BILL ANALYSIS �
AB 2609
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 2609 (Nestande)
As Amended July 1, 2014
Majority vote
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|ASSEMBLY: |73-0 |(May 8, 2014) |SENATE: |36-0 |(August 7, |
| | | | | |2014) |
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Original Committee Reference: G.O.
SUMMARY : Adds a new provision to the Alcoholic Beverage Control
Act (ABC Act) that allows nonprofit organizations established
for the purpose of promoting home brewing to serve beer at
fundraising events subject to specified conditions; and provides
that home brewed beer or wine may only be provided or served
within a clearly identified area.
The Senate amendments :
1)Make clarifying changes.
2)Require this beer or wine to be served within a clearly
identified area that has a physical barrier with a monitored
point of entry and would prohibit commercial manufacturers
from selling beer or wine in this area.
3)Provide if more than 50 members are expected to be in
attendance at the event, the nonprofit must provide Department
of Alcoholic Beverage Control (ABC) with the number of members
that have registered for the event and the estimated number
that will be in attendance, 48 hours prior to the event.
EXISTING LAW :
1)Establishes ABC and grants it exclusive authority to
administer the provisions of the ABC 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 for this purpose.
2)Authorizes a person over 21 years of age to manufacture beer
or wine (200 gallons per calendar year if there are two or
AB 2609
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more adults in the household or 100 gallons if there is only
one adult in the household) for personal or family use, and
not for sale, without the need for a license or permit.
3)Authorizes the removal of beer or wine, manufactured for
personal or family use, from the premises where manufactured
only under the following circumstances: a) for use, including
tasting by judges, in a bona fide competition or exhibition;
b) for personal or family use; and c) when donated to a
nonprofit organization for sale at fundraising events
conducted solely by and for the benefit of the nonprofit and
pursuant to a license issued by ABC to the nonprofit entity.
Explicitly prohibits nonprofit organizations that promote home
brewing or home winemaking or are primarily composed of home
brewers or home winemakers from selling beer pursuant to this
body of law.
4)Separates the alcoholic beverage industry into three component
parts of manufacturer, wholesaler, and retailer. This is
known as the "tied-house" law. This is the original policy
rationale for this body of law was to prohibit the vertical
integration of the alcohol industry and to protect the public
from predatory marketing practices. Generally, other than
exemptions granted by the Legislature, the holder of one type
of license is not permitted to do business as another type of
licensee within the "three-tier" system.
AS PASSED BY THE ASSEMBLY , this bill allowed nonprofit
organizations that promote home brewing, or that are primarily
composed of home brewers, to sell beer at fundraising events
subject to specified conditions, including a limit of two events
per year that sell wine or beer for each organization.
FISCAL EFFECT : According to the Senate Appropriations
Committee, pursuant to Senate Rule 28.8, negligible state costs.
COMMENTS : This bill, as amended in the Senate is consistent
with Assembly actions.
According to the author's office, this bill is intended to
revise the description regarding the authorized removal of home
brewed beer from the home for use at a competition, judging,
exhibition, or tasting. It also seeks to provide express
authorization for nonprofit home brew associations to host
annual or semi-annual events for their members to gather and
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participate in exhibitions, judgings, tastings or competitions.
Additionally, this bill limits the number of permits that can be
issued for such events to two per each nonprofit, per calendar
year. This bill also requires an educational component per
event, and provides that the entity sponsoring the event must
display a printed notice at the event stipulating that the home
brewed beer is not subject to certain health and safety
standards pertaining to manufactured beverages.
The author's office points out that prior to the passage of AB
1425 (Governmental Organization Committee), Chapter 463,
Statutes of 2013, the California Homebrewers Association (CHA)
held an annual event for their members to gather and share their
craft. These events featured judging, tastings, educational
components, and provided members the opportunity to expand their
knowledge about home brewed beer. CHA had been issued permits
by ABC to host such events. Unfortunately, in light of the
enactment of AB 1425, the Southern California Home Brew Festival
had to be cancelled this year. The author's office also notes
that existing law might prevent the 2015 National Homebrewers
Conference, scheduled in San Diego, from being held.
Background: According to the author's office, this bill is
intended to correct an unintended consequence of enactment of AB
1425. Among other things, AB 1425 addressed a problem which had
arisen regarding home winemakers and the use of their home-made
wine at community (nonprofit) fundraisers. Specifically, ABC
had asserted that charging an admission fee to nonprofit
sponsored events, exhibitions or competitions was equivalent to
selling the tastings taking place. ABC's conclusion resulted in
the cancellation of the decades old Napa Classic home
winemakers' festival which was the major support for the Dry
Creek Volunteer Fire Department.
AB 1425 allowed beer or wine made for personal or family use to
be donated to a non-profit organization for sale at a
fundraising event conducted solely by and for the benefit of the
nonprofit organization and only for consumption on the premises
of the fundraising event under a license issued by ABC to the
nonprofit. AB 1425 also imposed various labeling requirements
on the donated beer or wine and stipulated that the label
identify its producer and state that the beer or wine is
homemade and not available for sale or for consumption off the
licensed premises. Furthermore, AB 1425 excluded from this
authorization nonprofit organizations that either promote home
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brewing or home winemaking or that are primarily composed of
home brewers or home winemakers.
Support: CHA states that "the passage of AB 1425 of last year
dealt a devastating blow to our organization when the unintended
consequences of that law led to the cancellation of the 24th
year of the Southern California Homebrewers Festival." The CHA
believes that passage of this bill will clarify the law to allow
sharing between homebrew clubs as had been possible since the
1980s.
The American Homebrewers Association (AHA) states that "if AB
2609 is not passed, the AHA may be forced to cancel the 37th
Annual National Homebrewers Conference planned to be held in San
Diego in 2015. The National Homebrewers Conference is annually
the largest gathering of homebrewers in the world and is
expected to draw 4000-5000 attendees in 2015, generating
approximately $8 million dollars for the local economy."
Opposition: Alcohol Justice argues that "AB 2609 will expand
the availability of alcoholic products while eroding the
three-tier system which provides public health and safety
protections. Evidence shows that increased availability of
alcoholic beverages is correlated with an increase in alcohol
related harm."
Analysis Prepared by : Eric Johnson / G.O. / (916) 319-2531
FN: 0004442