BILL ANALYSIS Ó
AB 593
Page 1
ASSEMBLY THIRD READING
AB 593 (Quirk)
As Amended May 24, 2013
Majority vote
GOVERNMENTAL ORGANIZATION 16-0 APPROPRIATIONS 17-0
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|Ayes:|Hall, Nestande, Bigelow, |Ayes:|Gatto, Harkey, Bigelow, |
| |Chesbro, Cooley, Gray, | |Bocanegra, Bradford, Ian |
| |Hagman, | |Calderon, Campos, |
| |Roger Hernández, | |Donnelly, Eggman, Gomez, |
| |Jones-Sawyer, Levine, | |Hall, Ammiano, Linder, |
| |Medina, Perea, | |Pan, Quirk, Wagner, Weber |
| |V. Manuel Pérez, Salas, | | |
| |Torres, Waldron | | |
| | | | |
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SUMMARY : Makes various changes to the Alcoholic Beverage
Control Act (Act). Specifically, this bill :
1)Requires the Department of Alcoholic Beverage Control (ABC) to
evaluate its onsite license review process for restaurants in
order to implement a more expedited licensing process.
Requires ABC to prepare and submit a report to the
Legislature, on or before December 31, 2015, relating to the
review.
2)The Act specifies that applicants for an on-sale or off-sale
license to have a notice of the application published in a
newspaper of general circulation, as described. This bill
would exempt an applicant from this requirement if they must
provide notice of their application by mail to every resident
and owner of real property within 500-foot radius of the
premises for which the license is to be issued or if ABC is
required to notice by mail a respective public agency, public
official, or governing body of a city or county.
3)Permits ABC to reject protests, except protests made by a
public agency, public official, or governing body of a city or
county, it determines are invalid or unreasonable, as
described. The bill would also require a protest submitted by
a person other than an employee of the department or a public
officer to be submitted by an individual and limit the protest
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to one signatory.
EXISTING LAW :
1)Establishes ABC and grants it exclusive authority to
administer the provisions of the Alcoholic Beverage Control
Act in accordance with the laws enacted by the Legislature.
This involves licensing individuals and businesses associated
with the manufacture, importation and sale of alcoholic
beverages in this state and the collection of license fees or
occupation taxes for this purpose.
2)Provides that protests against the issuance of a liquor
license may be filed with ABC. Existing law permits ABC to
reject protests, except protests made by a public agency,
public official, or governing body of a city or county, it
determines to be false, vexatious, or without reasonable or
probable cause.
3)Requires any hearings held on a protest, accusation, or
petition for a license to be held at specified locations and
to be conducted in accordance with specified administrative
procedures specified applicants for on-sale or off-sale
licensees to have a notice of the application published, as
provided.
4)Requires the ABC to notify the appropriate sheriff, chief of
police, district attorney, city or county planning agency, and
legislative body of an application for the issuance or
transfer of a liquor license, and prohibit the ABC from
issuing or transferring a license until at least 30 days after
these notices are provided. Existing law authorizes the ABC
to extend that 30-day period for a period not to exceed 20
days if a proper written request is made by any local law
enforcement agency.
5)Restricts ABC from issuing an off-sale beer and wine license
if the applicant premise is located in a city or county where
the number of retail off-sale beer and wine licenses exceeds
one license for each 2,500 inhabitants. If the applicant
premise is located in a city and county, the ratio is one
license for every 1,250 inhabitants. If no licenses are
available due to the population restrictions, anyone
interested in obtaining a liquor license must purchase one
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from an existing licensee.
6)Requires ABC to deny an application for a license if issuance
of the license would result in or add to an undue
concentration of licenses in a particular area; unless the
local governing body finds that it would serve the public
convenience or necessity, as defined.
FISCAL EFFECT : According to the Assembly Appropriations
Committee, one-time costs for determining the list of
unreasonable protests and the required rulemaking would likely
be between $50,000 and $120,000 (ABC Fund). To the extent the
adopted list of unreasonable protests reduces the workload for
ABC, there could be on-going savings for the ABC.
COMMENTS :
Alcohol oversight : ABC is vested with the exclusive authority
to license and regulate the manufacture, distribution and sale
of alcoholic beverages within California. ABC has the authority
to suspend, revoke or deny a license if it determines that
granting or continuance of the license would be contrary to
public welfare or morals. All ABC decisions may be appealed to
the ABC Appeals Board, a three-member body appointed by the
Governor, subject to Senate confirmation.
There are currently more than 70,000 alcoholic beverage licenses
throughout the state. This includes both "on-sale" and
"off-sale" establishments that sell beer and wine, and "on-sale"
and "off-sale" general licensees that also sell distilled
spirits. ABC is required to investigate both the applicant and
the premises for, which a license is applied, to determine if
the public would be adversely affected by the license issuance.
These investigations include an evaluation of the moral
character of the applicant and the suitability of the proposed
premises.
ABC must deny an application for a license if issuance would
create a law enforcement problem or if issuance would result in,
or add to, an undue concentration of licenses in the area where
the license is desired. For liquor stores and other specified
retail licenses, however, ABC is authorized to issue a license
if the respective local government determines that public
convenience or necessity would be served by granting the
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license.
State law caps the number of new "on and off-sale" general
licenses issued by ABC, at one for every 2,500 inhabitants of
the county where the establishment is located (2,000:1 for
on-sale licenses). If no licenses are available from the state
due to the population restrictions, those people interested in
obtaining a liquor license may purchase one from an existing
licensee, for "whatever price the market bears."
Currently, there are restrictions on the issuance of licenses in
areas of undue concentration of retail licenses. ABC is
responsible for setting conditions for the safe operation of
these new licenses. Current law permits ABC to place reasonable
operating conditions upon retail licensees if grounds exist for
denial of a license. Operating conditions may cover any matter
relating to the conduct of the business or the condition of the
premises including, but not limited to, restrictions on hours of
sale, hiring of security guards, limitations on types and
strengths of beverages sold, and conduct of the licensee.
A protest can be made at any time within 30 days of any of the
following: 1) the first date of posting the premises with the
notice of intention to sell alcoholic beverages; 2) the first
date of posting the premises with the notice of application for
ownership change; and 3) the date of mailing the notice of
application to residents within 500 feet of the proposed
premises. If a valid protest is made to the issuance of a
license, usually a protest hearing will be held. In 2012, ABC
received 2,759 protest letters. From those letters, 414 license
applications were protested. If an application is protested, a
protested application can take a few months or longer to
complete.
If a retail license application has been protested and ABC has
recommended approval of the license, ABC may issue an Interim
Operating Permit upon the applicant's written request. If an
application is withdrawn because of a protest being filed, an
applicant may not re-file an application at the same premises
for one year, and all protests remain valid for one year against
any subsequent applications filed by other persons at the
premises.
Purpose of AB 593 : The author states the goal of this bill is
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to give ABC more discretion to prioritize their efforts while
allowing applicants to participate in a process that is as
efficient as possible. Toward that end, the bill allows ABC to
define what constitutes an invalid or unreasonable protest to an
ABC license application. The author hopes that the list will
include common examples to be determined by the ABC. By
providing clarity to which type of protests will be considered
valid, the author seeks to reduce the workload of the ABC by
giving them discretion to not respond to numerous unreasonable
protests.
In addition, the bill requires all public protests to be
submitted individually and limited to one signee. The author
maintains this will assist the ABC in meeting their obligation
to contact protesters directly, as opposed to those cases where
only a list of names on a petition is available.
Finally, the measure eliminates a requirement for applicants to
publish notification in regional print media in those cases
where individual notifications are already being mailed directly
to area residents. This change is intended to help simplify the
application process for certain applicants who have multiple
notification requirements.
Analysis Prepared by : Eric Johnson / G. O. / (916) 319-2531
FN:
0000967