First Regular Session Sixty-eighth General Assembly STATE OF COLORADO INTRODUCED LLS NO. 11-0823.01 Christy Chase SENATE BILL 11-194 SENATE SPONSORSHIP Boyd, HOUSE SPONSORSHIP (None), Senate Committees House Committees Business, Labor and Technology A BILL FOR AN ACT Concerning the regulation of alcohol beverages. Bill Summary (Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://www.leg.state.co.us/billsummaries.) Current law contains a separate category of licenses for establishments selling fermented malt beverages, which is beer with an alcohol content of 3.2% or less by weight (3.2% beer), as distinguished from licenses that permit the sale of other alcohol beverages with higher alcohol content, including malt liquor (full beer), wine, and spirits. Sections 1 to 6 of the bill allow the sale of full beer, in addition to 3.2% beer, in convenience stores, which are defined as retail businesses of less than 5,000 square feet that offer quick purchases of food, beverages, or gasoline but do not contain a pharmacy. Convenience stores would continue to be prohibited from selling other types of alcohol beverages such as wine or spirits and would be permitted to sell regular beer only between the hours of 8 a.m. and 12 midnight, but not on Christmas day. A convenience store licensed to sell full and 3.2% beer may employ a person under 18 years of age if the person is supervised by a person who is at least 21 years of age, but the employee under 18 cannot sell or dispense beer, check age identification, or make deliveries beyond the customary parking area for the licensed premises. Section 7 modifies the definition of "malt liquor" in the "Colorado Liquor Code" to include 3.2% beer, thereby allowing all persons licensed under the "Colorado Liquor Code" to manufacture, import, sell at wholesale or retail, sell for on-premise consumption, or serve full beer and 3.2% beer. Section 9 permits retail liquor store licensees to have an interest in multiple retail liquor store licenses as long as the licensed premises of each retail liquor store does not exceed 5,000 square feet of total retail space and does not contain a pharmacy on the premises. The remaining sections of the bill contain conforming amendments necessitated by the substantive law changes. Be it enacted by the General Assembly of the State of Colorado: SECTION 1. 12-46-102, Colorado Revised Statutes, is amended to read: 12-46-102. Legislative declaration. (1) The general assembly hereby declares that it is in the public interest that fermented malt beverages shall and malt liquors be manufactured, imported, and sold only by persons licensed as provided in this article or article 47 of this title. The general assembly further declares that it is lawful to manufacture and sell fermented malt beverages containing not more than three and two-tenths percent alcohol by weight, and malt liquors, subject to the provisions of this article and applicable provisions of articles 47 and 48 of this title. (2) The general assembly further recognizes that fermented malt beverages and malt liquors are separate and distinct from, malt and have a unique regulatory history in relation to, vinous and spirituous liquors, and as such require the retention of a separate and distinct regulatory framework under this article. To aid administrative efficiency, however, the provisions in article 47 of this title shall apply applies to the regulation of fermented malt beverages, except when otherwise expressly provided for in this article. SECTION 2. 12-46-103, Colorado Revised Statutes, is amended to read: 12-46-103. Definitions. Definitions applicable to this article also appear in article 47 of this title. As used in this article, unless the context otherwise requires: (1) "Convenience store" means a retail business with a total square footage of less than five thousand square feet whose primary business consists of providing the public with a convenient location to quickly purchase food items, beverages, gasoline, or a combination thereof and that does not have a pharmacy or employ pharmacists. (1) (2) "Fermented malt beverage" means any beverage obtained by the fermentation of any infusion or decoction of barley, malt, hops, or any similar product or any combination thereof in water containing not less than one-half of one percent alcohol by volume and not more than three and two-tenths percent alcohol by weight or four percent alcohol by volume; except that "fermented malt beverage" shall does not include confectionery containing alcohol within the limits prescribed by section 25-5-410 (1) (i) (II), C.R.S. (2) (3) "License" means a grant to a licensee to manufacture or sell fermented malt beverages or malt liquors as provided by this article. (3) (4) "Licensed premises" means the premises specified in an application for a license under this article which that are owned or in possession of the licensee and within which such licensee is authorized to sell, dispense, or serve fermented malt beverages or malt liquors in accordance with the provisions of this article. (4) (5) "Local licensing authority" means the governing body of a municipality or city and county, the board of county commissioners of a county, or any authority designated by municipal or county charter, municipal ordinance, or county resolution. (6) "Malt liquors" has the same meaning as set forth in section 12-47-103. (5) (7) "Sell at wholesale" means selling to any anyone other than the intended consumer of fermented malt beverages. "Sell at wholesale" shall not be construed to does not prevent a brewer or wholesale beer dealer from selling fermented malt beverages to the intended consumer thereof or to prevent a licensed manufacturer or importer from selling such beverages to a licensed wholesaler. (6) (8) "State licensing authority" means the executive director of the department of revenue or the deputy director of the department of revenue if the executive director so designates. SECTION 3. The introductory portion to 12-46-104 (1) and 12-46-104 (1) (c), Colorado Revised Statutes, are amended to read: 12-46-104. Licenses - state license fees - requirements - repeal. (1) The licenses to be granted and issued by the state licensing authority pursuant to this article for the manufacture, importation, and sale of fermented malt beverages shall be or malt liquors, as applicable, are as follows: (c) (I) A fermented malt beverage retailer's license, shall be granted and issued which the state licensing authority shall grant and issue to any person, partnership, association, organization, or corporation qualifying under section 12-47-301 and not prohibited from licensure under section 12-47-307 to sell at retail the said fermented malt beverages upon paying an annual license fee of seventy-five dollars to the state licensing authority. (II) A malt liquor retailer's license, which the state licensing authority shall grant and issue to any person, partnership, association, organization, or corporation qualifying under section 12-47-301 and not prohibited from licensure under section 12-47-307 to sell malt liquors in sealed containers at retail, in a convenience store, for consumption off the licensed premises, between the hours of 8 a.m. until 12 midnight each day except Christmas day. The state licensing authority shall issue the license to the person, partnership, association, organization, or corporation upon receipt of an annual license fee of seventy-five dollars. SECTION 4. 12-46-105 (1) (a), Colorado Revised Statutes, is amended to read: 12-46-105. Fees and taxes - allocation. (1) (a) (I) The state licensing authority shall establish fees for processing the following types of applications, notices, or reports required to be submitted to the state licensing authority: (A) Applications for new fermented malt beverage or malt liquor licenses pursuant to section 12-47-301 and regulations thereunder rules adopted pursuant to that section; (B) Applications for change of location pursuant to section 12-47-301 and regulations thereunder rules adopted pursuant to that section; (C) Applications for changing, altering, or modifying licensed premises pursuant to section 12-47-301 and regulations thereunder rules adopted pursuant to that section; (D) Applications for warehouse or branch house permits pursuant to section 12-46-104 and regulations thereunder rules adopted pursuant to that section; and (E) Applications for duplicate licenses and notices of change of name or trade name pursuant to section 12-47-301 and regulations thereunder rules adopted pursuant to that section. (II) The amounts of such fees, when added to the other fees and taxes transferred to the liquor enforcement division and state licensing authority cash fund pursuant to subsection (2) of this section and section 12-47-502 (1), shall must reflect the direct and indirect costs of the liquor enforcement division and the state licensing authority in the administration and enforcement of this article and articles 47 and 48 of this title. At least annually, the state licensing authority shall review the amounts of the fees shall be reviewed and, if necessary, adjusted shall adjust the fee amounts to reflect such the direct and indirect costs. SECTION 5. 12-46-106, Colorado Revised Statutes, is amended to read: 12-46-106. Lawful acts. It is lawful for a person under eighteen years of age who is under the supervision of a person on the premises over eighteen at least twenty-one years of age to be employed in a place of business where fermented malt beverages or malt liquors are sold at retail in containers for off-premises consumption. During the normal course of such employment, any person under eighteen years of age may handle and otherwise act with respect to fermented malt beverages or malt liquors in the same manner as that person does with other items sold at retail; except that no person under eighteen years of age shall sell or dispense fermented malt beverages or malt liquors, check age identification, or make deliveries beyond the customary parking area for the customers of the retail outlet. This section shall not be construed to does not permit the violation of any other provisions of this section under circumstances not specified in this section. SECTION 6. The introductory portion to 12-46-107 (1) and 12-46-107 (1) (c), Colorado Revised Statutes, are amended to read: 12-46-107. Local licensing authority - application - fees - rules. (1) The local licensing authority shall issue only the following classes of fermented malt beverage licenses for fermented malt beverages or malt liquors, as applicable: (c) Sales for consumption both on and off the premises of the licensee. A person licensed pursuant to this paragraph (c) may deliver at retail fermented malt beverages or malt liquors, as applicable, in factory-sealed containers in conjunction with the delivery of food products if such the person has obtained a permit for the delivery of fermented malt beverages or malt liquors, as applicable, from the state licensing authority. The state licensing authority shall promulgate rules as are necessary for the proper delivery of fermented malt beverages pursuant to this paragraph (c) and shall have has the authority to issue a permit to any person who is licensed pursuant to and delivers fermented malt beverages under this paragraph (c). SECTION 7. 12-47-103 (8) and (19), Colorado Revised Statutes, are amended to read: 12-47-103. Definitions. As used in this article and article 46 of this title, unless the context otherwise requires: (8) "Fermented malt beverage" has the same meaning as provided in section 12-46-103. (1). (19) "Malt liquors" includes beer and shall be construed to mean means any beverage obtained by the alcoholic fermentation of any infusion or decoction of barley, malt, hops, or any other similar product, or any combination thereof, in water containing more than three and two-tenths percent of alcohol by weight or four percent alcohol by volume not less than one-half of one percent alcohol by volume. SECTION 8. 12-47-301 (6) (a), Colorado Revised Statutes, is amended to read: 12-47-301. Licensing in general. (6) (a) Licensees at facilities owned by a municipality, county, or special district or at publicly or privately owned sports and entertainment venues with a minimum seating capacity of one thousand five hundred seats may possess and serve for on-premises consumption any type of malt, vinous, and spirituous liquor or fermented malt beverage as may be permitted pursuant to guidelines established by the local and state licensing authorities, and the licensees need not have meals available for consumption. However, fermented malt beverages and malt, vinous, and spirituous liquors may not be served on the same premises at the same time. SECTION 9. 12-47-407 (4), Colorado Revised Statutes, is amended to read: 12-47-407. Retail liquor store license. (4) (a) Except as specified in paragraph (b) of this subsection (4), it is unlawful for any owner, part owner, shareholder, or person interested directly or indirectly in a retail liquor store to conduct, own either in whole or in part, or be directly or indirectly interested in any other business licensed pursuant to this article. except that such a person (b) An owner, part owner, shareholder, or person interested directly or indirectly in a retail liquor store may have an interest interests in: (I) Additional retail liquor store licenses, if the licensed retail liquor store and any additional retail liquor stores in which the owner, part owner, shareholder, or person obtains an interest do not contain more than five thousand square feet of total retail space and do not have a pharmacy on the licensed premises; (II) An Arts license or licenses; (III) An Airline public transportation system license licenses granted under this article; or in (IV) A Financial institution institutions referred to in section 12-47-308 (4). SECTION 10. 12-47-901 (8), Colorado Revised Statutes, is amended to read: 12-47-901. Unlawful acts - exceptions. (8) It is unlawful for any manufacturer or wholesaler licensed pursuant to article 46 of this title to sell, deliver, or cause to be delivered to any retail licensee person licensed pursuant to section 12-47-407 or 12-47-408 any beverage containing alcohol in excess of three and two-tenths percent by weight or four percent by volume, or for any fermented malt beverage retailer licensed pursuant to section 12-46-104 (1) (c) (I) to sell, possess, or permit the consumption on the premises of any of the beverages containing alcohol in excess of three and two-tenths percent by weight or four percent by volume, or for any fermented malt beverage retail licensee licensed pursuant to section 12-46-104 (1) (c) (I) to hold or operate under any license for the sale of any beverages containing alcohol in excess of three and two-tenths percent by weight or four percent by volume for the same premises. Any violation of this subsection (8) by any fermented malt beverage licensee of the provisions of this subsection (8) shall licensed pursuant to article 46 of this title immediately cause the cancellation of invalidates the license granted under this article 46 of this title. SECTION 11. 12-47-902 (1) and (2), Colorado Revised Statutes, are amended to read: 12-47-902. Testing for intoxication by law enforcement officers - when prohibited. (1) No person who is patronizing a licensed premises as defined in sections 12-47-103 (14) and 12-46-103 (3) shall be required or solicited by any law enforcement officer to submit to any mechanical test for the purpose of determining the alcohol content of such the person's blood or breath while such the person is upon such the licensed premises except to determine if there is a violation of section 42-4-1301, C.R.S., by a driver of a motor vehicle unless the law enforcement officer is acting pursuant to a court order obtained in the manner described in subsection (2) of this section. No such test may be performed upon any licensed premises to obtain evidence of alleged intoxication, except pursuant to a court order as provided in this section or in case of a medical emergency, regardless of whether such alleged intoxication is a violation of any provision of this article. (2) An ex parte order to permit any law enforcement officer to solicit any person who is patronizing a licensed premises as defined in sections 12-47-103 (14) and 12-46-103 (3) to submit to any mechanical test for the purpose of determining the alcohol content of such the person's blood or breath while such the person is upon such the licensed premises may be issued by any judge of competent jurisdiction in the state of Colorado, including a district, county, or municipal court judge, upon application of a district attorney or a law enforcement agency showing probable cause to believe that evidence will be obtained of the commission of the crime of providing any alcohol beverage to a visibly intoxicated person or minor in violation of section 12-47-901 (1) (a) or (5) (a) (I). SECTION 12. Safety clause. The general assembly hereby finds, determines, and declares that this act is necessary for the immediate preservation of the public peace, health, and safety.