Bill Summary – FastDemocracy

House File 83 - Introduced
                                  HOUSE FILE 83
                                  BY JONES
                            A BILL FOR
An Act providing for the direct shipment of alcoholic liquor
  and including effective date provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
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    Section 1. Section 123.28, subsection 5, Code 2023, is
 amended to read as follows:
    5. This section does not affect the right of a retail
 alcohol license holder to purchase, possess, or transport
 alcoholic liquors subject to this chapter. In addition, this
 section shall not impact the direct shipment of alcoholic
 liquor as regulated by section 123.42A.
    Sec. 2. Section 123.32, subsection 1, paragraph b, Code
 2023, is amended by adding the following new subparagraph:
    NEW SUBPARAGRAPH. (4A) An alcoholic liquor direct shipper
 license as provided in section 123.42A.
    Sec. 3. Section 123.32, subsection 1, paragraph b,
 subparagraph (10), Code 2023, is amended to read as follows:
    (10) A wine An alcoholic beverage carrier permit as provided
 in section 123.188.
    Sec. 4. Section 123.41, subsection 1, Code 2023, is amended
 to read as follows:
    1. Each completed application to obtain or renew a
 manufacturer’s license shall be submitted to the division
 electronically, or in a manner prescribed by the administrator,
 and shall be accompanied by a fee of three hundred dollars
 payable to the division. The administrator may in accordance
 with this chapter grant and issue to a manufacturer a
 manufacturer’s license, valid for a one-year period after date
 of issuance, which shall allow the manufacture, storage, and
 wholesale disposition and sale of alcoholic liquors to the
 division and to customers outside of the state pursuant to the
 laws of that jurisdiction.
    Sec. 5. Section 123.41, Code 2023, is amended by adding the
 following new subsection:
    NEW SUBSECTION. 1A. A manufacturer of alcoholic liquor
 may ship alcoholic liquor in closed containers to individual
 purchasers inside this state by obtaining an alcoholic liquor
 direct shipper license pursuant to section 123.42A.
    Sec. 6. NEW SECTION. 123.42A Direct shipment of alcoholic
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 liquor —— license and requirements.
    1. An alcoholic liquor manufacturer licensed or permitted
 pursuant to laws regulating alcoholic beverages in this state
 or another state may apply for an alcoholic liquor direct
 shipper license, as provided in this section. For the purposes
 of this section, an “alcoholic liquor manufacturer” means a
 business with an operating still which distills spirits, barrel
 matures spirits for a period of two years on the licensed
 premises of the distillery where matured, or blends or mixes
 spirits comprised solely of spirits distilled or barrel matured
 for a period of two years on the licensed premises of the
 distillery, and which, combining all production facilities
 of the business, produces and manufactures not more than one
 hundred thousand proof gallons of native distilled spirits on
 an annual basis.
    2. a. Only an alcoholic liquor manufacturer that holds
 an alcoholic liquor direct shipper license issued pursuant to
 this section shall sell alcoholic liquor at retail for direct
 shipment to any person within this state. This section shall
 not prohibit an authorized retail licensee or permittee from
 delivering alcoholic liquor pursuant to section 123.46A.
    b. An alcoholic liquor manufacturer applying for an
 alcoholic liquor direct shipper license shall submit an
 application for the license electronically, or in a manner
 prescribed by the administrator, accompanied by a true copy
 of the manufacturer’s current alcoholic beverage license or
 permit issued by the state where the manufacturer is primarily
 located, a copy of the manufacturer’s basic permit issued by
 the alcohol and tobacco tax and trade bureau of the United
 States department of the treasury, and documents filed by the
 manufacturer with the alcohol and tobacco tax and trade bureau
 of the United States department of the treasury that show the
 total number of proof gallons of distilled spirits produced and
 manufactured by the manufacturer for the preceding calendar
 year.
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    c. An application submitted pursuant to paragraph “b” shall
 be accompanied by a license fee in the amount of twenty-five
 dollars.
    d. A license issued pursuant to this section may be
 renewed annually by submitting a renewal application with the
 administrator in a manner prescribed by the administrator,
 accompanied by the twenty-five dollar license fee.
    3. The direct shipment of alcoholic liquor pursuant to this
 section shall be subject to the following requirements and
 restrictions:
    a. Alcoholic liquor shall only be shipped to a resident of
 this state who is at least twenty-one years of age, for the
 resident’s personal use and consumption and not for resale.
    b. Alcoholic liquor subject to direct shipping shall be
 properly registered with the federal alcohol and tobacco tax
 and trade bureau, and manufactured on the licensed premises of
 the alcoholic liquor direct shipper licensee.
    c. Alcoholic liquor subject to direct shipping shall
 be properly registered with the division. Products which
 are not listed for sale by the division must be registered
 electronically with the division for direct shipping. This
 registration will include the name of the manufacturer, the
 name of the brand, the standard of fill, the wholesale price,
 and other information as requested by the division. The
 registration shall be updated as necessary to ensure the
 division possesses an accurate, current registration.
    d. All containers of alcoholic liquor shipped directly to a
 resident of this state shall be conspicuously labeled with the
 words “CONTAINS ALCOHOL: SIGNATURE OF PERSON AGE 21 OR OLDER
 REQUIRED FOR DELIVERY” or shall be conspicuously labeled with
 alternative wording preapproved by the administrator.
    e. All containers of alcoholic liquor shipped directly
 to a resident of this state shall be shipped by a holder of
 an alcoholic beverage carrier permit as provided in section
 123.188.
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    f. Shipment of alcoholic liquor pursuant to this subsection
 does not require a refund value for beverage container control
 purposes under chapter 455C.
    4. An alcoholic liquor direct shipper licensee shipping
 alcoholic liquor to this state shall remit the following amount
 to the division in a manner as directed by the division:
    a. For alcoholic liquor that is listed for sale by the
 division, an amount equivalent to fifty percent of the listed
 wholesale price.
    b. For alcoholic liquor that is not listed for sale
 by the division, an amount equivalent to fifty percent of
 the wholesale price as registered with the division under
 subsection 3.
    5. Each alcoholic liquor direct shipper licensee shall make
 a report under oath to the division electronically, or in a
 manner prescribed by the administrator, on or before the tenth
 day of each month, which includes the following information:
    a. The products and quantities shipped directly to residents
 of this state in the preceding month.
    b. The name and address of the individuals to whom the
 alcoholic liquor was sold in each sale.
    c. The wholesale price of the alcoholic liquor sold.
    d. The purchase price of the alcoholic liquor sold and
 the amount of taxes charged to the individual purchasing the
 alcoholic liquor.
    e. The alcoholic beverage carrier permittee who delivered
 the shipment.
    f. All documents filed by the alcoholic liquor direct
 shipper licensee with the alcohol and tobacco tax and trade
 bureau of the United States department of treasury for the
 preceding month, including all production, storage, and
 processing reports.
    6. The license holder at the time of filing the report as
 required by subsection 5 shall pay to the division the amount
 as required pursuant to subsection 4. A penalty of ten percent
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 of the amount due shall be assessed and collected if the report
 required to be filed pursuant to this section and the amount
 required to be paid as provided by subsection 4 is not filed
 and the amount paid within the time required by this section.
    7. An alcoholic liquor direct shipper licensee shall be
 deemed to have consented to the jurisdiction of the division or
 any other agency or court in this state concerning enforcement
 of this section and any related laws, rules, or regulations. A
 license holder shall allow the division to perform an audit of
 shipping records upon request.
    8. A violation of this section shall subject the licensee
 to the general penalties provided in this chapter and shall
 constitute grounds for imposition of a civil penalty or
 suspension or revocation of the license pursuant to section
 123.39.
    Sec. 7. Section 123.43A, subsection 2, Code 2023, is amended
 to read as follows:
    2. A native distillery shall not sell more than nine
 liters per person per day, of native distilled spirits on
 the premises of the native distillery. However, a native
 distillery shall not directly may ship native distilled spirits
 for sale at retail manufactured by the native distillery in
 closed containers to individual purchasers inside the state by
 obtaining an alcoholic liquor direct shipper license pursuant
 to section 123.42A. The native distillery shall maintain
 records of individual purchases of native distilled spirits at
 the native distillery for three years.
    Sec. 8. Section 123.43A, subsection 7, Code 2023, is amended
 to read as follows:
    7. A native distillery may sell the native distilled spirits
 it manufactures to customers outside the state, pursuant to the
 laws of that jurisdiction.
    Sec. 9. Section 123.46A, subsection 5, Code 2023, is amended
 to read as follows:
    5. Nothing in this section shall impact the direct shipment
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 of alcoholic liquor as regulated by section 123.42A or the
 direct shipment of wine as regulated by section 123.187.
    Sec. 10. Section 123.187, subsection 3, paragraph d, Code
 2023, is amended to read as follows:
    d. All containers of wine shipped directly to a resident of
 this state shall be shipped by a holder of a wine an alcoholic
 beverage carrier permit as provided in section 123.188.
    Sec. 11. Section 123.188, subsections 1, 2, and 4, Code
 2023, are amended to read as follows:
    1. A person desiring to deliver alcoholic liquor subject
 to direct shipment within this state pursuant to section
 123.42A and wine subject to direct shipment within this state
 pursuant to section 123.187 shall submit an application for a
 wine an alcoholic beverage carrier permit electronically, or
 in a manner prescribed by the administrator, which shall be
 accompanied by a fee in the amount of one hundred dollars.
    2. The administrator may in accordance with this chapter
 issue a wine an alcoholic beverage carrier permit which shall
 be valid for one year from the date of issuance unless it is
 sooner suspended or revoked for a violation of this chapter.
    4. The delivery of alcoholic liquor and wine pursuant to
 this section shall be subject to the following requirements and
 restrictions:
    a. A wine An alcoholic beverage carrier permittee shall not
 deliver alcoholic liquor or wine to any person under twenty-one
 years of age, or to any person who either is or appears to be in
 an intoxicated state or condition.
    b. A wine An alcoholic beverage carrier permittee shall
 obtain valid proof of identity and age prior to delivery,
 and shall obtain the signature of an adult as a condition of
 delivery.
    c. A wine An alcoholic beverage carrier permittee shall
 maintain records of alcoholic liquor and wine shipped which
 include the permit number and name of the alcoholic liquor
 and wine manufacturer, quantity of alcoholic liquor and wine
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  shipped, recipient’s name and address, and an electronic or
  paper form of signature from the recipient of the alcoholic
  liquor and wine. Records shall be submitted to the division
  on a monthly basis in a form and manner to be determined by the
  division.
     Sec. 12. EFFECTIVE DATE. This Act takes effect January 1,
  2024.
                            EXPLANATION
         The inclusion of this explanation does not constitute agreement with
         the explanation’s substance by the members of the general assembly.
    This bill allows for the direct shipment of alcoholic liquor
 within the state.
    New Code section 123.42A provides for the direct shipment of
 alcoholic liquor and provides for an alcoholic liquor direct
 shipper license. The bill provides that only alcoholic liquor
 manufacturers that produce and manufacture not more than
 100,000 proof gallons of native distilled spirits on an annual
 basis are eligible for this license. Provisions governing the
 direct shipment of wine and the wine direct shipper permit are
 generally made applicable to the new Code section providing
 for the direct shipment of alcoholic liquor. In addition to
 these requirements, the new Code section requires all alcoholic
 liquor subject to direct shipping to be properly registered
 with the alcoholic beverages division and that products which
 are not listed for sale by the division must be registered
 to include information on the name of the manufacturer, the
 name of the brand, the standard of fill, the wholesale price,
 and other information as requested by the division. The
 new Code section also requires each alcoholic liquor direct
 shipper licensee to make a monthly report to the alcoholic
 beverages division that lists the products and quantities
 shipped directly to residents of this state in the preceding
 month, the name and address of the individuals to whom the
 alcoholic liquor was sold in each sale, the wholesale price of
 the alcoholic liquor sold, the purchase price and taxes charged
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 of the alcoholic liquor sold, the alcoholic beverage carrier
 permittee who delivered each shipment, and documents filed by
 the licensee with the alcohol and tobacco tax and trade bureau
 of the United States department of treasury for the preceding
 month, including all production, storage, and processing
 reports. Finally, the new Code section provides that an
 alcoholic liquor direct shipper licensee shall remit an amount
 to the alcoholic beverages division depending on whether the
 alcoholic liquor shipped is listed for sale by the division.
 If the alcoholic liquor is listed for sale by the division, the
 permittee shall remit to the division an amount equivalent to
 50 percent of the wholesale price paid by the division for the
 alcoholic liquor. If the alcoholic liquor is not listed for
 sale by the division, the permittee shall remit to the division
 an amount equivalent to 50 percent of the wholesale price of
 the alcoholic liquor as registered with the division. The bill
 provides that a penalty of 10 percent of the amount due shall
 be assessed and collected if the amount required to be paid to
 the division as provided by the bill is not paid within the
 time required.
    The bill allows a manufacturer of alcoholic liquor and a
 native distillery to ship alcoholic liquor or native distilled
 spirits, as applicable, to individual purchasers inside this
 state by obtaining an alcoholic liquor direct shipper license
 as established in the bill.
    Code section 123.188, providing for a wine carrier permit,
 is amended to provide for the direct shipment of alcoholic
 liquor as provided by the bill.
    The bill takes effect January 1, 2024.