Regular Session 2017-2018 House Bill 1033 P.N. 2184

SENATE AMENDED

PRIOR PRINTER'S NOS. 1191, 1702

PRINTER'S NO. 2184

THE GENERAL ASSEMBLY OF PENNSYLVANIA

HOUSE BILL

No.

1033

Session of

2017

INTRODUCED BY ELLIS, JAMES, MUSTIO, WHEELAND, MILLARD, PICKETT,

GROVE, HEFFLEY AND RYAN, MARCH 30, 2017

SENATOR McILHINNEY, LAW AND JUSTICE, IN SENATE, AS AMENDED,

JUNE 28, 2017

AN ACT

Amending the act of April 12, 1951 (P.L.90, No.21), entitled, as

reenacted, "An act relating to alcoholic liquors, alcohol and

malt and brewed beverages; amending, revising, consolidating

and changing the laws relating thereto; regulating and

restricting the manufacture, purchase, sale, possession,

consumption, importation, transportation, furnishing, holding

in bond, holding in storage, traffic in and use of alcoholic

liquors, alcohol and malt and brewed beverages and the

persons engaged or employed therein; defining the powers and

duties of the Pennsylvania Liquor Control Board; providing

for the establishment and operation of State liquor stores,

for the payment of certain license fees to the respective

municipalities and townships, for the abatement of certain

nuisances and, in certain cases, for search and seizure

without warrant; prescribing penalties and forfeitures;

providing for local option, and repealing existing laws," in

licenses and regulations and liquor, alcohol and malt and

brewed beverages, providing for wine or spirits enhanced

permits. FURTHER PROVIDING FOR INTERLOCKING BUSINESS

PROHIBITED AND FOR UNLAWFUL ACTS RELATIVE TO LIQUOR, MALT AND

BREWED BEVERAGES AND LICENSEES.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1. The act of April 12, 1951 (P.L.90, No.21), known

as the Liquor Code, is amended by adding a section to read:

Section 417. Wine or Spirits Enhanced Permits.--(a) (1)

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The board shall issue a wine or spirits enhanced permit to a

person holding and possessing a valid distributor or importing

distributor license. Nothing in this section shall be construed

to prohibit a person possessing a valid distributor or importing

distributor license from acquiring both a wine enhanced permit

and a spirits enhanced permit.

(2) Nothing in this section may affect the ability of an

existing licensee to operate within the scope of its current

license as authorized by this act, except that no sales of wine

or spirits may take place by an enhanced permit holder after

eleven o'clock postmeridian of any day until eight o'clock

antemeridian of the next day.

(3) No wine or spirits enhanced permit may be issued to a

license holder whose underlying license is subject to a pending

objection by the director of the Bureau of Licensing or the

board under section 470(a.1), until the matter is decided.

Notwithstanding any other provision of law, a holder of a wine

or spirits enhanced permit may continue to operate under the

permit if its underlying license is objected to by the director

of the Bureau of Licensing or the board under section 470(a.1),

until the matter is decided.

(4) A wine or spirits enhanced permit holder must be in

compliance with the responsible alcohol management provisions

under section 471.1.

(5) A wine or spirits enhanced permit holder shall utilize a

transaction scan device to verify the age of an individual who

appears to be under thirty-five years of age before making a

sale of wine or spirits. A wine or spirits enhanced permit

holder may not sell or share data from the use of a transaction

scan device, provided that the licensee may use the data to show

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the enforcement bureau of the board that the licensee is in

compliance with this act. As used in this paragraph, the term

"transaction scan device" means a device capable of deciphering,

in an electronically readable format, the information encoded on

the magnetic strip or bar code of an identification card under

section 495(a).

(b) The initial application fee and renewal fees shall be as

follows:

(1) The initial application fee for a wine enhanced permit

issued to a licensee shall be five thousand dollars ($5,000).

(2) The annual renewal fee for a wine enhanced permit shall

be equal to two per centum of the costs of wine purchased from

the board.

(3) The initial application fee for a spirits enhanced

permit issued to a licensee shall be five thousand dollars

($5,000).

(4) The annual renewal fee for a spirits enhanced permit

shall be equal to two per centum of the costs of spirits

purchased from the board.

unlimited quantities of wine or spirits.

(d) All fees paid to the board under this section shall be

deposited into the General Fund.

(e) A wine or spirits enhanced permit holder selling wine or

spirits shall be considered a Pennsylvania Liquor Store for

purposes of collecting and remitting the taxes under Article II

of the act of March 4, 1971 (P.L.6, No.2), known as the Tax

Reform Code of 1971.

Section 2. This act shall take effect in 60 days.

SECTION 1. SECTION 411(D) AND (E) OF THE ACT OF APRIL 12,

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<--

1951 (P.L.90, NO.21), KNOWN AS THE LIQUOR CODE, AMENDED JUNE 8,

2016 (P.L.273, NO.39) AND NOVEMBER 15, 2016 (P.L.1286, NO.166),

ARE AMENDED TO READ:

SECTION 411. INTERLOCKING BUSINESS PROHIBITED.--* * *

(D) EXCEPTING AS HEREIN PROVIDED, NO [HOTEL LICENSEE,

RESTAURANT LICENSEE OR CLUB LICENSEE, AND NO OFFICER, DIRECTOR,

STOCKHOLDER, AGENT OR EMPLOYE OF ANY SUCH LICENSEE SHALL IN ANY

WISE BE INTERESTED, EITHER DIRECTLY OR INDIRECTLY, IN THE

OWNERSHIP OR LEASEHOLD OF ANY PROPERTY OR THE EQUIPMENT OF ANY

PROPERTY OR ANY MORTGAGE LIEN AGAINST THE SAME, USED BY A

MANUFACTURER IN MANUFACTURING LIQUOR OR MALT OR BREWED

BEVERAGES; NOR SHALL ANY] HOTEL, RESTAURANT OR CLUB LICENSEE, OR

ANY OFFICER, DIRECTOR, STOCKHOLDER, AGENT OR EMPLOYE OF ANY SUCH

LICENSEE, EITHER DIRECTLY OR INDIRECTLY, LEND ANY MONEYS,

CREDIT, OR GIVE ANYTHING OF VALUE OR THE EQUIVALENT THEREOF, TO

ANY MANUFACTURER FOR EQUIPPING, FITTING OUT, OR MAINTAINING AND

CONDUCTING, EITHER IN WHOLE OR IN PART, AN ESTABLISHMENT USED

FOR THE MANUFACTURE OF LIQUOR OR MALT OR BREWED BEVERAGES.

NOTWITHSTANDING ANY OTHER PROVISION OF THIS SECTION, A HOTEL,

RESTAURANT OR CLUB LICENSEE, OR ANY OFFICER, DIRECTOR,

STOCKHOLDER, AGENT OR EMPLOYE OF ANY SUCH LICENSEE, MAY ACT AS

LANDLORD OR LESSOR TO A MANUFACTURER LICENSEE.

(E) EXCEPT AS HEREIN PROVIDED, NO HOTEL, RESTAURANT, RETAIL

DISPENSER OR CLUB LICENSEE, AND NO OFFICER, DIRECTOR OR

STOCKHOLDER, AGENT OR EMPLOYE OF ANY SUCH LICENSEE SHALL IN ANY

WISE BE INTERESTED, DIRECTLY OR INDIRECTLY, IN THE OWNERSHIP OR

LEASEHOLD OF ANY PROPERTY OR THE EQUIPMENT OF ANY PROPERTY OR

ANY MORTGAGE LIEN AGAINST THE SAME, USED BY A DISTRIBUTOR,

IMPORTING DISTRIBUTOR, OR BY AN IMPORTER OR SACRAMENTAL WINE

LICENSEE, IN THE CONDUCT OF HIS BUSINESS; NOR SHALL ANY HOTEL,

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RESTAURANT, RETAIL DISPENSER OR CLUB LICENSEE, OR ANY OFFICER,

DIRECTOR, STOCKHOLDER, AGENT OR EMPLOYE OF ANY SUCH LICENSEE,

EITHER DIRECTLY OR INDIRECTLY, LEND ANY MONEYS, CREDIT, OR GIVE

ANYTHING OF VALUE OR THE EQUIVALENT THEREOF, TO ANY DISTRIBUTOR,

IMPORTING DISTRIBUTOR, IMPORTER OR SACRAMENTAL WINE LICENSEE,

FOR EQUIPPING, FITTING OUT, OR MAINTAINING AND CONDUCTING,

EITHER IN WHOLE OR IN PART, AN ESTABLISHMENT USED IN THE CONDUCT

OF HIS BUSINESS.

THE PURPOSE OF THIS SECTION IS TO REQUIRE A SEPARATION OF THE

FINANCIAL AND BUSINESS INTERESTS BETWEEN MANUFACTURERS AND

HOLDERS OF HOTEL OR RESTAURANT LIQUOR LICENSES AND, AS HEREIN

PROVIDED, OF CLUB LICENSES, ISSUED UNDER THIS ARTICLE, AND NO

PERSON SHALL, BY ANY DEVICE WHATSOEVER, DIRECTLY OR INDIRECTLY,

EVADE THE PROVISIONS OF THE SECTION. BUT IN VIEW OF EXISTING

ECONOMIC CONDITIONS, NOTHING CONTAINED IN THIS SECTION SHALL BE

CONSTRUED TO PROHIBIT THE OWNERSHIP OF PROPERTY OR CONFLICTING

INTEREST BY A MANUFACTURER OF ANY PLACE OCCUPIED BY A LICENSEE

UNDER THIS ARTICLE AFTER THE MANUFACTURER HAS CONTINUOUSLY OWNED

AND HAD A CONFLICTING INTEREST IN SUCH PLACE FOR A PERIOD OF AT

LEAST FIVE YEARS PRIOR TO JULY EIGHTEENTH, ONE THOUSAND NINE

HUNDRED THIRTY-FIVE: PROVIDED, HOWEVER, THAT THIS CLAUSE SHALL

NOT PROHIBIT ANY HOTEL, RESTAURANT OR CLUB LIQUOR LICENSEE, OR

ANY OFFICER, DIRECTOR OR STOCKHOLDER OF ANY SUCH LICENSEE, FROM

OWNING LAND OR BUILDINGS WHICH ARE LEASED TO A HOLDER OF A

RETAIL DISPENSER'S LICENSE[, A DISTILLERY LICENSE OR A LIMITED

DISTILLERY LICENSE] OR A MANUFACTURER'S LICENSE: AND, PROVIDED

FURTHER, THAT NOTHING CONTAINED IN THIS SECTION SHALL BE

CONSTRUED TO PROHIBIT ANY HOTEL, RESTAURANT, RETAIL DISPENSER OR

CLUB LICENSEE OR ANY OFFICER, DIRECTOR OR STOCKHOLDER, AGENT OR

EMPLOYE OF ANY SUCH LICENSEE FROM HAVING A FINANCIAL OR OTHER

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INTEREST, DIRECTLY OR INDIRECTLY IN THE OWNERSHIP OR LEASEHOLD

OF ANY PROPERTY OR THE EQUIPMENT OF ANY PROPERTY OR ANY MORTGAGE

LIEN AGAINST SAME, USED, LEASED BY AN IMPORTER OR SACRAMENTAL

WINE LICENSEE FOR THE EXCLUSIVE PURPOSE OF MAINTAINING

COMMERCIAL OFFICES AND ON THE CONDITION THAT SAID PROPERTY IS

NOT USED FOR THE STORAGE OR SALE OF LIQUOR OR MALT OR BREWED

BEVERAGES IN ANY QUANTITY: AND, PROVIDED FURTHER, THAT NOTHING

CONTAINED IN THIS SECTION SHALL PROHIBIT AN OFFICER OR MEMBER OF

A LICENSED PRIVATELY OWNED PRIVATE GOLF COURSE CATERING CLUB

FROM HAVING AN INTEREST IN A LIMITED WINERY LICENSE: AND,

PROVIDED FURTHER, THAT NOTHING CONTAINED IN THIS SECTION SHALL

BE CONSTRUED TO PROHIBIT A MEMBER OF THE GOVERNING BOARD OF A

PUBLIC AUTHORITY CREATED UNDER SUBDIVISION (N) OF ARTICLE XXIII

OF THE ACT OF AUGUST 9, 1955 (P.L.323, NO.130), KNOWN AS "THE

COUNTY CODE," FROM HAVING AN INTEREST IN A DISTRIBUTOR OR

IMPORTING DISTRIBUTOR LICENSE NOTWITHSTANDING THE FACT THAT THE

PUBLIC AUTHORITY HAS AN INTEREST IN ONE OR MORE RETAIL LICENSES

OR ACTS AS A LANDLORD FOR ONE OR MORE RETAIL LICENSES: AND,

PROVIDED FURTHER, THAT, NOTHING IN THIS SECTION MAY PROHIBIT AN

EMPLOYE OF A HOTEL OR RESTAURANT LICENSEE FROM [HAVING AN

INTEREST IN ANY PROPERTY USED BY A LIMITED WINERY LICENSEE OR

IN] GUARANTEEING ANY LOANS, OR LENDING ANY MONEYS, PROVIDING

CREDIT OR GIVING ANYTHING OF VALUE TO A LIMITED WINERY LICENSEE

OR ITS OFFICERS, DIRECTORS AND SHAREHOLDERS, PROVIDED THAT THE

PERSON ALSO IS NOT AN OFFICER OF OR DOES NOT HAVE ANY INTEREST

IN OR EXERCISE ANY CONTROL OVER ANY OTHER LICENSED ENTITY THAT

ENGAGES IN ANY SALES TO OR FROM THE LICENSEE: AND, PROVIDED

FURTHER, THAT, NOTWITHSTANDING ANY OTHER PROVISION OF THIS

SECTION, AN ENTITY MAY ACQUIRE BOTH A MANUFACTURER'S LICENSE OR

A LIMITED WINERY LICENSE AND A HOTEL, RESTAURANT OR RETAIL

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DISPENSER LICENSE FOR USE AT THE SAME LOCATION AND MORE THAN ONE

LOCATION MAY BE SO LICENSED. AND, PROVIDED FURTHER, THAT,

NOTWITHSTANDING ANY OTHER PROVISION OF THIS SECTION, AN ENTITY

LICENSED AS A LIMITED WINERY MAY HOLD AND OPERATE A RESTAURANT

LIQUOR LICENSE AT ONE OF ITS ADDITIONAL, BOARD-APPROVED

LOCATIONS INSTEAD OF AT ITS PRIMARY LOCATION WHERE MANUFACTURING

OCCURS. THE LICENSES AND A PERSON'S INTEREST IN THE LICENSES OR

IN THE ENTITY HOLDING THE LICENSES SHALL NOT BE SUBJECT TO THIS

SECTION. PROVIDED FURTHER, THAT, A PERSON WHO IS A HOLDER OF TEN

PER CENTUM (10%) OR LESS OF SECURITIES OR OTHER INTERESTS IN A

PUBLICLY OR PRIVATELY HELD DOMESTIC OR FOREIGN CORPORATION,

PARTNERSHIP, LIMITED LIABILITY COMPANY OR OTHER FORM OF LEGAL

ENTITY OWNING A RETAIL LICENSE SHALL NOT BE DEEMED TO POSSESS A

FINANCIAL INTEREST AND IS NOT SUBJECT TO THE PROVISIONS OF THIS

SECTION, PROVIDED THAT THE PERSON IS NOT AN OFFICER OF, EMPLOYE

OF OR DOES NOT HAVE ANY INTEREST IN OR EXERCISE ANY CONTROL OVER

ANY OTHER LICENSED ENTITY THAT ENGAGES IN ANY SALES TO OR FROM

THE RETAIL LICENSEE IN WHICH THE PERSON HOLDS THE TEN PER CENTUM

(10%) OR LESS INTEREST. PROVIDED FURTHER, THAT NOTHING IN THIS

SECTION SHALL PROHIBIT A PERSON WHO HAS AN OWNERSHIP INTEREST IN

A LIMITED WINERY LICENSE FROM BEING EMPLOYED BY AN ENTITY THAT

HOLDS A HOTEL, RESTAURANT, EATING PLACE OR CLUB LICENSE SO LONG

AS THE PERSON IS NOT EMPLOYED AS ALCOHOL SERVICE PERSONNEL OR AS

A MANAGER.

* * *

SECTION 2. SECTION 493(11) OF THE ACT IS AMENDED TO READ:

SECTION 493. UNLAWFUL ACTS RELATIVE TO LIQUOR, MALT AND

BREWED BEVERAGES AND LICENSEES.--THE TERM "LICENSEE," WHEN USED

IN THIS SECTION, SHALL MEAN THOSE PERSONS LICENSED UNDER THE

PROVISIONS OF ARTICLE IV, UNLESS THE CONTEXT CLEARLY INDICATES

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OTHERWISE.

IT SHALL BE UNLAWFUL--

* * *

(11) LICENSEES EMPLOYED BY OTHERS. FOR ANY HOTEL, RESTAURANT

OR CLUB LIQUOR LICENSEE, OR ANY MALT OR BREWED BEVERAGE

LICENSEE, OR ANY OFFICER, SERVANT, AGENT OR EMPLOYE OF SUCH

LICENSEE, TO BE AT THE SAME TIME EMPLOYED, DIRECTLY OR

INDIRECTLY, BY ANY DISTRIBUTOR, IMPORTING DISTRIBUTOR,

MANUFACTURER, IMPORTER OR VENDOR LICENSEE OR ANY OUT OF STATE

MANUFACTURER. IT SHALL ALSO BE UNLAWFUL FOR ANY DISTRIBUTOR OR

IMPORTING DISTRIBUTOR, OR ANY OFFICER, SERVANT, AGENT OR EMPLOYE

OF SUCH LICENSEE, TO BE AT THE SAME TIME EMPLOYED, DIRECTLY OR

INDIRECTLY, BY ANY OTHER DISTRIBUTOR, IMPORTING DISTRIBUTOR,

MANUFACTURER, IMPORTER, VENDOR, OUT OF STATE MANUFACTURER, HOTEL

RESTAURANT, MALT OR BREWED BEVERAGE LICENSEE, OR CLUB LIQUOR

LICENSEE. IT SHALL ALSO BE UNLAWFUL FOR ANY MANUFACTURER,

IMPORTER, OR VENDOR LICENSEE, OR ANY OUT OF STATE MANUFACTURER,

OR ANY OFFICER, SERVANT, AGENT OR EMPLOYE OF SUCH LICENSEE OR

MANUFACTURER, TO BE AT THE SAME TIME EMPLOYED, DIRECTLY OR

INDIRECTLY, BY ANY HOTEL, RESTAURANT OR CLUB LIQUOR LICENSEE OR

ANY MALT OR BREWED BEVERAGE LICENSEE OR ANY DISTRIBUTOR OR

IMPORTING DISTRIBUTOR LICENSEE. NOTHING IN THIS SUBSECTION SHALL

BE CONSTRUED TO PROHIBIT A MANUFACTURER OR LIMITED WINERY

LICENSEE, OR ANY OFFICER, SERVANT, AGENT OR EMPLOYE OF SUCH

LICENSEE, TO BE EMPLOYED AT THE SAME TIME BY A HOTEL, RESTAURANT

OR RETAIL DISPENSER LICENSEE IF THE HOTEL, RESTAURANT OR RETAIL

DISPENSER LICENSEE IS LOCATED AT THE MANUFACTURER OR LIMITED

WINERY PREMISES PURSUANT TO SECTION 443. FOR THE PURPOSES OF

THIS SUBSECTION, AN OFFICER, SERVANT, AGENT OR EMPLOYE OF A

LICENSEE OR MANUFACTURER IS AN INDIVIDUAL WHO HAS EITHER AN

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OWNERSHIP INTEREST IN THE LICENSEE OR MANUFACTURER OR WHO

RECEIVES COMPENSATION FOR HIS OR HER WORK ON BEHALF OF THE

LICENSEE OR MANUFACTURER. NOTHING IN THIS SECTION SHALL PROHIBIT

A PERSON WHO HAS AN OWNERSHIP INTEREST IN A LIMITED WINERY

LICENSE FROM BEING EMPLOYED BY AN ENTITY THAT HOLDS A HOTEL,

RESTAURANT, EATING PLACE OR CLUB LICENSE SO LONG AS THE PERSON

IS NOT EMPLOYED AS ALCOHOL SERVICE PERSONNEL OR AS A MANAGER.

* * *

SECTION 3. THIS ACT SHALL TAKE EFFECT IN 60 DAYS.

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