HB-6449, As Passed House, November 29, 2006                                          Amendment No. 1

 The Committee on Regulatory Reform offered the following substitute (H-3):

SUBSTITUTE FOR

HOUSE BILL NO. 6449

      A bill to amend 1998 PA 58, entitled

"Michigan liquor control code of 1998,"

by amending section 501 (MCL 436.1501), as amended by 2000 PA

431.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 1        Sec. 501. (1) The commission may issue licenses as provided

 2  in this act upon the payment of the fees provided in section 525

 3  and the filing of the bonds required in section 801 or liability

 4  insurance as provided in section 803. Beginning not later than

 5  July 1, 2002 and subject  The commission shall provide a

 6  notification of the ability of the purchaser or transferee to

 7  obtain a tax clearance certificate, in the manner provided for in

 8  subsection (6). Subject to section 906(2) and (3), the commission

 1  shall not issue a new on premises license or transfer more than

 2  50% interest in an existing on premises license unless the

 3  applicant or transferee offers proof acceptable to the commission

 4  that he or she has employed or has present on the licensed

 5  premises, at a minimum, supervisory personnel on each shift and

 6  during all hours in which alcoholic liquor is served who have

 7  successfully completed a server training program as further

 8  described in section 906. The commission may consider an

 9  individual enrolled and actively participating in a server

10  training program as having successfully completed the program for

11  such time as the individual is participating. The commission may

12  allow an applicant or a conditionally approved licensee at least

13  180 days, or more upon a showing of good cause, to meet the

14  minimum personnel training requirements of this subsection. The

15  commission may suspend the license of a conditionally approved

16  licensee for failure to comply with this subsection. The

17  commission may waive the server training requirements of this

18  subsection on the basis of either of the following circumstances:

19        (a) The licensee's responsible operating experience or

20  training.

21        (b) The person's demonstration of an acceptable level of

22  responsible operation either as a licensee during the preceding 3

23  years or as a manager with substantial experience in serving

24  alcoholic liquor.

25        (2) A full-year license issued by the commission shall

26  expire on April 30 following the date of issuance or the date

27  fixed by the commission. A license issued under this act shall be

 1  construed as a contract between the commission and the licensee

 2  and shall be signed by both parties. If a licensee dies, the

 3  commission may approve the operation of the establishment by a

 4  personal representative or independent personal representative

 5  duly appointed by a court of competent jurisdiction, pending the

 6  settlement of the estate of the deceased licensee. The commission

 7  may approve a receiver or trustee appointed by a court of

 8  competent jurisdiction to operate the licensed establishment of a

 9  licensee. The commission may grant a part-year license for a

10  proportionate part of the license fee specified in section 525.

11  In a resort area the commission shall grant a license for a

12  period of time as short as 3 months. A license may be transferred

13  with the consent of the commission. A class C or specially

14  designated distributor license obtained in a manner other than by

15  transfer shall not be transferred within 3 years after its

16  issuance except under circumstances where the licensee clearly

17  and convincingly demonstrates that unusual hardship will result

18  if the transfer does not receive the consent of the commission.

19  An application for a license to sell alcoholic liquor for

20  consumption on the premises, except in a city having a population

21  of 750,000 or more, shall be approved by the local legislative

22  body in which the applicant's place of business is located before

23  the license is granted by the commission, except that in the case

24  of an application for renewal of an existing license, if an

25  objection to a renewal has not been filed with the commission by

26  the local legislative body not less than 30 days before the date

27  of expiration of the license, the approval of the local

 1  legislative body shall not be required. The commission shall

 2  provide the local legislative body and the local chief of police

 3  with the name, home and business addresses, and home and business

 4  phone numbers to accomplish the local legislative reviews of new

 5  and transferred license applications required by this subsection.

 6  Upon request of the local legislative body after due notice and

 7  proper hearing by the local legislative body and the commission,

 8  the commission shall revoke the license of a licensee granted a

 9  license to sell alcoholic liquor for consumption on the premises

10  or any permit held in conjunction with that license.

11        (3) A local legislative body, by resolution, may request

12  that the commission revoke the license of a licensee granted a

13  license to sell alcoholic liquor for consumption off the premises

14  whose place of business is located within the local legislative

15  body's jurisdiction and who has been determined pursuant to

16  commission violation hearings to have sold or furnished alcoholic

17  liquor, on at least 3 separate occasions in a single calendar

18  year, to a  person who is less than 21 years of age  minor if

19  those violations did not involve the use of falsified or

20  fraudulent identification by the  person who is less than 21

21  years of age  minor. If the commission verifies that the licensee

22  who is the subject of the resolution has been found to have

23  committed the violations as prescribed in this subsection, the

24  commission may suspend or revoke the licensee's license and any

25  permit held in conjunction with that license.

26        (4) This act does not prohibit a hotel which is or was the

27  holder of a license authorizing the retail sale of alcoholic

 1  liquor for consumption on the premises from applying for and

 2  receiving under this act any other and different type of license

 3  authorizing the retail sale of alcoholic liquor for consumption

 4  on the premises, and the application for the license shall not be

 5  considered a new application for a license so long as the total

 6  number of public licenses for consumption on the premises does

 7  not exceed the authorized total established in this act and the

 8  sale of alcoholic liquor is approved by the electors. The

 9  commission may divide the state into 3 zones and establish for

10  each zone an anniversary date for renewal of full-year retail

11  licenses in the licensing year. The commission shall promulgate

12  rules pursuant to the administrative procedures act of 1969, 1969

13  PA 306, MCL 24.201 to 24.328, for the effective administration of

14  the renewal of licenses.

15        (5) The commission, with the written approval of the

16  department of agriculture in the case of the Michigan state

17  fairgrounds and the Upper Peninsula state fairgrounds, may issue

18  without regard to the quota provision of section 531 a tavern

19  license to a person as concessionaire leasing or renting a

20  portion of either the Upper Peninsula state fairgrounds or the

21  state fairgrounds, or both, to service the licensed area in use

22  for recreational or exhibition purposes other than at the time of

23  the annual Upper Peninsula state fair under section 2 of 1927 PA

24  89, MCL 285.142. A license issued under this subsection is not

25  transferable.

26        (6) The application for initial licensure or for a transfer

27  of a license shall contain a notice in substantial compliance

 1  with the following:

2         When purchasing a license, a buyer can be held liable

3         for tax debts incurred by the previous owner. Prior to

4         committing to the purchase of any license or establishment,

5         the buyer should request a tax clearance certificate

6         from the seller that indicates that all taxes have been

7         paid up to the date of issuance. Obtaining sound

8         professional assistance from an attorney or accountant

9         can be helpful to identify and avoid any pitfalls

10        and hidden liabilities when buying even a portion

11        of a business.

12        Sellers can make a request for the tax clearance

13        certificate through the Michigan department of treasury.