Bill Summary – FastDemocracy

Legislative Analysis
                                                                                  Phone: (517) 373-8080
LIQUOR DISTRIBUTOR OPERATING MOTOR FUEL PUMPS
                                                                                  http://www.house.mi.gov/hfa
House Bill 4865 (H-1) as reported from committee                                  Analysis available at
Sponsor: Rep. Will Snyder                                                         http://www.legislature.mi.gov
Committee: Regulatory Reform
Complete to 10-14-23
SUMMARY:
           House Bill 4865 would amend the Michigan Liquor Control Code to modify the conditions for
           a holder of a specially designated distributor (SDD) license to own or operate motor vehicle
           fuel pumps on or adjacent to the licensed premises or for the holder of a specially designated
           merchant (SDM) license to qualify for a secondary location permit.
           Owning and Operating Motor Vehicle Pumps
           Currently, the act generally prohibits the Liquor Control Commission from allowing an SDD
           licensee or applicant to own or operate motor vehicle fuel pumps on or adjacent to the licensed
           premises unless the site where alcoholic liquor is selected and paid for is at least five feet from
           the point where motor vehicle fuel is dispensed and one or both of the following apply:
               • The applicant or licensee is located in a neighborhood shopping center.
               • The applicant or licensee maintains a minimum inventory on the premises, excluding
                   alcoholic liquor and motor vehicle fuel, of at least $250,000, at cost, of goods and
                   services customarily marketed by approved types of businesses.
           The act also provides specific circumstances, largely based on population, under which the
           commission cannot prohibit SDD licensees or applicants from owning and operating motor
           vehicle fuel pumps on or adjacent to the licensed premises.
           The bill would eliminate the requirements and conditions described above and instead provide
           that the commission cannot prohibit an SDD applicant or licensee from owning and operating
           motor vehicle fuel pumps on or adjacent to the licensed premises as long as the site where
           alcoholic liquor is selected and paid for is at least five feet from the point where motor vehicle
           fuel is dispensed. However, this provision would not apply to an SDD license or SDM license
           issued to a marina under section 539 of the act. 1
           Secondary Location Permit
           The act also allows for the issuance of a secondary location permit for the sale of wine and
           beer at a secondary location if a specially designated merchant’s licensed premises are a
           primary location. To be considered a primary location, the licensed premises must meet the
           conditions listed above (neighborhood shopping center, minimum inventory, five feet).
           The bill would eliminate the inventory requirement to be eligible for a secondary location
           permit, but an applicant or licensee would still need to be located in a neighborhood shopping
           center to qualify, and the site where alcoholic liquor is selected and paid for would still have
1
    http://legislature.mi.gov/doc.aspx?mcl-436-1539
House Fiscal Agency                                                                                Page 1 of 2
       to be at least five feet from the point where motor vehicle fuel is dispensed. In addition, the bill
       would specifically allow a secondary location permit to allow for the sale of mixed spirit drinks.
       MCL 436.1541
BRIEF DISCUSSION:
     According to committee testimony, the bill is intended to eliminate the inventory requirement,
     described as onerous, because it does not apply to any other industry and can exclude small
     businesses from obtaining a license.
FISCAL IMPACT:
       House Bill 4865 would not have a direct fiscal impact on any state or local government
       units.
POSITIONS:
       Representatives of the following entities testified in support of the bill (9-26-23):
          • Wesco
          • Michigan Petroleum Association
          • Michigan Association of Convenience Stores
       The following entities indicated support for the bill:
           • National Federation of Independent Businesses (9-26-23)
           • Midwest Independent Retailers Association (10-3-23)
        The Liquor Control Commission indicated a neutral position on the bill. (10-3-23)
                                                            Legislative Analyst: Alex Stegbauer
                                                                 Fiscal Analyst: Marcus Coffin
■ This analysis was prepared by nonpartisan House Fiscal Agency staff for use by House members in their
deliberations and does not constitute an official statement of legislative intent.
House Fiscal Agency                                                 HB 4865 (H-1) as reported   Page 2 of 2
Statutes affected: 
Substitute (H-1): 436.1541
House Introduced Bill: 436.1541
As Passed by the House: 436.1541