HOUSE BILL No. 5873

 

 

September 14, 2016, Introduced by Rep. Hooker and referred to the Committee on Regulatory Reform.

 

     A bill to amend 1998 PA 58, entitled

 

"Michigan liquor control code of 1998,"

 

by amending section 409 (MCL 436.1409), as amended by 2014 PA 48.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 409. (1) Except as provided in this section, the

 

commission shall levy and collect a tax on all beer manufactured or

 

sold in this state at the rate of $6.30 following rates per barrel

 

if the beer is sold in bulk or in different quantities: .

 

     (a) Through December 31, 2016, $6.30 per barrel.

 

     (b) Beginning January 1, 2017, $21.70 per barrel.

 

     (c) Beginning with the rate effective January 1, 2018 and

 

January 1 of each even year thereafter, the commission shall

 

determine the per barrel rate by multiplying the rate in effect

 

during the immediately preceding calendar year by the inflation

 

rate and rounding the product to the nearest 1/10 of a cent.


     (2) Before February 1, 2015, the tax shall must be paid by the

 

brewer or brewpub if manufactured in this state or by the

 

wholesaler or the person from whom purchased if manufactured

 

outside this state, whichever is designated by the commission.

 

     (3) (2) Beginning on and after February 1, 2015, the tax shall

 

must be paid by the brewer or brewpub if the beer is manufactured

 

in this state or if the beer is manufactured outside this state the

 

tax shall must be paid by the wholesaler assigned to distribute

 

that the beer and the tax shall must be levied and collected on the

 

number of barrels the wholesaler actually sold to licensed

 

retailers in this state. A brewer may designate a wholesaler to pay

 

the tax on behalf of the brewer. If a brewer designates a

 

wholesaler to pay the tax on its behalf, the brewer shall notify

 

the commission of the designation and provide the commission with a

 

copy of its brewer's report of operations that it filed with the

 

alcohol and tobacco tax Alcohol and Tobacco Tax and trade bureau

 

Trade Bureau of the United States department of treasury Department

 

of Treasury for each calendar year.

 

     (4) (3) The commission shall establish by rule a method for

 

the collection of the tax levied under subsection (1) and reporting

 

requirements for wholesalers, brewers, brewpubs, and outstate

 

sellers of beer to verify the remission of taxes to this state. The

 

commission shall not require that the tax be paid in less than

 

monthly intervals. The rules shall must be promulgated pursuant to

 

under the administrative procedures act of 1969, 1969 PA 306, MCL

 

24.201 to 24.328.

 

     (5) (4) The tax levied in subsection (1) shall must not be


collected on beer that is consumed on the premises of the

 

manufacturer or is damaged in the process of brewing, packaging,

 

storage, and distribution and is not offered for sale. , except

 

that However, beer sold by a brewpub for consumption on the

 

premises or beer produced and consumed on the premises of a micro

 

brewer is subject to the tax levied under subsection (1).

 

     (6) (5) The tax levied under subsection (1) shall must be

 

rebated to the person that paid the tax if that the person provides

 

satisfactory proof to the commission that the beer was shipped

 

outside of this state for sale and consumption outside this state.

 

     (7) (6) For the purposes of the tax levied under subsection

 

(1), a barrel of beer contains 31 gallons.

 

     (8) (7) The commission may promulgate a rule that designates

 

the states or the laws or the rules of other states that require a

 

licensed prohibits all licensees from purchasing, receiving,

 

possessing, or selling any beer manufactured in the follow states:

 

     (a) Any state that requires a wholesaler of beer to pay an

 

additional fee for the right to purchase, import, or sell beer

 

manufactured in this state. ;

 

     (b) Any state that denies the issuance of a license

 

authorizing the importation of beer to any a wholesaler of beer in

 

that state who that applies for the license. ;

 

     (c) Any state that prohibits wholesalers of beer in that state

 

from possessing or selling beer purchased in this state, unless the

 

person from whom the beer was purchased has secured a license and

 

paid a fee in that state, if the seller does not transport the beer

 

into the state and does not sell the beer in the state. ; or


     (d) Any state that imposes any higher taxes or inspection fees

 

upon beer manufactured in this state when transporting the beer

 

into or selling the beer in that state than taxes or fees imposed

 

upon beer manufactured and sold within that state. A rule

 

promulgated under this subsection shall prohibit all licensees from

 

purchasing, receiving, possessing, or selling any beer manufactured

 

in any state designated in the rule.

 

     (9) A rule promulgated under this subsection (8) becomes

 

effective as provided in section 47 of the administrative

 

procedures act of 1969, 1969 PA 306, MCL 24.247. Any A licensee or

 

person adversely affected by a rule promulgated under this

 

subsection (8) is entitled to review by leave to by a court of

 

competent jurisdiction regarding the question as to of whether the

 

commission acted illegally or in excess of its authority in making

 

its finding under this subsection (8) with respect to any state.

 

     (10) (8) Regardless of whether the tax was remitted to this

 

state by the eligible brewer or a designated wholesaler, an

 

eligible brewer may claim a credit or request a refund, in a manner

 

as determined by the commission, against the tax levied under

 

subsection (1) in the amount of $2.00 per barrel for the first

 

30,000 barrels. As used in this subsection, "eligible brewer" means

 

a brewer, whether or not located in this state, or brewpub that

 

manufactures not more than 50,000 barrels of beer during the tax

 

year for which the credit is claimed. In determining the number of

 

barrels for purposes of the credit, all brands and labels of a

 

brewer shall must be combined and all facilities for the production

 

of beer that are owned or controlled by the same person shall must


be treated as a single facility.

 

     (11) Beginning January 1, 2017, the legislature shall

 

appropriate revenue generated from the tax under subsection (1)

 

from an increase in the per barrel rate above $6.30 in the

 

following percentages:

 

     (a) To the office of recovery oriented systems of care in the

 

department of health and human services for substance use disorder

 

treatment and rehabilitation services, 60%.

 

     (b) To the department of state police for enforcement of

 

underage drinking laws, drunk driving, and smuggling of alcoholic

 

liquor, 1%.

 

     (c) To the office of highway safety planning in the department

 

of state police for grants to local law enforcement agencies

 

providing prevention and enforcement of underage drinking laws, 3%.

 

     (d) To the commission for the enforcement of this act, 4%.

 

     (e) To the state court administrative office to support drug

 

treatment courts and DWI/sobriety courts under chapter 10A of the

 

revised judicature act of 1961, 1961 PA 236, MCL 600.1060 to

 

600.1084, and veterans treatment courts under chapter 12 of the

 

revised judicature act, 1961 PA 236, MCL 600.1200 to 600.1212, 4%.

 

     (f) To the department of corrections for treatment of

 

prisoners under its jurisdiction, 3%.

 

     (g) To the children's trust fund created in 1982 PA 249, MCL

 

21.171 to 21.172, for early childhood and prevention and education,

 

5.5%.

 

     (h) To the department of military and veterans affairs for

 

prevention, treatment, and recovery support services for veterans


and their families, 4%.

 

     (i) To the department of natural resources for alcohol and

 

drug enforcement, 0.5%.

 

     (j) To the department of state for prevention, enforcement,

 

and oversight of ignition interlock, 1%.

 

     (k) To the department of education for fund infrastructure

 

for model curriculum for and counseling services to support

 

intervention, treatment, and recovery support, 3%.

 

     (l) To the behavioral health and developmental disabilities

 

administration within the department of health and human services

 

to prevent fetal alcohol spectrum disorder, 4%.

 

     (m) To the department of health and human services to contract

 

with governmental or private organizations that provide substance

 

use disorder prevention services or substance use disorder

 

treatment and rehabilitation services, or both, 7%.

 

     (12) The money appropriated under subsection (11) may not be

 

used to supplant previously appropriated money.

 

     (13) The director of the office of recovery oriented systems

 

of care within the department of health and human services shall

 

establish an oversight committee to review the distribution of

 

money appropriated under subsection (1). The oversight committee

 

shall make recommendations to the legislature regarding the funding

 

under subsection (2). The oversight committee consists of the

 

following members:

 

     (a) One member appointed by the speaker of the house of

 

representatives.

 

     (b) One member appointed by the senate majority leader.


     (c) One member appointed by the chairperson of the commission.

 

     (d) The director of the office of recovery oriented systems of

 

care or his or her designee.

 

     (e) The following members appointed by the governor:

 

     (i) One member representing the Michigan Prevention

 

Association.

 

     (ii) One member representing the treatment provider community,

 

nominated by the office of recovery oriented systems of care.

 

     (iii) One member representing the recovery community nominated

 

by Michigan Recovery Voices.

 

     (iv) One member representing the Michigan Association of

 

Chiefs of Police.

 

     (v) One member of the impaired driving action team of the

 

office of highway safety within the department of state police.

 

     (14) As used in this section:

 

     (a) "Consumer price index" means the United States consumer

 

price index for all urban consumers as defined and reported by the

 

United States Department of Labor, Bureau of Labor Statistics.

 

     (b) "Inflation rate" means the annual percentage change in the

 

consumer price index, as determined by the commission, comparing

 

the 2 most recent October 1 through September 30 periods that are

 

immediately preceding the effective date of the rate prescribed

 

under subsection (1)(c), converted to decimals. If the annual

 

percentage change is negative, the inflation rate is zero.

 

     (c) "Substance use disorder prevention services" means that

 

term as defined in section 100d of the mental health code, 1974 PA

 

258, MCL 330.1100d.


     (d) "Substance use disorder treatment and rehabilitation

 

services" means that term as defined in section 100d of the mental

 

health code, 1974 PA 258, MCL 330.1100d.