BILL ANALYSIS Ó
AB 527
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Date of Hearing: May 20, 2015
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Jimmy Gomez, Chair
AB
527 (Dodd) - As Amended May 4, 2015
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|Policy |Governmental Organization |Vote:|20 - 0 |
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Urgency: No State Mandated Local Program: YesReimbursable:
No
SUMMARY:
This bill creates a tied-house exception to allow specific
alcohol manufacturers and distributors to sponsor events or
purchase advertising space and time from, or on behalf of, a
live entertainment marketing company that is a wholly-owned
subsidiary of a non-publicly traded live entertainment company
that has its principal place of business in Napa County, subject
to specified restrictions.
FISCAL EFFECT:
AB 527
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Minor, likely absorbable enforcement costs to the Department of
Alcoholic Beverage Control as the bill is effectively
unenforceable.
COMMENTS:
1)Purpose. According to the author, this bill allows live
entertainment marketing companies in Napa County, in
particular Latitude 38 Entertainment, to receive advertising
and sponsorship directly from alcohol manufacturers,
benefitting the Napa regional economy. The author believes
the tied-house exception is needed in order to help promote
the Napa Valley wine industry. The author maintains the bill
preserves adequate protections and competition for other
alcohol manufacturers by requiring the entertainment licensee
to serve other brands of beer, wine, and distilled spirits.
2)Latitude 38 Entertainment. Headquartered in Napa County, this
live entertainment company produces the BottleRock Napa Valley
Festival. The company spends approximately $2 million to
produce the event, renting the Napa County fairgrounds, hiring
contractors and employees, and paying various event permit and
security fees. More than 95,000 people attended the festival
in 2014, spending an estimated $14 million on hotels, food,
beverages, and retail purchases.
3)Findings. This bill contains two distinct legislative
findings sections, one codified and the other uncodified. The
uncodified findings attempt to draw a connection between the
2014 earthquake in Napa County and the need for this bill,
suggesting the tied-house exemption will help Napa County
recover from the earthquake. By implication, the findings
suggest that once Napa County has recovered, the tied-house
exemption in this bill will no longer be needed. Given this
AB 527
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bill is patterned off several other tied-house exemptions that
do not contain such qualifications, the author and the
Committee may wish to consider whether the Section 1
legislative findings are necessary.
Analysis Prepared by:Joel Tashjian / APPR. / (916)
319-2081