BILL ANALYSIS Ó AB 782 Page 1 CONCURRENCE IN SENATE AMENDMENTS AB 782 (Bocanegra) As Amended June 19, 2003 Majority vote ----------------------------------------------------------------- |ASSEMBLY: |70-0 |(May 16, 2013) |SENATE: |38-0 |(August 15, | | | | | | |2013) | ----------------------------------------------------------------- Original Committee Reference: G.O. SUMMARY : Adds a provision to the Alcoholic Beverage Control Act (ABC Act) to permit an on-sale retail licensee that obtained a caterer's permit to return unused and unopened beer, purchased for sale at the catered event, to the original selling licensee, as specified. The Senate amendments : 1)Permit an on-sale retail licensee, that purchases beer for sale at an event for which a caterer's event permit has been issued by the Department of Alcoholic Beverage Control (ABC), to return the unused and unopened beer to the original selling licensee at the conclusion of the catered event or upon expiration of the catering authorization, as defined. 2)Require the on-sale retail licensee holding the catering authorization to record and maintain a record of the inventory of all unused and unopened beer to be returned at the conclusion of the catering event. 3)Require the original selling licensee to prepare an invoice of the returned beer that references the original sales invoice, as described. 4)Make it explicit that any beer returned must be delivered to the original selling licensee at the conclusion of the catered event or upon expiration of the catering authorization. The original selling licensee may credit the account of the on-sale retail licensee in an amount not to exceed the original sales price of the returned beer, as defined. EXISTING LAW : AB 782 Page 2 1)Permits the return of beer for errors in delivery, health and safety recalls and the identical exchange of out-of-code products. 2)Authorizes a wholesaler or manufacturer of beer to accept the return of quantities of discontinued or seasonal brands of beer from a retail licensee, provided that the returned beer is exchanged for a quantity of beer of a brand produced or sold by the same manufacturer with a value not greater than the original sales price to the retail licensee of the returned beer. 3)Allows an alcoholic beverage licensee to accept the return of unsold and unopened beer from an organization that obtains a temporary license. Additionally, the licensee may credit the account of the organization in an amount not to exceed the original sales price of the returned beer, provided that the beer has been paid for in full. 4)Authorizes the ABC to issue special licenses for the sale of beer or wine on a temporary basis (usually one to three days) for premises temporarily occupied by the licensee for a picnic, social gathering, or similar occasion at a fee equal to the actual cost of issuing the license, but not to exceed $25 per day. Also, under existing law, ABC may, in its discretion, issue on a temporary basis a daily on-sale general license and the fee for such license shall be $25 per day. 5)Defines an "on-sale" license as authorizing the sale of all types of alcoholic beverages, namely: beer, wine and distilled spirits, for consumption on the premises (such as at a restaurant or bar). An "off-sale" license authorizes the sale of all types of alcoholic beverages for consumption off the premises in original, sealed containers. 6)Provides that a violation of any of its provisions for which another penalty or punishment is not specifically provided is a misdemeanor. AS PASSED BY THE ASSEMBLY , this bill added a new provision to the ABC Act that permits the return of unsold and unopened beer from an organization that obtained a temporary license. FISCAL EFFECT : According to the Senate Appropriations Committee, pursuant to Senate Rule 28.8, negligible state costs. AB 782 Page 3 COMMENTS : This bill, as amended in the Senate is consistent with Assembly actions. Purpose of the bill : According to the author's office, only specified holders of permanent retail licenses are able to acquire a caterer's permit. Due to the fact that they are holders of permanent retail licenses, they are ineligible to return unsold and unopened beer to an alcoholic beverage licensee and have their account credited. This measure is intended to allow a caterer to return unsold and unopened beer to a beer distributor or manufacturer for credit. The author's office points out that often times it is difficult to estimate the amount of beer that will be consumed at an event which can lead to a situation whereby a caterer has overestimated the amount of beer needed for any particular event and is left with an excess of stock. If the caterer cannot sell the beer at future events or at its permanently licensed premise and the beer expires or goes "out-of-code," the distributor or manufacturer must exchange the out-of-code beer for fresh beer and bear the cost of fresh inventory and also pay to have the out-of-code beer destroyed. Prior legislation : SB 1393 (Negrete McLeod), Chapter 163, Statutes of 2012. Allowed an alcoholic beverage licensee to accept the return of unsold and unopened beer from organizations that obtain a particular license, as specified, and allowed the return of beer that is recalled or that is considered to present a health and safety issue by the manufacturer, importer, or governmental entity if distributed, offered for sale, or sold in the state. Also, allowed for the exchange of beer or a credit memorandum. SB 487 (Negrete McLeod) of 2011. Would have added a new provision to the ABC Act authorizing the return of unsold and unopened beer from an organization that obtained a temporary license. This bill was held in the Assembly Governmental Organization (G.O.) Committee at the author's request. AB 3071 (Governmental Organization Committee), Chapter 508, Statutes of 2008. Among other things, authorized beer that is recalled for health or safety issues to be accepted for return at any time from a retailer and be picked up by the seller of beer. Also, permitted the seller of beer to exchange the AB 782 Page 4 returned beer for identical product, issue a deferred exchange memorandum showing the beer was picked-up and is to be replaced when inventory is available, or issue a credit to the retailer for the returned beer. SB 1035 (Perata), Chapter 657, Statutes of 2001. Allowed a person in possession of a stock of lawfully acquired alcoholic beverages following the revocation or voluntary surrender of, or failure to renew, an alcoholic beverage license to sell that stock to licensees, as authorized by the Department of ABC. Analysis Prepared by : Eric Johnson / G. O. / (916) 319-2531 FN: 0001704