HOUSE BILL No. 5427

March 25, 2014, Introduced by Reps. Schor, Daley, Lauwers, Kowall, Graves, Bumstead, Potvin, Yonker, Denby, Pscholka, Haveman, Haines, Slavens, Haugh, LaFontaine, Pettalia, Rogers, Singh, Irwin, Lipton, Abed, Knezek, Darany, Roberts, Lamonte, Cochran, LaVoy, Geiss, Segal, Faris, Lane, Brinks, Kivela, Dianda, Driskell, Switalski, Hobbs, Dillon, Brown, Kosowski, Lund, Kelly, Victory, Pagel and MacGregor and referred to the Committee on Regulatory Reform.

 

     A bill to amend 1998 PA 58, entitled

 

"Michigan liquor control code of 1998,"

 

by amending sections 109 and 537 (MCL 436.1109 and 436.1537),

 

section 109 as amended by 2010 PA 213 and section 537 as amended by

 

2013 PA 101.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 109. (1) "Manufacturer" means a person engaged in the

 

manufacture of alcoholic liquor, including, but not limited to, a

 

distiller, a rectifier, a wine maker, and a brewer.

 

     (2) "Master distributor" means a wholesaler who that acts in

 

the same or similar capacity as a brewer, wine maker, outstate

 

seller of wine, or outstate seller of beer for a brand or brands of

 

beer or wine to other wholesalers on a regular basis in the normal

 

course of business.


 

     (3) "Micro brewer" means a brewer that produces in total less

 

than 30,000 barrels of beer per year and that may sell the beer

 

produced to consumers at the licensed brewery premises for

 

consumption on or off the licensed brewery premises or at a

 

farmer's market pursuant to a farmer's market permit. In

 

determining the 30,000-barrel threshold, all brands and labels of a

 

brewer, whether brewed in this state or outside this state, shall

 

be combined and all facilities for the production of beer that are

 

owned or controlled by the same person shall be treated as a single

 

facility.

 

     (4) "Minor" means a person an individual less than 21 years of

 

age.

 

     (5) "Mixed spirit drink" means a drink produced and packaged

 

or sold by a mixed spirit drink manufacturer or an outstate seller

 

of mixed spirit drink which that contains 10% or less alcohol by

 

volume consisting of distilled spirits mixed with nonalcoholic

 

beverages or flavoring or coloring materials and which that may

 

also contain 1 or more of the following:

 

     (a) Water.

 

     (b) Fruit juices.

 

     (c) Fruit adjuncts.

 

     (d) Sugar.

 

     (e) Carbon dioxide.

 

     (f) Preservatives.

 

     (6) "Mixed spirit drink manufacturer" means any person

 

licensed under this act to manufacture mixed spirit drink in this

 

state and to sell mixed spirit drink to a wholesaler. For purposes


 

of rules promulgated by the commission, a mixed spirit drink

 

manufacturer shall be treated as a wine manufacturer but is subject

 

to the rules applicable to spirits for purposes of manufacturing

 

and labeling.

 

     (7) "Mixed wine drink" means a drink or similar product

 

marketed as a wine cooler and containing that contains less than 7%

 

alcohol by volume, consisting consists of wine and plain,

 

sparkling, or carbonated water, and containing contains any 1 or

 

more of the following:

 

     (a) Nonalcoholic beverages.

 

     (b) Flavoring.

 

     (c) Coloring materials.

 

     (d) Fruit juices.

 

     (e) Fruit adjuncts.

 

     (f) Sugar.

 

     (g) Carbon dioxide.

 

     (h) Preservatives.

 

     (8) "Outstate seller of beer" means a person licensed by the

 

commission to sell beer which that has not been manufactured in

 

this state to a wholesaler in this state in accordance with rules

 

promulgated by the commission.

 

     (9) "Outstate seller of mixed spirit drink" means a person

 

licensed by the commission to sell mixed spirit drink which that

 

has not been manufactured in this state to a wholesaler in this

 

state in accordance with rules promulgated by the commission. For

 

purposes of rules promulgated by the commission, an outstate seller

 

of mixed spirit drink shall be treated as an outstate seller of


 

wine but is subject to the rules applicable to spirits for purposes

 

of manufacturing and labeling.

 

     (10) "Outstate seller of wine" means a person licensed by the

 

commission to sell wine which that has not been manufactured in

 

this state to a wholesaler in this state in accordance with rules

 

promulgated by the commission and to sell sacramental wine as

 

provided in section 301.

 

     Sec. 537. (1) The following classes of vendors may sell

 

alcoholic liquor at retail as provided in this section:

 

     (a) Taverns, where beer and wine may be sold for consumption

 

on the premises only.

 

     (b) Class C licensee, where beer, wine, mixed spirit drink,

 

and spirits may be sold for consumption on the premises.

 

     (c) Clubs, where beer, wine, mixed spirit drink, and spirits

 

may be sold for consumption on the premises only to bona fide

 

members where consumption is limited to these members and their

 

bona fide guests, who are 21 years of age or older.

 

     (d) Direct shippers, where wine may be sold and shipped

 

directly to the consumer.

 

     (e) Hotels of class A, where beer and wine may be sold for

 

consumption on the premises and in the rooms of bona fide

 

registered guests. Hotels of class B where beer, wine, mixed spirit

 

drink, and spirits may be sold for consumption on the premises and

 

in the rooms of bona fide registered guests.

 

     (f) Specially designated merchants, where beer and wine may be

 

sold for consumption off the premises only.

 

     (g) Specially designated distributors, where spirits and mixed


 

spirit drink may be sold for consumption off the premises only.

 

     (h) Special licensee, where beer and wine or beer, wine, mixed

 

spirit drink, and spirits may be sold for consumption on the

 

premises only.

 

     (i) Dining cars or other railroad or Pullman cars, watercraft,

 

or aircraft, where alcoholic liquor may be sold for consumption on

 

the premises only, subject to rules promulgated by the commission.

 

     (j) Brewpubs, where beer manufactured on the premises by the

 

licensee may be sold for consumption on or off the premises by any

 

of the following licensees:

 

     (i) Class C.

 

     (ii) Tavern.

 

     (iii) Class A hotel.

 

     (iv) Class B hotel.

 

     (k) Micro brewers and brewers, where beer produced by the

 

micro brewer or brewer may be sold to a consumer for consumption on

 

or off the brewery premises.

 

     (l) Class G-1 licensee, where beer, wine, mixed spirit drink,

 

and spirits may be sold for consumption on the premises only to

 

members required to pay an annual membership fee and consumption is

 

limited to these members and their bona fide guests.

 

     (m) Class G-2 licensee, where beer and wine may be sold for

 

consumption on the premises only to members required to pay an

 

annual membership fee and consumption is limited to these members

 

and their bona fide guests.

 

     (n) Motorsports event licensee, where beer and wine may be

 

sold for consumption on the premises during sanctioned motorsports


 

events only.

 

     (o) Wine maker, where wine may be sold by direct shipment, at

 

retail on the licensed premises, and as provided for in subsections

 

(2) and (3).

 

     (p) Small distiller selling not more than 60,000 gallons of

 

spirits manufactured by that licensee to the consumer at retail for

 

consumption on or off the licensed premises in the manner provided

 

for in section 534.

 

     (q) Nonpublic continuing care retirement center license, where

 

beer, wine, mixed spirit drink, mixed wine drink, and spirits may

 

be sold at retail and served on the licensed premises to residents

 

and bona fide guests accompanying the resident for consumption only

 

on the licensed premises.

 

     (r) A small wine maker or an out-of-state entity that is the

 

substantial equivalent of a small wine maker, that holds a farmer's

 

market permit, where wine may be sampled and sold at a farmer's

 

market for consumption off the licensed premises.

 

     (s) A micro brewer or an out-of-state entity that is the

 

substantial equivalent of a micro brewer, that holds a farmer's

 

market permit, where beer may be sampled and sold at a farmer's

 

market for consumption off the licensed premises.

 

     (2) A wine maker may sell wine made by that wine maker in a

 

restaurant for consumption on or off the premises if the restaurant

 

is owned by the wine maker or operated by another person under an

 

agreement approved by the commission and located on the premises

 

where the wine maker is licensed.

 

     (3) A wine maker, with the prior written approval of the


 

commission, may conduct wine tastings of wines made by that wine

 

maker on the premises where the wine maker is licensed to

 

manufacture wine. The wine maker may charge for the samples.

 

     (4) A wine maker, with the prior written approval of the

 

commission, may conduct wine tastings of wines made by that wine

 

maker and may sell the wine made by that wine maker for consumption

 

off the premises at a location other than the premises where the

 

wine maker is licensed to manufacture wine, under the following

 

conditions:

 

     (a) The premises upon which the wine tasting occurs conforms

 

to local and state sanitation requirements.

 

     (b) Payment of a $100.00 fee per location is made to the

 

commission.

 

     (c) The wine tasting locations are considered licensed

 

premises, and the wine maker may include a charge for the samples.

 

     (d) The wine tasting takes place during the legal hours for

 

the sale of alcoholic liquor by the licensee.

 

     (e) The premises and the licensee comply with and are subject

 

to all applicable rules promulgated by the commission.

 

     (5) Notwithstanding section 1025(1), an outstate seller of

 

beer, an outstate seller of wine, a wine maker, a brewer, a micro

 

brewer, or a specially designated merchant, or an agent of any of

 

those persons, who does not hold a license allowing the consumption

 

of alcoholic liquor on the premises at the same licensed address,

 

may conduct beer and wine tastings on the licensed premises of a

 

specially designated merchant under the following conditions:

 

     (a) A customer is not charged for the tasting of beer or wine.


 

     (b) The tasting samples provided to a customer do not exceed 3

 

servings at up to 3 ounces per serving of beer or 3 servings at up

 

to 2 ounces of wine. A customer shall not be provided more than a

 

total of 3 samples of beer or wine within a 24-hour period per

 

licensed premises.

 

     (c) The specially designated merchant, outstate seller of

 

beer, outstate seller of wine, wine maker, micro brewer, or brewer

 

has first obtained an annual beer and wine tasting permit approved

 

by the commission.

 

     (d) The commission is notified, in writing, a minimum of 10

 

working days before the event, regarding the date, time, and

 

location of the event.

 

     (6) During the time a beer or wine tasting is conducted under

 

subsection (5), a specially designated merchant, outstate seller of

 

beer, outstate seller of wine, wine maker, micro brewer, or brewer,

 

or its agent or employee who has successfully completed a server

 

training program as provided for in section 906, shall devote full

 

time to the beer and wine tasting activity and shall perform no

 

other duties, including the sale of alcoholic liquor for

 

consumption off the licensed premises. Beer and wine used for the

 

tasting must come from the specially designated merchant's

 

inventory, and all open bottles must be removed from the premises

 

on the same business day or resealed and stored in a locked,

 

separate storage compartment on the licensed premises when not

 

being used for the activities allowed by the permit.

 

     (7) A wholesaler shall not conduct or participate in beer and

 

wine tastings allowed under a permit issued under subsection (5).


 

     (8) A beer and wine tasting under subsection (5) may only be

 

conducted during the legal hours for the sale of alcoholic liquor

 

by the licensee.

 

     (9) A brandy manufacturer or small distiller, with the prior

 

written approval of the commission, may conduct tastings of brandy

 

and spirits made by that brandy manufacturer or small distiller and

 

may sell the brandy and spirits made by that brandy manufacturer or

 

small distiller for consumption off the licensed premises at a

 

location other than the licensed premises where the brandy

 

manufacturer or small distiller is licensed to manufacture brandy

 

or spirits under the following conditions:

 

     (a) The premises upon which the brandy and spirits tastings

 

occur conform to local and state sanitation requirements.

 

     (b) Payment of a $100.00 fee per location is made to the

 

commission.

 

     (c) The brandy and spirits tasting locations are considered

 

licensed premises.

 

     (d) The brandy and spirits tasting takes place during the

 

legal hours for the sale of alcoholic liquor by the licensee.

 

     (e) The premises and the license comply with and are subject

 

to all applicable rules promulgated by the commission.

 

     (10) An eligible merchant may fill and sell growlers with beer

 

for consumption off the premises under the following conditions:

 

     (a) The premises where the filling of growlers takes place

 

comply with the requirements for food service establishments under

 

the food law, 2000 PA 92, MCL 289.1101 to 289.8111.

 

     (b) The growler is sealed and has a label affixed to it that


 

includes at least the brand name of the beer, the class of the

 

beer, the net contents of the container, and the name of the

 

retailer filling the growler.

 

     (c) The eligible merchant or his or her agent or employee

 

shall not fill a growler in advance of the sale.

 

     (d) The eligible merchant or his or her agent or employee

 

shall only utilize containers that have a capacity of 5 gallons or

 

more to fill a growler.

 

     (e) The beer to be dispensed has received a registration

 

number from the commission and has been approved for sale by the

 

commission.

 

     (f) The eligible merchant complies with all applicable rules

 

promulgated by the commission.

 

     (11) As used in this section:

 

     (a) "Eligible merchant" means a person that holds a specially

 

designated merchant license and a class C, tavern, class A hotel,

 

class B hotel, club, class G-1, or class G-2 license.

 

     (b) "Growler" means any clean, refillable, resealable

 

container that is exclusively intended, and used only, for the sale

 

of beer for consumption off the premises and that has a liquid

 

capacity that does not exceed 1 gallon.

 

     Enacting section 1. This amendatory act does not take effect

 

unless Senate Bill No.____ or House Bill No. 5426 (request no.

 

04418'13 *) of the 97th Legislature is enacted into law.