BILL NUMBER: SB 1401 AMENDED
BILL TEXT
AMENDED IN SENATE MARCH 26, 2014
INTRODUCED BY Senator Block
FEBRUARY 21, 2014
An act to amend Section 23053.5 of the Business and
Professions Code, relating to alcoholic beverages.
LEGISLATIVE COUNSEL'S DIGEST
SB 1401, as amended, Block. Alcoholic beverages.
Existing law, the Alcoholic Beverage Control Act, regulates the
application, issuance, and suspension of alcoholic beverage licenses
by the Department of Alcoholic Beverage Control. Existing
law provides that a person convicted of a violation of the act is
guilty of a misdemeanor unless another penalty or punishment is
specifically provided law, known as tied-house
restrictions, generally prohibits specified holders of alcoholic
beverage licenses from having an ownership interest in any on-sale
license or giving anything of value to a person operating, owning, or
maintaining an on-sale premises where alcoholic beverages are sold.
Existing law specifically grants the department the authority to
investigate violations of tied-house restrictions .
This bill would state the intent of the Legislature to
enact legislation to increase enforcement of the Alcoholic Beverage
Control Act specifically grant the Department of
Alcoholic Beverage Control the authority to investigate violations
relating to beer price posting and marketing regulations and
provisions relating to labeling and containers. The bill would direct
and authorize the department to hire six, full-time equivalent
personnel, additional to the department's current staff, to
investigate and prosecute violations of the tied-house laws. The bill
would make a statement of legislative findings and delete obsolete
cross- references .
Vote: majority. Appropriation: no. Fiscal committee: no
yes . State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. The Legislature finds and declares the
following:
(a) The investigation and enforcement of violations of the
tied-house laws by the Department of Alcoholic Beverage Control is
vital and necessary to the maintenance of a fair and orderly market
in the manufacture, distribution, and retail sales of alcoholic
beverages. These investigations are often extremely complex, take
considerable time, and require extensive resources.
(b) The alcoholic beverage industry members seeking to comply with
the law are placed at a competitive disadvantage by those few
members of the industry that choose to violate the tied-house laws.
Due to the complex nature of these investigations, together with
reductions in staff caused by a general reduction in state services,
the prioritization of the limited enforcement personnel to direct
public safety violations, such as sales of alcohol to minors and
intoxicated patrons, and the tremendous growth in licensed
businesses, the department is regularly unable to investigate these
violations.
(c) Although the Legislature has enacted a number of exceptions to
the tied-house laws in response to modern business practices and for
the purpose of promoting economic activity beneficial to the state
and local communities, these exceptions are balanced against the
potential for overly aggressive marketing practices that can lead to
negative effects, including the promotion of excessive consumption of
alcoholic beverages or anticompetitive behavior. These exceptions
are, therefore, intentionally narrow in scope.
(d) The separation between manufacturing interests, wholesale
interests, and retail interests in the production and distribution of
alcoholic beverages in order to prevent any entity from dominating
or controlling local markets, including the coercion of violations of
the Alcoholic Beverage Control Act through vertical or horizontal
integration, and to prevent excessive sales of alcoholic beverages
produced by overly aggressive marketing techniques, remains state
policy.
(e) In furtherance of these policies, the Legislature highly
encourages the Department of Alcoholic Beverage Control to devote the
necessary resources to adequately and aggressively enforce the
tied-house laws.
SEC. 2. Section 23053.5 of the Business
and Professions Code is amended to read:
23053.5. The department shall have the function of investigation
of violations of Chapters 10, 11 12, 13,
and 15 of this division and rules of the department relating
thereto. To the end ensure that such
provisions are more adequately and strictly enforced, funds for
support of this program shall be derived as follows: In addition to
fees otherwise provided for in this division, the following amounts
shall be paid to the department by holders of the following types of
licenses:
(a) Retail package off-sale
general license ................... $24 per year
(b) Rectifier's license ........... $52 per year
(c) Distilled spirits wholesaler's
license ........................... $52 per year
(d) Distilled spirits
manufacturer's agent's license .... $52 per year
(e) Distilled spirits
manufacturer's license ............ $52 per year
(f) Distilled spirits importer's
general license ................... $52 per year
(g) California winegrower's
agent's license ................... $52 per year
Payment of those amounts shall be made upon issuance or transfer
of these types of licenses, and shall be made by the holders of these
types of licenses at the time specified in this division for payment
of annual renewal fees therefor.
The provisions of Section 23322 shall apply to the amounts to be
paid under this section. All money collected from the fees provided
for in this section shall be deposited in the Alcohol Beverage
Control Fund as provided in Section 25761.
SEC. 3. The Legislature hereby directs and
authorizes the department to hire six, full-time equivalent
personnel, additional to the department's current staff, to
investigate and prosecute violations of the tied-house laws.
SECTION 1. It is the intent of the Legislature
to enact legislation to increase enforcement of the Alcoholic
Beverage Control Act.