Bill Summary – FastDemocracy

HB 428
                      Department of Legislative Services
                              Maryland General Assembly
                                    2021 Session
                           FISCAL AND POLICY NOTE
                              Third Reader - Revised
House Bill 428                  (Montgomery County Delegation)
Economic Matters                         Education, Health, and Environmental Affairs
          Montgomery County - Alcoholic Beverages Licenses - Annual Fees
                                   MC 19-21
This emergency bill requires the Montgomery County Board of License Commissioners to
refund the annual fees and late fees for each alcoholic beverages license issued by the
county for the 2020-2021 licensing period, as specified. The emergency bill also requires
the board to waive the late fees for alcoholic beverages licenses issued by the county for
the 2021-2022 licensing period, as specified. The bill terminates June 30, 2023.
                                    Fiscal Summary
State Effect: None.
Local Effect: Montgomery County revenues are reduced by an estimated $1.5 million in
FY 2021 from license fee refunds issued under the bill, as discussed below.
Montgomery County can handle the bill’s requirements with existing resources. This bill
imposes a mandate on a unit of local government.
Small Business Effect: Minimal overall, but potential meaningful impact for small
business license holders that receive license fee refunds under the bill.
                                         Analysis
Bill Summary: The board is required to refund each alcoholic beverages license holder
in the county for the 2020-2021 licensing period (1) the entire amount of the annual fee for
any alcoholic beverages license issued by the county that permits the holder to sell
alcoholic beverages for on-premises consumption only; (2) an amount equal to one-half of
the annual fee for any alcoholic beverages license issued by the county that permits the
holder to sell alcoholic beverages for both on- and off-premises consumption; and (3) the
entire amount of any late fee for any alcoholic beverages license issued by the county that
permits the holder to sell alcoholic beverages for on- or off-premises consumption if the
late fee has been paid, and must waive the late fee if it has not been paid.
For the 2021-2022 licensing period, the board must (1) waive the late fee for any alcoholic
beverages license issued by the county that permits the holder to sell alcoholic beverages for
on-premises consumption only and (2) waive the late fee for any alcoholic beverages license
issued by the county that permits the holder to sell alcoholic beverages for both on- and
off-premises consumption.
Current Law: Generally, the payment of annual fees for a local alcoholic beverages
license in the State is made to the local collecting agent, and these fees are then remitted to
the county, as specified. An alcoholic beverages license holder is generally not entitled to
a refund on the unearned portion of the license fee. However, refunds are authorized by
State law if (1) the license holder goes into bankruptcy; (2) the license holder dies; (3) the
license holder volunteers for or is drafted into the United States’ or an organized State
militia; (4) the license holder surrenders the license and receives a new license of another
class carrying a higher fee; (5) the license holder is found guilty of a crime and the license
is revoked; (6) the issuance of the license by a local licensing board is reversed upon
judicial review and the establishment is prohibited; or (7) the licensed premises is taken by
the federal government, the State, or municipality for public use.
In Montgomery County, if a license holder voluntarily surrenders the license at least
six months before the license expiration date, the license holder is entitled to a refund of
the unearned portion of the license fee.
Local Fiscal Effect: For fiscal 2020, there were 1,028 alcoholic beverage licenses issued for
use in Montgomery County. Exhibit 1 shows the breakdown of retail licenses by category.
                                      Exhibit 1
         Alcoholic Beverages Licenses Issued For Use in Montgomery County
                                     Fiscal 2020
                                    A             B            C        D         Total
    Beer                             0             0            1        1           2
    Beer and Wine                  145           196            1      115         457
    Beer, Wine, and Liquor           1           519           24        9         553
    Other (BD7)                                                                     16
    Total Licenses                                                                1,028
Source: Comptroller’s Office, Department of Legislative Services
HB 428/ Page 2
Montgomery County estimates that it will be required to refund $1.5 million in license fees
received for the 2020-2021 licensing period under the emergency bill. This refund will
reduce the county’s license fee revenues by $1.5 million in fiscal 2021. The bill’s
requirement to waive specified late fees for the 2021-2022 licensing period is not anticipated
to materially affect the county. Montgomery County can handle the bill’s requirements with
existing resources.
                                Additional Information
Prior Introductions: None.
Designated Cross File: None.
Information Source(s):      Comptroller’s Office; Montgomery County; Department of
Legislative Services
Fiscal Note History:      First Reader - February 18, 2021
rh/tso                    Third Reader - March 26, 2021
                                 Revised - Amendment(s) - March 26, 2021
Analysis by: Thomas S. Elder                            Direct Inquiries to:
                                                        (410) 946-5510
                                                        (301) 970-5510
HB 428/ Page 3