SB 76-ALCOHOLIC BEVERAGE CONTROL; ALCOHOL REG  3:50:34 PM CHAIR KITO announced that the final order of business would be CS FOR SPONSOR SUBSTITUTE FOR SENATE BILL NO. 76(FIN), "An Act relating to alcoholic beverages; relating to the regulation of manufacturers, wholesalers, retailers, and common carriers of alcoholic beverages; relating to licenses, endorsements, and permits involving alcoholic beverages; relating to the Alcoholic Beverage Control Board; relating to offenses involving alcoholic beverages; amending Rule 17(h), Alaska Rules of Minor Offense Procedure; and providing for an effective date." 3:51:00 PM REPRESENTATIVE WOOL moved to adopt HCS for CSSSSB 76(FIN) as the working document. CHAIR KITO objected for discussion. 3:51:35 PM LAURA STIDOLPH, Staff, Representative Adam Wool, Alaska State Legislature, explained the changes in Version S [included in members' packets], which reads as follows [original punctuation provided]: • Sec 04.09.330, Page 23, line 28 Distillery retail license. Adds: "The holder of a distillery retail license may combine the holder's distilled spirits under this subsection with other ingredients that are not alcoholic beverages, including mixers, liquids, and garnishes." • Sec 04.09.350, Page 26, line 4 Seasonal Restaurant or eating place tourism license Changes population requirements from "20,000 or less" to "40,000 or less". • Sec 04.09.350, Page 26, line 27 Seasonal Restaurant or eating place tourism license & 04.09.210(d) Page 12, line 30 Restaurant or eating place license modify allowable hours for providing entertainment from 3 PM to 11 AM. • Sec 04.09.410, Page 30, lines 20-22 Manufacturer sampling endorsement, add "; the holder of the distillery manufacturer license may combine the holder's distilled spirits under this paragraph with other ingredients that are not alcoholic beverages, including mixers, liquids, and garnishes." • AS 04.09.490, Page 39, lines 14-20 Package store sampling endorsement The holder of a package store sampling endorsement may serve a total volume of samples that does not exceed [12] 6 oz of beer or cider, if the cider contains 8.5% alcohol by volume; [6] 3 oz of wine, mead, sake, or cider, if the cider contains 8.5% or more alcohol by volume; or [1.5] .75 oz of distilled spirits. • AS 04.11.170, Page 52, lines 20-25 Distillery license New sections added to read: (f) The holder of a distillery license may combine the distiller's product under (d) and (e) of this section with other ingredients, including mixers, liquids, or garnishes, that are not alcoholic beverages. (g) In this section, "distillery's product" means an alcoholic beverage distilled on the licensed premises. • AS 04.11.400(a), Page 66, lines 2-3, Distillery license Add "one" before "winery retail", remove "or" add "and one" before "distillery retail license for each 9,000 population or fraction of that population". • AS 04.11.670, Page 78, lines 24-31, Page 79 lines 1-3, Foreclosure Allows license issued under this title is to be subject to foreclosure and be used as collateral to secure a debt if the license is transferred to another person, and the transferor secures payment for real and personal property conveyed to the transferee upon the promise of the transferee to transfer the license back to the transferor upon default in payment. • AS 04.16.180(b), Page 93, lines 6-7, Revocation of a license Eliminates the requirement of license revocation for certain violations, and reverts to earlier language: "on third conviction, the license of the premises involved may be suspended or revoked." 3:55:24 PM The committee took an at-ease from 3:55 p.m. to 3:59 p.m. 3:59:26 PM REPRESENTATIVE BIRCH had a query regarding manufacture retail licenses which may fall outside the population limit. ERIKA MCCONNELL, Director, AMCO, replied in the affirmative. 4:00:24 PM REPRESENTATIVE STUTES asked where it states in Title 4 that a beverage dispensary license (BDL) cannot have anyone in the establishment after closing time. 4:01:08 PM DALE FOX, Alaska CHARR, answered that under AS 4.16.0.10(c): A licensee, an agent, or employee may not permit a person to enter and a person may not enter premises licensed under this title between the hours of 5:00 a.m. and 8:00 a.m. each day. This subsection does not apply to common carriers or to an employee of the licensee who is on the premises to prepare for the next day's business. A person may enter or remain on the premises of a bona fide restaurant or eating place licensed under this title to consume food or nonalcoholic beverages. MR. FOX added that under (d): A municipality may provide for additional hours of closure under AS 04.21.010. REPRESENTATIVE STUTES asked whether the rewrite addresses closing hours. MR. FOX answered it does not. REPRESENTATIVE STUTES asked why not. MR. FOX answered that he thinks it was an oversight. CHAIR KITO clarified that hours are 5 a.m. to 8 a.m. unless the person is working, delivering, or contracting. REPRESENTATIVE KNOPP asked whether there were afterhours parties allowed on premises. REPRESENTATIVE STUTES remarked that with BDLs, closing hours means everyone off premises. She asked whether distilleries and breweries had to adhere to this. CHAIR KITO clarified that the rewrite leaves language in place for existing entities. He added they would have to adhere to what local ordinances require. REPRESENTATIVE STUTES asked whether the statute requires everyone off premise as well. MS. MCCONNELL answered that the language states businesses may not serve brewed beverages between 8 p.m. and 5 a.m. REPRESENTATIVE WOOL underlined that state law states no patrons may be on premises between 5 a.m. and 8 a.m. He said he did not know whether local ordinance addresses the same hours. MS. MCCONNELL assumed it meant the business would have to adhere to the local ordinance. 4:08:28 PM MS. MCCONNELL answered there is a situation in which food is served meaning patrons can remain on premises to finish their meal. REPRESENTATIVE WOOL said the state says that after 5 p.m. whereas the local ordinance can say that businesses have to close their doors but don't have to kick everyone out. MS MCCONNELL shared her belief that the municipality of Anchorage, Alaska, has a local ordinance stating that businesses can decide whether everyone has to leave or to stop serving alcohol. 4:10:06 PM CHAIR KITO removed his objection to adopting CS Version S. There being no objection, it was so ordered. 4:10:21 PM REPRESENTATIVE STUTES moved to adopt Amendment 1, labeled 30- LS0015\S.3, Bruce, 5/4/18, which read as follows: Page 21, line 19: Delete "36" Insert "24" Page 21, line 20: Delete "18" Insert "12" Page 22, line 19: Delete "18" Insert "12" Page 22, line 21: Delete "36" Insert "24" Page 23, line 26: Delete "three" Insert "two" REPRESENTATIVE STUTES spoke to Amendment 1. She stated it would specifically reduce allowable amounts by one third to 24 oz. She said she thinks reducing samples by one third is a fair compromise. She noted the bill sponsor is not opposed. REPRESENTATIVE BIRCH expressed he was not comfortable with the amendment because he does not know where the initial numbers came from. REPRESENTATIVE WOOL responded that the issue had come up when a bill was pass in 2014. He spoke to the industry standard and said that every state except Oklahoma has tasting rooms. He stated the samples range from 2.5 oz to 3.25 oz and Alaska allows 3 oz. CHAIR KITO suggested Representative Wool was speaking about distilled spirits specifically. REPRESENTATIVE WOOL answered in the affirmative. REPRESENTATIVE KNOPP said he thinks it is a great compromise. 4:15:21 PM The committee took an at-ease from 4:15 p.m. to 4:15 p.m. 4:16:02 PM REPRESENTATIVE CHUCK KOPP, Alaska State Legislature, spoke to the work that had been done in creating the legislation. He stated the bill sponsor had no opposition to Amendment 1. He said that all things considered, it would not harm the bill. 4:17:15 PM CHAIR KITO removed his objection. There being no further objection, Amendment 1 was adopted. CHAIR KITO mentioned a concern he had with sporting events and theater alcohol consumption. 4:18:46 PM The committee took an at-ease from 4:18 p.m. to 4:26 p.m. 4:26:35 PM CHAIR KITO stated he had spoken with Senator Micciche, prime sponsor, who had expressed he did have concerns about reducing volumes. He said the sponsor had agreed about reducing samples in package stores. REPRESENTATIVE STUTES indicated she had previously spoken with the sponsor of HB 357, Representative Kopp, who had presented no objection. 4:27:38 PM REPRESENTATIVE BIRCH moved to call for the question 4:28:07 PM REPRESENTATIVE JOSEPHSON stated he did not feel there was a need for that. CHAIR KITO said it was unfortunate that bill had taken so long to get to the current point. He stated he appreciated the amount of work that had gone into the legislation. He added he thought it was in decent shape to move forward. REPRESENTATIVE WOOL commented there had been public testimony but not much analysis within the committee. He said he understood the "time crunch" the committee was under. He spoke to changes in the bill versions. REPRESENTATIVE BIRCH encouraged the committee to move the bill forward. 4:34:40 PM CHAIR KITO remarked that work in committee can seem like a "teeter-totter" but that he was interested in moving the bill forward. 4:35:39 PM CHAIR KITO moved to report SB 76 out of committee as amended with individual recommendations and the accompanying fiscal notes. There being no objection, it was so ordered.