BILL ANALYSIS Ó
AB 2739
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Date of Hearing: April 6, 2016
ASSEMBLY COMMITTEE ON GOVERNMENTAL ORGANIZATION
Adam Gray, Chair
AB 2739
(Chiu) - As Introduced February 19, 2016
SUBJECT: Department of Alcoholic Beverage Control: special
on-sale general license: for-profit theater
SUMMARY: Deletes in a provision in current law that the
Department of Alcoholic Beverage Control (ABC) shall not issue a
special on-sale general license to the operator of any
for-profit theater located within the City and County of San
Francisco, configured with theatrical seating of at least 1,000
seats and primarily devoted to live theatrical performances
until any existing licenses issued by the department to the
operator for the premises of the for-profit theater are
canceled .
EXISTING LAW:
1) Establishes ABC and grants it exclusive authority to
administer the provisions of the Alcoholic Beverage Control Act
in accordance with 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.
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2) Provides ABC may issue a special on-sale general license to
any nonprofit theater company that meets specified requirements.
Theater companies holding a license pursuant to these
provisions may only sell and serve alcoholic beverages to
ticketholders during, and two hours prior to and one hour after,
a bona fide theater performance of the company. There are 90 of
these Type 64 licenses in California for non-profit theater
companies who meet the specified requirements. All licenses are
renewed on a 12-month basis.
3) Provides ABC may issue a special on-sale general license to
the operator of any for-profit theater located within the City
and County of San Francisco, configured with theatrical seating
of at least 1,000 seats and primarily devoted to live theatrical
performances.
4) Prohibits that special on-sale general license from being
issued until any existing licenses issued by the department to
the operator for the premises of the for-profit theater are
canceled.
5) Provides the special on-sale general license shall permit
sales, service, and consumption of alcoholic beverages in the
lobbies and seating areas of the theater for the period
beginning two consecutive hours prior to a live theatrical
performance and ending one hour after the live theatrical
performance is completed, as specified.
6) Makes it explicit that any special on-sale general license
issued shall be subject to the limitations provided in existing
law that caps the number of new on-sale general licenses issued
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by the ABC at one for every 2,000 inhabitants of the county
where the establishment is located. Also, provides that the
license issued does not mandate that the premises be operated as
a bona fide public eating-place.
7) Stipulates that the theater shall not be subject to an
existing provision of the ABC Act that prohibits the
transferring of a license unless the applicant can show that
substantial public demand cannot otherwise be satisfied.
Specifies that a "for-profit theater" shall not include an adult
or sexually oriented business, as defined in Penal Code Section
318.5.
8) Defines "bona fide public eating place" to mean a place
which is regularly and in a bona fide manner used and kept open
for the serving of meals to guests for compensation and which
has suitable kitchen facilities connected therewith, containing
conveniences for cooking an assortment of foods which may be
required for ordinary meals, the kitchen of which must be kept
in a sanitary condition with the proper amount of refrigeration
for keeping of food on said premises and must comply with all
the regulations of the local Department of Health.
9) 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.
FISCAL EFFECT: Unknown
COMMENTS:
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Background : In 2013, AB 525 (Ting), Chapter 235, created a new
special on-sale general license in the ABC Act that enabled the
operator of any for-profit theater (Curran, Orpheum and Golden
Gate Theatres), configured with theatrical seating of at least
1,000 seats and primarily devoted to live theatrical
performances, located within the City and County of San
Francisco. The measure was intended to create a special license
category to accommodate the business goals of an operator of any
for-profit theater located in the City and County of San
Francisco.
Before the passage of AB 525, patrons of a for-profit theater
located in the City and County of San Francisco were prevented
from approaching service bars to purchase alcoholic and
non-alcoholic beverages and carrying those drinks elsewhere in
the lobby or to their seats. The bill was a narrowly crafted to
enhance the experience of theatergoers at many of the city's
grand historically renovated theaters. Additionally, the
measure contained several provisions to ensure appropriate
controls relating to licensing.
Purpose of the bill : The author states this bill will make a
change to the above-mentioned bill relating to the issuance of a
special on-sale general license (Type 71) for any for-profit
theater in the City and County of San Francisco. Such a license
enables each theater to serve beer, wine, and distilled spirits
to patrons.
The Curran Theatre, which opened in February 1922, closed on
January 1, 2015 for renovations to the 1,650-seat theater, and
is set to reopen in January 2017. Prior to its closure, the
Curran Theatre was operated by an ABC licensee that will no
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longer have ownership interest in the theater or the alcohol
beverage service when it reopens. AB 2739 would delete the
requirement that prior to ABC issuing a Type 71 license; any
existing license issued for the premises must be "cancelled" by
the operator.
The author states that a change in statute is necessary because
current law did not take into account the possibility that an
owner or operator of an existing theater may change ownership,
which would leave the new owner without the ability to apply for
and be issued a new license by ABC unless the prior license is
cancelled by the previous owner(s). This requirement will
prevent the Curran Theatre from applying for a new special
on-sale general license or from serving alcoholic beverages to
its patrons when it reopens to the public in January 2017.
The author further states that the "cancellation" requirement is
a unique licensing process and is inconsistent with how other
licenses are issued by the department under the ABC Act and
specific policies that allow for the application and purchase of
a new license from the ABC by the new owner or operator of a
premise.
Prior legislation : AB 525 (Ting), Chapter 235, Statutes of
2013. Created a new special on-sale general license in the ABC
Act that enables the operator of any for-profit theater, as
specified, located within the City and County of San Francisco,
to serve alcoholic beverages during certain hours in specified
areas of the theater.
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SB 1531 (Wolk), Chapter 334, Statutes of 2012. Created a narrow
tied-house exception, until January 1, 2018, enabling the Napa
Valley Opera House to accept wine and monetary donations from
wineries located within the Counties of Napa, Sonoma, Lake, and
Mendocino.
AB 2793 (Governmental Organization Committee), Chapter 273,
Statutes of 2010. Among other things, authorized a licensed
winegrower to serve on the board of trustees of a nonprofit
theater company operating a theater in the City of Livermore, as
specified. Also, authorized ABC to issue a club license to
nonprofit lawn bowling clubs that do not discriminate or
restrict membership, as specified.
SB 131 (Wiggins), Chapter 638, Statutes of 2009. Created an
exception to the ABC Act, until December 31, 2014, authorizing
the San Francisco Symphony, which holds an on-sales liquor
license, to accept monetary and alcoholic beverage product
contributions (for free) from licensed alcoholic beverage
manufacturers.
AB 23 (Ma), Chapter 23, Statutes of 2008. Allowed those
licensees operating a cabaret theater to admit persons under 21
years of age to theater performances at any time, provided that
alcoholic beverages are not sold, served, or consumed on the
premises during those performances.
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AB 1429 (Governmental Organization), Chapter 567, Statutes of
2001. Among other things, deleted the requirement that a
nonprofit theater company must be in existence for at least ten
years in order for ABC to issue a special on-sale general
license.
REGISTERED SUPPORT / OPPOSITION:
Support
Curran Live, LLC
Opposition
None on file
Analysis Prepared by:Eric Johnson / G.O. / (916) 319-2531
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