1Amending the act of April 12, 1951 (P.L.90, No.21), entitled, as
2reenacted, "An act relating to alcoholic liquors, alcohol and
3malt and brewed beverages; amending, revising, consolidating
4and changing the laws relating thereto; regulating and
5restricting the manufacture, purchase, sale, possession,
6consumption, importation, transportation, furnishing, holding
7in bond, holding in storage, traffic in and use of alcoholic
8liquors, alcohol and malt and brewed beverages and the
9persons engaged or employed therein; defining the powers and
10duties of the Pennsylvania Liquor Control Board; providing
11for the establishment and operation of State liquor stores,
12for the payment of certain license fees to the respective
13municipalities and townships, for the abatement of certain
14nuisances and, in certain cases, for search and seizure
15without warrant; prescribing penalties and forfeitures;
16providing for local option, and repealing existing laws," in
17preliminary provisions, further providing for definitions; in
18Pennsylvania Liquor Control Board, further providing for
19general powers of the board; in Pennsylvania Liquor Stores,
20further providing for when sales may be made at Pennsylvania
21Liquor Stores and for sales by Pennsylvania Liquor Stores;
22providing for licensed package stores; in licenses and
23regulations and liquor, alcohol and malt and brewed
24beverages, further providing for authority to issue liquor
25licenses to hotels, restaurants and clubs, for issuance,
26transfer or extension of hotel, restaurant and club liquor
27licenses, for sales by liquor licensees and restrictions, for
28malt and brewed beverages manufacturers', distributors' and
29importing distributors' licenses, for malt and brewed
30beverages retail licenses, for number and kinds of licenses
31allowed same licensee, for licenses not assignable and
32transfers, for revocation and suspension of licenses and
33fines, for responsible alcohol management and for unlawful
34acts relative to liquor, malt and brewed beverages and

1licensees; providing for privatization of wholesale liquor
2distribution; in disposition of moneys collected under
3provisions of act, further providing for moneys paid into
4Liquor License Fund and returned to municipalities and for
5moneys paid into the State Stores Fund for use of the
6Commonwealth and providing for Public Education Legislative
7Initiative Fund; imposing duties on the Department of General
8Services; and making a related repeal.

9The General Assembly of the Commonwealth of Pennsylvania
10hereby enacts as follows:

11Section 1. The definition of "potable distilled spirits" in
12section 102 of the act of April 12, 1951 (P.L.90, No.21), known
13as the Liquor Code, reenacted and amended June 29, 1987 (P.L.32,
14No.14), is amended and the section is amended by adding
15definitions to read:

16Section 102. Definitions.--The following words or phrases,
17unless the context clearly indicates otherwise, shall have the
18meanings ascribed to them in this section:

19"Affiliate" or "person affiliated with" shall mean a person
20that directly or indirectly, through one or more intermediaries,
21controls, is controlled by or is under common control with a
22specified person.

23* * *

24"Bid-rigging" shall mean the concerted activity of two or
25more persons to determine in advance, or attempt to influence,
26the selected bidder for a package store license. The term
27includes any of the following:

28(1) Conspiring or cooperating in the preparation of bids,
29including the determination of bid amounts.

30(2) Submitting prearranged bids, agreed-upon higher or lower
31bids or other complementary bids.

32(3) Agreeing to submit identical bids.

33(4) Agreeing to coordinate the retail zones in which a
34person will or will not submit a bid.

1(5) Agreeing to share profits with or give an equity
2interest to a person who does not submit the high bid.

3(6) Agreeing to set up territories to restrict competition.

4(7) Agreeing not to submit a bid.

5"Blended brand valuation" shall mean, for a particular brand
6of liquor, the sum of the wholesale profit margin on each
7product of a brand.

8* * *

9"Brand of liquor" shall mean a liquor product or series of
10liquor products produced by a single manufacturer.

11* * *

12"Change in control" shall mean, for purposes of wine and
13spirits wholesale licensees, the acquisition by a person or
14group of persons acting in concert of more than twenty per
15centum of:

16(1) a licensee's securities or other ownership interests,
17except for an ownership interest of the person that existed at
18the time of initial licensing; or

19(2) the securities or other ownership interests of a
20corporation or other legal entity which owns, directly or
21indirectly, at least twenty per centum of the securities or
22other ownership interests of the licensee.

23* * *

24"Controlling interest" shall mean as follows:

25(1) For a publicly traded legal entity, an interest in a
26legal entity, applicant or licensee by which a person's sole
27voting rights under State law or corporate articles or bylaws
28entitle the person to elect or appoint one or more of the
29members of the board of directors or other governing board or
30the ownership, directly or indirectly, of five per centum or

1more of the securities of the publicly traded corporation.

2(2) For a privately held corporation, partnership, limited
3liability company or other form of a privately held legal
4entity, the holding of securities in the legal entity.

5* * *

6"Department" shall mean the Department of General Services of
7the Commonwealth.

8* * *

9"Licensed premises" or "controlled area" shall mean the areas
10utilized by a wholesale or retail licensee for the storage, sale
11or distribution of liquor.

12* * *

13"Package store licensee" shall mean a license issued by the
14board authorizing a person to sell and distribute liquor to the
15public on a retail basis in accordance with this act.

16* * *

17"Potable distilled spirits" or "spirits" shall mean and
18include any distillate from grains, wine, fruits, vegetables or
19molasses, except ethyl alcohol, capable of being used for
20beverage purposes.

21* * *

22"Variable pricing" shall mean, for purposes of the wholesale
23sale of liquor, a disparity in the price of an item sold to one
24licensee as compared to the price of the same item to another
25licensee or a licensee of a different classification. The term
26shall not include discounts for volume purchases.

27* * *

28"Wholesale acquisition factor" shall mean a factor of 2.5
29applied to the wholesale profit margin of a brand of liquor in
30determining the wholesale license fee.

1"Wholesale profit margin" shall mean twenty per centum of the
2total of costs of goods sold of a particular liquor product over
3the most recent twelve-month period for which information is
4available.

5* * *

6"Wine and spirits wholesale license" shall mean a license
7issued by the department or the board authorizing a person to
8sell and distribute liquor on a wholesale basis to package store
9licensees and other licensees under this act.

10"Wine and spirits wholesale licensee" shall mean a person
11that holds a wine and spirits wholesale license under this act.

12* * *

13Section 2. Section 207 of the act, amended or added
14February 21, 2002 (P.L.103, No.10), November 30, 2004 (P.L.1727,
15No.221) and December 8, 2004 (P.L.1810, No.239), is amended to
16read:

17Section 207. General Powers of Board.--Under this act, the
18board shall have the power and its duty shall be:

19(a) (1) To buy, import or have in its possession for sale
20and sell liquor, alcohol, corkscrews, wine and liquor
21accessories, trade publications, gift cards, gift certificates,
22wine- or liquor-scented candles and wine glasses in the manner
23set forth in this act: Provided, however, That all purchases
24shall be made subject to the approval of the State Treasurer, or
25his designated deputy. The board shall buy liquor and alcohol at
26the lowest price and in the greatest variety reasonably
27obtainable.

28(2) Upon substantial divestiture of the board's wholesale
29portfolio of wine and spirits to wine and spirits wholesale
30licensees under Article IV-A, purchases of liquor and alcohol by

1the board for sale shall be made only from a wine and spirits
2wholesale licensee.

3(b) (1) To control the manufacture, possession, sale,
4consumption, importation, use, storage, transportation and
5delivery of liquor, alcohol and malt or brewed beverages in
6accordance with the provisions of this act, and to fix the
7wholesale and retail prices at which liquors and alcohol shall
8be sold at Pennsylvania Liquor Stores. [Prices shall be
9proportional with prices paid by the board to its suppliers and
10shall reflect any advantage obtained through volume purchases by
11the board.] Prices for a particular liquor product offered for 
12sale by the board shall be uniform throughout this Commonwealth.
13The board [may] shall, whenever practical, establish a
14preferential price structure for wines produced within this
15Commonwealth for the promotion of such wines, as long as the
16price structure is uniform within each class of wine purchased
17by the board. The board shall require each Pennsylvania
18manufacturer and each nonresident manufacturer of liquors, other
19than wine, selling such liquors to the board, which are not
20manufactured in this Commonwealth, to make application for and
21be granted a permit by the board before such liquors not
22manufactured in this Commonwealth shall be purchased from such
23manufacturer. Each such manufacturer shall pay for such permit a
24fee which, in the case of a manufacturer of this Commonwealth,
25shall be equal to that required to be paid, if any, by a
26manufacturer or wholesaler of the state, territory or country of
27origin of the liquors, for selling liquors manufactured in
28Pennsylvania, and in the case of a nonresident manufacturer,
29shall be equal to that required to be paid, if any, in such
30state, territory or country by Pennsylvania manufacturers doing

1business in such state, territory or country. In the event that
2any such manufacturer shall, in the opinion of the board, sell
3or attempt to sell liquors to the board through another person
4for the purpose of evading this provision relating to permits,
5the board shall require such person, before purchasing liquors
6from him or it, to take out a permit and pay the same fee as
7hereinbefore required to be paid by such manufacturer. All
8permit fees so collected shall be paid into the State Stores
9Fund. The board shall not purchase any alcohol or liquor
10fermented, distilled, rectified, compounded or bottled in any
11state, territory or country, the laws of which result in
12prohibiting the importation therein of alcohol or liquor,
13fermented, distilled, rectified, compounded or bottled in
14Pennsylvania.

15(2) The board may not assess a markup on the sale of liquor
16that exceeds twenty-five per centum of the cost of the
17particular liquor product sold to the board.

18(c) To determine the municipalities within which
19Pennsylvania Liquor Stores shall be established and the
20locations of the stores within such municipalities.

21(d) To grant and issue all licenses and to grant, issue,
22suspend and revoke all permits authorized to be issued under
23this act.

24(e) Through the Department of General Services as agent, to
25lease and furnish and equip such buildings, rooms and other
26accommodations as shall be required for the operation of this
27act.

28(f) To appoint, fix the compensation and define the powers
29and duties of such managers, officers, inspectors, examiners,
30clerks and other employes as shall be required for the operation

1of this act, subject to the provisions of The Administrative
2Code of 1929 and the Civil Service Act.

3(g) To determine the nature, form and capacity of all
4packages and original containers to be used for containing
5liquor, alcohol or malt or brewed beverages.

6(h) Without in any way limiting or being limited by the
7foregoing, to do all such things and perform all such acts as
8are deemed necessary or advisable for the purpose of carrying
9into effect the provisions of this act and the regulations made
10thereunder.

11(i) From time to time, to make such regulations not
12inconsistent with this act as it may deem necessary for the
13efficient administration of this act. The board shall cause such
14regulations to be published and disseminated throughout the
15Commonwealth in such manner as it shall deem necessary and
16advisable or as may be provided by law. Such regulations adopted
17by the board shall have the same force as if they formed a part
18of this act.

19(j) By regulation, to provide for the use of a computerized
20referral system to assist consumers in locating special items at
21Pennsylvania Liquor Stores and for the use of electronic
22transfer of funds and credit cards for the purchase of liquor
23and alcohol at Pennsylvania Liquor Stores.

24(k) To issue grants to various entities for alcohol
25education and prevention efforts.

26(l) The board may buy, import or have in its possession for
27sale to consumers and sell malt or brewed beverages at
28Pennsylvania Liquor Stores for off-premises consumption under
29the following conditions:

30(1) For each Pennsylvania Liquor store at which malt or

1brewed beverages are to be sold, the board shall make a one-time
2deposit of fifty thousand dollars ($50,000) into the Public
3Education Legislative Initiative Fund.

4(2) The board may not warehouse or deliver malt and brewed
5beverages. The board shall purchase malt and brewed beverages at
6wholesale from an importing distributor licensed under section
7431 and shall take delivery of the malt or brewed beverages at
8the Pennsylvania Liquor store at which the beverages are to be
9sold.

10(3) The board may not sell malt and brewed beverages to
11persons licensed or permitted to sell malt and brewed beverages
12by the board.

13(4) The board shall maintain records of all transactions.

14Section 3. Section 304 of the act, amended December 8, 2004
15(P.L.1810, No.239), is amended to read:

16Section 304. When Sales May Be Made at Pennsylvania Liquor
17Stores.--(a) Except as provided for in subsection (b), every
18Pennsylvania Liquor Store shall be open for business week days,
19except holidays as that term is defined in section 102. The
20board may, with the approval of the Governor, temporarily close
21any store in any municipality.

22(b) Certain Pennsylvania Liquor Stores operated by the board
23shall be open for Sunday retail sales between the hours of
24[noon] nine o'clock antemeridian and [five] nine o'clock
25postmeridian, except that no Sunday sales shall occur on Easter
26Sunday or Christmas day. The board shall open up [to twenty-five
27per centum of the total number of Pennsylvania Liquor Stores at
28its discretion] as many Pennsylvania Liquor Stores as it deems 
29necessary for Sunday sales as provided for in this subsection.
30The board shall submit yearly reports to the Appropriations and

1the Law and Justice Committees of the Senate and the
2Appropriations and the Liquor Control Committees of the House of
3Representatives summarizing the total dollar value of sales
4under this section.

5Section 4. Section 305 of the act, amended May 8, 2003
6(P.L.1, No.1), July 17, 2003 (P.L.63, No.15), December 8, 2004
7(P.L.1810, No.239), July 6, 2005 (P.L.135, No.39) and July 5,
82012 (P.L.1007, No.116), is amended to read:

9Section 305. Sales by Pennsylvania Liquor Stores.--(a) The
10board shall in its discretion determine where and what classes,
11varieties and brands of liquor and alcohol it shall make
12available to the public and where such liquor and alcohol will
13be sold. Every Pennsylvania Liquor Store shall be authorized to
14sell combination packages. If a person desires to purchase a
15class, variety or brand of liquor or alcohol not currently
16available from the board, he or she may place a special order
17for such item so long as the order is for two or more bottles.
18The board may require a reasonable deposit from the purchaser as
19a condition for accepting the order. The customer shall be
20notified immediately upon the arrival of the goods.

21In computing the retail price of such special orders for
22liquor or alcohol, the board shall not include the cost of
23freight or shipping before applying the mark-up and taxes but
24shall add the freight or shipping charges to the price after the
25mark-up and taxes have been applied.

26Unless the customer pays for and accepts delivery of any such
27special order within ten days after notice of arrival, the store
28may place it in stock for general sale and the customer's
29deposit shall be forfeited.

30(b) (1) Every Pennsylvania Liquor Store shall sell liquors

1at wholesale to hotels, restaurants, clubs, and railroad,
2pullman and steamship companies licensed under this act; and,
3under the regulations of the board, to pharmacists duly licensed
4and registered under the laws of the Commonwealth, and to
5manufacturing pharmacists, and to reputable hospitals approved
6by the board, or chemists. Sales to licensees shall be made at a
7price that includes a discount of at least ten per centum from
8the retail price. The board may sell to registered pharmacists
9only such liquors as conform to the Pharmacopoeia of the United
10States, the National Formulary, or the American Homeopathic
11Pharmacopoeia. The board may sell at special prices under the
12regulations of the board, to United States Armed Forces
13facilities which are located on United States Armed Forces
14installations and are conducted pursuant to the authority and
15regulations of the United States Armed Forces. All other sales
16by such stores shall be at retail. A person entitled to purchase
17liquor at wholesale prices may purchase the liquor at any
18Pennsylvania Liquor Store upon tendering cash, check or credit
19card for the full amount of the purchase. For this purpose, the
20board shall issue a discount card to each licensee identifying
21such licensee as a person authorized to purchase liquor at
22wholesale prices. Such discount card shall be retained by the
23licensee. The board may contract through the Commonwealth
24bidding process for delivery to wholesale licensees at the
25expense of the licensee receiving the delivery.

26(2) Upon substantial divestiture of wholesale operations to
27wine and spirits wholesale licensees under Article IV-A, sales
28to persons licensed under this act may be made only in emergency
29situations, as defined by the board by regulation.

30(c) Whenever any checks issued in payment of liquor or

1alcohol purchased from State Liquor Stores by persons holding
2wholesale purchase permit cards issued by the board shall be
3returned to the board as dishonored, the board shall charge a
4fee of five dollars per hundred dollars or fractional part
5thereof, plus all protest fees, to the maker of such check
6submitted to the board. Failure to pay the face amount of the
7check in full and all charges thereon as herein required within
8ten days after demand has been made by the board upon the maker
9of the check shall be cause for revocation or suspension of any
10license issued by the board to the person who issued such check
11and the cancellation of the wholesale purchase permit card held
12by such person.

13(d) No liquor or alcohol package shall be opened on the
14premises of a Pennsylvania Liquor Store. No manager or other
15employe of the board employed in a Pennsylvania Liquor Store
16shall allow any liquor or alcohol to be consumed on the store
17premises, nor shall any person consume any liquor or alcohol on
18such premises, except liquor and alcohol which is part of a
19tasting conducted pursuant to the board's regulations. Such
20tastings may also be conducted in the board's headquarters or
21regional offices.

22(e) The board may sell tax exempt alcohol to the
23Commonwealth of Pennsylvania and to persons to whom the board
24shall, by regulation to be promulgated by it, issue special
25permits for the purchase of such tax exempt alcohol.

26Such permits may be issued to the United States or any
27governmental agency thereof, to any university or college of
28learning, any laboratory for use exclusively in scientific
29research, any hospital, sanitorium, eleemosynary institution or
30dispensary; to physicians, dentists, veterinarians and

1pharmacists duly licensed and registered under the laws of the
2Commonwealth of Pennsylvania; to manufacturing chemists and
3pharmacists or other persons for use in the manufacture or
4compounding of preparations unfit for beverage purposes.

5(f) Every purchaser of liquor, alcohol, corkscrews, wine or
6liquor accessories, trade publications, gift cards, gift
7certificates, wine- or liquor-scented candles or wine glasses
8from a Pennsylvania Liquor Store shall receive a numbered
9receipt which shall show the price paid therefor and such other
10information as the board may prescribe. Copies of all receipts
11issued by a Pennsylvania Liquor Store shall be retained by and
12shall form part of the records of such store.

13(g) The board is hereby authorized and empowered to adopt
14and enforce appropriate rules and regulations to insure the
15equitable wholesale and retail sale and distribution, through
16the Pennsylvania Liquor Stores, of available liquor and alcohol
17at any time when the demand therefor is greater than the supply.

18(h) Every Pennsylvania Liquor Store shall sell gift
19certificates and gift cards which may be redeemed for any
20product sold by the board. In addition, the board may sell
21corkscrews, wine and liquor accessories, wine- or liquor-scented
22candles, trade publications and wine sleeves at Pennsylvania
23Liquor Stores.

24(i) Notwithstanding any other provision of law to the
25contrary, the board may sell wine in containers having a
26capacity of sixty liters or less.

27Section 5. The act is amended by adding an article to read:

28ARTICLE III-A

29LICENSED PACKAGE STORES

30Section 301-A. Retail sales through issuance of package store

1licenses.

2(a) Authorized retail licenses.--The department may issue
3not more than 1,400 package store licenses to qualified
4applicants and then to successful bidders in accordance with
5this article.

6(b) Other licenses.--Nothing in this article or this act may
7prohibit a package store licensee from applying for and, if
8approved, being issued a distributor license as referred to
9under section 431 that authorizes the licensee to sell malt and
10brewed beverages at retail for off-premises consumption. Use of
11the licenses shall be in a manner consistent with section 315-A.

12Section 302-A. Sale and auction of package store licenses.

13(a) Application for package store licenses.--For the first
1490 days following the effective date of this section, the
15department, with the cooperation and assistance of the board,
16shall receive applications from distributors licensed under
17section 431 whose license was in active status with the board on
18the effective date of this section for the issuance of package
19store licenses.

20(b) Auction of remaining licenses.--

21(1) At the conclusion of the 90-day period under
22subsection (a), the department, with the cooperation and
23assistance of the board, shall auction the remaining package
24store licenses on a county-by-county basis to bidders.

25(2) To determine the number of remaining package store
26licenses, the department, with the full cooperation of the
27board, shall subtract the total number of applications that
28were accepted by the department and the board under
29subsection (a) from the total number of distributors licensed
30under section 431 whose license was in active status with the

1board on the effective date of this section and add 200,
2which shall be the total number of package store licenses
3authorized for auction.

4(3) To determine how many package store licenses in each
5county shall be auctioned, the department, with the full
6cooperation and assistance of the board, shall assign package
7store licenses consistent with all of the following:

8(i) The department shall assign package store
9licenses to counties across this Commonwealth.

10(ii) In assigning package store licenses, the
11department shall balance the factor of historic sales of
12liquor, population density and median household income
13with the policy objective of assuring adequate and
14reasonable liquor distribution in all areas of this
15Commonwealth.

16(4) The department shall assign package store licenses
17through the promulgation of temporary regulations and shall
18publish the temporary regulations in the Pennsylvania
19Bulletin.

20Section 303-A. Application for package store licenses by
21distributors.

22(a) Application.--In accordance with section 302-A, the
23department, with the full cooperation of the board, shall
24receive applications for package store licenses from
25distributors licensed under section 431 whose licenses were in
26active status with the board on the effective date of this
27section.

28(b) Investigation.--Upon receiving an application, the
29department shall conduct an investigation based upon the
30information submitted to evaluate whether the applicant meets

1all of the following:

2(1) The applicant qualifies as a responsible and
3suitable person to hold a package store liquor license and
4operate a package store location.

5(2) The applicant has proposed an acceptable facility
6and location for a package store.

7(3) The applicant's planned operation complies with the
8requirements prescribed in this article and the statement of
9conditions under section 310-A.

10(c) Additional information.--The department may require
11additional information from an applicant and conduct onsite
12inspections, as necessary, to complete the application process.

13(d) Assistance with investigations.--The department may
14enter into an agreement with the Pennsylvania State Police or
15the Office of Inspector General to assist the department in the
16conduct of investigations under this section. The agreement
17shall provide for the reimbursement of the Pennsylvania State
18Police or the Office of Inspector General for the actual costs
19incurred for providing assistance.

20(e) Application fee.--There shall be an application fee of
21$5,000 payable at the time of application. This fee shall be
22refunded to the applicant if, due to no fault of the applicant,
23the package store license is not issued to the applicant.

24(f) Retail license fee.--

25(1) There shall be a one-time retail license fee payable
26by applicants based on the following:

27(i) For authority to sell wine for consumption off
28the licensed premises, $50,000.

29(ii) For authority to sell spirits for consumption
30off the licensed premises, $50,000.

1(2) The retail license fee shall be payable via
2certified check or wire transfer to a designated restricted
3account established in The State Stores Fund within 60 days
4of the date of application by the distributor or prior to the
5issuance of the package store license, whichever is earlier
6in time.

7(g) Investigative fees.--The department shall have the
8authority to establish, charge and collect fees from an
9applicant to recover the costs directly related to the
10department's investigation within the application process.

11(h) Acceptance of qualifications.--An applicant's
12qualifications will be accepted by the department if the
13department's investigation reveals all of the following:

14(1) The applicant was truthful.

15(2) The applicant and its officers, directors and
16principals, if any, are of good character, integrity and
17suitability.

18(3) The applicant possesses sufficient financial
19resources to operate a package store, pay all taxes due and
20meet all other financial obligations.

21(4) The applicant possesses sufficient business ability
22to operate a package store.

23(5) The proposed facility complies with the requirements
24prescribed in this article and the statement of conditions
25under section 310-A.

26(i) Issuance of license.--If an applicant's qualifications
27are accepted by the department, the department shall qualify the
28applicant and issue a package store license upon the occurrence
29of all of the following:

30(1) The execution and delivery to the department and the

1board of the statement of conditions required under section
2310-A.

3(2) Payment of any outstanding application, license or
4investigation fees.

5(3) The surrender of the distributor's license issued
6pursuant to section 431.

7(4) Fulfillment of any other conditions required by the
8department.

9(j) License endorsements.--Licenses issued pursuant to this
10section shall include endorsements that indicate that the
11licensee is authorized to engage in the retail sale of malt and
12brewed beverages in packages and volumes as permitted for sale
13by distributor licensee under section 431, excluding packages
14and volumes authorized via an expanded sales permit under
15section 431(g), and:

16(1) Wine if the one-time license fee under subsection
17(f) for wine has been paid.

18(2) Spirits if the one-time license fee under subsection
19(f) for spirits has been paid.

20(k) Qualifications unacceptable.--If an applicant's
21qualifications are not accepted by the department, the
22department shall add the license to the number of package store
23licenses being made available for auction pursuant to this
24article.

25(l) Approval of qualifications.--If the qualifications of
26the applicant are approved by the department, the department
27shall issue a package store license to the applicant consistent
28with the requirements of subsection (i).

29(m) License not entitlement.--Nothing contained in this
30article is intended or may be construed to create an entitlement

1to a package store license. A package store license shall be a
2privilege as between the board and the licensee, but shall be
3property as between the licensee and third parties.

4(n) Terms of licensure.--A package store license, after
5payment of the applicable fees, shall be in effect unless
6suspended, revoked or not renewed by the board upon good cause
7shown consistent with the license requirements as provided for
8under this article. The license of a package store licensee in
9good standing shall be subject to renewal every two years
10consistent with this article. Nothing under this subsection may
11relieve a package store licensee of the affirmative duty to
12notify the board of any changes relating to the status of its
13license or to any other information contained in the application
14materials on file with the department or the board.

15Section 304-A. Conduct of retail auctions and requirements.

16(a) Conduct of auctions.--The department shall conduct an
17auction for package store licenses for each county in this
18Commonwealth to which a package store license has been assigned
19for auction under sections 302-A(b) and 303-A(k) consistent with
20the following:

21(1) The department shall establish a deadline for
22submission of bids for auctions.

23(2) The department shall review the submission of timely
24bids to determine compliance with the minimum bid
25requirements of section 309-A. A bid that does not comply
26with the minimum bid amount shall be rejected. Bidder
27identification information and bid amount for an accepted bid
28shall be made subject to public disclosure.

29(3) The department shall select the highest bid for best
30and final offers. The number of bids selected for each county

1shall be equal to two times the number of package store
2licenses assigned for auction by the department to a given
3county. The department shall notify the bidders of the
4selected bids in each county.

5(4) The department shall establish a best and final
6offer period in which the bidders making the selected bids
7under paragraph (3) shall be provided an opportunity to
8submit a revised bid that will represent its best and final
9offer. A bidder may not submit a best and final offer that
10includes a bid amount less than the bidder's original bid.

11(5) The department shall review the best and final
12offers submitted under paragraph (4) and shall accept a high
13bidder for each license in each county.

14(b) Other bidders.--Nothing in this article may prohibit a
15person licensed by the department to sell malt and brewed
16beverages at retail for off-premises consumption from submitting
17a bid and, if successful, being issued a package store license.
18Use of the licenses shall be in a manner consistent with section
19314-A.

20(c) Bidder collusion.--Persons may not collude to rig a bid
21involving a package store license.

22(d) Criminal penalty.--

23(1) An individual who violates subsection (c) commits a
24felony of the third degree and shall, upon conviction, be
25sentenced to pay a fine of not more than $50,000 or to
26imprisonment for not more than one year, or both.

27(2) A person other than an individual that violates
28subsection (c) commits a felony of the third degree and
29shall, upon conviction, be sentenced to pay a fine of not
30more than $1,000,000.

1(e) Civil penalty.--

2(1) Except as set forth in paragraph (2), the Attorney
3General may bring a civil action against a person that
4violates subsection (c) for a penalty of up to $100,000.

5(2) If there is a criminal action under subsection (d),
6paragraph (1) shall not apply.

7(f) Disqualification, termination and debarment.--In
8addition to any other criminal or civil penalties imposed under
9this section, the following shall apply to a person penalized
10under subsection (d) or (e):

11(1) The person shall be disqualified from bidding on or
12holding a package store license or holding any other license
13authorized under this act for a period of three years.

14(2) The board shall revoke any license issued under this
15act.

16(3) The person may be subject to 62 Pa.C.S. § 531
17(relating to debarment or suspension).

18Section 305-A. Postqualification of selected bidders.

19(a) Investigation.--Upon selection of a bid under section
20304-A(a)(5), the department shall conduct an investigation of
21each bidder whose bid was accepted under section 304-A(a)(5)
22based upon the information submitted to evaluate whether:

23(1) the bidder qualifies as a responsible and suitable
24person to hold a package store license and operate a package
25store;

26(2) the bidder has proposed an acceptable facility and
27location for a package store; and

28(3) the bidder's planned operation complies with this
29article.

30(b) Additional information.--The department may require

1additional information from a bidder and conduct onsite
2inspections, as necessary, to complete the postqualification
3process.

4(c) Assistance with investigations.--The department may
5enter into an agreement with the Pennsylvania State Police or
6the Office of Inspector General to assist the department in the
7conduct of investigations under this section and to provide for
8the reimbursement of actual costs incurred for providing
9assistance.

10(d) Public input hearings.--During the postqualification
11process, the department shall schedule public input hearings in
12six regions of this Commonwealth, including one in a city of the
13first class, at which interested members of the public will be
14provided the opportunity to testify regarding selected bidder
15qualifications, including the location of proposed wine and
16spirits stores. The testimony of a public witness shall be
17considered by the department in the postqualification
18investigation of bidders to which the testimony applies.

19(e) Investigative fees.--The department may charge fees to a
20bidder to recover the costs directly related to the department's
21investigation within the postqualification process.

22(f) Acceptance of qualifications.--A bidder's qualifications
23shall be accepted by the department if the department's
24investigation reveals all of the following:

25(1) The bid information was truthful.

26(2) The bidder and its officers, directors and
27principals, if any, are of good character, integrity and
28suitability.

29(3) The bidder possesses sufficient financial resources
30to operate a package store, pay all taxes due and meet all

1other financial obligations.

2(4) The bidder possesses sufficient business ability to
3operate a package store.

4(5) The proposed facilities are compliant with all of
5the operational requirements of the statement of conditions
6under this article.

7(g) Issuance of license.--If a selected bidder's
8qualifications are accepted by the department, the department
9shall qualify the bidder and shall issue a package store license
10to the bidder upon the occurrence of the following:

11(1) Execution and delivery to the department and the
12board of the statement of conditions required under section
13310-A.

14(2) Payment of the bid amount by certified check or wire
15transfer to a designated restricted account established in
16The State Stores Fund.

17(3) Payment of any outstanding bid or investigation
18fees.

19(4) If the applicant intends to sell malt or brewed
20beverages in conjunction with the sale of wine and spirits,
21surrender of the applicant's license that authorizes the sale
22of malt or brewed beverages for consumption off the licensed
23premises.

24(5) Fulfillment of any other conditions required by the
25department.

26(h) License endorsements.--Licenses issued pursuant to this
27section shall include endorsements that indicate that the
28licensee is authorized to engage in the retail sale of wine and
29spirits and malt and brewed beverages in packages and volumes as
30permitted for sale pursuant to the license surrendered by the

1applicant, if any, excluding packages and volumes authorized by
2any expanded sales permit.

3(i) Qualifications unacceptable.--

4(1) If a bidder's qualifications are not accepted by the
5department, the department shall identify the next highest
6bidder that was not selected in the auction under section
7304-A(a)(5) and conduct a postqualification investigation of
8that bidder, consistent with subsection (a).

9(2) If the second highest bidder is not approved, the
10department shall repeat the postqualification process for the
11next highest unselected bidder in the auction for that
12county.

13(3) If the third highest bidder in an auction is not
14approved by the department, the department shall have the
15authority whether to proceed with a new auction for that
16package store license or conduct an additional best and final
17offer period to consider additional bids from the original
18auction.

19(j) Approval of qualifications.--If the qualifications of
20the bidder are approved by the department under subsection (f),
21the department shall issue a package store license to the
22successful bidder consistent with the requirements of subsection
23(h).

24(k) License not entitlement.--Nothing contained under this
25article is intended to create an entitlement to a package store
26license. A package store license shall be a privilege as between
27the board and the licensee, but shall be property as between the
28licensee and third parties.

29(l) Terms of licensure.--

30(1) A package store license shall be in effect unless

1suspended, revoked or not renewed by the board upon good
2cause shown consistent with the license requirements as
3provided for under this article.

4(2) A package store license shall be subject to renewal
5every two years consistent with this article.

6(3) Nothing under this subsection relieves a package
7store licensee of the affirmative duty to notify the board of
8changes relating to the status of its license or to other
9information contained in the application materials on file
10with the department or the board.

11Section 306-A. Auctions with no or insufficient minimum bids.

12If an insufficient number of bids that meet or exceed the
13minimum bid are submitted in an auction in a county, the
14department:

15(1) shall select the bids that meet or exceed the
16minimum bid subject to postqualification; and

17(2) may conduct a new auction for the remaining package
18store licenses without a minimum bid or with a modified
19minimum bid.

20Section 307-A. Protest of bid selection.

21(a) Time period.--Within five days of the selection of a
22bidder in an auction for a county, a bidder that is not selected
23by the department for the package store license in the county
24must file a protest in writing with the department. Failure to
25comply with this subsection results in a waiver of the right to
26appeal the selection.

27(b) Requirements.--

28(1) The subject matter of a protest is restricted to the
29conduct of the auction for the specific county in which the
30protester participated. A person may not protest an auction

1in which that person did not participate as a bidder.

2(2) The protesting party must be represented by an
3attorney at law.

4(3) The protesting party waives its right to and is
5disqualified from being selected by the department as the
6next highest bidder for postqualification under section
7305-A.

8(4) The protesting party must provide the department
9with a bond, letter of credit or other form of security
10acceptable to the department in an amount equal to the amount
11of the bid that was accepted. The accepted security must be
12in an amount equal to the highest bid received from any
13bidder. If the bid protest does not result in the overturning
14of the department's bid selection for the specific package
15store license protested, and the original bidder who was
16selected does not pay the bid amount for any reason, the
17protester shall forfeit its security to the department.

18Section 308-A. Content of bids.

19Each bid submitted to participate in a package store license
20auction under this article must meet or include the following
21requirements:

22(1) The bid must include a summary page that clearly
23identifies:

24(i) The name, address and tax identification number
25of the bidder.

26(ii) The county for which the bid is being
27submitted.

28(iii) The amount of the bid.

29(iv) The amount of the minimum bid for the package
30store license auction in which the bidder is

1participating.

2(2) A general description of the bid and the location of
3the proposed package store, including the estimated square
4feet of total retail space in the proposed location.

5(3) Whether the applicant is an individual, corporation,
6limited liability company, limited partnership, partnership
7or association or other legal entity and, if the applicant is
8not an individual, the state of incorporation or organization
9and the names and residence addresses of each executive
10officer, director, general or limited partner or person
11holding a controlling interest in the applicant.

12(4) If the bidder is an association, the bid must set
13forth the names and addresses of the persons constituting the
14association.

15(5) If the bidder is a corporation, limited liability
16company, limited partnership, partnership, association or
17other legal entity, the bid must show that the entity is
18organized under the laws of this Commonwealth.

19(6) If the bidder is an individual, the bid must show
20that the bidder is a citizen of the United States and a
21resident of this Commonwealth and that the bidder is not
22acting as an agent for any other person, partnership,
23association or group of persons beneficially interested in
24the license.

25(7) The proposed location and ownership of the site for
26the package store, including floor plans of existing
27facilities to be utilized in the bidder's retail operation or
28design plans for any facilities not yet constructed, to the
29extent they are available.

30(8) Information disclosing an arrest of the applicant

1and an affiliate of the applicant, executive officer,
2director or general or limited partner of the applicant or
3person holding a controlling interest in the applicant and a
4citation issued to the same for an offense that is not a
5summary offense. The information must include:

6(i) A brief description of the circumstances
7surrounding the arrest or issuance of the citation.

8(ii) The specific offense charged or cited.

9(iii) The ultimate disposition of the charge or
10citation, including the details of a dismissal, plea
11bargain, conviction, sentence, pardon, expungement or
12order of Accelerated Rehabilitative Disposition.

13(9) A sworn statement that the bidder, an affiliate of
14the bidder or an executive officer, director or general or
15limited partner of the bidder or person holding a controlling
16interest in the bidder have never been convicted of a crime
17involving fraud, moral turpitude or racketeering within a
18period of ten years immediately preceding the date of the
19bid, or been convicted of a felony or equivalent crime in a
20Federal or state jurisdiction, including this Commonwealth.

21(10) A statement that the bidder will continuously
22operate a package store for the duration of the two-year
23license period.

24(11) The bidder shall provide a financial statement or
25letter of credit, consistent with the requirements prescribed
26by the department, which demonstrates the financial
27capability to operate the package store and the estimated
28volume of business to be conducted.

29(12) A current tax certificate issued by the Department
30of Revenue for the bidder, an affiliate of the bidder and an

1executive officer, director or general or limited partner of
2the bidder or person holding a controlling interest in the
3bidder. An unpaid tax identified on a tax certificate
4required to be filed with the bid must be paid before the bid
5is accepted for submission by the department.

6(13) There is a bid filing fee of $10,000 that must be
7submitted by certified check with the bid. The bid must be
8refunded by the department if, through no fault of the
9bidder, the bidder is not issued a package store license. The
10term "no fault of the bidder" shall include an instance when
11the bid amount exceeded the reserve for the license, but was
12not high enough for the bidder to be selected.

13(14) The bid must be signed and verified by oath or
14affirmation by the owner as follows:

15(i) if an individual or, in the case of an
16association, by a member or partner thereof; or

17(ii) in the case of a corporation or limited
18liability company, by an executive officer thereof or a
19person specifically authorized by the corporation to sign
20the bid. Written evidence of the authority must be
21attached to the bid.

22(15) (i) A noncollusion affidavit executed by the
23bidder, if an individual, or a person specifically
24authorized by the bidder, if a legal entity, to sign the
25affidavit, certifying that the bidder or an affiliate of
26the bidder or executive officer, director or general or
27limited partner of the bidder or person holding a
28controlling interest in the bidder has not engaged in
29collusion, bid-rigging or other prohibited activity in
30relation to the bid.

1(ii) The department shall determine the form and
2content of the noncollusion affidavit. Failure of a
3bidder to provide the required noncollusion affidavit
4disqualifies the bid unless cured within a time period
5determined by the department.

6(iii) A required noncollusion affidavit must state
7whether or not the bidder or an affiliate of the bidder
8or an executive officer, director or general or limited
9partner of the bidder or person holding a controlling
10interest in the bidder has been convicted or found liable
11for an act prohibited by Federal or State law in a
12jurisdiction involving conspiracy or collusion with
13respect to bidding on a public contract or in relation to
14the sale or lease of a public asset within the last ten
15years. If the bidder provides an affirmative statement
16that the bidder or an affiliate of the bidder or an
17executive officer, director or general or limited partner
18of the bidder or person holding a controlling interest in
19the bidder has been convicted or found liable on the
20grounds, the conviction or finding may be grounds for the
21department to find the bidder not suitable.

22(16) A bidder has a continuing duty during the auction
23process to update information in the bid and provide any
24other information determined to be appropriate by the
25department.

26Section 309-A. Minimum bid for retail auctions.

27During the initial implementation period as provided for by
28section 305-A, the department shall establish a minimum bid
29amount for a package store license auction of $250,000.

30Section 310-A. Package store licensee statement of conditions.

1(a) Statement of conditions.--The department shall develop a
2statement of conditions to be executed by a package store
3licensee that govern the package store licensee.

4(b) Conditions.--In addition to any other conditions the
5department, in consultation with the board, deems necessary or
6appropriate for a specific package store licensee, a statement
7of conditions under this section must include, at a minimum, the
8following conditions and impose the following obligations and
9requirements on an ongoing basis:

10(1) A package store licensee is strictly prohibited from
11selling or distributing liquor to persons under 21 years of
12age or persons that are visibly intoxicated.

13(2) A package store licensee may not operate a package
14store located within:

15(i) Three hundred feet of an elementary or secondary
16school without board approval.

17(ii) A dry municipality without first having a
18referendum approving the sale of wine and spirits at
19retail.

20(3) A package store license may not be operated where a
21business that sells liquid fuel and oil operates if the point
22of sale or dispensing of liquid fuel and oil is within 200
23feet of the closest point to the physical building where the
24license is located.

25(4) A facility of a package store licensee that is
26involved in retail operations, including a change to the
27facilities during the term of the license, are subject to the
28inspection, investigation and approval of the department or
29the board.

30(5) Package store licensees shall maintain adequate

1security to protect the licensee's inventory from
2unauthorized sale or diversion and prevent its unauthorized
3distribution. This paragraph does not preclude a package
4store licensee from moving wine and spirits inventory between
5package stores under common ownership on a quarterly basis
6upon no less than 24 hours' notice to the board.

7(6) A package store licensee may not engage in a
8separate business activity upon a licensed premises on which
9retail liquor operations are conducted without prior approval
10of the board.

11(7) A package store licensee may not sell wine or
12spirits to a person licensed under Article IV or other
13package store licensee except in an emergency, as defined by
14regulation by the board.

15(8) A package store licensee shall notify the board
16within 15 days of a change in a person who holds a
17controlling interest in the package store licensee.

18(9) A package store licensee shall notify the board
19within 15 days of becoming aware of an arrest or criminal
20indictment or conviction by:

21(i) the package store licensee or an affiliate of
22the licensee;

23(ii) an executive officer, director or general or
24limited partner of the licensee; or

25(iii) a person holding a controlling interest in the
26licensee.

27(10) A package store licensee shall notify the board
28within 15 days of becoming aware of a violation of this
29article by:

30(i) the licensee or an affiliate of the licensee;

1(ii) an executive officer, director or general or
2limited partner of the licensee; or

3(iii) a person holding a controlling interest in the
4licensee or employee of the licensee.

5(11) The premises of each package store must be a self-
6contained unit with limited customer access dedicated to the
7sale of liquor and related merchandise. A package store may
8not have an interior connection with another business or with
9a residential building except as provided in this act and as
10approved by the board. A purchase of wine and spirits must be
11paid for at a location within the confines of the controlled
12area.

13(12) A package store licensee shall design its
14controlled area in a manner and with adequate safeguards to
15ensure that its liquor products are secure and that the area
16may not be accessed during prohibited hours of operation.

17(13) A package store licensee may not hold, directly or
18indirectly, more than 40 package store licenses within this
19Commonwealth or own:

20(i) more than 10% of the package store licenses in a
21county that has ten or more package store licenses; and

22(ii) more than one package store license in a county
23that has less than ten package store licenses.

24(14) A package store may sell wine and spirits and malt
25and brewed beverages for off-premises consumption consistent
26with the endorsements on the package store license. In
27addition to the sale of liquor, a package store may sell
28related merchandise within the controlled area of the store.
29Sales of related merchandise within the controlled area may
30not exceed 30% of the gross annual sales of a package store.

1(15) A package store licensee shall make the premises
2and facilities involved in the retail operation and the
3business and financial books and records of the retail
4operation available at any time for inspection and audit by
5the board.

6(16) A package store licensee may sell wine or spirits
7between 9 a.m. and 11 p.m. of any day except Sunday to
8persons not licensed under this act.

9(17) In addition to the hours authorized under paragraph
10(16), a package store licensee may, upon purchasing a permit
11from the board at an annual fee of $1,000, sell wine or
12spirits to a person not licensed under this act or a holder
13of a special occasion permit on Sunday between the hours of 9
14a.m. and 9 p.m.

15(18) A package store licensee may not employ a person
16under 18 years of age to work in a controlled area. An
17employee under 21 years of age is permitted to engage in the
18sale of liquor.

19(19) A package store licensee may not hold a wine and
20spirits wholesale license.

21(20) The package store licensee, if a corporation,
22limited liability company, limited partnership, partnership,
23association or other legal entity, must be organized under
24the laws of this Commonwealth.

25(21) The package store licensee, if an individual, must
26be a citizen of the United States and a resident of this
27Commonwealth.

28(22) A licensee shall ensure that the package store
29managers and employees authorized to engage in the sale of
30liquor complete the training program for responsible alcohol

1management in accordance with section 471.1 within six months
2of commencing employment with the licensee.

3(23) A package store licensee may place its license in
4safekeeping for a period not to exceed two years:

5(i) pending transfer of the license from person-to-
6person or place-to-place or both; or

7(ii) during renovation of the premises upon which
8retail operations are conducted.

9(24) A package store license that remains in safekeeping
10for a period that exceeds two consecutive years must be
11forfeited and reauctioned by the board in a manner consistent
12with the provisions of this article.

13(25) Except as permitted under paragraph (18), a package
14store licensee shall ensure that no person under 21 years of
15age is permitted to enter the controlled area unless
16accompanied by an adult.

17(26) In addition to the provisions of section 495(b) and
18(c), a package store licensee shall assure the use of a
19transaction scan device to verify the age of a person who
20appears to be under 35 years of age. The board shall
21promulgate regulations as are necessary for the
22implementation and use of a transaction scan device.

23(27) The package store licensee may not sell a liquor
24product at a price less than its underlying cost.

25(28) The package store licensee may not provide tasting
26samples of liquor on the premises where a retail operation is
27conducted in individual portions greater than one fluid ounce
28or to individuals who are less than 21 years of age.

29(29) A package store licensee may not require a customer
30of the premises where wine and spirits are sold to purchase a

1membership or otherwise charge a fee in order to purchase a
2product, including wine and spirits, from the premises.

3(30) A package store licensee is considered a
4Pennsylvania Liquor Store for the purposes of collecting and
5remitting taxes consistent with the act of March 4, 1971
6(P.L.6, No.2), known as the Tax Reform Code of 1971, for
7transactions involving the sale of liquor.

8(31) A package store licensee shall pay to the board an
9amount equal to 1% of the licensee's annual gross receipts on
10the sale of wine and spirits minus the annual taxes paid by
11the licensee. The board shall transfer the funds received
12under this paragraph to the Department of Drug and Alcohol
13Programs or its successor in function for the following
14purposes:

15(i) Treatment and rehabilitation of persons addicted
16to the excessive use of alcoholic beverages.

17(ii) Promotion of education, prevention and early
18intervention programs designed to eliminate abuse and
19addiction to alcohol or other mood-altering substances or
20secure appropriate treatment for persons who are already
21addicted.

22(iii) Study of the problem of addiction.

23(iv) To issue grants to various entities for alcohol
24education and prevention efforts.

25(c) Sanctions.--A package store licensee that fails to abide
26by a condition contained in the licensee's statement of
27conditions is subject to board-imposed administrative sanctions
28or other penalties authorized under sections 471 and 494.

29Section 311-A. License renewals.

30(a) Renewal.--A package store license issued under this

1article is subject to renewal every two years. The application
2for renewal must be submitted on a form provided by the board at
3least 30 days prior to the expiration of the package store
4license and must include, at a minimum, an update of the
5information contained in the initial and prior renewal
6applications, if any, and the payment of a renewal application
7filing fee required by this article. A package store license for
8which a completed renewal application and fee has been received
9by the board continues to be valid unless and until the board
10sends written notification to the licensee that the board has
11denied the renewal of the license.

12(b) Renewal fee.--An application filing fee of $1,000 is due
13upon application for the renewal of a package store license. The
14board has the authority to adjust the renewal application filing
15fee to ensure that the fee adequately recovers the costs
16associated with license renewal. The board shall also collect
17fees from a renewal applicant to recover the costs of a renewal
18investigation.

19(c) Renewal hearing.--The board may hold a hearing on a
20renewal application as it deems necessary at a time and in a
21format that it determines. A package store licensee whose
22renewal application is denied is entitled to a hearing before
23the board in accordance with section 464.

24(d) Revocation or failure to renew.--In addition to another
25sanction the board may impose, the board may, at its discretion,
26suspend, revoke or deny renewal of a package store license
27issued under this article if it finds that the licensee or any
28of its affiliates, executive officers, directors or general or
29limited partners or persons holding a controlling interest in
30the licensee is in violation of a provision of this act, has

1furnished the board with false or misleading information or is
2no longer suitable for licensure. In the event of a revocation
3or failure to renew, the package store licensee's authorization
4to conduct business as a package store licensee shall
5immediately cease, and the fees paid in connection with
6licensure are deemed forfeited. In the event of a suspension,
7the licensee's authorization to conduct business shall
8immediately cease until the board notifies the licensee that the
9suspension is no longer in effect.

10(e) Affirmative duty.--This section does not relieve a
11package store licensee of the affirmative duty to notify the
12board of a change relating to the status of its license or
13other information contained in the application materials filed
14with the board.

15Section 312-A. Sale, assignment or transfer of license.

16(a) Prohibition.--A person may not sell, assign or transfer
17a package store license granted under this article unless the
18following are met:

19(1) the person obtained the prior written approval of
20the board;

21(2) the person paid the fee under subsection (c); and

22(3) the package store was in continuous operation for at
23least one year prior to the date of the transfer of the
24license.

25(b) Compliance.--A person to whom a package store license is
26sold, assigned or transferred shall comply with the provisions
27of this article prior to the sale, assignment or transfer of the
28license.

29(c) Transfer fee.--The transfer of a package store license
30is subject to a transfer fee equal to 1% of the license fee paid

1for the license and must be paid as a condition of the transfer
2of the license.

3(d) Change of control.--For the purposes of this section, a
4change of control of a package store licensee is deemed to be a
5sale, assignment or transfer of a package store wholesale or
6retail license. A licensee shall notify the board immediately
7upon becoming aware of a proposed or contemplated change of
8control.

9Section 313-A. Suspension or revocation.

10(a) Authority of board.--The board shall have the authority
11to suspend or revoke a package store license issued under this
12article when the board finds that any of the following apply:

13(1) the licensee violated this article or any
14regulations of the board;

15(2) the licensee knowingly presented to the board false,
16incomplete or misleading information;

17(3) the licensee pleaded guilty, entered a plea of nolo
18contendere or was found guilty of a felony by a judge or jury
19in a Federal or State court; or

20(4) the licensee failed to operate the business.

21(b) Hearings.--A suspension and revocation hearing must be
22held in accordance with the procedures under section 514.

23(c) Sales prohibited.--A person may not sell liquor at any
24premises if the package store license applicable to the premises
25was forfeited, suspended, revoked or expired.

26(d) Public sale.--In the event of the revocation, forfeiture
27or surrender of a package store license in accordance with this
28article, the board shall conduct an auction of the license
29consistent with the procedures and requirements under this
30article.

1Section 314-A. Combined use of certain licenses.

2(a) Package store with distributor endorsement.--

3(1) A package store license with an endorsement for the
4sale of malt and brewed beverages established upon the
5surrender of a distributor license may not be operated on the
6same premises as or have an interior connection to an
7unlicensed business or residence.

8(2) A package store license with an endorsement for the
9sale of malt and brewed beverages established pursuant to the
10surrender of a distributor license may not be operated with
11an interior connection to another business or residence for
12which the board authorized a class of retail license that
13authorizes the holder of the license to sell malt or brewed
14beverages for off-premises consumption.

15(b) Other package stores.--A package store license that has
16no endorsement for the sale of malt and brewed beverages or has
17an endorsement for the sale of malt and brewed beverages
18established upon the surrender of a retail license, other than a
19distributor license, may be operated with an interior connection
20to a grocery store or supermarket as provided in subsection (c).

21(c) Requirements for interior connections to grocery stores
22or supermarkets.--The board shall require, as a condition of
23authorizing an interior connection for a package store license
24and grocery store or supermarket, the following:

25(1) The construction of a solid, permanent, continuous
26physical separation of at least four feet in height between
27the licensed business and grocery store or supermarket.

28(2) Unless additional connections are required by law,
29the licensee may not be permitted more than one interior
30connection that may not be more than ten feet wide, for every

140 linear feet of physical separation under paragraph (1).

2(d) Definition.--For the purposes of this section, a
3"grocery store" or "supermarket" shall mean a retail
4establishment where food, food products and supplies for the
5table are sold for human off-premises consumption on an ongoing
6basis.

7Section 315-A. Endorsements for package store licenses.

8(a) General rule.--A package store license must clearly
9identify the authority granted under this act for the licensee
10to sell wine, spirits and malt or brewed beverages and include
11the restrictions on the package size or volume imposed under
12this act.

13(b) Additional endorsements.--The holder of a package store
14license that has not obtained an endorsement for the sale of
15malt and brewed beverages may obtain the endorsement as follows:

16(1) the holder of the package store license also holds a
17license that authorizes the holder to sell malt and brewed
18beverages for off-premises consumption and may be placed in
19the municipality in which the package store licensed premises
20is located;

21(2) the license authorizing the holder to sell malt and
22brewed beverages for off-premises consumption under paragraph
23(1) was surrendered by the licensee; and

24(3) the authority to sell malt and brewed beverages is
25limited to the packages and volumes authorized under the
26license surrendered by the package store licensee excluding
27an expanded sales permit.

28(c) Sales for consumption on the premises prohibited.--A
29package store with an endorsement for the sale of malt and
30brewed beverages does not have the authority to sell liquor,

1malt and brewed beverages or food for consumption on the
2licensed premises and is not required to establish a seating
3area for the service of the food or beverages.

4(d) Revocation of surrendered licenses.--Upon the surrender
5of a license that authorizes the holder to sell malt and brewed
6beverages for off-premises consumption for the purposes of a
7package store endorsement, the license is revoked by the board
8and may not be reissued for any reason.

9Section 316-A. Return of fee or bid.

10The package store license fee or package store bid amount
11paid by a package store licensee under section 303-A(f) or
12305-A(g) must be returned if this article is amended or altered
13by an act of the General Assembly within five years of the
14effective date of this section to authorize additional package
15store licenses under section 301-A.

16Section 317-A. Deposit of fee or bid.

17The package store license fee or package store bid amount
18paid by a package store licensee under section 303-A(f) or
19305-A(g) must be deposited into the Public Education Legislative
20Initiative Fund.

21Section 6. Section 401 of the act, amended December 22, 2011
22(P.L.530, No.113), is amended to read:

23Section 401. Authority to Issue Liquor Licenses to Hotels,
24Restaurants and Clubs.--(a) (1) Subject to the provisions of 
25this act and regulations promulgated under this act, the board 
26shall have authority to issue a retail liquor license for any 
27premises kept or operated by a hotel, restaurant or club and 
28specified in the license entitling the hotel, restaurant or club 
29to purchase liquor from a Pennsylvania Liquor Store or the 
30holder of a wine and spirits wholesale license under section 

1404-A and to keep on the premises such liquor and, subject to 
2the provisions of this act and the regulations made thereunder, 
3to sell the same and also malt or brewed beverages to guests, 
4patrons or members for consumption on the hotel, restaurant or 
5club premises. Such licensees, other than clubs, shall be 
6permitted to sell malt or brewed beverages for consumption off 
7the premises where sold in quantities of not more than one 
8hundred ninety-two fluid ounces in a single sale to one person 
9as provided for in section 407. Such licenses shall be known as 
10hotel liquor licenses, restaurant liquor licenses and club 
11liquor licenses, respectively. No person who holds any public 
12office that involves the duty to enforce any of the penal laws 
13of the United States, this Commonwealth or of any political 
14subdivision of this Commonwealth may have any interest in a 
15hotel or restaurant liquor license. This prohibition applies to 
16anyone with arrest authority, including, but not limited to, 
17United States attorneys, State attorneys general, district 
18attorneys, sheriffs and police officers. This prohibition shall 
19also apply to magisterial district judges, judges or any other 
20individuals who can impose a criminal sentence. This prohibition 
21does not apply to members of the General Assembly, township 
22supervisors, city councilpersons, mayors without arrest 
23authority and any other public official who does not have the 
24ability to arrest or the ability to impose a criminal sentence. 
25This section does not apply if the proposed premises are located 
26outside the jurisdiction of the individual in question.

27(2) Upon substantial divestiture of wholesale operations to
28wine and spirits wholesale licensees under Article IV-A, sales
29to persons licensed under this act may be made only in emergency
30situations, as defined by the board by regulation.

1(b) The board may issue to any club which caters to groups
2of non-members, either privately or for functions, a catering
3license, and the board shall, by its rules and regulations,
4define what constitutes catering under this subsection except
5that any club which is issued a catering license shall not be
6prohibited from catering on Sundays during the hours which the
7club may lawfully serve liquor, malt or brewed beverages.

8Section 7. Section 404 of the act, amended January 6, 2006
9(P.L.1, No.1), is amended to read:

10Section 404. Issuance, Transfer or Extension of Hotel,
11Restaurant and Club Liquor Licenses.--Upon receipt of the
12application and the proper fees, and upon being satisfied of the
13truth of the statements in the application that the applicant is
14the only person in any manner pecuniarily interested in the
15business so asked to be licensed and that no other person will
16be in any manner pecuniarily interested therein during the
17continuance of the license, except as hereinafter permitted, and
18that the applicant is a person of good repute, that the premises
19applied for meet all the requirements of this act and the
20regulations of the board, that the applicant seeks a license for
21a hotel, restaurant or club, as defined in this act, and that
22the issuance of such license is not prohibited by any of the
23provisions of this act, the board shall, in the case of a hotel
24or restaurant, grant and issue to the applicant a liquor
25license, and in the case of a club may, in its discretion, issue
26or refuse a license: Provided, however, That in the case of any
27new license or the transfer of any license to a new location or
28the extension of an existing license to cover an additional area
29the board may, in its discretion, grant or refuse such new
30license, transfer or extension if such place proposed to be

1licensed is within three hundred feet of any church, hospital,
2charitable institution, school, or public playground, or if such
3new license, transfer or extension is applied for a place which
4is within two hundred feet of any other premises which is
5licensed by the board: And provided further, That the board's
6authority to refuse to grant a license because of its proximity
7to a church, hospital, charitable institution, public playground
8or other licensed premises shall not be applicable to license
9applications submitted for public venues or performing arts
10facilities: And provided further, That the board shall refuse
11any application for a new license, the transfer of any license
12to a new location or the extension of an existing license to
13cover an additional area if, in the board's opinion, such new
14license, transfer or extension would be detrimental to the
15welfare, health, peace and morals of the inhabitants of the
16neighborhood within a radius of five hundred feet of the place
17proposed to be licensed: And provided further, That the board
18shall have the discretion to refuse a license to any person or
19to any corporation, partnership or association if such person,
20or any officer or director of such corporation, or any member or
21partner of such partnership or association shall have been
22convicted or found guilty of a felony within a period of five
23years immediately preceding the date of application for the said
24license. The board shall refuse any application for a new
25license, the transfer of any license to a new location or the
26extension of any license to cover an additional area where the
27sale of liquid fuels or oil is conducted if the point of sale or 
28dispensing of liquid fuels or oil is within two hundred feet of 
29the closest point to the physical building in which the license 
30is located. The board may enter into an agreement with the

1applicant concerning additional restrictions on the license in
2question. If the board and the applicant enter into such an
3agreement, such agreement shall be binding on the applicant.
4Failure by the applicant to adhere to the agreement will be
5sufficient cause to form the basis for a citation under section
6471 and for the nonrenewal of the license under section 470. If
7the board enters into an agreement with an applicant concerning
8additional restrictions, those restrictions shall be binding on
9subsequent holders of the license until the license is
10transferred to a new location or until the board enters into a
11subsequent agreement removing those restrictions. If the
12application in question involves a location previously licensed
13by the board, then any restrictions imposed by the board on the
14previous license at that location shall be binding on the
15applicant unless the board enters into a new agreement
16rescinding those restrictions. The board may, in its discretion,
17refuse an application for an economic development license under
18section 461(b.1) or an application for an intermunicipal
19transfer of a license if the board receives a protest from the
20governing body of the receiving municipality. The receiving
21municipality of an intermunicipal transfer or an economic
22development license under section 461(b.1) may file a protest
23against the transfer of a license into its municipality, and the
24receiving municipality shall have standing in a hearing to
25present testimony in support of or against the issuance or
26transfer of a license. Upon any opening in any quota, an
27application for a new license shall only be filed with the board
28for a period of six months following said opening.

29Section 8. Section 406 of the act is amended by adding a
30subsection to read:

1Section 406. Sales by Liquor Licensees; Restrictions.--* * *

2(h) (1) In addition to the authority provided under
3sections 401 and 407 for the sale of malt and brewed beverages
4for off-premises consumption, a restaurant licensee may apply
5for an expanded sales permit which shall grant a restaurant
6licensee the authority to sell malt or brewed beverages for off-
7premises consumption where sold in quantities of thirty
8containers or less containing a total of not more than three
9hundred and eighty-four ounces in a single sale to one person.

10(2) A restaurant expanded sales permit for malt and brewed
11beverages application shall be made on a form and in a manner as
12prescribed by the board.

13(3) A restaurant expanded sales permit for malt and brewed
14beverages shall be valid for a period not to exceed two years or
15until the expiration of the term for the restaurant license held
16by the applicant, whichever is shorter.

17(4) The fee for the initial issuance and renewal of a
18restaurant expanded sales permit for malt or brewed beverages
19shall be one hundred dollars ($100.00).

20(i) (1) In addition to the authority provided under
21sections 401 and 407 for the sale of malt and brewed beverages
22for off-premises consumption, a restaurant licensee may apply
23for an expanded sales permit which shall grant a restaurant
24licensee the authority to sell the following for off-premises
25consumption, if sold in a single sale to one person:

26(i) Up to four containers of wine, each containing not more
27than one and one-half liters.

28(ii) A single container of spirits containing not more than
29one and one-half liters.

30(2) A restaurant expanded sales permit for wine and spirits

1application shall be made on a form and in a manner as
2prescribed by the board.

3(3) A restaurant expanded sales permit for wine and spirits
4shall be valid for a period of not more than two years or until
5the expiration of the term for the restaurant license held by
6the applicant, whichever is shorter.

7(4) The fee for the initial issuance and renewal of a
8restaurant expanded sales permit for wine and spirits beverages
9shall be one hundred dollars ($100.00).

10(j) A holder of an expanded sales permit under subsection
11(h) or (i) may not have an interior connection to another
12business or with a residential building. A restaurant licensee
13with an interior connection to another business or with a
14residential building shall not be eligible to apply for an
15expanded sales permit under subsections (h) or (i).

16Section 9. Section 431(b) of the act, amended December 8,
172004 (P.L.1810, No.239), is amended and the section is amended
18by adding subsections to read:

19Section 431. Malt and Brewed Beverages Manufacturers',
20Distributors' and Importing Distributors' Licenses.--* * *

21(b) The board shall issue to any reputable person who
22applies therefor, and pays the license fee hereinafter
23prescribed, a distributor's or importing distributor's license
24for the place which such person desires to maintain for the sale
25of malt or brewed beverages, not for consumption on the premises
26where sold, and in quantities of not less than a case or
27original containers containing one hundred twenty-eight ounces
28or more which may be sold separately as prepared for the market
29by the manufacturer at the place of manufacture. The board shall
30have the discretion to refuse a license to any person or to any

1corporation, partnership or association if such person, or any
2officer or director of such corporation, or any member or
3partner of such partnership or association shall have been
4convicted or found guilty of a felony within a period of five
5years immediately preceding the date of application for the said
6license: And provided further, That, in the case of any new
7license or the transfer of any license to a new location, the
8board may, in its discretion, grant or refuse such new license
9or transfer if such place proposed to be licensed is within
10three hundred feet of any church, hospital, charitable
11institution, school or public playground, or if such new license
12or transfer is applied for a place which is within two hundred
13feet of any other premises which is licensed by the board: And
14provided further, That the board shall refuse any application
15for a new license or the transfer of any license to a new
16location if, in the board's opinion, such new license or
17transfer would be detrimental to the welfare, health, peace and
18morals of the inhabitants of the neighborhood within a radius of
19five hundred feet of the place proposed to be licensed. The
20board shall refuse any application for a new license or the
21transfer of any license to a location where the sale of liquid
22fuels or oil is conducted if the point of sale or dispensing of 
23liquid fuels or oil is within two hundred feet of the closest 
24point to the physical building in which the licensee is located.
25The board may enter into an agreement with the applicant
26concerning additional restrictions on the license in question.
27If the board and the applicant enter into such an agreement,
28such agreement shall be binding on the applicant. Failure by the
29applicant to adhere to the agreement will be sufficient cause to
30form the basis for a citation under section 471 and for the

1nonrenewal of the license under section 470. If the board enters
2into an agreement with an applicant concerning additional
3restrictions, those restrictions shall be binding on subsequent
4holders of the license until the license is transferred to a new
5location or until the board enters into a subsequent agreement
6removing those restrictions. If the application in question
7involves a location previously licensed by the board, then any
8restrictions imposed by the board on the previous license at
9that location shall be binding on the applicant unless the board
10enters into a new agreement rescinding those restrictions. The
11board shall require notice to be posted on the property or
12premises upon which the licensee or proposed licensee will
13engage in sales of malt or brewed beverages. This notice shall
14be similar to the notice required of hotel, restaurant and club
15liquor licensees.

16Except as hereinafter provided, such license shall authorize
17the holder thereof to sell or deliver malt or brewed beverages
18in quantities above specified anywhere within the Commonwealth
19of Pennsylvania, which, in the case of distributors, have been
20purchased only from persons licensed under this act as
21manufacturers or importing distributors, and in the case of
22importing distributors, have been purchased from manufacturers
23or persons outside this Commonwealth engaged in the legal sale
24of malt or brewed beverages or from manufacturers or importing
25distributors licensed under this article. In the case of an
26importing distributor, the holder of such a license shall be
27authorized to store and repackage malt or brewed beverages owned
28by a manufacturer at a segregated portion of a warehouse or
29other storage facility authorized by section 441(d) and operated
30by the importing distributor within its appointed territory and

1deliver such beverages to another importing distributor who has
2been granted distribution rights by the manufacturer as provided
3herein. The importing distributor shall be permitted to receive
4a fee from the manufacturer for any related storage, repackaging
5or delivery services. In the case of a bailee for hire hired by
6a manufacturer, the holder of such a permit shall be authorized:
7to receive, store and repackage malt or brewed beverages
8produced by that manufacturer for sale by that manufacturer to
9importing distributors to whom that manufacturer has given
10distribution rights pursuant to this subsection or to purchasers
11outside this Commonwealth for delivery outside this
12Commonwealth; or to ship to that manufacturer's storage
13facilities outside this Commonwealth. The bailee for hire shall
14be permitted to receive a fee from the manufacturer for any
15related storage, repackaging or delivery services. The bailee
16for hire shall, as required in Article V of this act, keep
17complete and accurate records of all transactions, inventory,
18receipts and shipments and make all records and the licensed
19areas available for inspection by the board and for the
20Pennsylvania State Police, Bureau of Liquor Control Enforcement,
21during normal business hours.

22Each out of State manufacturer of malt or brewed beverages
23whose products are sold and delivered in this Commonwealth shall
24give distributing rights for such products in designated
25geographical areas to specific importing distributors, and such
26importing distributor shall not sell or deliver malt or brewed
27beverages manufactured by the out of State manufacturer to any
28person issued a license under the provisions of this act whose
29licensed premises are not located within the geographical area
30for which he has been given distributing rights by such

1manufacturer. Should a licensee accept the delivery of such malt
2or brewed beverages in violation of this section, said licensee
3shall be subject to a suspension of his license for at least
4thirty days: Provided, That the importing distributor holding
5such distributing rights for such product shall not sell or
6deliver the same to another importing distributor without first
7having entered into a written agreement with the said secondary
8importing distributor setting forth the terms and conditions
9under which such products are to be resold within the territory
10granted to the primary importing distributor by the
11manufacturer.

12When a Pennsylvania manufacturer of malt or brewed beverages
13licensed under this article names or constitutes a distributor
14or importing distributor as the primary or original supplier of
15his product, he shall also designate the specific geographical
16area for which the said distributor or importing distributor is
17given distributing rights, and such distributor or importing
18distributor shall not sell or deliver the products of such
19manufacturer to any person issued a license under the provisions
20of this act whose licensed premises are not located within the
21geographical area for which distributing rights have been given
22to the distributor and importing distributor by the said
23manufacturer: Provided, That the importing distributor holding
24such distributing rights for such product shall not sell or
25deliver the same to another importing distributor without first
26having entered into a written agreement with the said secondary
27importing distributor setting forth the terms and conditions
28under which such products are to be resold within the territory
29granted to the primary importing distributor by the
30manufacturer. Nothing herein contained shall be construed to

1prevent any manufacturer from authorizing the importing
2distributor holding the distributing rights for a designated
3geographical area from selling the products of such manufacturer
4to another importing distributor also holding distributing
5rights from the same manufacturer for another geographical area,
6providing such authority be contained in writing and a copy
7thereof be given to each of the importing distributors so
8affected.

9* * *

10(g) (1) A distributor or importing distributor may apply
11for an expanded sales permit which shall grant a distributor or
12importing distributor the authority to sell malt or brewed
13beverages in packages of:

14(i) six containers or more with a total of at least sixty-
15seven and two tenths fluid ounces;

16(ii) four containers or more with a total of at least
17eighty-eight fluid ounces; or

18(iii) a single container with a total of at least sixty-four
19ounces.

20(2) A distributor expanded sales permit application shall be
21made on a form and in a manner as prescribed by the board.

22(3) A distributor expanded sales permit shall be valid for a
23period of not more than two years or until the expiration of the
24term for the distributor or importing distributor license held
25by the applicant, whichever is shorter.

26(4) The fee for a distributor expanded sales permit shall be
27one hundred dollars ($100.00).

28Section 10. Section 432(d) of the act, amended January 6,
292006 (P.L.1, No.1), is amended and the section is amended by
30adding subsections to read:

1Section 432. Malt and Brewed Beverages Retail Licenses.--* *
2*

3(d) The board shall, in its discretion, grant or refuse any
4new license, the transfer of any license to a new location or
5the extension of an existing license to cover an additional area
6if such place proposed to be licensed is within three hundred
7feet of any church, hospital, charitable institution, school, or
8public playground, or if such new license, transfer or extension
9is applied for a place which is within two hundred feet of any
10other premises which is licensed by the board. The board shall
11refuse any application for a new license, the transfer of any
12license to a new location or the extension of an existing
13license to cover an additional area if, in the board's opinion,
14such new license, transfer or extension would be detrimental to
15the welfare, health, peace and morals of the inhabitants of the
16neighborhood within a radius of five hundred feet of the place
17to be licensed. The board may enter into an agreement with the
18applicant concerning additional restrictions on the license in
19question. If the board and the applicant enter into such an
20agreement, such agreement shall be binding on the applicant.
21Failure by the applicant to adhere to the agreement will be
22sufficient cause to form the basis for a citation under section
23471 and for the nonrenewal of the license under section 470. If
24the board enters into an agreement with an applicant concerning
25additional restrictions, those restrictions shall be binding on
26subsequent holders of the license until the license is
27transferred to a new location or until the board enters into a
28subsequent agreement removing those restrictions. If the
29application in question involves a location previously licensed
30by the board, then any restrictions imposed by the board on the

1previous license at that location shall be binding on the
2applicant unless the board enters into a new agreement
3rescinding those restrictions. The board shall refuse any
4application for a new license, the transfer of any license to a
5location where the sale of liquid fuels or oil is conducted or
6the extension of an existing license to cover an additional area
7if the point of sale or dispensing of liquid fuels or oil is 
8within two hundred feet of the closest point to the physical 
9building in which the licensee is located: And provided further,
10That the board shall have the discretion to refuse a license to
11any person or to any corporation, partnership or association if
12such person, or any officer or director of such corporation, or
13any member or partner of such partnership or association shall
14have been convicted or found guilty of a felony within a period
15of five years immediately preceding the date of application for
16the said license. The board may, in its discretion, refuse an
17application for an economic development license under section
18461(b.1) or an application for an intermunicipal transfer or a
19license if the board receives a protest from the governing body
20of the receiving municipality. The receiving municipality of an
21intermunicipal transfer or an economic development license under
22section 461(b.1) may file a protest against the approval for
23issuance of a license for economic development or an
24intermunicipal transfer of a license into its municipality, and
25such municipality shall have standing in a hearing to present
26testimony in support of or against the issuance or transfer of a
27license. Upon any opening in any quota, an application for a new
28license shall only be filed with the board for a period of six
29months following said opening.

30* * *

1(h) (1) In addition to the authority provided under
2sections 401 and 407 for the sale of malt and brewed beverages
3for off-premises consumption, a malt and brewed beverage retail
4dispenser licensee may apply for an expanded sales permit which
5shall grant the licensee the authority to sell malt or brewed
6beverages for off-premises consumption if sold in quantities of
7thirty containers or less containing a total of not more than
8three hundred and eighty-four ounces in a single sale to one
9person.

10(2) An expanded sales permit for malt and brewed beverages
11application under this subsection shall be made on a form and in
12a manner as prescribed by the board.

13(3) An expanded sales permit for malt and brewed beverages
14under this subsection shall be valid for a period of not more
15than two years or until the expiration of the term for the
16restaurant license held by the applicant, whichever is shorter.

17(4) The fee for the initial issuance and renewal of a
18restaurant expanded sales permit under this subsection for malt
19or brewed beverages shall be one hundred dollars ($100).

20(i) A holder of an expanded sales permit under subsection
21(h) may not have an interior connection to another business or
22with a residential building. A retail dispenser licensee with an
23interior connection to another business or with a residential
24building may not apply for an expanded sales permit under
25subsection (h).

26Section 11. Section 438 of the act, amended June 25, 2010
27(P.L.217, No.35), is amended to read:

28Section 438. Number and Kinds of Licenses Allowed Same
29Licensee.--(a) Any retail dispenser may be granted licenses to
30maintain, operate or conduct any number of places for the sale

1of malt or brewed beverages, but a separate license must be
2secured for each place where malt or brewed beverages are sold.

3(b) No person shall possess or be issued more than [one
4distributor's or importing distributor's license.] forty 
5distributor's licenses, nor shall any person possess or be 
6issued:

7(1) more than ten per centum of the distributor licenses in
8any one county which has ten or more distributor licenses; or

9(2) more than one distributor license in any one county
10which has fewer than ten distributor licenses.

11(b.1) No person shall possess or be issued more than one
12importing distributor's license.

13(c) No person shall possess more than one class of license, 
14except that a holder of a retail dispenser's license may also be 
15a holder of a retail liquor license: Provided, however, That 
16nothing contained in this section shall be construed to prohibit 
17a member of the governing board of a public authority created 
18under subdivision (n) of Article XXIII of the act of August 9, 
191955 (P.L.323, No.130), known as "The County Code," from having 
20an interest in a distributor or importing distributor license 
21notwithstanding the fact that the public authority has an 
22interest in one or more retail licenses or acts as a landlord 
23for one or more retail licenses: And, provided further, That, 
24notwithstanding any other provision of this section, an entity 
25may acquire both a manufacturer's license or a limited winery 
26license and a hotel, restaurant or retail dispenser license for 
27use at the same location and more than one location may be so 
28licensed. The licenses and a person's interest in the licenses 
29or in the entity holding the licenses shall not be subject to 
30this section.

1Section 12. Section 468(a)(3) of the act, amended December
220, 2000 (P.L.992, No.141), is amended to read:

3Section 468. Licenses Not Assignable; Transfers.--(a) * * *

4(3) No license shall be transferred to any place or property 
5upon which is located as a business the sale of liquid fuels and 
6oil if the point of sale or dispensing of liquid fuels and oil 
7is within two hundred feet of the closest point to the physical 
8building in which the licensee is located. Except in cases of 
9emergency such as death, serious illness, or circumstances 
10beyond the control of the licensee, as the board may determine 
11such circumstances to justify its action, transfers of licenses 
12may be made only at times fixed by the board. In the case of the 
13death of a licensee, the board may transfer the license to the 
14surviving spouse or personal representative or to a person 
15designated by him. From any refusal to grant a transfer or upon 
16the grant of any transfer, the party aggrieved shall have the 
17right of appeal to the proper court in the manner hereinbefore 
18provided.

19* * *

20Section 13. Section 471(b) of the act, amended July 6, 2005
21(P.L.135, No.39), is amended to read:

22Section 471. Revocation and Suspension of Licenses; Fines.--
23* * *

24(b) Hearing on such citations shall be held in the same 
25manner as provided herein for hearings on applications for 
26license. Upon such hearing, if satisfied that any such violation 
27has occurred or for other sufficient cause, the administrative 
28law judge shall immediately suspend or revoke the license, or 
29impose a fine of not less than [fifty dollars ($50)] one hundred 
30dollars ($100) nor more than [one thousand dollars ($1,000)] two 

1thousand dollars ($2,000), or both, notifying the licensee by 
2registered letter addressed to his licensed premises. If the 
3licensee has been cited and found to have violated section 
4493(1) insofar as it relates to sales to minors or sales to a 
5visibly intoxicated person, section 493(10) insofar as it 
6relates to lewd, immoral or improper entertainment or section 
7493(14), (16) or (21), or has been found to be a public nuisance 
8pursuant to section 611, or if the owner or operator of the 
9licensed premises or any authorized agent of the owner or 
10operator has been convicted of any violation of the act of April 
1114, 1972 (P.L.233, No.64), known as "The Controlled Substance, 
12Drug, Device and Cosmetic Act," or of 18 Pa.C.S. § 5902 
13(relating to prostitution and related offenses) or 6301 
14(relating to corruption of minors), at or relating to the 
15licensed premises, the administrative law judge shall 
16immediately suspend or revoke the license, or impose a fine of 
17not less than [one thousand dollars ($1,000)] five thousand 
18dollars ($5,000) nor more than [five thousand dollars ($5,000)] 
19ten thousand dollars ($10,000), or both. However, if a licensee 
20has been cited and found to have violated section 493(1) as it 
21relates to sales to minors or sales to a visibly intoxicated 
22person but at the time of the sale the licensee was in 
23compliance with the requirements set forth in section 471.1 and 
24the licensee had not sold to minors or visibly intoxicated 
25persons in the previous four years, then the administrative law 
26judge shall immediately suspend or revoke the license, or impose 
27a fine of not less than [fifty dollars ($50)] one hundred 
28dollars ($100) nor more than [one thousand dollars ($1,000)] two 
29thousand dollars ($2,000), or both. The administrative law judge 
30shall notify the licensee by registered mail, addressed to the 

1licensed premises, of such suspension, revocation or fine. In 
2the event the fine is not paid within twenty days of the 
3adjudication, the administrative law judge shall suspend or 
4revoke the license, notifying the licensee by registered mail 
5addressed to the licensed premises. Suspensions and revocations 
6shall not go into effect until thirty days have elapsed from the 
7date of the adjudication during which time the licensee may take 
8an appeal as provided for in this act, except that revocations 
9mandated in section 481(c) shall go into effect immediately. Any 
10licensee whose license is revoked shall be ineligible to have a 
11license under this act until the expiration of three years from 
12the date such license was revoked. In the event a license is 
13revoked, no license shall be granted for the premises or 
14transferred to the premises in which the said license was 
15conducted for a period of at least one year after the date of 
16the revocation of the license conducted in the said premises, 
17except in cases where the licensee or a member of his immediate 
18family is not the owner of the premises, in which case the board 
19may, in its discretion, issue or transfer a license within the 
20said year. In the event the bureau or the person who was fined 
21or whose license was suspended or revoked shall feel aggrieved 
22by the adjudication of the administrative law judge, there shall 
23be a right to appeal to the board. The appeal shall be based 
24solely on the record before the administrative law judge. The 
25board shall only reverse the decision of the administrative law 
26judge if the administrative law judge committed an error of law, 
27abused its discretion or if its decision is not based on 
28substantial evidence. In the event the bureau or the person who 
29was fined or whose license was suspended or revoked shall feel 
30aggrieved by the decision of the board, there shall be a right 

1to appeal to the court of common pleas in the same manner as 
2herein provided for appeals from refusals to grant licenses. 
3Each of the appeals shall act as a supersedeas unless, upon 
4sufficient cause shown, the reviewing authority shall determine 
5otherwise; however, if the licensee has been cited and found to 
6have violated section 493(1) insofar as it relates to sales to 
7minors or sales to a visibly intoxicated person, section 493(10) 
8insofar as it relates to lewd, immoral or improper entertainment 
9or section 493(14), (16) or (21), or has been found to be a 
10public nuisance pursuant to section 611, or if the owner or 
11operator of the licensed premises or any authorized agent of the 
12owner or operator has been convicted of any violation of "The 
13Controlled Substance, Drug, Device and Cosmetic Act," or of 18 
14Pa.C.S. § 5902 or 6301, at or relating to the licensed premises, 
15or if the license has been revoked under section 481(c), its 
16appeal shall not act as a supersedeas unless the reviewing 
17authority determines otherwise upon sufficient cause shown. In 
18any hearing on an application for a supersedeas under this 
19section, the reviewing authority may consider, in addition to 
20other relevant evidence, documentary evidence, including records 
21of the bureau, showing the prior history of citations, fines, 
22suspensions or revocations against the licensee; and the 
23reviewing authority may also consider, in addition to other 
24relevant evidence, evidence of any recurrence of the unlawful 
25activity occurring between the date of the citation which is the 
26subject of the appeal and the date of the hearing. If the 
27reviewing authority is the board, no hearing shall be held on 
28the application for a supersedeas; however, a decision shall be 
29made based on the application, answer and documentary evidence 
30under this subsection. If the application for a supersedeas is 

1for a license that has been revoked under section 481(c), the 
2reviewing authority shall grant the supersedeas only if it finds 
3that the licensee will likely prevail on the merits. No penalty 
4provided by this section shall be imposed for any violations 
5provided for in this act unless the bureau notifies the licensee 
6of its nature within thirty days of the completion of the 
7investigation.

8Section 14. Section 471.1 of the act, amended or added
9December 20, 2000 (P.L.992, No.141) and December 22, 2011
10(P.L.530, No.113), is amended to read:

11Section 471.1. Responsible Alcohol Management.--(a) The
12board is authorized to offer, or authorize qualified entities to 
13offer, a responsible alcohol service program to licensees. The
14program shall consist of four parts: new employe orientation,
15training for alcohol service personnel, manager/owner training
16and the displaying of responsible alcohol service signage. New
17employe orientation shall consist of orienting newly hired
18alcohol service personnel as to Pennsylvania law relating to the
19sale, furnishing or serving of alcoholic beverages to minors and
20visibly intoxicated persons. It shall also mean orienting newly
21hired alcohol service personnel to responsible server practices,
22as the term is defined by the board, through regulation.
23Training for alcohol service personnel shall be as set forth by
24the board, but at minimum it shall consist of training to
25prevent service of alcohol to minors and to visibly intoxicated
26persons. Manager/owner training shall be as set forth by the
27board, but at a minimum it shall consist of training on how to
28monitor employes, proper service of alcohol and how to develop
29an appropriate alcohol service policy. The responsible alcohol
30service signage shall be as set forth by the board and shall

1consist of signage dealing with the licensee's policy against
2sales to minors and visibly intoxicated persons. Alcohol service
3personnel training may be conducted by the board or by an entity
4certified by the board to conduct such training.

5(b) The board shall be authorized to certify and decertify
6entities that wish to offer training for alcohol service
7personnel. The training entity and the board shall maintain
8records establishing the names of individuals who have
9successfully undergone alcohol service personnel training.

10(c) Training for managers and owners must be conducted by
11the board or its employes. The board shall maintain records
12establishing the names of individuals who have successfully
13undergone manager/owner training.

14(d) In order to be considered in compliance with this
15section for purposes of section 471, a restaurant, retail
16dispenser, eating place, hotel, club, catering club, distributor
17and importing distributor licensee shall:

18(1) have at least fifty per centum of its alcohol service
19personnel certified as having successfully completed an alcohol
20beverage servers training;

21(2) have its manager or owner certified as having
22successfully completed manager/owner training;

23(3) have all alcohol service personnel undergo new employe
24orientation; and

25(4) have appropriate responsible alcohol service signage
26posted on the licensed premises.

27For purposes of this section, an owner is an individual who owns
28at least twenty-five per centum of the licensed entity.

29(e) Licensees ordered to comply with this act pursuant to
30section 471 who change managers shall have sixty calendar days

1to have the new manager trained as required by this section. If
2a licensee ordered to comply with this act pursuant to section
3471 hires additional alcohol service personnel, those additional
4employes shall be deemed to have been certified from their date
5of hire if they successfully complete an alcohol serving program
6within sixty days of their date of hire.

7(f) Upon completion of a certified alcohol service personnel
8program or the board's owner/manager training program, the
9participant will be certified by the training entity or the
10board as having successfully completed the program. Said
11certification will be valid for two years. The licensee shall
12keep records of the certification status of its employes,
13managers and owners, including the name of the employe, manager
14or owner and the date of that individual's certification, in the
15same manner as it keeps other business records pursuant to
16section 493(12). The licensee shall also keep records of its new
17employe orientation program and records of its responsible
18alcohol service signage as set forth by the board by regulation.

19(g) Unless successfully completed prior to appointment, a
20manager appointed by any restaurant, eating place retail
21dispenser, hotel, club, limited distillery licensee or
22distributor licensee shall be required to complete the
23manager/owner training under subsection (c) within one hundred
24eighty days of approval of appointment by the board.

25(h) (1) The board shall require a person who, pursuant to a
26license or extended sales permit, is authorized to sell liquor
27for consumption off the licensed premises to comply with this
28section.

29(2) Notwithstanding subsection (d)(1), a person authorized
30to sell liquor for consumption off the licensed premises shall

1have all of its alcohol service personnel engaged in the sale of
2liquor for sale off the licensed premises consumption certified
3as having successfully completed an alcohol beverage servers
4training.

5Section 15. Section 493(24)(i) of the act, amended November
629, 2006 (P.L.1421, No.155), is amended to read:

7Section 493. Unlawful Acts Relative to Liquor, Malt and
8Brewed Beverages and Licensees.--The term "licensee," when used
9in this section, shall mean those persons licensed under the
10provisions of Article IV, unless the context clearly indicates
11otherwise.

12It shall be unlawful--

13* * *

14(24) (i) Things of Value Offered as Inducement. Except as
15provided in subclause (ii), for any licensee under the
16provisions of this article, or the board or any manufacturer, or
17any employe or agent of a manufacturer, licensee or of the
18board, to offer to give anything of value or to solicit or
19receive anything of value as a premium for the return of caps,
20stoppers, corks, stamps or labels taken from any bottle, case,
21barrel or package containing liquor or malt or brewed beverage,
22or to offer or give or solicit or receive anything of value as a
23premium or present to induce directly the purchase of liquor or
24malt or brewed beverage, or for any licensee, manufacturer or
25other person to offer or give to trade or consumer buyers any
26prize, premium, gift or other inducement to purchase liquor or
27malt or brewed beverages, except advertising novelties of
28nominal value which the board shall define. This section shall
29not prevent any manufacturer or any agent of a manufacturer from
30offering and honoring coupons which offer monetary rebates on

1purchases of wines and spirits through State Liquor Stores or
2purchases of malt or brewed beverages through distributors and
3importing distributors in accordance with conditions or
4regulations established by the board. The board may redeem
5coupons offered by a manufacturer or an agent of a manufacturer
6at the time of purchase. Coupons offered by a manufacturer or an
7agent of a manufacturer shall not be redeemed without proof of
8purchase. This section shall not apply to the return of any
9monies specifically deposited for the return of the original
10container to the owners thereof.

11(ii) Notwithstanding subclause (i) or any other provision of
12law, a holder of a restaurant license that is also approved to
13hold a slot machine license or a conditional slot machine
14license under 4 Pa.C.S. Part II (relating to gaming) may give
15liquor and malt or brewed beverages free of charge to any person
16actively engaged in playing a slot machine.

17(iii) Notwithstanding subclause (i) or any other provision
18of law, the board may establish and implement a customer
19relations marketing program for the purpose of offering
20incentives, including coupons or discounts on products which may
21be conditioned upon the purchase of liquor, to customers of the
22board.

23* * *

24Section 16. The act is amended by adding an article to read:

25ARTICLE IV-A

26PRIVATIZATION OF

27WHOLESALE LIQUOR DISTRIBUTION

28Section 401-A. Wine and spirits wholesale divestiture.

29(a) Authorized wine and spirits wholesale licenses.--

30(1) One wine and spirits wholesale license may be issued

1by the department to a successful applicant. The wine and
2spirits wholesale license shall authorize the distribution of
3the brands of liquor to licensees authorized to sell or
4distribute liquor under this act, as proposed by an applicant
5and approved by the department.

6(2) Subject to the conditions enumerated under section
7405-A, a wholesale licensee may distribute more than one
8brand of liquor under the same wine and spirits wholesale
9license.

10(3) Upon application by a wine and spirits wholesale
11licensee, the board may amend the authorization under a wine
12and spirits wholesale license to include or exclude an
13additional brand of liquor.

14(b) Wholesale license fee.--

15(1) At the time of issuance, the department shall impose
16a one-time wholesale license fee to be paid by a successful
17applicant for a wine and spirits wholesale license in an
18amount equal to the blended brand valuation for a brand of
19liquor authorized by the wine and spirits wholesale license
20multiplied by the wholesale acquisition factor.

21(2) Within the 90 days of the effective date of this
22section, the department shall determine and publish as a
23notice in the Pennsylvania Bulletin the wholesale license fee
24for each brand of liquor sold at Pennsylvania Liquor Stores
25for a continuous period of at least one year prior to the
26effective date of this section.

27(c) Brands not previously sold.--

28(1) The department may not impose a one-time wine and
29spirits wholesale license fee for a brand of liquor, not sold
30at Pennsylvania Liquor Stores for a continuous period of one

1year in the ten years prior to the effective date of this
2section and is proposed to be distributed by an applicant for
3a wine and spirits wholesale license on a Statewide basis.

4(2) If, at any time during the term of a wine and
5spirits wholesale license, the wine and spirits wholesale
6licensee proposes to sell and distribute a new brand of
7liquor not previously sold in this Commonwealth, the wine and
8spirits wholesale licensee shall apply to the board for
9permission to sell the brand and pay an additional license
10fee determined in accordance with this section.

11(d) Term.--

12(1) After payment of the wholesale license fee, a wine
13and spirits wholesale license is in effect unless the board
14suspends, revokes or does not renew the wine and spirits
15wholesale license upon good cause consistent with the license
16requirements as provided for under this article.

17(2) The license of a wine and spirits wholesale licensee
18in good standing must be renewed every two years consistent
19with this article.

20(3) This subsection may not be construed to relieve a
21wine and spirits wholesale licensee of the affirmative duty
22to notify the board of a change relating to the status of its
23license or other information contained in the application
24materials on file with the department or the board.

25Section 402-A. Application for wine and spirits wholesale
26license.

27(a) Applications.--An application for a wine and spirits
28wholesale license shall be submitted on a form and in a manner
29as shall be required by the department.

30(b) Eligibility.--A person may be eligible to apply for a

1wine and spirits wholesale license if the person satisfies all
2of the following:

3(1) Neither the applicant nor any affiliate of the
4applicant has applied for or holds a license which authorizes
5the retail sale of wine and spirits to consumers in this
6Commonwealth.

7(2) The applicant, if a corporation, a limited liability
8company, limited partnership, partnership, association or
9other legal entity, is organized under the laws of this
10Commonwealth.

11(3) The applicant, if a natural person, is a citizen of
12the United States and a resident of this Commonwealth.

13(4) Neither the applicant nor any affiliate of the
14applicant, executive officer, director or general or limited
15partner of the applicant or person holding, directly or
16indirectly, a controlling interest in the applicant has been
17convicted of a crime identified under subsection (d)(9).

18(c) Other licenses.--Nothing under this article or act shall
19be construed to prohibit a properly licensed importing
20distributor of malt and brewed beverages from applying for and,
21if approved, being issued a wine and spirits wholesale license.

22(d) General requirements.--In addition to any other
23information required under this article or as may be required by
24the department, the applicant for a wine and spirits wholesale
25license shall include, at a minimum, the following:

26(1) The name and address of the applicant.

27(2) A statement as to whether the applicant is an
28individual, corporation, limited liability company, limited
29partnership, partnership or association and, if the applicant
30is not an individual, the state of incorporation or

1organization.

2(3) If the applicant is not an individual, the names and
3residence addresses of each executive officer, director,
4general or limited partner or person holding a controlling
5interest in the applicant.

6(4) If the applicant is an association, the names and
7residence addresses of the persons constituting the
8association.

9(5) A statement of the brands of liquor the applicant
10proposes to engage in wholesale distribution on a Statewide
11basis.

12(6) The proposed location and proof of ownership or
13lease for the wholesale operation, including any proposed
14warehouses, if available.

15(7) Floor plans for any facility proposed to be used in
16wholesale operations and existing design plans for any
17facility that is planned, but not yet constructed, to the
18extent they are available.

19(8) Information disclosing all arrests of the applicant
20and any affiliate of the applicant, executive officer,
21director or general or limited partner of the applicant or
22person holding a controlling interest in the applicant and
23all citations issued to the same for nonsummary offenses.
24The information shall include:

25(i) A brief description of the circumstances
26surrounding the arrest or issuance of the citation.

27(ii) The specific offense charged or cited.

28(iii) The ultimate disposition of the charge or
29citation, including the details of any dismissal, plea
30bargain, conviction, sentence, pardon, expungement or

1order of Accelerated Rehabilitative Disposition.

2(9) A sworn statement that the applicant and any
3affiliate of the applicant, or any executive officer,
4director or general or limited partner of the applicant or
5person holding a controlling interest in the applicant have
6never been convicted:

7(i) of any crime involving fraud, moral turpitude or
8racketeering within a period of ten years immediately
9preceding the date of the application; or

10(ii) of any felony or equivalent crime.

11(10) A statement that the applicant intends to
12continuously operate as a wine and spirits wholesale licensee
13for the duration of the license term and to provide a level
14of service, including product availability, reasonably
15equivalent to the level of service currently provided by the
16Commonwealth.

17(11) A financial statement or letter of credit in a form
18and containing such information as the department shall
19prescribe to indicate the applicant's financial capability to
20operate the wholesale operation and the estimated volume of
21wholesale business to be conducted annually.

22(12) A current tax certificate issued by the Department
23of Revenue showing any amount of taxes owed to the
24Commonwealth for the applicant and any affiliate of the
25applicant, executive officer, director or general or limited
26partner of the applicant or person holding a controlling
27interest in the applicant. Any unpaid taxes identified on the
28tax certificate must be paid before the application is
29considered complete and reviewed by the department.

30(13) A signature and verification by oath or

1affirmation, or under penalty of unsworn falsification to
2authorities, by the applicant, if a natural person, or, when
3the applicant is a legal entity, a person specifically
4authorized by the legal entity to sign the application, to
5which shall be attached written evidence of that authority.

6(e) Additional information.--An applicant shall, during the
7application process, provide any other information determined to
8be appropriate by the department.

9(f) Amended application.--When a change occurs in any
10information provided to the department as part of the
11application process, the applicant shall immediately notify the
12department of the change and timely provide amended information
13to the department in a form and manner determined by the
14department.

15(g) Application fees and investigative costs.--The following
16shall apply:

17(1) An application filing fee of $1,000 shall be due
18upon application for a wine and spirits wholesale license.
19The application filing fee shall be refunded if, due to no
20fault on the part of the applicant, the wine and spirits
21wholesale license is not approved.

22(2) The department shall establish, charge and collect
23fees from an applicant to recover the costs directly related
24to the department's review and investigation of the
25application for a wine and spirits wholesale license. The
26board shall have the same duty relating to fees as to
27applications for renewal.

28Section 403-A. Review and investigation of application.

29(a) Completeness of application.--

30(1) The following shall apply:

1(i) The department may not consider an incomplete
2application and shall notify the applicant in writing if
3an application is incomplete.

4(ii) An application shall be considered incomplete
5if it does not include all applicable fees and all
6information and accompanying documentation required by
7the department, including the payment of any unpaid taxes
8identified on any tax certificate required to be filed
9with the application.

10(2) A notification of incompleteness shall state the
11deficiencies in the application that must be corrected prior
12to consideration of the merits of the application.

13(3) The applicant shall be afforded a reasonable period
14of time, as determined by the department, to cure the
15deficiencies.

16(4) If the applicant fails to timely cure noticed
17deficiencies, the application shall be deemed denied by the
18department without further action.

19(b) Investigation.--After receipt of an application for a
20wine and spirits wholesale license and a determination that the
21application is complete, the department shall conduct an
22investigation of the application as deemed necessary or
23desirable. The investigation shall include, and the applicant
24shall have the burden of demonstrating, at a minimum, the
25following:

26(1) The truth and veracity of the information provided
27in the application.

28(2) The applicant's cooperation and the cooperation of
29any affiliate of the applicant and any executive officer,
30director or general or limited partner of the applicant or

1person holding a controlling interest in the applicant in the
2application process and with any request by the department or
3the board for any information deemed necessary for licensure.

4(3) The good character, integrity and suitability of the
5applicant and any affiliate of the applicant, executive
6officer, director or general or limited partner of the
7applicant or person holding a controlling interest in the
8applicant.

9(4) The applicant possesses sufficient financial
10resources to:

11(i) Operate as a wholesale licensee.

12(ii) Pay all taxes due and owing to the
13Commonwealth.

14(iii) Assume liability for the safe operation of the
15wholesale operations.

16(5) The applicant possesses sufficient business ability
17and experience to create and maintain a successful and
18efficient wholesale operation that provides service at a
19level that is reasonably equivalent to the level of service
20currently provided in this Commonwealth at the time of
21enactment of this article.

22(6) The applicant has entered into a contractual
23relationship with one or more licensed manufacturers or
24importers for the distribution in this Commonwealth of a
25brand or brands of liquor regardless of whether the
26contractual relationship is contingent upon the board issuing
27a wine and spirits wholesale license to the applicant.

28(7) The physical facilities proposed to be used in the
29applicant's wholesale operations are located and designed in
30such a manner as to:

1(i) Assure that all warehouses are located within
2this Commonwealth.

3(ii) Function as a self-contained unit, with limited
4customer access.

5(iii) Not have any interior connection with any
6other business or with any residential building without
7prior board approval.

8(iv) Provide adequate security to protect the
9applicant's inventory from unauthorized sale or
10diversion.

11(v) Protect the public interest.

12(c) Assistance with investigations.--The department may
13enter into an agreement with the Pennsylvania State Police or
14the Office of Inspector General to assist the department in
15conducting investigations under this section and to provide for
16the reimbursement of actual costs incurred for providing the
17assistance.

18Section 404-A. Issuance of licenses.

19(a) Notification.--Upon completion of the investigation
20under section 403-A, the department shall inform the applicant
21in writing of its decision to approve or deny the application.

22(b) Approval.--If the application is approved, the
23department shall notify the successful applicant of the
24licensing fee due, as required under section 401-A for the
25brands of liquor approved for the applicant.

26(c) Denial.--The following shall apply:

27(1) If an application is denied, the department shall
28provide the applicant with the specific reasons for the
29denial in the written notification required under subsection
30(a).

1(2) The applicant shall be entitled to a hearing on the
2denial, if a hearing is requested within ten days of the
3department's notification and the request is in writing on a
4form and in a manner prescribed by the department.

5(3) Any hearing conducted under this section shall
6comply with 2 Pa.C.S. (relating to administrative law and
7procedure).

8(d) Issuance.--After approval of an application, the
9department shall issue a wine and spirits wholesale license to
10the applicant, if the applicant has completed all of the
11following acts:

12(1) Paid the wholesale license fee required under this
13article. Payment shall be made by certified check or wire
14transfer to a designated restricted account in The State
15Stores Fund.

16(2) Paid any outstanding application or investigation
17fees.

18(3) Executed and delivered to the department the
19statement of conditions required under section 405-A.

20(4) Purchased the board's marketable surplus warehouse
21inventory of all brands of liquor the applicant is being
22authorized to distribute at the board's original cost plus an
23administrative fee to be determined by the board.

24(5) Fulfilled any other conditions required by the
25department or the board or provided for under this article.

26(e) License not entitlement.--Nothing in this article shall
27be construed to create an entitlement to a wine and spirits
28wholesale license.

29(f) Other licenses.--Nothing in this act shall be construed
30to prohibit a wine and spirits wholesale licensee from applying

1for and, if approved, being issued a license as an importing
2distributor of malt and brewed beverages.

3Section 405-A. Wholesale licensee statement of conditions.

4(a) Statement of conditions.--The department shall develop a
5statement of conditions to be executed by a wine and spirits
6wholesale licensee governing the wine and spirits wholesale
7licensee.

8(b) Conditions.--In addition to any other conditions the
9department deems necessary or appropriate for a specific wine
10and spirits wholesale licensee, a statement of conditions under
11this section shall include, at a minimum, the following
12conditions and impose the following obligations and requirements
13on an ongoing basis:

14(1) Wine and spirits wholesale licensees may not sell
15liquor to persons that are not licensed under this act.

16(2) Wine and spirits wholesale licensees shall:

17(i) serve all licensees eligible to purchase liquor
18under this act and the board; and

19(ii) shall make liquor available for sale to those
20licensees and the board under the same pricing structure.

21(3) Except for wine and spirits wholesale licensees that
22hold an importing distributor license under section 431, wine
23and spirits wholesale licensees may not under any
24circumstances sell malt or brewed beverages.

25(4) Wine and spirits wholesale licensees may not engage
26in the conduct that would constitute any of the following:

27(i) Variable pricing.

28(ii) Unfair or deceptive trade practices proscribed
29under Federal or State law or regulation.

30(iii) Intentional exclusion of competing brands of

1liquor from the marketplace.

2(5) A wine and spirits wholesale licensee shall only
3sell and distribute liquor that is subject to a contractual
4relationship between the wine and spirits wholesale licensee
5and one or more licensed manufacturers or importers of wine
6and spirits.

7(6) The following shall apply:

8(i) A wine and spirits wholesale licensee shall do
9all of the following:

10(A) Acquire liquor exclusively from:

11(I) a licensed manufacturer or importer of
12wine and spirits with whom the wine and spirits
13wholesale licensee has the contractual authority
14to sell at wholesale as provided under this act;
15or

16(II) an entity affiliated with the wine and
17spirits wholesale licensee.

18(B) Keep a detailed log of all wholesale liquor
19transactions, including both acquisitions and sales
20to licensees under this act.

21(ii) When liquor is acquired from an entity
22affiliated with the wine and spirits wholesale licensee,
23the entity shall be considered a licensed manufacturer or
24importer of wine and spirits.

25(7) A wine and spirits wholesale licensee's licensed
26premises and all facilities involved in its wholesale
27operations, including any changes to those facilities during
28the term of the license, shall be subject to the inspection,
29investigation and approval of the department or the board.

30(8) A wine and spirits wholesale licensee shall maintain

1adequate security to protect the licensee's inventory from
2unauthorized sale or diversion and prevent its unauthorized
3distribution.

4(9) Wine and spirits wholesale licensees shall not
5engage in any separate business activity upon any premises on
6which wholesale liquor operations are conducted without prior
7approval of the board.

8(10) Wine and spirits wholesale licensees may sell
9liquor between 2 a.m. of any Monday and 12 midnight of the
10following Saturday.

11(11) A wine and spirits wholesale licensee shall be
12considered a Pennsylvania Liquor Store for the purposes of
13collecting and remitting taxes consistent with the act of
14March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of
151971, for wholesale transactions to licensees authorized to
16sell wine and spirits in this Commonwealth.

17(12) A wine and spirits wholesale licensee shall notify
18the board within 15 days of any change in persons holding a
19controlling interest in the license.

20(13) A wine and spirits wholesale licensee shall notify
21the board within 15 days of becoming aware of any arrest or
22criminal indictments or convictions by the licensee or any
23affiliate of the licensee, or any executive officer, director
24or general or limited partner of the licensee or person
25holding a controlling interest in the licensee.

26(14) A wine and spirits wholesale licensee shall notify
27the board within 15 days of becoming aware of any violation
28of this act by the licensee or any affiliate of the licensee,
29or any executive officer, director or general or limited
30partner of the licensee, person holding a controlling

1interest in the licensee or employee of the licensee.

2(15) Neither a wine and spirits wholesale licensee, nor
3any of its affiliates, shall, at any time, seek to be
4approved or be approved by the department or the board to
5distribute brands of liquor in a manner which constitutes a
6violation of Federal or State law, including, but not limited
7to, antitrust or other unfair trade practices, or creates a
8monopolistic liquor distribution system in this Commonwealth.

9(16) Wine and spirits wholesale licensees shall make the
10licensed premises, all of the facilities involved in the
11wholesale operation and all of the business and financial
12books and records of the wholesale operation available at any
13time for inspection and audit by the department or the board.

14(17) Wine and spirits wholesale licensees shall
15cooperate fully in any inquiry or investigation by the
16department or the board and provide any information requested
17by the department or the board.

18(18) A wine and spirits wholesale licensee, if a
19corporation, a limited liability company, limited
20partnership, partnership, association or other legal entity,
21shall at all times be organized under the laws of this
22Commonwealth.

23(19) A wine and spirits wholesale licensee, if a natural
24person, shall at all times be a citizen of the United States
25and a resident of this Commonwealth.

26(20) A wine and spirits wholesale licensee shall pay to
27the board an amount equal to 1% of the licensee's annual
28gross receipts on the sale of wine and spirits minus the
29annual taxes paid by the licensee. The board shall transfer
30the funds received under this paragraph to the Department of

1Drug and Alcohol Programs or its successor in function for
2the following purposes:

3(i) Treatment and rehabilitation of persons addicted
4to the excessive use of alcoholic beverages.

5(ii) Promotion of education, prevention and early
6intervention programs designed to eliminate abuse and
7addiction to alcohol or other mood-altering substances or
8secure appropriate treatment for persons who are already
9addicted.

10(iii) Study of the problem of addiction.

11(iv) To issue grants to various entities for alcohol
12education and prevention efforts.

13(c) Sanctions.--A wine and spirits wholesale licensee that
14fails to comply with any condition contained in the licensee's
15statement of conditions shall be subject to board-imposed
16administrative sanctions or other penalties authorized under
17sections 471 and 494.

18Section 406-A. Loss of rights to wholesale brands of liquor.

19The department shall establish procedures and standards to
20govern the relationship between wine and spirits wholesale
21licensees and manufacturers which shall, at a minimum,
22incorporate the following principles:

23(1) A manufacturer having a contract, including all
24agreements, understandings or other arrangements, whether
25written or oral, with a wine and spirits wholesale licensee
26for the distribution in this Commonwealth of a brand or
27brands of liquor may terminate the distribution rights and
28transfer the rights to another wine and spirits wholesale
29licensee upon the voluntary agreement of both licensees. In
30the event of a voluntary termination and transfer, the

1manufacturer shall provide written notice to the board
2indicating that affected wine and spirits wholesale licensees
3have both agreed to the termination and transfer. A copy of
4the notification to the board shall be provided to both
5licensees.

6(2) If a wine and spirits wholesale licensee does not
7agree to the termination or transfer of its distribution
8rights, the manufacturer may terminate or transfer the rights
9only for good cause, as defined by the department or the
10board, or upon payment to the terminated licensee of
11reasonable compensation, as determined by the board to
12reflect the value of the wine and spirits wholesale
13licensee's business related to the terminated brand of
14liquor.

15(3) Whether voluntary or involuntary, the termination
16and transfer of the right to distribute the brand of liquor
17shall comply with section 408-A.

18Section 407-A. Sale, assignment or transfer of license.

19(a) Prohibition.--No person may sell, assign or otherwise
20transfer a wholesale wine and spirits license granted under this
21article unless all of the following are met:

22(1) The person has obtained the prior written approval
23of the board.

24(2) The person has paid the fee under subsection (c).

25(b) Compliance.--Any person to whom a wholesale wine and
26spirits license is sold, assigned or transferred shall comply
27with the provisions of this article prior to the sale,
28assignment or transfer of the license.

29(c) Transfer fee.--The transfer of a wine and spirits
30license shall be subject to a transfer fee equal to 1% of the

1license fee paid for the license and shall be paid as a
2condition of the transfer of the license. The transfer fee
3applicable to the transfer of brands of liquor under section
4408-A(b) shall not apply to the transfer of a package store
5wholesale license.

6(d) Change of control.--For the purposes of this section, a
7change of control of a package store licensee shall be deemed to
8be a sale, assignment or transfer of a package store wholesale
9or retail license. A licensee shall notify the board immediately
10upon becoming aware of any proposed or contemplated change of
11control.

12Section 408-A. Transfer of brands of liquor.

13(a) Prohibition.--No brand of liquor offered for sale in
14this Commonwealth may be transferred to a different wine and
15spirits wholesale licensee without prior approval from the
16board.

17(b) Transfer fee.--An application to the board to transfer
18the right to distribute a brand of liquor shall be subject to an
19application fee equal to 1% of the initial license fee
20attributable to the brand of liquor or $1,000, whichever is
21greater.

22Section 409-A. Return of fee or bid.

23The entire wholesale license fee paid by a wine and spirits
24wholesale licensee under section 401-A(b) shall be returned if
25this article is amended or otherwise altered by an act of the
26General Assembly within five years of the effective date of this
27section to change provisions relating to the loss of rights to
28wholesale brands of liquors under section 406-A.

29Section 410-A. Deposit of license fees.

30The license fee paid by a wine and spirits wholesale licensee

1under section 401-A (b) shall be deposited into the Public
2Education Legislative Initiative Fund.

3Section 411-A. Excise tax on wine and spirits.

4(a) Duty to collect taxes.--A wine and spirits wholesale
5licensee shall collect from each licensee authorized to purchase
6and sell wine and spirits to consumers an excise tax on wine and
7spirits sold in this Commonwealth at a rate of 21.5%.

8(b) Remittance of excise tax.--A wine and spirits wholesale
9licensee shall remit the tax imposed and collected under this
10section to the Department of Revenue monthly on or before the
11tenth day of the month following the collection of the tax.

12(c) Exemptions.--A tax imposed under this section does not
13apply to:

14(1) a malt and brewed beverage; or

15(2) liquor sold to a post exchange, ship service store
16or base exchange located in a military, naval or air force
17reservation within this Commonwealth.

18Section 412-A. Duties of the Department of General Services.

19The Department of General Services shall:

20(1) determine when the Pennsylvania Liquor Control Board
21substantially divested of its wholesale liquor function to
22wine and spirits wholesale licensees under this article; and

23(2) publish the date determined under paragraph (1) as a
24notice in the Pennsylvania Bulletin.

25Section 17. Section 801(b) of the act is amended and the
26section is amended by adding a subsection to read:

27Section 801. Moneys Paid Into Liquor License Fund and
28Returned to Municipalities.--* * *

29(b) The moneys in the Liquor License Fund shall, on the 
30first days of February and August of each year, be paid by the 

1board to the respective municipalities in which the respective 
2licensed places are situated, if the municipalities have a 
3municipal police force, in such amounts as represent the 
4aggregate license fees collected from licenses in such 
5municipalities during the preceding period.

6(b.1) Money in the Liquor License Fund that is due to
7municipalities that have a municipal police force shall be paid
8to the enforcement bureau on the first days of February and
9August of each year to be utilized for the implementation of
10compliance checks for underage sales by licensees.

11* * *

12Section 18. Section 802(c) of the act is amended to read:

13Section 802. Moneys Paid Into The State Stores Fund for Use
14of the Commonwealth.--* * *

15(c) [Two] Five per centum of annual profits from the sale of
16liquor and alcohol shall be annually transferred to the
17Department [of Health for use by the Office] of Drug and Alcohol
18Programs, or its successor in function, for the following
19purposes:

20(1) Treatment and rehabilitation of persons addicted to the
21excessive use of alcoholic beverages.

22(2) Promotion of education, prevention and early
23intervention programs designed to eliminate abuse and addiction
24to alcohol or other mood-altering substances or secure
25appropriate treatment for the already addicted.

26(3) Study of the problem of addiction.

27(4) To issue grants to various entities for alcohol
28education and prevention efforts.

29* * *

30Section 19. The act is amended by adding a section to read:

1Section 804. Public Education Legislative Initiative Fund.--
2(a) The Public Education Legislative Initiative Fund is
3established as a restricted receipts account in the General
4Fund.

5(b) Money shall be deposited into the Public Education
6Legislation Initiative Fund in accordance with this act.

7(c) Money in the Public Education Legislation Initiative
8Fund may be appropriated by the General Assembly for the
9purposes of improving the delivery and quality of primary and
10secondary public education to Commonwealth residents.

11Section 20. Repeals are as follows:

12(1) The General Assembly declares that the repeal under
13paragraph (2) is necessary to effectuate the addition of
14section 336-A of the act.

15(2) The the act of June 9, 1936 (1st Sp.Sess., P.L.13,
16No.4), entitled "An act imposing an emergency State tax on
17liquor, as herein defined, sold by the Pennsylvania Liquor
18Control Board; providing for the collection and payment of
19such tax; and imposing duties upon the Department of Revenue
20and the Pennsylvania Liquor Control Board," is repealed.

21Section 21. This act shall take effect as follows:

22(1) The provisions of section 20 shall take effect upon
23publication of the notice under section 412-A(2) of the act.

24(2) The remainder of this act shall take effect in 90
25days.