 authority granted a holder of a current class “B” native wine 13 permit. The current class “C” and special class “C” liquor 14 control licenses are renamed as class “C” and special class “C” 15 retail alcohol licenses. The current special class “C” native 16 distilled spirits liquor control license is repealed. Finally, 17 the current class “E” liquor control license is renamed a class 18 “E” retail alcohol license. In addition, the bill provides 19 that a class “E” retail alcohol licensee can purchase wine and 20 beer from a class “A” wine or beer permittee, respectively. 21 The bill specifically allows the class “E” licensee to sell 22 wine and beer in unopened containers at retail, and to sell 23 alcoholic liquor and high alcoholic content beer at wholesale. 24 Code section 123.131, providing for liquor control license 25 applications, is stricken and rewritten by the bill. Existing 26 application requirements for liquor control licenses are made 27 applicable to retail alcohol licenses established by the bill. 28 In addition, requirements for issuance of a current class “B” 29 beer permit, class “C” beer permit, and retail wine permit 30 are generally made applicable to issuance of a retail alcohol 31 license. 32 New Code section 123.31A establishes the authority granted 33 a holder of a new class “B”, class “C”, special class “C”, 34 and class “E” retail alcohol license. The authority granted 35 -69- LSB 5045SV (1) 89 ec/rn 69/ 77

S.F. 2350 a holder of these licenses as to both wine and beer is similar 1 to the authority granted current holders of a class “B” beer 2 permit, class “C” beer permit, and class “B” wine permit, 3 to include sales of beer or wine in other than the original 4 container. The new Code section provides that a holder of 5 a new class “C” or special class “C” retail alcohol license 6 cannot sell beer or wine to other retail alcohol license 7 holders. The bill also provides, similarly to current Code 8 section 123.181(1), that a holder of any retail alcohol permit 9 shall not sell wine except wine purchased from a person holding 10 a class “A” permit or native wine manufacturer. 11 New Code section 123.31B establishes the authority granted a 12 holder of a new special class “B” retail native wine license. 13 The authority granted a holder of this new license is similar 14 to the authority granted a holder of a current class “B” native 15 wine permit. 16 With the authority granted retail alcohol licensees 17 regarding beer, the current class “B” and class “C” beer 18 permits are repealed. As a result, the division repeals, as 19 to beer permits, Code section 123.138, providing for class 20 “B” beer permit applications, Code section 123.129, providing 21 for class “C” beer permit applications, Code section 123.131, 22 concerning authority under a class “B” beer permit, Code 23 section 123.132, concerning authority under a class “C” beer 24 permit, and Code section 123.140, concerning separate locations 25 for class “B” or class “C” beer permits. In addition, based 26 on the authority granted the new retail licenses regarding 27 wine, the current class “B” wine, class “B” native wine, and 28 class “C” native wine permits are repealed. As a result, the 29 division repeals, as to wine permits, Code section 123.178, 30 concerning authority under a class “B” wine permit, Code 31 section 123.178A, concerning authority under a class “B” native 32 wine permit, and Code section 123.178B, concerning authority 33 under a class “C” native wine permit. 34 DIVISION II —— ALCOHOLIC BEVERAGE CONTROL FEES. This 35 -70- LSB 5045SV (1) 89 ec/rn 70/ 77

S.F. 2350 division concerns fees for the new retail alcohol licenses as 1 well as changes to fees for other licenses and permits in Code 2 chapter 123. 3 Code section 123.23, concerning the distiller’s certificate 4 of compliance, is amended to increase the annual fee for the 5 certificate from $50 to $200. 6 Code section 123.36, concerning liquor control license 7 fees, is stricken and rewritten and made applicable to the new 8 retail alcohol licenses. The current fees for a class “A” 9 liquor control licensee are made applicable to the new class 10 “F” retail alcohol license. The current fees for a class 11 “B” liquor control license are repealed. Instead, the bill 12 establishes fees for the new class “B” retail alcohol license 13 based on the population of the city where the premises is 14 located as well as the square footage of the licensed premises. 15 The fee for the new special class “B” native wine license is 16 $125, an increase from the fee for a current class “B” native 17 wine permit of $25. The fees for the new class “C” and special 18 class “C” retail alcohol license are modified from the current 19 fees for class “C” liquor control licenses. The new fees 20 increase the population thresholds for increased fees for both 21 the new class “C” and special class “C” licenses and reduce the 22 fees for the class “C” retail alcohol license by $50 over the 23 current fees for a class “C” liquor control license. The new 24 class “D” retail alcohol license fees remain the same as the 25 fees for the current class “D” liquor control license. The 26 bill establishes fees for the new class “E” retail alcohol 27 license based on the population of the city where the premises 28 is located as well as the square footage of the licensed 29 premises. Current fees for the class “E” liquor control 30 license are based only on the population of the city where 31 the premises is located. Current provisions in Code section 32 123.36 governing crediting of liquor control license fees to 33 the beer and liquor control fund are made applicable to the new 34 retail alcohol license fees, excluding the new special class 35 -71- LSB 5045SV (1) 89 ec/rn 71/ 77

S.F. 2350 “B” retail alcohol licenses. Current provisions imposing fee 1 surcharges are also made applicable to the new retail alcohol 2 license fees, excluding the new class “B” and special class “B” 3 retail alcohol licenses. 4 Code section 123.41, concerning the manufacturer’s license, 5 is amended to decrease the annual fee for the license from $350 6 to $300. 7 Code section 123.43(3), concerning a class “A” native 8 distilled spirits license, is amended to decrease the annual 9 fee for the license from $500 to $300. 10 Code section 123.134, concerning beer permit fees, is 11 stricken and rewritten. The bill keeps the annual permit fee 12 for a class “A” beer permit at $750, reduces the annual permit 13 fee for a special class “A” beer permit from $750 to $300, and 14 provides that the annual fee for a class “A” beer permit for a 15 native brewery is $300. Fees for class “B” and class “C” beer 16 permits are repealed as those permits are repealed by the bill. 17 Code section 123.135, concerning the brewer’s certificate 18 of compliance, is amended to reduce the annual fee for the 19 certificate from $500 to $200. 20 Code section 123.179, concerning wine permit fees, is 21 stricken and rewritten by the bill. The bill keeps the annual 22 permit fee for a class “A” wine permit that is not issued 23 to a native wine manufacturer at $750, increases the annual 24 permit fee for a class “A” wine permit issued to a native wine 25 manufacturer from $25 to $100, and provides that the annual fee 26 for a charity beer, spirits, and wine special event license 27 created in the bill is $100. Fees for class “B” wine permits 28 and class “B” and class “C” native wine permits are stricken 29 as those permits are repealed by the bill. The current fees 30 for charity wine auctions and charity wine event permits are 31 stricken as those permits are repealed by the bill and combined 32 in the new charity beer, spirits, and wine special event 33 license created by the bill. 34 Code section 123.180, concerning the vintner’s certificate 35 -72- LSB 5045SV (1) 89 ec/rn 72/ 77

S.F. 2350 of compliance, is amended to increase the annual fee for the 1 certificate from $150 to $200. 2 DIVISION III —— ALCOHOLIC BEVERAGE CONTROL. This division 3 makes changes to Code chapter 123 relative to alcoholic 4 beverage control, to include making conforming changes relative 5 to the creation of the new retail alcohol licenses and the 6 elimination of certain native distilled spirits, beer, and wine 7 permits in the bill. The bill also eliminates the requirement 8 to obtain a special privilege to sell alcoholic beverages on 9 Sunday and provides that sales or other activities relating 10 to alcoholic beverages on Sunday will be allowed to the same 11 extent as they are allowed on any other day. 12 Code section 123.3, definitions, is amended to reflect the 13 new retail alcohol licenses. The bill strikes definitions for 14 “retail beer permit” and “retail wine permit” as those permits 15 are repealed by the bill and creates a new “retail alcohol 16 license” definition reflecting the classes of licenses included 17 within this new license. The definition of “high alcoholic 18 content beer” is also amended to provide that high alcoholic 19 content beer may contain up to 19 percent of alcohol by volume 20 instead of the current 15 percent. 21 Code section 123.34, concerning seasonal licenses and 22 permits, is amended. The bill amends the Code section to 23 reflect the new retail alcohol licenses and allows seasonal 24 and shortened licenses for new class “C”, special class 25 “C”, class “D”, and class “F” retail alcohol licensees. The 26 bill eliminates the six-month seasonal license or permit and 27 provides that the fee for an eight-month seasonal license shall 28 be 50 percent of the license fee for that class of license 29 instead of a proportional share of that fee. 30 New Code section 123.35 includes the provision from 31 current Code section 123.34 providing for the expiration of 32 licenses, permits, and certificates of compliance without 33 the notification requirement. The new Code section further 34 provides, notwithstanding any provision of Code chapter 123 35 -73- LSB 5045SV (1) 89 ec/rn 73/ 77

S.F. 2350 to the contrary, for the automatic renewal of a class “E” 1 retail alcohol license, a distiller’s, vintner’s, or brewer’s 2 certificate of compliance, and a wine direct shipper’s 3 permit. The bill allows the renewal of the applicable license, 4 certificate, or permit without approval by the administrator 5 of the alcoholic beverages division or endorsement of any 6 applicable local authority upon collection of the annual fee 7 for that license, certificate, or permit by the alcoholic 8 beverages division, provided certain conditions are met since 9 the preceding license, certificate, or permit was issued. The 10 bill provides that the license, certificate, or permit can be 11 automatically renewed if, in the preceding year, the license, 12 certificate, or permit has not been suspended or revoked, 13 a civil penalty has not been imposed, an administrative 14 proceeding is not pending to suspend or revoke the license, 15 certificate, or permit or to impose a civil penalty, all 16 required payments to the division have been made, and the 17 licensee, certificate holder, or permittee, and all persons 18 associated with the licensee, certificate holder, or permittee 19 as described in Code section 123.3(40)(e), have not been 20 convicted of a violation of Code chapter 123. In addition, for 21 renewal of a class “E” retail alcohol license, the licensed 22 premises shall constitute a safe and proper place and building 23 that complies with all applicable building-related regulations. 24 Code section 123.43A, concerning native distilleries, is 25 amended to reflect the new retail alcohol licenses in the bill. 26 The bill also provides that a distillery that produces no more 27 than 100,000 proof gallons of native distilled spirits annually 28 may be granted not more than two class “C” retail alcohol 29 licenses instead of two class “C” native distilled spirits 30 liquor control licenses as those licenses are repealed by the 31 bill. A holder of a class “C” retail alcohol license under 32 the bill is granted the authority to sell alcoholic liquor, 33 wine, and beer while a holder of the current class “C” native 34 distilled spirits liquor control licenses has the authority 35 -74- LSB 5045SV (1) 89 ec/rn 74/ 77

S.F. 2350 to only sell native distilled spirits and mixed drinks or 1 cocktails. 2 Code section 123.46A, concerning delivery of alcoholic 3 beverages by retailers, is amended to reflect that the new 4 retail alcohol licenses in the bill are licenses, not permits. 5 The bill also provides that deliveries shall occur on the same 6 day the order for delivery of alcoholic beverages is removed 7 from the licensed premises of the retailer. 8 Code sections 123.49 and 123.50, concerning prohibitions 9 and criminal and civil penalties, are amended to reflect the 10 new retail alcohol licenses created in the bill and the fact 11 that the authority to sell at retail is granted only to retail 12 alcohol licensees and not permittees. 13 Code section 123.92, the dramshop Act, is amended to 14 provide that every retail alcohol licensee, except a class 15 “B”, special class “B”, or class “E” retail alcohol licensee, 16 shall furnish proof of financial responsibility by the 17 existence of a liability insurance policy. Under current law, 18 every liquor control licensee, class “B” beer permittee, and 19 class “C” native wine permittee, except a class “E” liquor 20 control licensee, is required to furnish proof of financial 21 responsibility. 22 Code section 123.97, providing that most revenues arising 23 under the operation of Code chapter 123 become part of the 24 general fund of the state, is repealed as inconsistent with the 25 provisions of current Code section 123.17. 26 Code section 123.123, concerning the applicability of 27 provisions relating to class “B” beer permits to liquor control 28 licensees, is repealed as class “B” beer permits are repealed 29 in the bill. 30 Code section 123.130, concerning authority under class “A” 31 beer permits, is amended to reflect the new retail alcohol 32 licenses in the bill. The bill also provides that a native 33 brewery may be granted not more than two class “C” or special 34 class “C” retail alcohol licenses instead of two class “B” 35 -75- LSB 5045SV (1) 89 ec/rn 75/ 77

S.F. 2350 permits which permits are repealed by the bill. 1 Code section 123.138, concerning keg identification 2 stickers, is amended to reflect the new retail alcohol licenses 3 and provides for a keg identification label instead of a 4 sticker. In addition, the bill strikes provisions concerning 5 the forfeiture and remittance of deposits relating to defacing 6 the keg identification label. 7 Code section 123.143, concerning distribution of funds, is 8 amended to strike the provision directing where retail beer 9 permit fees shall be distributed. The bill repeals all retail 10 beer permit fees and the distribution of funds from retail 11 alcohol licenses is governed by Code section 123.36 as amended 12 by the bill. 13 Code section 123.172, concerning the applicability of 14 provisions relating to class “B” wine permits to liquor control 15 licensees, is repealed as class “B” wine permits are repealed 16 in the bill. 17 Code section 123.173, concerning classes of wine permits, is 18 amended by striking provisions relating to class “B”, class “B” 19 native wine, and class “C” native wine permits as those permits 20 are repealed by the bill. 21 Code section 123.173A, providing for a charity beer, 22 spirits, and wine auction permit, and Code section 123.173B, 23 providing for a charity beer, spirits, and wine event permit, 24 are stricken and replaced with a combined charity beer, 25 spirits, and wine special event license, allowing the license 26 holder to conduct a charity auction, charity event, or a 27 combined charity auction and charity event in a similar manner 28 as is allowed under current law for the two separate permits. 29 The bill only allows one charity auction, charity event, or 30 combined charity auction and charity event to be conducted 31 during the period of the license and limits a person to no more 32 than two special event licenses in a calendar year. 33 Code section 123.176, concerning native wines, is amended 34 to reflect the new retail alcohol licenses in the bill. The 35 -76- LSB 5045SV (1) 89 ec/rn 76/ 77

S.F. 2350 bill also provides that a manufacturer of native wines may be 1 granted not more than two class “C” retail alcohol licenses 2 instead of two class “C” native wine permits which permits are 3 repealed by the bill. A holder of a class “C” retail alcohol 4 license under the bill is granted the authority to sell wine 5 and beer. 6 Code section 123.187, concerning the wine direct shipper 7 permit, is amended to remove the requirement that an 8 application for the permit be accompanied by a bond if not 9 otherwise required to submit a bond as a wine manufacturer. 10 Code section 125.59 is amended to reflect that current 11 provisions providing for transfer of certain revenues to the 12 department of public health are stricken by the bill. 13 DIVISION IV —— CONFORMING CHANGES. This division makes 14 conforming changes to Code chapters 7D, 12, and 99B, relative 15 to the creation of the new retail alcohol licenses and the 16 elimination of certain native distilled spirits, beer, and wine 17 permits in the bill. 18 Code section 137F.1, defining food establishments for 19 purposes of licensure, is amended to provide that a food 20 establishment does not include only a premises covered by a 21 class “A” wine permit. Under current law, a food establishment 22 also does not include a premises covered by a class “B” wine 23 permit which is stricken by the bill. 24 DIVISION V —— TRANSITION PROVISIONS —— EFFECTIVE DATE. 25 This division provides that any license or permit issued by 26 the alcoholic beverages division that is repealed, merged, or 27 altered in the bill and in effect on the effective date of the 28 bill shall continue in full force and effect with the authority 29 granted by that license or permit until expiration or renewal. 30 The division also provides that the bill takes effect January 31 1, 2023. 32 -77- LSB 5045SV (1) 89 ec/rn 77/ 77