BILL ANALYSIS �
AB 517
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Date of Hearing: March 30, 2011
ASSEMBLY COMMITTEE ON GOVERNMENTAL ORGANIZATION
Isadore Hall, Chair
AB 517 (Hall) - As Introduced: February 15, 2011
SUBJECT : Alcoholic beverage control: licensees: returns.
SUMMARY : Adds a new provision to the Alcoholic Beverage
Control Act (Act) that permits the return of unsold and unopened
beer from an organization that obtained a temporary license.
Specifically, this bill :
1) Authorizes an alcoholic beverage licensee to accept the
return of unsold and unopened beer from an organization that has
obtained a temporary daily license.
2) Permits the licensee to 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.
3) Adds clarity to an existing provision of law relating to the
reintroduction of discontinued/seasonal brands of beer in the
same California market area in which a return and exchange of
that beer has taken place.
EXISTING LAW :
1) Establishes the Department of Alcoholic Beverage Control
(ABC) and grants it exclusive authority to administer the
provisions of the 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.
2) Separates the alcoholic beverage industry into three
component parts, or tiers, of manufacturer (including breweries,
wineries and distilleries), wholesaler, and retailer (both
on-sale and off-sale).
3) Permits the return of beer for errors in delivery, health
and safety recalls and the identical exchange of out-of-code
products.
AB 517
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4) 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.
FISCAL EFFECT : Unknown.
COMMENTS :
Purpose of the bill : According to the author's office, this
bill has been introduced on behalf of beer distributors in
California who have experienced increasing demands to accept the
return of unsold or unopened beer from nonprofit organizations
that are the holders of temporary on-sale licenses (issued for
special events, fundraisers, parties, etc.).
Currently, holders of such licenses may choose to keep the
unopened and unused beer for a future event for which another
temporary license may be issued. However, they have no legal
option to sell or dispose of the beer in their possession at the
expiration of their daily license. This measure would permit
the return of unsold and unopened beer by daily licensees to the
licensee from whom the beer was purchased.
Prior/Related Legislation : AB 3071 (Assembly G.O. 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 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 ABC.
SB 452 (Maddy) Chapter 273, Statutes of 1998. Among other
things, authorized a wholesaler or manufacturer of beer to
AB 517
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accept the return 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.
REGISTERED SUPPORT / OPPOSITION :
Support
None on file
Opposition
None on file.
Analysis Prepared by : Eric Johnson / G. O. / (916) 319-2531