Legislature(1999 - 2000)
03/05/1999 03:18 PM House L&C
| Audio | Topic |
|---|
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE LABOR AND COMMERCE STANDING COMMITTEE
March 5, 1999
3:18 p.m.
MEMBERS PRESENT
Representative Norman Rokeberg, Chairman
Representative Andrew Halcro, Vice Chairman
Representative Lisa Murkowski
Representative John Harris
Representative Sharon Cissna
MEMBERS ABSENT
Representative Jerry Sanders
Representative Tom Brice
COMMITTEE CALENDAR
* HOUSE BILL NO. 94
"An Act removing employees of the Alcoholic Beverage Control Board
from the exempt service."
- MOVED OUT OF COMMITTEE
HOUSE BILL NO. 69
"An Act relating to the Alcoholic Beverage Control Board; and
providing for an effective date."
- MOVED CSHB 69(L&C) OUT OF COMMITTEE
(* First public hearing)
PREVIOUS ACTION
BILL: HB 94
SHORT TITLE: ABC BD EMPLOYEES NOT EXEMPT EMPLOYEES
SPONSOR(S): REPRESENTATIVES(S) KOTT
Jrn-Date Jrn-Page Action
2/16/99 222 (H) READ THE FIRST TIME - REFERRAL(S)
2/16/99 222 (H) L&C, FINANCE
3/05/99 (H) L&C AT 3:15 PM CAPITOL 17
BILL: HB 69
SHORT TITLE: ALCOHOLIC BEVERAGE CONTROL BOARD
SPONSOR(S): REPRESENTATIVES(S) ROKEBERG
Jrn-Date Jrn-Page Action
1/25/99 81 (H) READ THE FIRST TIME - REFERRAL(S)
1/25/99 81 (H) L&C, FINANCE
2/24/99 (H) L&C AT 3:15 PM CAPITOL 17
2/24/99 (H) HEARD AND HELD
3/05/99 (H) L&C AT 3:15 PM CAPITOL 17
WITNESS REGISTER
PAT HARMAN, Legislative Administrative Assistant
to Representative Kott
Alaska State Legislature
Capitol Building, Room 118
Juneau, Alaska 99801
Telephone: (907) 465-3777
POSITION STATEMENT: Discussed HB 94 on behalf of the sponsor.
DOUG GRIFFIN, Director
Alcoholic Beverage Control Board
Department of Revenue
550 West 7th Avenue, Suite 350
Anchorage, Alaska 99501-33510
POSITION STATEMENT: Did not have a position on HB 94; commented on
HB 69, Version G, and amendments.
ROD HANCOCK, Co-Owner
Moose's Tooth Pub and Pizzeria, Moose's Tooth Brewing
3300 Old Seward Highway
Anchorage, Alaska 99503
Telephone: (907) 258-2536
POSITION STATEMENT: Discussed Version G of HB 69 as a compromise.
GARY KLOPFER, Majority Owner
Snow Goose Restaurant, Sleeping Lady Brewing Company
717 West 3rd Avenue
Anchorage, Alaska 99501
Telephone: (907) 561-2274
POSITION STATEMENT: Testified in opposition to HB 69.
MARK STAPLES, Founder and Majority Owner
Midnight Sun Brewing Company
7329 Arctic Boulevard
Anchorage, Alaska 99518
Telephone: (907) 344-1179
POSITION STATEMENT: Agreed with Mr. Klopfer's testimony regarding
HB 69 and provided additional testimony.
S.J. KLEIN, President and Founder
Borealis Brewery
349 East Ship Creek Avenue
Anchorage, Alaska 99501
Telephone: (907) 278-5480
POSITION STATEMENT: Testified on HB 69.
CHRIS ANDERSON, Co-Owner
Glacier Brewhouse
737 West 5th Avenue
Anchorage, Alaska 99501
Telephone: (907) 786-3789
POSITION STATEMENT: Testified in support of HB 69.
ACTION NARRATIVE
TAPE 99-20, SIDE A
Number 0001
CHAIRMAN NORMAN ROKEBERG called the House Labor and Commerce
Standing Committee meeting to order at 3:18 p.m. Members present
at the call to order were Representatives Rokeberg, Halcro,
Murkowski, Harris and Cissna. Representatives Sanders and Brice
were absent. The committee took a brief at-ease from 3:24 p.m. to
3:25 p.m.
HB 94 - ABC BD EMPLOYEES NOT EXEMPT EMPLOYEES
Number 0037
CHAIRMAN ROKEBERG announced that the first order of business before
the committee would be HB 94, "An Act removing employees of the
Alcoholic Beverage Control Board from the exempt service."
Number 0057
PAT HARMAN, Legislative Administrative Assistant to Representative
Kott, Alaska State Legislature, informed the committee that HB 94
is a repeal of Alaska Statute 39.25.110(15) which states that
agents of the Alcoholic Beverage Control Board (ABC Board) are
granted limited peace officer powers and listed under the exempt
service. In practice, agents of the ABC Board are in the
classified service as normal civil servants. This statute is no
longer applicable and should be repealed. Mr. Harman noted that
Doug Griffin with the ABC Board was online in Anchorage and could
answer questions regarding the agency. He indicated Marco
Pignalberi, who had served as an agent when the agency employees
were exempt, had been expected as well.
CHAIRMAN ROKEBERG said that HB 94 is clearly a housekeeping matter
and the committee packet contains the statute.
REPRESENTATIVE MURKOWSKI asked if subsection (15) was ever
applicable.
MR. HARMAN replied yes. He indicated a portion of the statute was
probably applicable over 25 years ago which is as far back as there
is corporate knowledge.
Number 0246
DOUG GRIFFIN, Director, Alcoholic Beverage Control Board,
Department of Revenue, testified via teleconference from Anchorage.
Mr. Griffin had no position on HB 94, but concurred with Chairman
Rokeberg's assessment of HB 94 as a housekeeping matter. Mr.
Griffin confirmed to Chairman Rokeberg that he did not object to
the passage of HB 94 by the committee and the legislature.
CHAIRMAN ROKEBERG closed the public testimony, there being no
further questions or testimony.
Number 0305
REPRESENTATIVE HALCRO moved to report HB 94 out of committee with
individual recommendations and the accompanying zero fiscal note.
There being no objection, it was so ordered.
HB 69 - ALCOHOLIC BEVERAGE CONTROL BOARD
Number 0320
CHAIRMAN ROKEBERG announced that the next order of business before
the committee would be HB 69, "An Act relating to the Alcoholic
Beverage Control Board; and providing for an effective date."
Chairman Rokeberg noted the committee packet included a few
amendments for the committee's consideration.
Number 0384
DOUG GRIFFIN, Director, Alcoholic Beverage Control Board,
Department of Revenue, testified via teleconference from Anchorage.
Mr. Griffin confirmed to the chairman that those present in
Anchorage had copies of the four proposed amendments.
CHAIRMAN ROKEBERG noted that Version G, 1-LS0354\G, Ford, dated
2/19/99, of HB 94 is before the committee. He informed everyone
that it was his intention to take up the amendments for discussion
and action.
Number 0482
CHAIRMAN ROKEBERG called a very brief at-ease at 3:30 p.m. due to
a teleconference malfunction. The committee came back to order in
less than a minute without the teleconference.
Number 0490
CHAIRMAN ROKEBERG explained to the committee that the amendment,
1-LS0354\G.1, Ford, 2/23/99, relates to the sales of alcoholic
beverages for weddings and florists. Chairman Rokeberg referred to
subsection (j) of amendment G.1 which ultimately holds the licensee
responsible for delivery, and subsection (k) of amendment G.1 which
clarifies the hours of delivery. After the teleconference
connection was restored, the public hearing began. Chairman
Rokeberg informed everyone that if the testimony could be concluded
today as well as consensus on the amendments, he wanted to move the
legislation to its next committee of referral, the House Finance
Standing Committee.
Number 0646
ROD HANCOCK, Co-Owner, Moose's Tooth Pub and Pizzeria, Moose's
Tooth Brewing, testified via teleconference from Anchorage. He
said that he had seen amendment G.3 which seems to satisfy the
Moose's Tooth special case as well as allowing the
brewery-restaurant combinations to move forward. This is an
acceptable compromise. Mr. Hancock said that his previous
testimony would remain.
CHAIRMAN ROKEBERG asked if Mr. Hancock's comment about moving
forward meant expanding the premises by obtaining a beverage
dispensary license and growing the business.
MR. HANCOCK agreed with Chairman Rokeberg's interpretation. When
the Moose's Tooth was formed in 1996, the plan was to open multiple
locations in Alaska. Halfway through the process, the rules were
changed. This resulted in the Moose's Tooth not being able to
expand beyond the single restaurant. Mr. Hancock said this is a
compromise and limits barrelage, but allows the restaurant to
continue with its original plan of opening multiple restaurants.
Number 0806
CHAIRMAN ROKEBERG pointed out that the provisions of the proposed
committee substitute (CS) provide that a beverage dispensary
license brewpub category would be allowed to sell to distributors
on a wholesale basis. How would that differ from the current sales
allowed to the public or "out the back door rather than on the
premises?"
MR. HANCOCK clarified that currently there is no barrelage
restriction, therefore the Moose's Tooth Brewery can produce as
much beer as it can sell. Currently, the Moose's Tooth is not
restricted to selling beer to wholesalers. Mr. Hancock informed
the committee this legislation would not allow the Moose's Tooth
Brewery to continue its current practice of self-distributing its
beer to its accounts. However, it is an acceptable compromise to
be forced to use distributors. In response to Chairman Rokeberg,
Mr. Hancock said the brewery was allowed to sell to other licensees
including restaurant eating place licensees and beverage dispensary
licensees.
CHAIRMAN ROKEBERG surmised then that Mr. Hancock could sell to a
bar or restaurant, a package store, a distributor, or any other
licensee under the State of Alaska due to the uniqueness of a
brewery classification.
Number 0913
MR. HANCOCK agreed with Chairman Rokeberg's statement, but pointed
out that all restaurant-brewery combinations can do that as well.
He noted some of the restaurant-brewery combinations have zoning
issues, due to city regulations, that may be restrictive. All
restaurant-brewery combinations are allowed to sell as much beer as
desired and self-distribute that beer if they so choose. Mr.
Hancock emphasized that self-distributing is not all it's "cracked
up to be sometimes."
CHAIRMAN ROKEBERG pointed out that the proposed CS, Version G,
would prohibit self-distributing.
MR. HANCOCK said that he would be forced to use a distributor who
picks up the beer, often promotes the beer, and distributes the
beer. Consequently, the distributor would take a portion of the
sale per keg which would reduce his business's profit margin a bit.
With regard to why Mr. Hancock would agree to that, he explained
that he wanted to come to a compromise in order to move forward
with his restaurant.
REPRESENTATIVE HALCRO understood that under the proposed CS and
amendments, Mr. Hancock would have to purchase a dispensary license
if opening another location.
Number 1037
MR. HANCOCK said that he was prepared to purchase another
dispensary license in order to open another location. He
acknowledged this is not an ideal situation and stressed that he
would not sell hard alcohol at his restaurant even with the
beverage dispensary license. There is a small fringe benefit of
live music, but Mr. Hancock did not intend to increase his current
once-a-month use of live music. Mr. Hancock stated that he was
prepared to spend $125,000 to $150,000 in order to expand.
REPRESENTATIVE MURKOWSKI asked Mr. Hancock if beverage dispensary
licenses are readily available.
MR. HANCOCK replied that, from his inquiries, beverage dispensary
licenses are available. He noted that the price reflects the
supply and demand of the beverage dispensary license. Mr. Hancock
pointed out that the city has issue with certain areas of the
beverage dispensary licenses and he would have to reapply for his
conditional use permit.
Number 1134
REPRESENTATIVE MURKOWSKI asked if limitations would be placed on
the ability to purchase a full beverage dispensary license due to
the location of an establishment. Would there be the possibility
of opposition from his community council or similar organization?
MR. HANCOCK said that he had not fully reviewed that matter, but
was fairly convinced that the location of the Moose's Tooth would
not be a problem. He noted his restaurant was a family restaurant.
With to amendment G.3, Mr. Hancock felt it was alright.
Number 1252
GARY KLOPFER, Majority Owner, Snow Goose Restaurant, Sleeping Lady
Brewing Company, testified via teleconference from Anchorage. The
Snow Goose Restaurant is a restaurant-brewery combination. In a
preliminary view, Mr. Klopfer was opposed to the entire bill which
merely "band-aids" a bad situation. The entire code should be
reviewed in order to determine what is best for the state and the
industry. He informed the committee that he and his associate were
the first to apply for a restaurant brewery license in downtown
Anchorage. That combination was desired because the original
capacities were not large enough for a "brewpub brewery" and there
was no intention to serve hard liquor. Originally, there were five
restaurant-brewery combinations with the majority concentrated in
Anchorage. Mr. Klopfer believed the liquor license holders of
Alaska originally felt the restaurant-brewery combination would
wreck havoc on the value of the liquor license and create
competition that would destroy the liquor license holder's
business. Of the original five restaurant-brewery combinations,
the four in Anchorage had spent in excess of $7 million to open the
establishments that employ hundreds of people and pay millions to
the local vendors. Mr. Klopfer imagined that any economically
sane-minded person would endorse this industry, however Alaska
chose to make it illegal. The notion people chose the
restaurant-brewery combination because they did not want to
purchase a liquor license is misguided. Mr. Klopfer indicated that
one would have a difficult time finding a liquor license holder in
the Anchorage area that would say they were impacted by the
restaurant breweries which are an expensive operation. He informed
the committee that he spent over $500,000 just on the brewery for
the Snow Goose Restaurant and Brewery. It would have been cheaper
to spend $125,000 to $150,000 for a liquor license.
Number 1432
MR. KLOPFER said that he would prefer to return to the way it was
three years ago. He believed it to be in the best interest of the
state, future of employees, and future tax revenues to allow this
industry to grow. Mr. Klopfer informed the committee that he was
in the process of forming a state brewers guild in order to develop
some guidelines that would help everyone move forward. This
legislation will hurt the industry. Mr. Klopfer suggested that the
appropriate action would be to rescind the grandfathering of the
brewery dispensary licenses and allow anyone to obtain a brewery
dispensary license. He supported those holding a liquor license to
supply their own establishment with beer, but was opposed to
allowing those holding a liquor license the ability to wholesale
beer to other establishments that they do not own. A brewpub or a
liquor license holder would now become a quasi-brewery that
directly competes with breweries. He noted one of his licenses is
a brewery license. Mr. Klopfer suggested the deletion of
subsection (b) of amendment G.3 which allows wholesaling to a
licensed wholesaler.
CHAIRMAN ROKEBERG asked, "But Mr. Klopfer, do you not now as a --
because of your combination exempt license brewery owner allowed to
sell to distributors and to retail establishments, so doesn't that
restrict them? ... Or is it because the brewpub provision now does
not allow any kind of off-sell [off-site] sales over five gallons?"
MR. KLOPFER explained that presently with the purchase of a liquor
license one can become a brewpub which restricts consumption of the
beer to onsite. "I believe with this bill, I'm in favor if you own
other establishments, that in fact you can supply those
establishments because it's obviously coming out of the same
pocket. ... There is a way there that it would definitely be not in
favor of a brewery licensed owner to have that happen, in my
opinion."
Number 1614
CHAIRMAN ROKEBERG asked if Mr. Klopfer would prefer to have two of
his competitors change to beverage dispensary licenses to become
brewpubs and, therefore, not be able to compete with the Snow Goose
in the wholesale market for brewed beverages.
MR. KLOPFER replied no. Mr. Klopfer did not want the
restaurant-brewery combination establishments to have to buy liquor
licenses. Unfortunately, this legislation is pushing the
restaurant-brewery combinations to purchase liquor licenses. Mr.
Klopfer indicated he believed most of the restaurant-brewery
combinations owners would be in favor of rescinding the prohibition
against the expansion of combination establishments, as he would
be. He felt it ridiculous that Mr. Hancock would have to purchase
a $150,000 liquor license when he did not want to sell liquor.
With regards to downtown Anchorage, there is concern with the
number of hard liquor licenses and therefore, if the two
establishments downtown wanted to sell hard liquor there would be
more serious review of the issue.
CHAIRMAN ROKEBERG noted that he had heard Mr. Klopfer testify
before the ABC Board and various committees over the years. He
asked if Mr. Klopfer was the person who had started the concept of
the exempt brewpub restaurant license
MR. KLOPFER replied yes.
CHAIRMAN ROKEBERG said, "What you're asking this committee to do is
go back to your idea that you got in statute four years ago and
override what the legislature did three years ago to correct that
mistake of public policy. So, it's a matter of how you view public
policy and how the legislature at that time viewed public policy.
Is that a correct assessment?"
MR. KLOPFER said that Chairman Rokeberg was incorrect. Mr. Klopfer
explained that the original public policy stood for Alaska for many
years and no one abused it.
CHAIRMAN ROKEBERG interjected that he was referring to the existing
liquor laws.
MR. KLOPFER reiterated that he did not want to serve hard liquor,
but rather make beer to sell to the public.
CHAIRMAN ROKEBERG surmised then that Mr. Klopfer had the law
changed to accommodate his desire to make beer and sell it to the
public.
MR. KLOPFER replied no. Mr. Klopfer emphasized that he utilized
the existing law. He stated, "You changed the law after the fact."
CHAIRMAN ROKEBERG did not believe that to be correct.
MR. KLOPFER said that he had the statutes to prove it.
Number 1746
CHAIRMAN ROKEBERG explained that in 1988 the brewpub license came
into effect and the "Cyrano's clause" of the statute of 1994
allowed the brewpub exempt licenses to exist. He asked if that is
correct.
MR. KLOPFER agreed that was correct, but noted that a brewpub
license is under a liquor license. He stated he never applied, nor
did he want, a brewpub license. Mr. Klopfer said he went for a
brewery and restaurant license. In further response to Chairman
Rokeberg, Mr. Klopfer clarified that he has a brewery license and
a restaurant license.
CHAIRMAN ROKEBERG pointed out under that existing statute that
would be an exempt license.
MR. KLOPFER agreed. He explained that as of October 1996 it is
illegal to receive a brewery and restaurant license.
REPRESENTATIVE HALCRO requested that Mr. Klopfer address other
concerns with the current statutes that tie his hands with regard
to expansion and sale or transfer of his restaurant brewery
business.
Number 1808
MR. KLOPFER informed the committee that his license only exists as
long as he is alive. He referred to Code section 411 to 450 which
created the exemption that does not include any language regarding
transfer of the sale of the business. Under the current statutes,
Mr. Klopfer cannot transfer his business. Further, the desire to
expand, as in Portland where the McMenamins brothers have
redeveloped old properties into viable entities, is not an option
here.
MR. KLOPFER, in further response to Representative Halcro, believed
that he, as the licensee, may not transfer the license. Mr.
Klopfer understood from discussions with the ABC Board that if he
wanted to sell the business, the new owner would have to buy a
liquor license. He informed the committee that the Snow Goose
Restaurant and Brewery employs on average 80 employees year-round,
and spent approximately $1 million with vendors in the local
economy, and tens of thousands of dollars in taxes.
Number 1948
REPRESENTATIVE HALCRO said that upon this discussion, he has
determined this to be an "political hot potato." He asked if Mr.
Klopfer would be amenable to a conceptual amendment allowing the
sale or transfer of this combination license with certain
restrictions.
MR. KLOPFER replied no. He believed it a travesty that the current
law exists. If someone wanted to open up a one barrel brewery and
sell hamburgers next door, that is illegal, which Mr. Klopfer
believed to be ludicrous. Furthermore, it does not make economic
sense to require that person to purchase a liquor license. For the
future, Mr. Klopfer believed the law should return to the point
where people can own a brewery and restaurant.
Number 2032
MARK STAPLES, Founder and Majority Owner, Midnight Sun Brewing
Company, testified via teleconference from Anchorage.
CHAIRMAN ROKEBERG noted that the committee should have a letter
from Mr. Staples.
MR. STAPLES agreed with Mr. Klopfer's testimony. Mr. Staples was
opposed to forcing the utilization of a distributor. In most
areas, there are three distributors who are "Bud," "Miller" and
"Coors." "These big breweries have come down with huge incentives
for these distributors to give what Budweiser, that's
Anheuser-Busch, calls 'one hundred percent peace of mind' and and
what they're doing is giving such incentives to these distributors
that if they stop distributing other products besides their own."
He pointed out that most distributors are not taking on any new
products, but rather are trying to reduce the number of products.
This could result in the inability to find a distributor and sell
the beer outside of the restaurant. Even if a distributor were
found, who is to say that the distributor would do a good job
distributing the beer. Mr. Staples said that forcing the use of a
distributor eliminates the motivation of the distributor to do a
good job for the craft brewery and leaves the brewery no recourse.
Mr. Staples opposed legislation requiring a brewery to use a
distributor.
MR. STAPLES informed the committee that when he started the
Midnight Sun Brewing Company, it was legal to own a restaurant and
a brewery license. Currently, those breweries that have
grandfathered licenses have the ability to sell both retail and
wholesale and, therefore, can compete with the Midnight Sun Brewing
Company, which places Mr. Staples at a disadvantage. Mr. Staples
noted that he had no desire nor means to acquire a liquor license.
Mr. Staples supported returning to the law that allowed breweries
and restaurants to obtain a license to do both.
CHAIRMAN ROKEBERG referred to Mr. Staples' letter which states that
it is not economically feasible for most small, would-be
restaurant-breweries to purchase beverage dispensary licenses. The
current statute does not allow that.
MR. STAPLES agreed and said that he would like that changed.
CHAIRMAN ROKEBERG interpreted Mr. Staples' desire for change to
mean that he wanted to create a tavern in Alaska.
MR. STAPLES disagreed with that interpretation. Mr. Staples
clarified that he wanted to return to 1985 when it was legal to own
a restaurant license as well as a brewery license which was the
case until 1996. Legislation was passed due to the fear of the
beverage dispensary owners that their license would be devalued
because of a brewpub being located on every corner. As Mr. Klopfer
stated, there will not be a brewery on every corner because the
market cannot handle it.
Number 2247
CHAIRMAN ROKEBERG asked if, as a brewery, a brewery can sell to
retailers or any other licensee while brewpubs are not allowed the
same.
MR. STAPLES agreed.
CHAIRMAN ROKEBERG asked if the actual level of competition with Mr.
Staples from the exempt licenses might be reduced under the
proposed CS since it would allow these exempt licenses to convert
to beverage dispensary licenses and then allow them to sell to
distributors.
MR. STAPLES replied yes and noted that in the short-term this
legislation may help his business by reducing his competition.
However, using common sense, if a business wants to sell beer, the
business should not have to purchase a hard liquor license. The
brewing industry in Alaska is very young and in order to expand
this industry it should be easier to enter this business. Mr.
Staples expressed interest in expanding the entire industry.
CHAIRMAN ROKEBERG pointed out that what Mr. Staples is proposing is
called a tavern in other states, where only beer and wine are sold.
MR. STAPLES pointed out that in other states this is legal. He
asked how having a brewery on one side of town and a restaurant on
the other could be considered a tavern.
CHAIRMAN ROKEBERG explained, "Because you are able to sell without
having a very limited menu." He said that is in Alaska Statute.
MR. STAPLES stated that the restaurant license already includes
restrictions regarding the percentage of food and beer or alcohol
that must be sold which is not an issue. None of the brewpubs come
close to selling as much beer as food, revenue wise.
Number 2363
S.J. KLEIN, President and Founder, Borealis Brewery, testified via
teleconference from Anchorage. Although the Borealis Brewery, a
production brewery in Anchorage, is not a brewpub, Mr. Klein was
interested in this legislation because it is related to the making
of beer in Alaska. Mr. Klein believed that the legislation to date
had confused two issues: the making of beer and how that beer is
sold. The current laws are not ideal. The Anchorage area saw four
brewery-restaurant combinations racing to open before 1995 to 1996.
Since that time and since the change in law, there have been no new
brewery/restaurants, or brewpubs, or restaurants affiliated with
the concept of crafting their own beer in the Anchorage area. Mr.
Klein believed this fact helps support the notion that requiring a
beverage dispensary license to start up a brewpub is somewhat
restrictive. This is bad for the beer-making industry which is in
its infancy in Alaska. He noted that the Alaskan Brewing Company
has been in operation for over a decade, but there has not been
another brewery operating for more than five years. In the Lower
48, there are hundreds of breweries that have been operating for
quite sometime and have contributed quite a bit to their respective
local economies.
TAPE 99-20, SIDE B
Number 0001
MR. KLEIN did not believe that any legislation encouraged economic
success of brewing companies. With regard to the amendments, he
emphasized that the amendments are a compromise which he did not
view any differently than the compromise existing since 1995. The
restriction to distribution through a wholesaler is not a long-term
solution. If the focus of this legislation is to encourage local
beer-making and the employment that it creates, the legislation
would be worth review.
Number 0134
REPRESENTATIVE HALCRO posed the following scenario. A person
wanted to open a brewery/restaurant, invest over $500,000 on the
equipment, and serve food. A beverage dispensary license could
cost upwards of $180,000 and a beer and wine license [restaurant or
eating place license] can cost up to $125,000, which is a
significant difference in the price. He asked if tight constraints
are desired when a person brews beer and is serving food? To
Representative Halcro it was of no consequence whether the beer was
brewed "out your back door" or purchased from "Budweiser" because
in either case the beer was sold in the restaurant. What
percentage of beer sales are wholesale for the Moose's Tooth or the
Snow Goose?
MR. KLEIN said that there is a full set of laws which regulate the
sale of beer to the public. The fact that a restaurant makes beer
does not affect the restaurant's ability to sell beer whether that
beer is Budweiser or homegrown ale. The issue becomes problematic
with regard to other restaurant owners. For example, Diane
Thompson (ph) at "Humpy's" [Humpy's Great Alaskan Alehouse] would
question why Glacier Brewhouse could sell a half gallon of beer
"out the door" to a customer if she could not? The law seems to be
clear on that issue in that the act of brewing beer is licensed
separately from the act of serving beer in a restaurant. He
believed the current law requires a line of demarcation between the
act of brewing and serving beer which he was unsure of in the case
of a brewpub. Mr. Klein indicated that the sales to other premises
is not a major portion of the Moose's Tooth and Snow Goose's
business, for them it would be a matter of prestige as well as
increasing attention to local products. Mr. Klein did not believe
that was bad for the industry.
Number 0305
CHAIRMAN ROKEBERG viewed Mr. Klein as a person dedicated to the art
of brewing beer in Alaska and would encourage that. Chairman
Rokeberg asked if Mr. Klein would like the law to allow a
restaurant operation more easily.
MR. KLEIN said that he had no desire to open a restaurant; his
interest is that the beer be perfect. However, Mr. Klein did not
believe that making beer should restrict him from becoming an owner
in a restaurant elsewhere. The "Tidehouse (ph) Laws" currently
existing were intended to keep say, Anheuser-Busch Companies,
Incorporated, from buying restaurants and bars in Alaska and having
a straight-through distribution like that. A lot of those at the
table today illustrate that encouraging a single-tier production to
plate system like these restaurant-brewery combinations have has
proven to be an economic boon for the state. Mr. Klein said, "When
you step back from, sort of the individual requirements, the
individual requirements, what each of us want out of the
legislation to the general goal of fostering economic growth up
here. I don't think there is anything wrong with that at all."
Mr. Klein did not like any operation being forced to sell only
through a wholesaler for the same reasons Mr. Staples outlined.
The more restrictions placed on the act of beer making, the more
problematic running a business becomes. This is a really tough
business.
Number 0467
REPRESENTATIVE MURKOWSKI understood Mr. Klein to suggest that this
legislation was not so bad given the alternatives. She pointed out
that Mr. Klein is viewing this from the brewery perspective and
others present view this from the brewpub perspective. Could all
of you, with a little more time, produce a better piece of
legislation?
MR. KLEIN stated that there had been much discussion. Mr. Klein
said that there are others who have more interest in the specific
amendment. If the goal is to encourage growth in the industry, the
brewers, given the right forum, could produce something that made
more sense. There is not much to model from in the Lower 48.
There is a new guild, the "Craft Breweries Guild," that is forming
which he foresaw encouraging discussions on this issue. Mr. Klein
reiterated that his interest was to ensure the committee realize
that passage of these amendments is merely a temporary fix. There
is a reason no new brewpubs have opened in the Anchorage area for
the past three or so years, and that is not necessarily a good
thing.
Number 0599
REPRESENTATIVE HALCRO asked Mr. Hancock of the Moose's Tooth what
would he do with the $180,000 if he had the ability to expand and
did not have to purchase a beverage dispensary license. What would
happen if the state did not require the purchase of a license that
Mr. Hancock and his colleagues did not need nor want?
MR. HANCOCK did not doubt that with more capital, a business could
grow faster. The money could be used to do all kinds of things.
Mr. Hancock agreed that this legislation was a "duct tape" fix to
this issue, but at least those in the game would be allowed to
expand which he was ready to do.
Number 0700
CHRIS ANDERSON, Co-Owner, Glacier Brewhouse, testified via
teleconference from Anchorage. This is a compromise which is the
key. Mr. Anderson informed the committee that he has spent years
on this issue. The first years were spent doing exactly what Mr.
Klopfer detailed; that expansion be allowed under the rules the
business were created under. This compromise has resulted after
years of discussion with the Cabaret Hotel and Restaurant Retail
Association (CHARR), the Anchorage Restaurant and Beverage
Association (ARBA), the ABC Board, wholesalers, legislators, and
many more. This compromise allows brewery/restaurants who wish to
expand the ability to expand. If this legislation is tabled, the
ability to expand would not be available. For years, the inability
to expand has cost the industry millions in revenue, millions in
payments to employees and vendors. Mr. Anderson was not happy that
he would have to purchase a beverage dispensary license in order to
solve this problem, but that is the compromise. The battle may not
be over. The brewers guild, of which Mr. Anderson is a member, can
propose legislation and work with the players of the issue to
provide viable options. Mr. Anderson believed the intent of the
legislation was to allow a vehicle for expansion of those brewpubs
desiring expansion. This is not a perfect solution, but it is "a"
solution. The people involved that are interested in expansion of
their business and would spend the money to expand are satisfied
while those not willing to do that are unsatisfied. Mr. Anderson
urged the committee not to let this issue get out of control. From
Mr. Anderson's perspective, he wanted to expand his business.
Number 0869
CHAIRMAN ROKEBERG inquired as to who Mr. Anderson was compromising
with.
MR. ANDERSON informed the committee that he had met with the ABC
Board, CHARR, ARBA, and distributors. There were several formal
meetings during which these issues were discussed and resulted in
legislation that was thought would pass through, but did not. This
issue has been brought to the attention of all those who have been
opposed in the past. Mr. Anderson stated that everyone has backed
away and wants to allow expansion for those business interested in
such. There are larger issues facing the industry. Mr. Anderson
believed that stopping this legislation would stop commerce. In
further response to Chairman Rokeberg, Mr. Anderson informed the
committee that CHARR and ARBA employ hundreds and hundreds of
people in Alaska. He pointed out that CHARR and ARBA are currently
aligned with the hotel and restaurant association. He noted all
three of these organizations have given their vote on this bill,
commenting that that is thousands of people throughout the state.
CHAIRMAN ROKEBERG surmised that those organizations would comprise
over hundreds of businesses and tens of thousands of people.
MR. ANDERSON agreed with Chairman Rokeberg's assessment.
Number 0976
REPRESENTATIVE MURKOWSKI noted that Mr. Anderson had stated that
the he had been in negotiation and conversation with CHARR, ARBA
and others which resulted in the compromise before the committee.
She pointed out that the committee does not have any correspondence
from CHARR or ARBA stating their support. Representative Murkowski
was curious if anyone from CHARR was present to provide feedback on
this. Representative Murkowski appreciated the ongoing process
that resulted in this difficult compromise. If no one is terribly
excited about the compromise, Representative Murkowski felt that
was probably a sign that it is a good compromise.
CHAIRMAN ROKEBERG mentioned that there are observers from CHARR who
are available for comments after the completion of questions to Mr.
Anderson. Chairman Rokeberg informed the committee that CHARR is
aware of the proceedings, but has been waiting to see the
amendments before composing a letter.
REPRESENTATIVE HALCRO detected frustration in the voice of Mr.
Anderson. Representative Halcro acknowledged that this has been a
three-year journey. Representative Halcro believed Mr. Anderson
would agree that this discussion of the changes is occurring
because the restrictive language was placed in this bill by
legislators who were serving their constituents which
Representative Halcro said he was doing.
MR. ANDERSON said he did not disagree with Representative Halcro's
comments.
CHAIRMAN ROKEBERG requested that Doug Griffin of the ABC Board
comment on the amendments.
Number 1125
MR. GRIFFIN said he believed the amendments, specifically G.3, did
address some of the unique situations such as the Moose's Tooth.
This would allow the option of expansion through the purchase of a
beverage dispensary license. Mr. Griffin said that he understood
the concerns of Mr. Klopfer and others regarding the beverage
dispensary license. Mr. Griffin pointed out that the board did
address this issue and offered SB 138 last year which did not
progress. Senate Bill 138 would have allowed a restaurant eating
place licensee to get a brewpub license without purchasing a
beverage dispensary license. The main opposition to that was from
those with the beverage dispensary licenses. Mr. Griffin agreed
that Mr. Anderson promoted the compromise in order to move the
discussion forward and allow the expansion of commerce. Mr.
Griffin believed the ABC Board took the same view. The ABC Board
is sort of neutral, but the board does see the value of the
expansion of businesses. "So therefore, I, we do support this
approach to that extent. It's not comprehensive and it's not a
total fix; it is the duct tape solution, but it will work. And we
think it's something that we can administer."
CHAIRMAN ROKEBERG referred to amendment G.1, Sections 5 and 6
regarding the control licensee as related to the florist. Is the
board comfortable with the provisions in G.1 as written?
MR. GRIFFIN pointed out that the language in G.1 is language
developed by the board in response to a request from Senator
Torgerson on behalf of a constituent in Seward. Mr. Griffin
indicated the need to clarify the language since he differed with
the explanation provided to the committee at the last meeting. He
explained that the board would, in terms of delivery, hold the
liquor licensee responsible. The board feels comfortable with
the language. Mr. Griffin commented that the board attempts to
find the balance between alcoholic beverage commerce and protection
of the public which resulted in the restrictions placed on the
delivery and purchase of the delivery products. With regard to
whether this would exclude grocery stores, Mr. Griffin interpreted
the language as not excluding grocery stores.
Number 1475
REPRESENTATIVE MURKOWSKI referred to amendment G.1 and pointed out
that both subsections provide that the board would issue a permit
to the licensee authorized to deliver the alcoholic beverages.
Would that language change the zero fiscal note? She clarified
that she was referring to whether it would cost the board more to
operate it.
MR. GRIFFIN viewed it as a wash. Anything collected would cover
the cost. He acknowledged that the board could not predict this.
This will mainly be used to keep track of who does deliveries
similar to the monitoring of those package stores that are in the
written order business. The permit is not designed to be a money
generator, but would cover the costs.
REPRESENTATIVE MURKOWSKI referred to subsection (k) in amendment
G.1 which requires that delivery can only be made to a responsible
adult who provides positive identification and proof of age. No
such language exists in subsection (j) referring to deliveries to
cruise ships. Is there any reason there was no proof of age
requirement in subsection (j)?
MR. GRIFFIN agreed that the language referring to deliveries to
cruise ships does not specify that. He noted that there are many
provisions in Title 4 that require alcohol only be received by
persons of age. Mr. Griffin said it would not hurt to add language
to the cruise ship and hotel subsections because the desire is to
have the same criteria apply. Through testimony received during
the development of this language it was brought forth that often
these deliveries are made to a purser or other officer due to the
security on the ship. Still the person receiving the delivery
would need to be of age.
REPRESENTATIVE MURKOWSKI asked, in reference to amendment G.3, if
the beverage dispensary license would be readily available.
MR. GRIFFIN informed the committee that in Anchorage approximately
10 beverage dispensary licenses exist which are not operating or
are not tied to a premise that is operating. That is more
non-operating beverage dispensary licenses than has been the case
in some time. Mr. Griffin did not follow the price, but he
indicated that the range of $125,000 to $180,000 was probably
accurate.
Number 1774
REPRESENTATIVE HALCRO inquired as to how many beer and wine
licenses are available or are those restricted.
MR. GRIFFIN said that type of license is restricted. He clarified
that the beer and wine license is the restaurant eating place
license. Twice as many restaurant eating place licenses are
available. Mr. Griffin explained that the beverage dispensary
license is restricted to one per every population of 3,000 which is
being exceeded. A restaurant eating license is restricted to one
per every population of 1,500. Currently, there is not a secondary
market for restaurant eating place licenses. There are about
twelve restaurant eating place licenses available which allows a
person to come in and purchase a restaurant eating place license
from the board without shopping around which would be required for
the beverage dispensary license.
CHAIRMAN ROKEBERG informed Mr. Griffin that he had an amendment
referring to the proposed CS, Version G, page 5, line 21 changing
the year from 2002 to 2003 or 2004. Chairman Rokeberg asked which
year Mr. Griffin would prefer.
MR. GRIFFIN stated that he appreciated anything that could be
given.
REPRESENTATIVE MURKOWSKI requested that Mr. Griffin comment on
amendment G.4 which would eliminate the restriction regarding how
much an individual may bring into a premise.
Number 1974
MR. GRIFFIN believed that the amendment was offered by Chairman
Rokeberg who was being responsive to a comment from the chairman of
the ABC Board who had spoken solely on his own behalf. The issue
of corkage has not been discussed with the board as a body. Prior
to the last hearing, Mr. Griffin said he had talked with Bob Klein,
the chairman of the ABC Board. Mr. Klein asked that Mr. Griffin
inform the committee, on Mr. Klein's behalf, not as a member of the
board, that there may be instances that people would want to bring
more alcohol. Mr. Griffin conveyed that Mr. Klein felt that would
be acceptable as long as the licensee is in full control with the
ability to not over serve someone, as if the licensee were selling
their own alcoholic products. He noted Mr. Klein felt that the one
bottle for every two person restriction was really not necessary.
Mr. Griffin said that he could agree with that; the main goal is
that the licensee has the ability to control how much alcohol is
served. Mr. Griffin indicated the restriction might be a problem
in a wine tasting or wine comparison situation.
Number 2116
REPRESENTATIVE MURKOWSKI asked if she had permission to bring in my
own wine into an establishment, would she then turn the wine over
to the server who refills the glass and keeps the bottle. What
does the reference to the licensee maintaining control mean?
MR. GRIFFIN agreed with Representative Murkowski's description.
REPRESENTATIVE HALCRO inquired as to how corkage would effect host
liability laws.
MR. GRIFFIN referred to amendment G.2 which would insert "With the
permission of the licensee, a" language. Mr. Griffin emphasized
that if this corkage would be allowed, it must be clear that the
licensee has the ability to restrict and stop serving. The
licensee must be able to control the situation because the licensee
has to have the connection with what is going on at the table. Mr.
Griffin reiterated that the main point is that the wait person or
licensee's representative must be present to monitor the situation.
Therefore, the host liability should not be affected.
Number 2324
CHAIRMAN ROKEBERG asked if anyone else wished to testify on HB 69.
Hearing none, the public testimony on HB 69 was closed. Chairman
Rokeberg directed discussion to the amendment regarding the
extension of the ABC Board. He favored extending the board for two
years. The ABC Board was extended for one year last year by the
"golf course bill" [HB 458] authored by the chairman. The audit
indicated extension to the year 2002. Chairman Rokeberg believed
the extension should be to the year 2003 or 2004.
REPRESENTATIVE HALCRO expressed concern that the renewal of the ABC
Board is the only manner in which outstanding issues would be
addressed. Representative Halcro believed that by extending the
board to the year 2004, some issues not addressed to some people's
satisfaction would have to wait five years before being able to
address those issues. This is of grave concern because a number of
these items are restrictive and unfair. If these issues are not
addressed this year, they should be addressed next year or the year
after. He did not believe waiting five years would be beneficial
to anyone.
CHAIRMAN ROKEBERG noted that there is nothing to dissuade
Representative Halcro from introducing a bill on the subject.
REPRESENTATIVE HARRIS pointed out that the items before the
committee are add-ons to the original legislation.
TAPE 99-21, SIDE A
Number 0001
REPRESENTATIVE HARRIS asked if there were any glaring problems with
the last audit [Audit Report, September 8, 1997, Division of
Legislative Audit].
CHAIRMAN ROKEBERG replied that there were three recommendations,
and two of those were "housekeeping/accounting-type procedures."
The major criticism, he added, was regarding following the
recommendations of local bodies; however, the ABC Board took strong
exception to the auditor's position.
Number 0049
REPRESENTATIVE MURKOWSKI indicated that she reviewed the audit
before the first hearing of HB 69. She noted that she was very
interested in the definition of authority that ABC investigators
have, how that has extended from licensing to actually making
arrests for prostitution and gaming. She inquired as to the full
scope of that authority. She advised that the auditor's
recommendation was for an extension to be granted, and that there
was nothing in his report that would inhibit that; however, she
stressed that the audit did raise some interesting issues that the
committee would do well to look into at a future date.
CHAIRMAN ROKEBERG agreed. He pointed out that the legislature
granted a one-year extension last year based on the 1997 audit,
bringing the sunset date to 2003.
Number 0197
REPRESENTATIVE HALCRO reopened the question of broadening the base
of responsibility of the ABC Board to include tobacco enforcement
and/or gaming. He agreed with a comment made by United States
Senator Ted Stevens who, when asked why so many riders were being
attached, said, "It's the only train leaving the station." That
being the case, Representative Halcro added, "I think we need to
make sure that it comes around more than once every five years."
Number 0247
CHAIRMAN ROKEBERG called an at-ease at 5:03 p.m. The committee
came back to order at 5:07 p.m.
Number 0284
REPRESENTATIVE MURKOWSKI made a motion to adopt Amendment G.1,
labeled 1-LS0354\G.1, Ford, 02/23/99, which read:
Page 1, line 4, following "licenses;":
Insert "relating to package store licenses;"
Page 3, following line 30:
Insert new bill sections to read:
"*Sec.5. AS 04.11.150(a) is amended to read:
(a) Except as provided under (g),(j) and (k) of this
section, a package store license authorizes the licensee
to sell alcoholic beverages to a person present on the
licensed premises or to a person known to the licensee
who makes a written solicitation to that licensee for
shipment. A licensee, agent, or employee may only ship
alcoholic beverages to the purchaser. Before commencing
the practice of shipping alcoholic beverages, and with
each subsequent application to renew the license, a
licensee shall notify the board in writing of the
licensee's intention to ship alcoholic beverages in
response to a written solicitation. The package store
licensee, agent, or employee shall include written
information on fetal alcohol syndrome and fetal alcohol
effects resulting from a woman consuming alcohol during
pregnancy in a shipment of alcoholic beverages sold in
response to a written solicitation.
*Sec. 6. AS 04.11.150 is amended by adding new
subsections to read:
(j) A package store license authorizes the licensee
to deliver not more than two bottles of wine or champagne
in a gift basket with a floral arrangement to a cruise
ship passenger or a hotel guest. The wine or champagne
for delivery may be purchased from a package store
licensee by a florist or gift basket establishment with
a state business license that designates the business as
a florist or gift basket establishment. The package
store licensee shall keep on file a copy of the Alaska
business license of a florist or gift basket
establishment to which the licensee sells wine or
champagne for delivery to third persons by the package
store. The package store must keep a written record of
each delivery made under this subsection for a period of
at least one year, including the name of the business
purchasing the wine or champagne and the name of the
person to whom the delivery is made. A delivery under
this subsection must be made by the licensee or an
employee or agent of the licensee who has completed
alcohol server training as required under AS 04.21.025.
The board shall issue a permit to each licensee
authorized to deliver wine or champagne under this
subsection and may by regulation impose an administrative
fee for the cost of issuing the permit.
(k) a package store license authorizes the licensee
to deliver alcoholic beverages between the hours of 8:00
a.m. and 5:00 p.m. to a responsible adult at the location
of a wedding or wedding reception or other social event
as defined by regulation of the board. A delivery under
this subsection may be made only after a sale by written
order received from a person present on the licensed
premises who makes payment in full at least 48 hours
before the delivery. The written order must include the
name and address of the purchaser and the date, time, and
address of the delivery, as well as the name and address
of the responsible adult who will receive the delivery of
alcoholic beverages. A delivery authorized under this
subsection must be made by the licensee or an employee or
agent of the licensee who has completed alcohol server
training as required under AS 04.21.025. Delivery may
only be made to a responsible adult at the delivery
address on the written order. The responsible adult must
provide identification and proof of age as defined in AS
04.21.050, and must acknowledge receipt of the alcoholic
beverages in writing. The package store licensee shall
retain the written order and the responsible adult's
written acknowledgment for at least one year after
delivery. The board shall issue a permit to each
licensee authorized to deliver alcoholic beverages under
this subsection and may by regulation impose an
administrative fee for the cost of issuing the permit."
Renumber the following bill sections accordingly.
Page 5, line 23:
Delete "Section 12"
Insert "Section 14"
Page 5, line 24:
Delete "sec. 13"
Insert "sec. 15"
CHAIRMAN ROKEBERG asked whether there was any objection. There
being none, Amendment G.1 was adopted.
Number 0315
REPRESENTATIVE MURKOWSKI made a motion to adopt Amendment G.2,
1-LS0354\G.2, Ford, 02/24/99, which read:
Page 4, line 27:
Delete "A"
Insert "With the permission of the licensee, a"
CHAIRMAN ROKEBERG objected for the purposes of discussion. He
clarified that Amendment G.2 gives the licensee the right to refuse
to do corkage, allowing the licensee to maintain control. Having
said that, Chairman Rokeberg removed his objection, and asked
whether there were any further objections. There being none,
Amendment G.2 was adopted.
Number 0358
REPRESENTATIVE MURKOWSKI made a motion to adopt Amendment G.3,
1-LS0354\G.3, Ford, 02/25/99, which read:
Page 3, following line 30:
Insert a new bill section to read:
"*Sec.5. AS 04.11.135 is amended by adding a new
subsection to read:
(d) Notwithstanding (a) of this section, the holder
of a brewpub license who under the provisions of AS
04.11.450(b) formerly held a brewery license and a
restaurant or eating plate license and who, under the
former brewery license, manufactured beer at a location
other than the premises licensed under the former
restaurant or eating place license may
(1) manufacture not more than 75,000 gallons of
beer in a calendar year on premises other than the
premises licensed under the beverage dispensary license;
(2) provide a small sample of the manufactured
beer free of charge at the location the beer is
manufactured unless prohibited by AS 04.16.030; and
(3) sell the beer authorized to be manufactured
under this subsection
(A) on the premises licensed under the
beverage dispensary license or other licensed premises of
the beverage dispensary licensee;
(B) to a wholesaler licensed under AS
04.11.160; or
(C) to an individual who is present on the
premises where the beer is manufactured in quantities of
not more than five gallons per day."
Renumber the following bill sections accordingly.
Page 5, line 23:
Delete "Section 12"
Insert "Section 13"
Page 5, line 24
Delete "sec. 13"
Insert "sec. 14"
CHAIRMAN ROKEBERG asked whether there was any objection. There
being none, Amendment G.3 was adopted.
Number 0376
REPRESENTATIVE MURKOWSKI made a motion to adopt Amendment 4, which
read:
Page 1, line 4:
After "licensed premises"
Insert ";"
After ";"
Delete: "and"
Insert: "relating"
After "licensed premises" the sentence now
reads "; relating"
Page 4, lines 30-31
Delete: "A person may not bring more than one
bottle of wine for every two persons seated at
the person's table on the licensed premises."
CHAIRMAN ROKEBERG objected for purposes of discussion. He
clarified that Amendment 4 modifies the final changes recommended
by the assistant attorney general and modified by Mike Ford,
Legislative Legal Counsel, Legislative Legal and Research Services,
Legislative Affairs Agency. Secondly, he pointed out, it addressed
corkage removal on page 4, lines 30 to 31, to allow for a fiftieth
anniversary celebration. Having said that, Chairman Rokeberg
removed his objection to Amendment 4, and asked if there were any
further objections. There being none, Amendment 4 was adopted.
Number 0434
REPRESENTATIVE MURKOWSKI made a motion to adopt Amendment 5, which
read:
page 5 Line 21
Delete "2002"
Add "2003"
page 1 Line 7
After "Board"
Add "to June 30, 2003"
CHAIRMAN ROKEBERG asked whether there was any objection. There
being none, Amendment 5 was adopted.
Number 0461
CHAIRMAN ROKEBERG stated, "I would like to thank the committee for
their indulgence in this bill. It is very complicated, and it is
the culmination, basically, of three years of negotiations between
those people in the industry that have beverage dispensary
licenses, and those people that, some four years ago, because of
what I call a quirk in the law, and/or a change in the law that I
think a lot of people in the industry weren't fully aware of,
allowed the creation of the exempt, now grandfathered, combination
brewery restaurant licensure."
Number 0516
CHAIRMAN ROKEBERG added that there were initially five of these
licenses issued, and he believed that four are current. One of
those licenses is for the Armadillo Tex-Mex Cafe in Juneau, and it
was his understanding that they only manufactured about 100 barrels
of beer a year. Consequently, there are three main establishments
involved, and two of the three testified in agreement with this
compromise. He acknowledged that liquor statutes in the state of
Alaska become highly political issues, but Alaska's laws are
patterned on the federal three-tier system that regulates
distributors, wholesalers and retailers. These policies, he
stressed, were made for protection of the public, as well as the
protection of commerce. Chairman Rokeberg declared that the
individuals who would be affected by HB 69, as amended, have agreed
to it, and added that it is a "pro-business, pro-jobs bill."
According to the "Wine Institute," he reported, only four states in
the United States prohibit corkage, and at least 24 states allow
it, including all of the "wine-growing states on the West Coast."
He asked for further comments or objections.
Number 0728
REPRESENTATIVE HALCRO objected, and added, "I understand the hard
work of the last three years and the compromise, but this bill is
still blatantly unfair. I don't think it does anything for labor
or commerce. I think it restricts the ability of business to grow.
I think there is an established, clear-cut firewall between beer
and wine and hard liquor, not only state laws, but federal laws.
I think both sides are very well-protected, as you can tell by the
disparity in the cost of a beer and wine license and a beverage
dispensary license. It is unfortunate that people like Moose's
Tooth or the Snow Goose or Glacier Brewhouse have to go out and
spend $125,000 to $180,000 for the benefit of contributing more to
the property tax base, employing more people, investing more into
the economy. It is truly a travesty, and these restrictions that
are in this statute were put there solely by people protecting
their constituents, and I am just sorry that I couldn't do the
same. I fully intend to stand on the floor and make amendments to
this bill, simply because this is blatantly unfair." Having said
that, Representative Halcro withdrew his objection.
Number 0831
REPRESENTATIVE HARRIS made a motion to move CSHB 69, Version G as
amended, from the committee with individual recommendations and the
attached fiscal note. There being no objection, CSHB 69(L&C) moved
out of the House Labor and Commerce Standing Committee.
ADJOURNMENT
Number 0859
CHAIRMAN ROKEBERG adjourned the House Labor and Commerce Standing
Committee meeting at 5:17 p.m.
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