BILL ANALYSIS Ó
AB 1322
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Date of Hearing: April 8, 2015
ASSEMBLY COMMITTEE ON GOVERNMENTAL ORGANIZATION
Adam Gray, Chair
AB 1322
(Daly) - As Introduced February 27, 2015
SUBJECT: Alcoholic beverages: licenses: beauty salons
SUMMARY: This bill expands an existing provision of the
Alcoholic Beverage Control Act (ABC Act) that allows the serving
of alcohol without a license or permit in a limousine or as part
of a hot air balloon ride service to also include a beauty salon
or barbershop , provided there is no extra charge or fee for the
alcoholic beverages. Specifically, this bill :
1) Provides a license or permit is not required for the serving
of alcoholic beverages as part of a beauty salon service or
barbershop service, provided there is no extra charge or fee for
the alcoholic beverages.
2) Specifies that there shall be no extra charge or fee for the
alcoholic beverages when the fee charged for the beauty salon
service or barbershop is the same regardless of whether
alcoholic beverages are served.
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EXISTING LAW:
1) Establishes the Department of Alcoholic Beverage Control
(ABC) and grants it exclusive authority to administer the
provisions of the ABC Act in accordance with laws enacted by the
Legislature.
2) Makes it unlawful for any person other than a licensee of
the ABC to sell, manufacture, or import alcoholic beverages in
this state.
3) Provides that no license or permit shall be required for the
serving of alcoholic beverages in a "limousine" or as part of a
"hot air balloon ride" service, provided there is no extra
charge or fee for the alcoholic beverages.
4) Provides that 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 license, however, the ABC is authorized
to issue a license if the respective local government determines
that public convenience or necessity would be served by granting
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the license.
5) Caps the number of new on and off-sale general licenses
issued by the 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. In 1994, the
Legislature approved a three-year moratorium on the issuance of
new off-sale beer and wine licenses, which at the time was not
bound by any population to license restriction. In 1997, this
moratorium was made permanent.
6) Establishes the Barbering and Cosmetology Act, which
provides for the licensure and regulation of barbers and
cosmetologists, including the practice of skin care by licensed
estheticians, by the Board in the Department of Consumer
Affairs. (Business and Professions Code (BPC) Section 7316)
7) Establishes the specified requirements that applicants for a
cosmetology, esthetician, barbering, manicurist and
electrologist license must meet in order to sit for the
licensure examination. (BPC 7321, 7321.5, 7324, 7326, 7330)
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FISCAL EFFECT: Unknown
COMMENTS:
Background : In October of 1985, the Attorney General issued
opinion No. 85-701, which held that the operator of a commercial
enterprise who offers and provides complimentary alcoholic
beverages to guests, customers, or passengers while charging for
the services rendered is deemed to have "sold" the alcoholic
beverage, thereby necessitating an alcoholic beverage license.
At the time, this opinion affected a large number of California
businesses (e.g., limousine and bus services, and
bed-and-breakfast inns) which had made a practice of offering
complimentary champagne and other alcoholic beverages to
passengers and guests as part of their service.
The Legislature has responded to a number of concerns raised by
various business entities over the years relative to this matter
by enacting narrowly crafted legislation to address the problem.
Specifically, SB 1546 (Beverly), Chapter 1354, Statutes of 1986
provides that no license or permit shall be required for the
serving of complimentary alcoholic beverages in limousines. A
few years later, AB 2416 (Assembly Governmental Organization
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Committee), Chapter 639, Statutes of 1998, was enacted which
granted hot air balloon ride services the same privilege.
In California, it is unlawful for any corporation, club, or
organization to sell, give, serve, dispense, keep, or allow to
be consumed on its premises any alcoholic beverage unless
licensed or permitted by law. This prohibition includes the
serving of free alcohol with the purchase of another good or
service. It is also unlawful for any person to keep or consume
an alcoholic beverage on any premises open to the public other
than as specifically permitted by law.
According to the California Board of Barbering and Cosmetology
(CBBC), within the Department of Consumer Affairs, there are a
total of 41,830 beauty salon and barbershop location permits
issued in the State. The CBCC "location license" does not
differentiate between a beauty salon or barbershop. The
following services are not under the jurisdiction of the Board
of Barbering and Cosmetology: body-piercing, braiding, ear
candling, laser services, massage, permanent make-up, medical
services, threading and reflexology.
Purpose of the bill : According to the author's office, this
bill intended to grant beauty salon or barber shop businesses
the opportunity to serve champagne or other alcoholic beverages
to their clients ages 21 and over without an ABC license or a
permit, provided there is no extra fee charged for the beverage.
The author states many beauty salons and barbershops throughout
California offer complementary alcoholic beverages to their
customers at no charge. However, by providing such beverages
without an ABC license, these establishments are in conflict
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with state and local alcohol licensing requirements. The author
points out that most beauty salons and barbershops are small,
mom and pop operations which seek to provide a positive
experience for their customers; unfortunately, such businesses
currently serving alcoholic beverages face potential sanctions
for their actions.
AB 1322 is simply intended to clarify in law that beauty salons
and barbershops may offer a free alcoholic beverage to patrons
of age who purchase a specified service under the Barbering and
Cosmetology Act.
Policy consideration . The author might consider amending the
bill to state the following: 1) alcoholic beverages may only be
served by an entity whose license is in good standing with the
California Board of Barbering and Cosmetology; 2) only beer and
wine may be served at the beauty salon or barbershop; 3) no more
than twelve ounces of beer or wine by the glass for on-premise
consumption may be offered; and 4) beer and wine may only be
provided during normal business hours but no later than 10 p.m.
each night.
In opposition : The California Council on Alcohol Problems
opposes the bill, concerned about the unintended consequences of
allowing alcohol consumption at beauty/barbering establishments.
For instance, is ABC prepared/able to monitor the thousands of
licenses under the CBBC? Will the alcohol industry begin
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marketing and distributing their products through
beauty/barbering establishments as another means of public
tastings?
Prior legislation : AB 461 (Achadjian), Chapter 110, Statutes of
2013. Authorized ABC to issue five new original on-sale general
licenses to San Luis Obispo County between January 1, 2014, and
December 31, 2016, for restaurants with a seating capacity for
50 or more diners.
AB 1320 (Allen), Chapter 467, Statutes of 2012. Authorized ABC
to issue a maximum of 15 new original on-sale general licenses,
over a three-year period, for bona fide public eating-places in
Marin County.
AB 2266 (Evans), Chapter 130, Statutes of 2008. Authorized ABC
to issue a maximum of 15 new original on-sale general licenses,
over a three-year period, for bona fide public eating-places in
Napa County.
SB 762 (Cox), Chapter 193, Statutes of 2007. Allowed ABC to
issue 10 new original on-sale general licenses for bona fide
public eating-places in Mono County.
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AB 2416 (Assembly Governmental Organization Committee), Chapter
639, Statutes of 1998. Provided that no license or permit is
required for the serving of alcoholic beverages as part of a hot
air balloon ride service, provided there is no extra charge or
fee for the alcoholic beverages.
SB 1546 (Beverly), Chapter 1354, Statutes of 1986. Provided
that no license or permit is required for, the serving of
alcoholic beverages in a limousine regulated by the Public
Utilities Commission provided there is no extra charge for the
alcoholic beverages.
AB 1252 (N. Waters), Chapter 753, Statutes of 1977. Permitted
the Director of ABC to authorize the conversion of any on-sale
general license for "seasonal business" to an on-sale general
license, as specified.
REGISTERED SUPPORT / OPPOSITION:
Support
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Lee Short, Franchise owner, 18|8 Fine Men's Salon of Playa Vista
Opposition
California Council on Alcohol Problems
Analysis Prepared by:Eric Johnson / G.O. / (916) 319-2531