Regular Session 2015-2016 House Bill 0189 P.N. 0181

PRINTER'S NO. 181

THE GENERAL ASSEMBLY OF PENNSYLVANIA

HOUSE BILL

No.

189

Session of

2015

INTRODUCED BY SONNEY, BARRAR, D. COSTA, ELLIS, GRELL, A. HARRIS,

JAMES, KILLION, KNOWLES, MACKENZIE, MARSICO, MILLARD,

O'BRIEN, O'NEILL, SAINATO, SAYLOR AND DeLUCA,

JANUARY 23, 2015

REFERRED TO COMMITTEE ON LIQUOR CONTROL, JANUARY 23, 2015

AN ACT

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

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

malt and brewed beverages; amending, revising, consolidating

and changing the laws relating thereto; regulating and

restricting the manufacture, purchase, sale, possession,

consumption, importation, transportation, furnishing, holding

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

liquors, alcohol and malt and brewed beverages and the

persons engaged or employed therein; defining the powers and

duties of the Pennsylvania Liquor Control Board; providing

for the establishment and operation of State liquor stores,

for the payment of certain license fees to the respective

municipalities and townships, for the abatement of certain

nuisances and, in certain cases, for search and seizure

without warrant; prescribing penalties and forfeitures;

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

preliminary provisions, further providing for definitions, in

Pennsylvania Liquor Control Board, further providing for

general powers of the Pennsylvania Liquor Control Board, in

Pennsylvania liquor stores, further providing for sales by

Pennsylvania liquor stores, in licenses and regulations,

further providing for shipment of wine into Commonwealth and,

in distilleries, wineries, warehouses, bailees and

transporters, further providing for limited wineries.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1. The definition of "eligible entity" in section

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

Liquor Code, reenacted and amended June 29, 1987 (P.L.32, No.14)

and amended July 5, 2012 (P.L.1007, No.116), is amended to read:

Section 102. Definitions.--The following words or phrases,

unless the context clearly indicates otherwise, shall have the

meanings ascribed to them in this section:

* * *

"Eligible entity" shall mean a city of the third class, a

hospital, a church, a synagogue, a volunteer fire company, a

volunteer ambulance company, a volunteer rescue squad, a unit of

a nationally chartered club which has been issued a club liquor

license, a club which has been issued a club liquor license and

which, as of December 31, 2002, has been in existence for at

least 100 years, a library, a nationally accredited Pennsylvania

nonprofit zoological institution licensed by the United States

Department of Agriculture, a nonprofit agricultural association

in existence for at least ten years, a bona fide sportsmen's

club in existence for at least ten years, a nationally chartered

veterans' organization and any affiliated lodge or subdivision

of such organization, a fraternal benefit society that is

licensed to do business in this Commonwealth and any affiliated

lodge or subdivision of such fraternal benefit society, a museum

operated by a nonprofit corporation, a nonprofit corporation

engaged in the performing arts, an arts council, a nonprofit

corporation that operates an arts facility or museum, a

nonprofit organization as defined under section 501(c)(3) of the

Internal Revenue Code of 1986 (Public Law 99-514, 26 U.S.C. §

501(c)(3)) whose purpose is to protect the architectural

heritage of boroughs or a township of the second class and which

has been recognized as such by a municipal resolution, a

nonprofit organization as defined under section 501(c)(3) of the

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Internal Revenue Code of 1986 (Public Law 99-514, 26 U.S.C. §

501(c)(3)) conducting a regatta in a city of the second class

with the permit to be used on State park grounds or conducting a

family-oriented celebration as part of Welcome America in a city

of the first class on property leased from that city for more

than fifty years, a nonprofit organization as defined under

section 501(c)(3) of the Internal Revenue Code of 1986 (26

U.S.C. § 501(c)(3)) whose purpose is to raise funds for the

research and treatment of cystic fibrosis, a nonprofit

organization as defined under section 501(c)(3) of the Internal

Revenue Code of 1986 (26 U.S.C. § 501(c)(3)) whose purpose is to

educate the public on issues dealing with watershed

conservation, a nonprofit organization as defined under section

501(c)(3) of the Internal Revenue Code of 1986 (Public Law 99-

514, 26 U.S.C. § 501(c)(3)) whose purpose is to provide equine

assisted activities for children and adults with special needs,

a nonprofit economic development agency in a city of the second

class with the primary function to serve as an economic

generator for the greater southwestern Pennsylvania region by

attracting and supporting film, television and related media

industry projects and coordinating government and business

offices in support of a production, a county tourist promotion

agency as defined in section 3(1) of the act of April 28, 1961

(P.L.111, No.50), known as the "Tourist Promotion Law," a junior

league that is a nonprofit organization as defined under section

501(c)(3) of the Internal Revenue Code of 1986 (26 U.S.C. §

501(c)(3)) that is comprised of women whose purpose is

exclusively educational and charitable in promoting the

volunteerism of women and developing and participating in

community projects and that has been in existence for over

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seventy years, a nonprofit organization as defined under section

501(c)(3) of the Internal Revenue Code of 1986 and whose purpose

is the education and promotion of American history, a nonprofit

organization as defined under section 501(c)(6) of the Internal

Revenue Code of 1986 whose purpose is to support business and

industry, a brewery which has been issued a license to

manufacture malt or brewed beverages and has been in existence

for at least 100 years or a club recognized by Rotary

International and whose purpose is to provide service to others,

to promote high ethical standards and to advance world

understanding, goodwill and peace through its fellowship of

business, professional and community leaders or a nonprofit

organization as defined under section 501(c)(3) of the Internal

Revenue Code of 1986 (Public Law 99-514, 26 U.S.C. § 501(c)(3))

whose purpose is to promote mushrooms while supporting local and

regional charities, a museum operated by a not-for-profit

corporation in a city of the second class A, a nonprofit

organization as defined under section 501(c)(3) of the Internal

Revenue Code of 1986 which is located in a city of the second

class A and has as its purpose economic and community

development, a nonprofit organization as defined under section

501(c)(3) or (6) of the Internal Revenue Code of 1986 that is

located in a city of the third class in a county of the fifth

class, a nonprofit social service organization defined under

section 501(c)(3) of the Internal Revenue Code of 1986 located

in a county of the third class whose purpose is to serve

individuals and families in that county of the third class, a

nonprofit organization as defined under section 501(c)(3) of the

Internal Revenue Code of 1986 whose main purpose is to

temporarily foster stray and unwanted animals and match them to

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suitable permanent homes or a nonprofit organization as defined

under section 501(c)(3) of the Internal Revenue Code of 1986 who

operates either a Main Street Program or Elm Street Program

recognized by the Commonwealth, the National Trust for Historic

Preservation or both, a nonprofit radio station that is a member

of the National Public Radio network, a nonprofit public

television station that is a member of the Pennsylvania Public

Television Network or a nonprofit organization as defined under

section 501(c)(3) of the Internal Revenue Code of 1986 whose

purpose is to promote awareness, education and research and to

provide a support system for patients with neutropenia and their

families through a national resource network or a nonprofit

organization as defined under section 501(c)(3) of the Internal

Revenue Code of 1986 whose purpose is to allocate funds for

research to expedite a cure for achromatopsia.

* * *

Section 2. Section 207(b) of the act is amended to read:

Section 207. General Powers of Board.--Under this act, the

board shall have the power and its duty shall be:

* * *

(b) To control the manufacture, possession, sale,

consumption, importation, use, storage, transportation and

delivery of liquor, alcohol and malt or brewed beverages in

accordance with the provisions of this act, and to fix the

wholesale and retail prices at which liquors and alcohol shall

be sold at Pennsylvania Liquor Stores. Prices shall be

proportional with prices paid by the board to its suppliers and

shall reflect any advantage obtained through volume purchases by

the board. This proportional pricing provision shall not apply

to special liquor orders authorized under section 305(a) of this

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act. The board may establish a preferential price structure for

wines produced within this Commonwealth for the promotion of

such wines, as long as the price structure is uniform within

each class of wine purchased by the board. The board shall

require each Pennsylvania manufacturer and each nonresident

manufacturer of liquors, other than wine, selling such liquors

to the board, which are not manufactured in this Commonwealth,

to make application for and be granted a permit by the board

before such liquors not manufactured in this Commonwealth shall

be purchased from such manufacturer. Each such manufacturer

shall pay for such permit a fee which, in the case of a

manufacturer of this Commonwealth, shall be equal to that

required to be paid, if any, by a manufacturer or wholesaler of

the state, territory or country of origin of the liquors, for

selling liquors manufactured in Pennsylvania, and in the case of

a nonresident manufacturer, shall be equal to that required to

be paid, if any, in such state, territory or country by

Pennsylvania manufacturers doing business in such state,

territory or country. In the event that any such manufacturer

shall, in the opinion of the board, sell or attempt to sell

liquors to the board through another person for the purpose of

evading this provision relating to permits, the board shall

require such person, before purchasing liquors from him or it,

to take out a permit and pay the same fee as hereinbefore

required to be paid by such manufacturer. All permit fees so

collected shall be paid into the State Stores Fund. The board

shall not purchase any alcohol or liquor fermented, distilled,

rectified, compounded or bottled in any state, territory or

country, the laws of which result in prohibiting the importation

therein of alcohol or liquor, fermented, distilled, rectified,

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compounded or bottled in Pennsylvania.

* * *

Section 3. Section 305(a) of the act, amended May 8, 2003

(P.L.1, No.1), is amended to read:

Section 305. Sales by Pennsylvania Liquor Stores.--(a) The

board shall in its discretion determine where and what classes,

varieties and brands of liquor and alcohol it shall make

available to the public and where such liquor and alcohol will

be sold. Every Pennsylvania Liquor Store shall be authorized to

sell combination packages. If a person desires to purchase a

class, variety or brand of liquor or alcohol not currently

available from the board, he or she may place a special order

for such item so long as the order is for two or more bottles.

The board may require a reasonable deposit from the purchaser as

a condition for accepting the order. The customer shall be

notified immediately upon the arrival of the goods.

In computing the retail price of such special orders for

liquor or alcohol, the board shall not include the cost of

freight or shipping before applying [the] a mark-up that shall

not exceed ten per centum of the cost of the product and taxes

but shall add the freight or shipping charges to the price after

the mark-up and taxes have been applied.

Unless the customer pays for and accepts delivery of any such

special order within ten days after notice of arrival, the store

may place it in stock for general sale and the customer's

deposit shall be forfeited.

* * *

Section 4. Section 488 of the act, added February 21, 2002

(P.L.103, No.10), is amended to read:

Section 488. Shipment of Wine [into Commonwealth].--(a) The

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shipment of wine [from out-of-State] to residents of this

Commonwealth [is prohibited, except as otherwise provided for

in] shall be governed by this section.

(b) Notwithstanding any other provision of this act or law

to the contrary, a person licensed by the board or another state

as a producer[, supplier, importer, wholesaler, distributor or

retailer] of wine and who obtains a direct wine shipper license

as provided for in this section may ship [up to nine liters per

month of] any wine [not included on the list provided for in

subsection (c)] on the [Internet] order of any resident of this

Commonwealth who is at least twenty-one (21) years of age for

such resident's personal use and not for resale.

list of all classes, varieties and brands of wine available for

sale in the Pennsylvania Liquor Stores. A person holding a

direct shipper license may ship only those classes, varieties

and brands of wine not included on the list at the time an

Internet order is placed.] Prior to issuing a direct wine

shipper license, the board shall require the person seeking the

license to:

(1) File an application with the board.

(2) Pay a one hundred dollar ($100) registration fee.

(3) Provide to the board a true copy of the applicant's

current alcoholic beverage license issued by the board or

another state, if applicable.

(4) Provide documentation to the board which evidences that

the applicant has obtained a sales tax license from the

Department of Revenue.

(5) Provide the board with any other information that the

board deems necessary and appropriate.

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(d) [An out-of-State] A direct wine shipper shall:

(1) [Not ship more than nine liters per month on the

Internet order of any person in this Commonwealth.] On a

quarterly basis, pay to the Department of Revenue all taxes due

on sales to residents of this Commonwealth. Notwithstanding any

other provision of law to the contrary, the wine delivered under

the authority of this section will be subject to the sales and

use tax imposed by section 202 of the act of March 4, 1971

(P.L.6, No.2), known as the "Tax Reform Code of 1971," the sales

and use tax imposed by Article XXXI-B of the act of July 28,

1953 (P.L.723, No.230), known as the "Second Class County Code,"

the sales and use tax imposed by the act of June 5, 1991 (P.L.9,

No.6), known as the "Pennsylvania Intergovernmental Cooperation

Authority Act for Cities of the First Class," and the emergency

State tax imposed on wines sold by the board under the act of

June 9, 1936 (1st Sp. Sess., P.L.13, No.4), entitled "An act

imposing an emergency State tax on liquor, as herein defined,

sold by the Pennsylvania Liquor Control Board; providing for the

collection and payment of such tax; and imposing duties upon the

Department of Revenue and the Pennsylvania Liquor Control

Board."

(2) Report to the board each year the total of wine shipped

[into] to residents of this Commonwealth in the preceding

calendar year.

(3) Permit the board, the enforcement bureau or the

Secretary of Revenue, or their designated representatives, to

perform an audit of the [out-of-State] direct wine shipper's

records upon request.

(4) Be deemed to have submitted to the jurisdiction of the

board, any other State agency and the courts of this

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Commonwealth for purposes of enforcement of this section and any

related laws, rules or regulations[.], including the collection

and remission of taxes as required under this section.

(5) Require proof of age of the recipient, in a manner or

format approved by the board, before any wine is shipped to a

resident of this Commonwealth.

(6) Ensure that all boxes or exterior containers of wine

shipped directly to a resident of this Commonwealth are

conspicuously labeled with the words "CONTAINS ALCOHOL:

SIGNATURE OF PERSON 21 YEARS OF AGE OR OLDER REQUIRED FOR

DELIVERY."

(7) Annually renew its license by paying a renewal fee

established by the board.

(e) A direct shipper may ship wine on the [Internet] order

of a resident into this Commonwealth provided that the wine [is

shipped to a Pennsylvania Liquor Store selected by the resident.

The wine will be subject to taxes in the same manner as wine

sold directly by the board. The wine will not be released by the

State store until all moneys due, including all taxes and fees,

have been paid by the resident.] delivered under the authority

of this section will be subject to the sales and use tax imposed

by section 202 of the Tax Reform Code of 1971, the sales and use

tax imposed by Article XXXI-B of the Second Class County Code,

the sales and use tax imposed by the Pennsylvania

Intergovernmental Cooperation Authority Act for Cities of the

First Class, and the emergency State tax imposed on wines sold

by the board under the act of June 9, 1936 (1st Sp. Sess.,

P.L.13, No.4), entitled "An act imposing an emergency State tax

on liquor, as herein defined, sold by the Pennsylvania Liquor

Control Board; providing for the collection and payment of such

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tax; and imposing duties upon the Department of Revenue and the

Pennsylvania Liquor Control Board."

(e.1) A transporter for hire shall:

(1) keep records as required under section 512 pertaining to

the direct shipment of wine; and

(2) permit the board and the enforcement bureau, or their

designated representatives, to inspect such records in

accordance with section 513.

(f) [A person shall sign an affidavit provided by the

Pennsylvania Liquor Store where the wine was delivered to

stating that the wine will only be used for the person's

personal use.] Any person who resells wine obtained under this

section commits a misdemeanor of the second degree.

(g) The board may promulgate such rules and regulations as

are necessary to implement and enforce the provisions of this

section. [The board may charge the resident a fee to cover the

cost associated with processing the Internet order.]

(h) The board shall submit [monthly] annual reports to the

Appropriations Committee and the Law and Justice Committee of

the Senate and to the Appropriations Committee and the Liquor

Control Committee of the House of Representatives summarizing

the number of direct shipper licenses issued by the board[,] and

the quantity of wine sold by direct wine shippers pursuant to

this section [and the total dollar value of sales under this

section].

(i) The term "wine" as used in this section shall mean

liquor which is fermented from grapes and other fruits, having

alcoholic content of twenty-four per centum or less. The term

"wine" shall not include malt or brewed beverages nor shall wine

include any products containing alcohol derived from malt,

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grain, cereal, molasses or cactus.

(j) The term "direct wine shipper" as used in this section

shall mean a person who holds a direct wine shipper license as

provided for in this section and includes a limited winery.

Section 5. Section 505.2(a) of the act is amended by adding

a clause to read:

Section 505.2. Limited Wineries.--(a) In the interest of

promoting tourism and recreational development in Pennsylvania,

holders of a limited winery license may:

* * *

(2.1) Notwithstanding any other provision of this act or law

to the contrary, only ship wine to residents of this

Commonwealth in accordance with the provisions of section 488.

* * *

Section 6. This act shall take effect in 60 days.

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