Legislature(2019 - 2020)BELTZ 105 (TSBldg)
04/11/2019 01:30 PM Senate LABOR & COMMERCE
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| Audio | Topic |
|---|---|
| Start | |
| SB52 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 52 | TELECONFERENCED | |
| + | TELECONFERENCED |
SB 52-ALCOHOLIC BEVERAGE CONTROL; ALCOHOL REG
1:37:26 PM
CHAIR REINBOLD announced that the only order of business would
be SENATE BILL NO. 52, "An Act relating to alcoholic beverages;
relating to the regulation of manufacturers, wholesalers, and
retailers of alcoholic beverages; relating to licenses,
endorsements, and permits involving alcoholic beverages;
relating to common carrier approval to transport or deliver
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."
1:37:51 PM
SENATOR COSTELLO moved to adopt Amendment 1, work order 31-
LS0004\U.18, Bruce, 4/11/19.
AMENDMENT 1
Page 56, following line 3:
Insert a new bill section to read:
"* Sec. 27. AS 04.11.280 is amended by adding new
subsections to read:
(c) A license is automatically transferred as
requested in an application for transfer of the
license to another person if
(1) the board does not approve or deny the
application within 60 days after receiving the
application;
(2) the application is for transfer of a
(A) restaurant or eating place license under
AS 04.09.210;
(B) seasonal restaurant or eating place
tourism license under AS 04.09.350;
(C) restaurant or eating place license under
AS 04.09.210 with one or more endorsements; or
(D) seasonal restaurant or eating place
tourism license under AS 04.09.350 with one or more
endorsements; and
(3) the applicant for transfer of a license
has not previously had a license or permit suspended
or revoked under AS 04.11.370.
(d) The board may suspend or revoke a license
that was automatically transferred to another person
under (c) of this section if, after receiving criminal
justice information and records obtained under
AS 04.11.295, the board determines that the licensee
does not meet the qualifications for transfer of a
license to another person under this title."
Renumber the following bill sections accordingly.
Page 58, line 29:
Delete "sec. 32"
Insert "sec. 33"
Page 60, line 25:
Delete "sec. 37"
Insert "sec. 38"
Page 62, line 20:
Delete "sec. 39"
Insert "sec. 40"
Page 66, line 29:
Delete "sec. 45"
Insert "sec. 46"
Page 71, line 7:
Delete "sec. 49"
Insert "sec. 50"
Page 71, line 13:
Delete "sec. 49"
Insert "sec. 50"
Page 114, line 26:
Delete "Sections 165(a) and 166"
Insert "Sections 166(a) and 167"
Page 114, lines 29 - 30:
Delete "30, 80 - 83, 85 - 130, 135 - 138, 140,
and 148 - 150"
Insert "31, 81 - 84, 86 - 131, 136 - 139, 141,
and 149 - 151"
Page 115, line 2:
Delete "sec. 123"
Insert "sec. 124"
Page 115, line 3:
Delete "sec. 124"
Insert "sec. 125"
Delete "sec. 129"
Insert "sec. 130"
Page 115, line 8:
Delete "sec. 170"
Insert "sec. 171"
Page 115, line 11:
Delete "70, and 165"
Insert "71, and 166"
Page 115, line 13:
Delete "70, and 165"
Insert "71, and 166"
Page 115, line 22:
Delete "sec. 160"
Insert "sec. 161"
Page 115, line 28:
Delete "sec. 160"
Insert "sec. 161"
Page 116, line 3:
Delete "sec. 159"
Insert "sec. 160"
Page 116, line 7:
Delete "sec. 159"
Insert "sec. 160"
Page 116, line 11:
Delete "sec. 159"
Insert "sec. 160"
Page 116, line 14:
Delete "sec. 159"
Insert "sec. 160"
Page 116, line 17:
Delete "sec. 159"
Insert "sec. 160"
Page 116, line 20:
Delete "sec. 159"
Insert "sec. 160"
Page 116, line 23:
Delete "sec. 159"
Insert "sec. 160"
Page 116, line 28:
Delete "sec. 159"
Insert "sec. 160"
Page 117, line 1:
Delete "sec. 159"
Insert "sec. 160"
Page 117, line 5:
Delete "sec. 159"
Insert "sec. 160"
Page 117, line 9:
Delete "sec. 159"
Insert "sec. 160"
Page 117, line 13:
Delete "sec. 159"
Insert "sec. 160"
Page 117, line 17:
Delete "sec. 159"
Insert "sec. 160"
Page 117, line 21:
Delete "sec. 159"
Insert "sec. 160"
Page 119, line 15:
Delete "Sections 32, 37, 39, 45, 49, 54, 160,
165(a), 165(c)(8), 166, and 167"
Insert "Sections 33, 38, 40, 46, 50, 55, 161,
166(a), 166(c)(8), 167, and 168"
Page 119, line 17:
Delete "Section 164"
Insert "Section 165"
Page 119, line 18:
Delete "secs. 168 and 169"
Insert "secs 169 and 170"
CHAIR REINBOLD objected for discussion purposes.
1:38:34 PM
TOM WRIGHT, Staff, Senator Mia Costello, Alaska State
Legislature, Juneau, explained Amendment 1, work order 31-
LS0004\U.18. This would require the board to issue a license
within 60 days. However, some conditions apply, including that
the license cannot be issued if the applicant has previously had
a license suspended or revoked. The board may suspend or revoke
a license that was automatically transferred to another person,
if after receiving criminal justice information and records
gained under AS 04.11.295, the board determines the licensee
does not meet the qualifications for transfer of the license. He
indicated that the bill sponsor would like this language added,
particularly the language in subsection (d).
1:40:06 PM
ERIKA MCCONNELL, Director, Alcohol and Marijuana Control Office,
Anchorage, responded that the she has not seen the amendments
since the amendments are not posted.
1:40:39 PM
At-ease.
1:43:15 PM
CHAIR REINBOLD reconvened the meeting.
1:43:20 PM
CHAIR REINBOLD remarked that some of the amendments were just
submitted and were not yet uploaded to BASIS. She asked the
sponsor's staff to continue.
1:43:49 PM
MR. WRIGHT reiterated the effect of Amendment 1. For example, a
license for a restaurant that serves alcoholic beverages would
be automatically transferred as per the application. These
transfers would be automatically granted if the board does not
approve or deny the application within 60 days. The board may
suspend or revoke a license that was automatically transferred
to another person, if after receiving criminal justice
information and records gained und AS 04.11.295, the board
determines the licensee does not meet the qualifications for
transfer of the license.
1:44:50 PM
SENATOR GRAY-JACKSON remarked that she would like to ask Ms.
McConnell a question.
CHAIR REINBOLD reminded her that the amendments were being
uploaded.
1:45:10 PM
CHAIR REINBOLD solicited a motion to move Amendment 1, U.18, to
the bottom of the calendar.
1:45:31 PM
SENATOR BISHOP moved to table Amendment 1, U.18 to the bottom of
the calendar.
There being no further objection, Amendment 1 was moved to the
bottom of the calendar.
1:45:53 PM
SENATOR COSTELLO moved to adopt Amendment 2 to SB 52, work order
31-LS0004\U.2, Bruce, 3/29/19:
AMENDMENT 2
Page 65, lines 23 - 26:
Delete all material.
Renumber the following bill sections accordingly.
Page 66, line 29:
Delete "sec. 45"
Insert "sec. 44"
Page 71, line 7:
Delete "sec. 49"
Insert "sec. 48"
Page 71, line 13:
Delete "sec. 49"
Insert "sec. 48"
Page 114, line 26:
Delete "Sections 165(a) and 166"
Insert "Sections 164(a) and 165"
Page 114, lines 29 - 30:
Delete "80 - 83, 85 - 130, 135 - 138, 140, and
148 - 150"
Insert "79 - 82, 84 - 129, 134 - 137, 139, and
147 - 149"
Page 115, line 2:
Delete "sec. 123"
Insert "sec. 122"
Page 115, line 3:
Delete "sec. 124"
Insert "sec. 123"
Delete "sec. 129"
Insert "sec. 128"
Page 115, line 8:
Delete "sec. 170"
Insert "sec. 169"
Page 115, line 11:
Delete "70, and 165"
Insert "69, and 164"
Page 115, line 13:
Delete "70, and 165"
Insert "69, and 164"
Page 115, line 22:
Delete "sec. 160"
Insert "sec. 159"
Page 115, line 28:
Delete "sec. 160"
Insert "sec. 159"
Page 116, line 3:
Delete "sec. 159"
Insert "sec. 158"
Page 116, line 7:
Delete "sec. 159"
Insert "sec. 158"
Page 116, line 11:
Delete "sec. 159"
Insert "sec. 158"
Page 116, line 14:
Delete "sec. 159"
Insert "sec. 158"
Page 116, line 17:
Delete "sec. 159"
Insert "sec. 158"
Page 116, line 20:
Delete "sec. 159"
Insert "sec. 158"
Page 116, line 23:
Delete "sec. 159"
Insert "sec. 158"
Page 116, line 28:
Delete "sec. 159"
Insert "sec. 158"
Page 117, line 1:
Delete "sec. 159"
Insert "sec. 158"
Page 117, line 5:
Delete "sec. 159"
Insert "sec. 158"
Page 117, line 9:
Delete "sec. 159"
Insert "sec. 158"
Page 117, line 13:
Delete "sec. 159"
Insert "sec. 158"
Page 117, line 17:
Delete "sec. 159"
Insert "sec. 158"
Page 117, line 21:
Delete "sec. 159"
Insert "sec. 158"
Page 119, line 15:
Delete "45, 49, 54, 160, 165(a), 165(c)(8), 166,
and 167"
Insert "44, 48, 53, 159, 164(a), 164(c)(8), 165,
and 166"
Page 119, line 17:
Delete "Section 164"
Insert "Section 163"
Page 119, line 18:
Delete "secs. 168 and 169"
Insert "secs. 167 and 168"
CHAIR REINBOLD objected for discussion purposes.
1:46:16 PM
MR. WRIGHT explained Amendment 2, which would delete Section 44
of SB 52. That language would grant the executive director
additional powers to place restrictions or conditions on
licenses.
1:46:50 PM
SENATOR COSTELLO explained Amendment 2 would delete Section 44.
She directed attention to page 65 and read:
* Sec. 44. AS 04.11.395 is amended by adding a new
subsection to read:
(b) Except for a conditional contractor's permit
issued under AS 04.09.690, the director may, in the
best interests of the public, impose conditions or
restrictions on a permit issued under this chapter.
She explained the intention of Amendment 2 is to sustain the
traditional powers of boards. The board has the power and
conveys instructions to the executive director, who will carry
out the intentions of the board.
MR. WRIGHT explained that most of Amendment 2 pertained to
renumbering the sections.
1:47:57 PM
SENATOR BIRCH asked how often the board meets. He asked for
assurances that it would not affect or stall licenses until the
next board meeting.
MR. WRIGHT answered that the board meets quarterly, but it can
meet telephonically, as needed.
SENATOR BIRCH asked for further clarification that if an issue
arose between the quarterly meetings that the executive director
could poll the board and obtain a sense of the board.
MR. WRIGHT answered yes.
1:49:24 PM
SENATOR MICCICHE, Alaska State Legislature, Juneau, as sponsor
of SB 52, stated he did not support Amendment 2. This works
against [Amendment 1] U.18. He said that currently the
application will either be approved or denied. This section
allows the executive director to work with the board to develop
conditions for approval. If someone fails a public safety
background check, the previous amendment would allow an
automatic continuance of the license. He said that if Amendment
2 were to pass, the board would not be able to approve an
application if conditions were placed on the license. He
acknowledged that he understood the intent, but it would
actually place obstacles in the approval process rather than
streamlining the process.
1:51:18 PM
At-ease.
1:52:10 PM
CHAIR REINBOLD reconvened the meeting.
1:52:15 PM
SENATOR COSTELLO said that after speaking with the bill sponsor,
she believes a conceptual amendment would meet her concern that
the board must hold the authority and the executive director
must carry out the instructions from the board. It would also
address the concern that without Section 44, some applications
could be delayed because there would not be any allowance to
provide any conditions to an application.
1:53:01 PM
SENATOR COSTELLO made a motion to adopt a Conceptual Amendment
to Amendment 2. On page 65, line 25, delete, "the director may,"
and replace it with, "the board may." She described it as a
fairly simple concept.
1:53:57 PM
At-ease.
1:54:43 PM
CHAIR REINBOLD reconvened the meeting.
There being no objection, the Conceptual Amendment to Amendment
2 was adopted.
CHAIR REINBOLD brought Amendment 2, as amended, before the
committee.
SENATOR COSTELLO clarified for the record that conditions can be
imposed on an application and doing so moves the application
process along rather than creating a delay. However, the board
would provide the conditions rather than the executive director,
who serves the board.
SENATOR MICCICHE agreed to Amendment 2, as amended.
CHAIR REINBOLD removed her objection to Amendment 2, as amended.
There being no further objection, Amendment 2, as amended, was
adopted.
1:56:08 PM
SENATOR COSTELLO moved to adopt Amendment 3, work order 31-
LS0004\U.9, Bruce, 4/5/19:
AMENDMENT 3
Page 34, line 5, following "roof":
Insert ", for consumption on the site of the
large resort"
Page 94, following line 5:
Insert a new subsection to read:
"(f) Notwithstanding (a) of this section, a
person may remove alcoholic beverages from the
licensed premises of a beverage dispensary license
under AS 04.09.200 or a beverage dispensary tourism
license under AS 04.09.340 for consumption on
unlicensed portions of a large resort if the licensee
holds a large resort endorsement under AS 04.09.440."
Reletter the following subsection accordingly.
CHAIR REINBOLD objected for discussion purposes.
MR. WRIGHT explained Amendment 3. This would allow a person at a
large resort who was served a drink to transport it to another
part of the resort without the necessity to have a server do so.
1:57:18 PM
CHAIR REINBOLD offered her support for Amendment 3.
1:57:37 PM
SENATOR GRAY-JACKSON offered her support for Amendment 3.
1:57:45 PM
CHAIR REINBOLD removed her objection. There being no further
objection, Amendment 3 was adopted.
1:58:01 PM
CHAIR REINBOLD moved to adopt Amendment 4, work order 31-
LS0004\U.14, Bruce, 4/10/19:
AMENDMENT 4
Page 6, line 12:
Delete "1,250"
Insert "1,000"
Page 6, line 19:
Delete "1,250"
Insert "1,000"
Page 6, line 26:
Delete "1,250"
Insert "1,000"
Page 21, line 22:
Delete "1,250"
Insert "1,000"
Page 22, line 22:
Delete "1,250"
Insert "1,000"
Page 23, line 27:
Delete "1,250"
Insert "1,000"
SENATOR BISHOP objected for discussion purposes.
1:58:41 PM
At-ease.
1:59:07 PM
CHAIR REINBOLD reconvened the meeting. She explained Amendment
4. This would reduce the biennial brewery and winery
manufacturer license fees from $1,250 to $1,000. She explained
that some smaller brewery and wineries expressed concern that a
480 percent increase would be detrimental to their businesses.
SENATOR MICCICHE pointed out that fees have not been increased
for over 40 years. He said that he has only had one complaint
from a winery, but none from breweries. He explained that
enforcement has not done any compliance checks in any facilities
in three years. He expressed concern that this would impact the
public safety gains in the bill.
SENATOR BISHOP asked whether the license fees go to the board
for administrative costs or to the general fund. He offered his
belief that the fiscal note was a little "light" to implement
the potential regulations needed under the bill.
SENATOR MICCICHE answered that the license fees go to the board
to manage compliance of alcoholic beverage licensing.
2:01:54 PM
SENATOR GRAY-JACKSON asked for further clarification that
reducing the license fees would reduce public safety.
SENATOR MICCICHE agreed. He explained that the additional $250
fee increase per licensee assists with compliance checks. One of
the primary reasons for the bill was to reinstitute compliance
checks for the thousands of licensees not currently being
checked. He offered his belief that has a direct impact on minor
consuming. The executive director prepares and submits an annual
budget that includes the funding for administration,
enforcement, education, training, and prevention activities
under the title. He said that the license fees were designed to
fund those activities.
2:03:07 PM
SENATOR BISHOP asked for further clarification on the current
fees.
2:03:29 PM
EDRA MORLEDGE, Staff, Senator Peter Micciche, Juneau answered
that she was not certain, but she thought that the fees were
$800 biennially.
SENATOR BISHOP asked whether the sponsor had vetted the increase
to the industry.
SENATOR MICCICHE directed attention to letters of support in
members' packets that indicate that the industry supports the
current status of SB 52, including the increased license fees.
The understand the values of the bill, such that it would clean
up the industry and address the small number of operators that
give the industry a bad name. He offered his belief that without
compliance checks the problems seemed to be increasing.
SENATOR BISHOP said he does not like to see supplemental budget
requests. He said he has previously expressed his concerns about
the fiscal note.
2:04:42 PM
SENATOR COSTELLO asked Ms. McConnell to comment on the current
compliance staff and the total number of compliance checks
necessary for businesses that fall under the bill
2:05:03 PM
MS. MCCONNELL explained that compliance checks were previously
funded through a federal grant from the Department of Justice,
which ended in 2015. The program was suspended at this time with
the intent to reexamine and continue it. The assignment of
marijuana program to the office created upheaval. It was tough
to focus on anything other than getting the marijuana program up
and running.
She indicated the intention to continue to do compliance checks.
The Alcohol & Marijuana Control Office has eight enforcement
officers to cover the entire state. The office would like to
conduct the compliance checks to protect the underage persons
conducting the activity, including providing workers'
compensation for any injuries. For example, if enforcement
officers were traveling with staff and a car accident were to
occur. She said that the agency is trying to work out those
details before bringing the program back.
MS. MCCONNELL highlighted that the program is expensive and
requires travel. She reported that approximately 1,900 licensees
are in place statewide. She was not certain of the number of
licenses that serve alcoholic beverages on premises. AMCO
provides compliance checks for consumption on the premises and
in package stores. She offered to provide the specific
information in writing. In response to a question, she verified
that the office has eight investigators.
2:06:51 PM
SENATOR GRAY-JACKSON asked how much funding the $250 increase
provides annually. She expressed an interest in knowing if it
was equivalent to the salary for one or two investigators.
MS. MCCONNELL offered to provide the information to the
committee.
SENATOR GRAY-JACKSON expressed an interest in knowing the impact
to public safety and investigators providing compliance checks
if Amendment 4 passed and the license fees were reduced from
$1,250 to $1,000.
MS. MCCONNELL responded that she would have to review and assess
the fiscal note. She offered to report back to the committee.
2:09:15 PM
SENATOR MICCICHE asked to correct the licensing fee amounts.
Under SB 52, license fees for a brewery and distillery would
increase from $1,000 to $1,250, which is a 25 percent increase.
The one complaint from Mr. Olson related to a winery
manufacturing license, which would increase from $500 to $1,250,
for a 150 percent increase.
He said that he understood the concerns, that winery license
fees could be reduced to $1,000. He pointed out that Mr. Olson
suggested a change to the bond, which was adopted. It meant that
quality operators who pay their taxes timely no longer have to
have the expense of a bond if the licensee pays their taxes
timely for three years in a row.
2:10:46 PM
CHAIR REINBOLD suggested conflicting testimony was given on
current fees.
CHAIR REINBOLD asked to withdraw Amendment 4 in order to
continue to work with the sponsor. She expressed an interest in
justifying the fees. She expressed concern about abuses or
excess spending.
2:12:48 PM
SENATOR MICCICHE clarified that Ms. Morledge indicated she was
not positive about the current fees. He reiterated that Am0 4
proposed an increase in biennial license fees from $1,000 to
$1,250. The winery license fees would increase to $1,250 for a
150 percent increase. He reported that he reviewed the
legislative audits. The only problem that arose related to the
application of a statute. He did not find any abuses or excesses
in spending, he said.
CHAIR REINBOLD clarified that she did not have concerns about
AMCO and that she has reviewed their audits. She raised concerns
about spending by other boards and commissions. She would like
accountability and a measurable outcome that improves public
safety.
2:14:48 PM
SENATOR COSTELLO said she appreciated her concerns. She said the
message from the committee is that the fee increases would be
used for investigators.
2:15:36 PM
SENATOR GRAY-JACKSON asked that the information on fee increases
be provided in a timely manner.
2:16:12 PM
SENATOR BISHOP asked whether the bond was a cash bond or is an
insurance binder for a percentage of the bond. He further asked
if it pertained to a cash bone, whether AMCO would lose revenue
or if the fee increase was a wash.
2:17:02 PM
MS. MCCONNELL answered that the bond was related to the taxes
owed to the Department of Revenue and is paid to that
department. It is entirely unrelated to Alcohol & Marijuana
Control Office budget, she said.
2:17:19 PM
CHAIR REINBOLD reiterated that Amendment 4 was withdrawn. She
said that she intended to bring the amendment before the next
committee of referral, the Senate Judiciary Committee.
2:17:43 PM
CHAIR REINBOLD moved to adopt Amendment 5, work order 31-
LS0004\U.19, Bruce, 4/11/19:
AMENDMENT 5
Page 31, lines 13 - 17:
Delete all material.
Reletter the following subsections accordingly.
Page 31, line 23:
Delete "(c) - (e)"
Insert "(c) or (d)"
SENATOR COSTELLO objected for discussion purposes.
CHAIR REINBOLD explained Amendment 5. She said that the holder
of a manufacturer license to offer sampling of the product via a
manufacturer sampling endorsement would be authorized to
advertise.
2:18:19 PM
SENATOR COSTELLO asked for further clarification. She offered
her belief that AS 04.09.410 was a curious section of the bill.
She pointed out that the holder of a manufacturer sampling
endorsement may not advertise through newsprint, radio, or
television, but the business may notify existing customers of
sampling activities by electronic means. She asked the reason
for the restriction.
SENATOR MICCICHE said he understood Amendment 5 and supports it.
He deferred to Ms. Brawley.
2:19:11 PM
ANNA BRAWLEY, Title 4 Review Coordinator, Senior Associate,
Agnew Beck Consulting, Anchorage, related her understanding that
the question was about Amendment 5 removing advertising
restrictions for sampling by manufacturers.
CHAIR REINBOLD directed attention to page 31, lines 13-17.
MS. BRAWLEY answered that the purpose of the policy proposal was
to ensure that advertising for providing free samples would not
turn into signage that promoted "free alcohol" to encourage over
consumption for the purposes of generating business. The current
language in the bill would restrict public advertising for
sampling to address this concern. However, it is currently part
of the business model to offer tours and sampling, not just in
Alaska but in other places. She said that she held discussions
with Alaska Berries who had objected to this. The idea that it
would be a severe problem is less than initially anticipated,
she said.
SENATOR COSTELLO said that she appreciated the concerns that
Recover Alaska has raised, but she offered her support for
Amendment 5.
SENATOR MICCICHE said that he supports Amendment 5. He related
that he has reached out to Alaska Berries, his constituent, to
try to find some compromises. He offered his belief that the
amendment makes reasonable and productive changes.
2:21:37 PM
SENATOR COSTELLO removed her objection.
There being no further objection, Amendment 5 was adopted.
2:21:56 PM
CHAIR REINBOLD moved to adopt Amendment 6, work order 31-
LS0004\U.20, Bruce, 4/11/19:
AMENDMENT 6
Page 22, line 11, following "than":
Insert "5.167 gallons of the holder's beer or
sake."
Page 22, lines 12 - 13:
Delete all material.
Page 23, line 14, following "than":
Insert "5.167 gallons of the holder's wine, mead,
or cider."
Page 23, lines 15 - 19:
Delete all material.
Page 42, line 25, following "than":
Insert "5.167 gallons of the holder's beer or
sake;"
Page 42, lines 26 - 27:
Delete all material.
SENATOR COSTELLO objected for discussion purposes.
CHAIR REINBOLD explained that Amendment 6 was a conforming
amendment that allows those with a retail license to sell 5.67
gallons of beer, wine, mead, cider or sake.
2:22:37 PM
SENATOR MICCICHE said that he supports Amendment 6. He said it
is allowed by brewers and should be allowed by wineries, cider
makers, and sake makers, as well. It puts everyone on a level
playing field.
CHAIR REINBOLD pointed out that it relates to wine, mead, and
cider.
SENATOR BISHOP asked whether kombucha falls under this provision
since some Oregon kombucha makers are making craft kombucha.
MS. MORLEDGE answered that this bill does not regulate kombucha.
It only pertains to alcoholic beverages.
2:24:05 PM
SENATOR BIRCH related that one of his constituents uses a drive-
up grocery delivery service. He questioned whether the groceries
could include wine or beer. He wondered if a conceptual
amendment was necessary. It would read, "It shall not be a
violation of this section for the holder of a package store
licensed to deliver alcoholic beverages to a customer waiting in
package store parking lot if the customer has previously placed
an order with the package store licensee and the payment is
processed on site." He expressed an interest in hearing from the
sponsor.
SENATOR MICCICHE answered that he was uncertain. He offered to
address this matter outside the meeting in order to consider if
it would create any unintended consequences. At first blush, it
sounded reasonable, but he would like an opportunity to evaluate
the concept with the department.
SENATOR BIRCH pointed out that this service is a fairly new one
offered by some stores. For example, a consumer could drive to a
Walmart parking lot and text the store, and the store would
deliver the preordered groceries to the parking lot. He
reiterated that he wondered whether these deliveries could
include wine or beer. He agreed to discuss this outside of the
committee.
SENATOR MICCICHE deferred to Ms. McConnell.
MS. MCCONNELL said she has no comment. She said it appeared to
be a policy decision. However, she would like to consider it
more fully and communicate with the sponsor.
CHAIR REINBOLD offered to work on this issue in the Senate
Judiciary Committee, the next committee of referral, if it is
not resolved before the bill is reported from committee.
2:27:35 PM
SENATOR COSTELLO removed her objection.
There being no further objection, Amendment 6 was adopted.
2:28:11 PM
CHAIR REINBOLD solicited a motion to consider Amendment 1, work
order 31-LS0004\U.18, which was set aside.
2:28:24 PM
SENATOR BISHOP moved to adopt Amendment 1, which was discussed
earlier in the meeting and moved to the bottom of the calendar.
SENATOR COSTELLO objected for discussion purposes.
MS. MCCONNELL said she appreciated the committee delaying action
on Amendment 1 to allow her to review it. She raised several
considerations. First, AS 04.11.510 (a) requires the staff and
board to bring completed applications to the board within 90
days. She explained that the Alcohol & Marijuana Control Office
board schedule is based on the 90-day requirement. The board
meets approximately five times per year to ensure that completed
applications are considered timely. She expressed concern that a
60-day requirement would mean that the board would meet more
often and add additional expense or some applications for
transfers would go to the board and others would not.
MS. MCCONNELL said it could lead to local government protests.
She asked for further clarification on how that would be
addressed. Second, it raises concern on whether applicants have
met their obligations under unemployment and workers'
compensation insurance. The Department of Labor periodically
reports when licensees do not meet these requirements. Further,
the Workers' Compensation Board has issued fines and outlined
issues that licensees need addressed.
MS. MCCONNELL said third, that the criminal background check was
addressed in subsection (d). However, the board cannot currently
approve a transfer unless, per AS 04.11.360 (4):
(4) the transferor has not paid all debts or taxes
arising from the conduct of the business licensed
under this title unless
(A) the transferor gives security for the payment
of the debts or taxes satisfactory to the creditor or
taxing authority;
She said that a transfer provides an opportunity for creditors
to ensure that payments are received, so liens are often filed
on licensees by distributors and suppliers for nonpayment.
MS. MCCONNELL reiterated that she was unclear on how those three
issues would be addressed if Amendment 1 was adopted.
SENATOR COSTELLO offered her belief that this amendment would
not affect local community protests. She recalled from Ms.
McConnell's previous testimony that the board was able to hold
telephonic meetings and the agency was working towards an online
application process. She suggested these two items dovetail and
satisfy the concerns. Further, she recalled her response to why
so many restaurants in her community are on hold even though the
previous owner had the ability to serve alcoholic beverages.
SENATOR COSTELLO asserted that this bill reinforces what the
AMCO has previously testified already occurs. However, in
practice, it may not transpire in the same way. She offered her
belief that the protections in current law are good ones.
However, the fact that some transfers are being significantly
delayed was a concern to her. Amendment 1 attempts to address
her concerns, she said.
2:33:38 PM
SENATOR GRAY-JACKSON remarked that she has served in local
government observing the number of protests on liquor licenses.
She asked for further clarification on whether Amendment 1 would
affect local government protests due to conflicting comments.
MS. MCCONNELL said she was unsure how Senator Costello viewed
Amendment 1 with respect to protests. She highlighted her
concern was for licenses automatically transferred. She
suggested that language similar to subsection (e) could be added
to ensure that if the local body objected timely, it would be
addressed.
SENATOR COSTELLO offered her belief that all the tools currently
exist for AMCO. This would just change the timeline from 90 days
to 60 days, which essentially requires AMCO to speed up the
processing time. She was not under the impression that Amendment
1 would affect any of the current processes. For example,
Alcohol & Marijuana Control Office would still have the ability
to deny a license transfer.
SENATOR MICCICHE said that he understands both sides of this
concern. He offered his support for Amendment 1. He suggested
that if Amendment 1 was adopted today, the bill sponsor and
Senator Costello could continue to evaluate whether any
additional stop gaps were necessary if money is owed or other
issues arise that would interrupt the automatic license
transfer.
2:36:37 PM
CHAIR REINBOLD referred to page 1 line 6 of Amendment 1. She
said she thought it was important to clarify that it was a
"completed" application.
MS. MCCONNELL said that the board's interpretation is that this
refers to a completed application. She explained that the board
would not allow a licensee to stonewall a needed correction and
expect that the application was approved because 60 days had
passed. She said that the addition of "completed" would be
positive and provide clarity, but the interpretation would be
the same.
2:37:40 PM
CHAIR REINBOLD offered a Conceptual Amendment to Amendment 1, on
line 6, before "application" to add "completed".
SENATOR COSTELLO said that the Conceptual Amendment to Amendment
1 would add clarity and she had no objection.
There being no further objection, Conceptual Amendment 1 to
Amendment 1 was adopted.
2:38:19 PM
SENATOR BISHOP said he previously removed his objection.
2:38:33 PM
SENATOR COSTELLO remarked that this bill has previously been
through the process. Further, SB 52 has been referred to three
committees. She offered to work with Ms. McConnell and the
sponsor with respect to how Amendment 1 will affect the board's
ability to carry out the important public safety
responsibilities.
SENATOR MICCICHE acknowledged that as a past mayor he observed
some issues with licensees, who might owe local taxes or have
complaints lodged. He suggested that the transfer process often
provided an opportunity to sort through some of the issues. He
offered his belief that Amendment 1 was a good amendment. He
suggested that this language would force conversations to ensure
that local government make certain that people who are most
impacted by the licensees have a voice in the process. He
offered to continue to work on any issues.
2:39:54 PM
SENATOR BIRCH thanked the committee for the work on the
amendments. He also thanked Ms. McConnell for her timely
responses to issues he raised and the sponsor for the work on
the bill.
2:40:35 PM
There being no further objection, Amendment 1, as amended, was
adopted.
[SB 52 was held in committee.]
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB52 Amendments 4-11-19.pdf |
SL&C 4/11/2019 1:30:00 PM |
SB 52 |
| SB052-DHSS-PS-4-11-2019.pdf |
SL&C 4/11/2019 1:30:00 PM |
SB 52 |