NOTE: The governor signed this measure on 6/10/2016. HOUSE BILL 16-1439 BY REPRESENTATIVE(S) Garnett, Arndt, Becker K., Conti, Lontine, Melton, Rosenthal, Hullinghorst; also SENATOR(S) Holbert, Hill, Kerr, Merrifield, Steadman, Todd, Woods. Concerning the creation of a new alcohol beverage license under the "Colorado Liquor Code" to permit a lodging and entertainment facility to sell alcohol beverages by the drink for consumption on the licensed premises, and, in connection therewith, allowing the holder of a tavern license to convert the tavern license to a lodging and entertainment license or other appropriate license under specified conditions. Be it enacted by the General Assembly of the State of Colorado: SECTION 1. In Colorado Revised Statutes, 12-47-103, amend (7.5) (c) (IX) and (7.5) (c) (X); and add (7.5) (c) (XI) and (18.5) as follows: 12-47-103. Definitions. As used in this article and article 46 of this title, unless the context otherwise requires: (7.5) "Entertainment district" means an area that: (c) Contains at least twenty thousand square feet of premises that, at the time the district is created, is licensed pursuant to this article as a: (IX) Beer wholesaler that operates a sales room pursuant to section 12-47-406 (1) (b) (I); or (X) Limited winery; or (XI) Lodging and entertainment facility licensee. (18.5) "Lodging and entertainment facility" means an establishment that: (a) Is either: (I) A lodging facility, the primary business of which is to provide the public with sleeping rooms and meeting facilities; or (II) An entertainment facility, the primary business of which is to provide the public with sports or entertainment activities within its licensed premises; and (b) Incidental to its primary business, sells and serves alcohol beverages at retail for consumption on the premises and has sandwiches and light snacks available for consumption on the premises. SECTION 2. In Colorado Revised Statutes, add 12-47-426 as follows: 12-47-426. Lodging and entertainment license. (1) A lodging and entertainment license may be issued to a lodging and entertainment facility selling alcohol beverages by the drink only to customers for consumption on the premises. A lodging and entertainment facility licensee shall have sandwiches and light snacks available for consumption on the premises during business hours but need not have meals available for consumption. (2) (a) A lodging and entertainment facility licensed to sell alcohol beverages as provided in this section shall purchase alcohol beverages only from a wholesaler licensed pursuant to this article or article 46 of this title; except that, during a calendar year, a lodging and entertainment facility licensed to sell alcohol beverages as provided in this section may purchase not more than two thousand dollars' worth of: (I) Malt, vinous, and spirituous liquors from a retailer licensed pursuant to section 12-47-407 or 12-47-408; and (II) Fermented malt beverages from a retailer licensed pursuant to section 12-46-104 (1) (c). (b) A lodging and entertainment facility licensee shall retain evidence of each purchase of malt, vinous, or spirituous liquors from a retailer licensed pursuant to section 12-47-407 or 12-47-408 and each purchase of fermented malt beverages from a retailer licensed pursuant to section 12-46-104 (1) (c), in the form of a purchase receipt showing the name of the licensed retailer, the date of purchase, a description of the alcohol beverages purchased, and the price paid for the alcohol beverages. The lodging and entertainment facility licensee shall retain the receipt and make it available to the state and local licensing authorities at all times during business hours. (3) (a) Except as provided in paragraph (b) of this subsection (3), it is unlawful for any owner, part owner, shareholder, or person interested directly or indirectly in lodging and entertainment licenses to conduct, own either in whole or in part, or be directly or indirectly interested in any other business licensed pursuant to this article or article 46 of this title. (b) An owner, part owner, shareholder, or person interested directly or indirectly in a lodging and entertainment license may have an interest in: (I) A license described in section 12-46-104 (1) (c), 12-47-401 (1) (j) to (1) (t), (1) (v), or (1) (w), or 12-47-410 (1); or (II) A financial institution referred to in section 12-47-308 (4). (4) (a) Each lodging and entertainment facility licensee shall manage or have a separate and distinct manager for each licensed premises and shall register the manager of each licensed premises with both the state and the local licensing authority. A person shall not be a registered manager for more than one lodging and entertainment license. (b) The registered manager for each lodging and entertainment license or the lodging and entertainment facility licensee shall purchase alcohol beverages for one licensed premises only, and the purchases shall be separate and distinct from purchases for any other lodging and entertainment license. (c) When a person ceases to be a registered manager for a lodging and entertainment license, the lodging and entertainment facility licensee shall notify the licensing authorities within five days and shall designate a new registered manager within thirty days. (d) The state licensing authority or the local licensing authority may refuse to accept any person as a registered manager unless the person is satisfactory to the respective licensing authorities as to character, record, and reputation. In determining a registered manager's character, record, and reputation, the state or local licensing authority may have access to criminal history record information furnished by a criminal justice agency subject to any restrictions imposed by the agency. (e) The lodging and entertainment facility licensee shall pay a registration fee, not to exceed seventy-five dollars, for actual and necessary expenses incurred in determining the character, record, and reputation of each registered manager. The lodging and entertainment facility licensee shall pay the fee to both the state and the local licensing authority. (5) At the time a tavern license issued under section 12-47-412 is due for renewal or by one year after the effective date of this section, whichever occurs later, a person licensed as a tavern that does not have as its principal business the sale of alcohol beverages, has a valid license on the effective date of this section, and is a lodging and entertainment facility may apply to, and the applicable local licensing authority shall, convert the tavern license to a lodging and entertainment license under this section, and the person may continue to operate as a lodging and entertainment facility licensee. A person applying to convert an existing tavern license to a lodging and entertainment license under this subsection (5) may apply to convert the license, even if the location of the licensed premises is within five hundred feet of any public or parochial school or the principal campus of any college, university, or seminary, so long as the local licensing authority has previously approved the location of the licensed premises in accordance with section 12-47-313 (1) (d). SECTION 3. In Colorado Revised Statutes, 12-47-301, amend (2) (a), (8), (11) (c) (II) introductory portion, and (11) (e) (I) as follows: 12-47-301. Licensing in general. (2) (a) Before granting any license, all licensing authorities shall consider, except where this article and article 46 of this title specifically provide otherwise, the reasonable requirements of the neighborhood, the desires of the adult inhabitants as evidenced by petitions, remonstrances, or otherwise, and all other reasonable restrictions that are or may be placed upon the neighborhood by the local licensing authority. With respect to a second or additional license described in section 12-47-401 (1) (j) to (1) (t), 12-47-424, (1) (v), or (1) (w) or 12-47-410 (1) or in a financial institution referred to in section 12-47-308 (4) for the same licensee, all licensing authorities shall consider the effect on competition of the granting or disapproving of additional licenses to such licensee and no shall not approve an application for a second or additional hotel and restaurant or vintner's restaurant license that would have the effect of restraining competition shall be approved. (8) Each licensee holding a fermented malt beverage on-premises license or on- and off-premises license, beer and wine license, tavern license, lodging and entertainment license, club license, arts license, or racetrack license shall manage such the premises himself or herself or employ a separate and distinct manager on the premises and shall report the name of such the manager to the state and local licensing authorities. Such The licensee shall report any change in managers to the state and local licensing authorities within thirty days after the change. It is unlawful for the licensee to fail to report the name of or any change in managers as required by this subsection (8). Such The failure to report shall be is grounds for suspension of the license. (11) (c) (II) An association or licensed tavern, lodging and entertainment facility, hotel and restaurant, brew pub, distillery pub, retail gaming tavern, vintner's restaurant, beer and wine licensee, manufacturer or beer wholesaler that operates a sales room, or limited winery that wishes to create a promotional association may submit an application to the local licensing authority. To qualify for certification, the promotional association must: (e) (I) A licensed tavern, lodging and entertainment facility, hotel and restaurant, brew pub, distillery pub, retail gaming tavern, vintner's restaurant, beer and wine licensee, manufacturer or beer wholesaler that operates a sales room, or limited winery that wishes to attach to a common consumption area may submit an application to the local licensing authority. To qualify, the licensee must include a request for authority to attach to the common consumption area from the certified promotional association of the common consumption area unless the promotional association does not exist when the application is submitted; if so, the applicant shall request the authority when a promotional association is certified and shall demonstrate to the local licensing authority that the authority has been obtained by the time the applicant's license issued under this article is renewed. SECTION 4. In Colorado Revised Statutes, 12-47-309, add (1) (n) as follows: 12-47-309. Local licensing authority - applications - optional premises licenses. (1) A local licensing authority may issue only the following alcohol beverage licenses upon payment of the fee specified in section 12-47-505: (n) Lodging and entertainment license. SECTION 5. In Colorado Revised Statutes, 12-47-401, add (1) (w) as follows: 12-47-401. Classes of licenses. (1) For the purpose of regulating the manufacture, sale, and distribution of alcohol beverages, the state licensing authority in its discretion, upon application in the prescribed form made to it, may issue and grant to the applicant a license or permit from any of the following classes, subject to the provisions and restrictions provided by this article: (w) Lodging and entertainment license. SECTION 6. In Colorado Revised Statutes, 12-47-409, amend (3) as follows: 12-47-409. Beer and wine license. (3) It is unlawful for any owner, part owner, shareholder, or person interested directly or indirectly in a beer and wine license to conduct, own either in whole or in part, or be directly or indirectly interested in any other business licensed pursuant to this article or article 46 of this title; except that the person may have an interest in a license described in section 12-46-104 (1) (c), 12-47-401 (1) (j) to (1) (t), 12-47-401 (1) (v), or (1) (w), or 12-47-410 (1) or in a financial institution referred to in section 12-47-308 (4). SECTION 7. In Colorado Revised Statutes, 12-47-410, amend (5) as follows: 12-47-410. Bed and breakfast permit. (5) It is unlawful for any owner, part owner, shareholder, or person interested directly or indirectly in a bed and breakfast permit to conduct, own either in whole or in part, or be directly or indirectly interested in any other business licensed pursuant to this article or article 46 of this title; except that a person regulated under this section may have an interest in other bed and breakfast permits, in a license described in section 12-46-104 (1) (c), 12-47-401 (1) (j) to (1) (t), or 12-47-401 (1) (v), or (1) (w) or in a financial institution referred to in section 12-47-308 (4). SECTION 8. In Colorado Revised Statutes, 12-47-411, amend (13) (b) as follows: 12-47-411. Hotel and restaurant license - definition - rules. (13) (b) Notwithstanding paragraph (a) of this subsection (13), an owner, part owner, shareholder, or person interested directly or indirectly in a hotel and restaurant license may conduct, own either in whole or in part, or be directly or indirectly interested in a license described in section 12-46-104 (1) (c), 12-47-401 (1) (j) to (1) (t), 12-47-401 (1) (v), or (1) (w), or 12-47-410 (1) or in a financial institution referred to in section 12-47-308 (4). SECTION 9. In Colorado Revised Statutes, 12-47-412, amend (3); and add (9) as follows: 12-47-412. Tavern license. (3) It is unlawful for any owner, part owner, shareholder, or person interested directly or indirectly in tavern licenses to conduct, own either in whole or in part, or be directly or indirectly interested in any other business licensed pursuant to this article or article 46 of this title; except that the person may have an interest in a license described in section 12-46-104 (1) (c), 12-47-401 (1) (j) to (1) (t), 12-47-401 (1) (v), or (1) (w), or 12-47-410 (1) or in a financial institution referred to in section 12-47-308 (4). (9) (a) At the time a tavern license is due for renewal or by one year after the effective date of this subsection (9), whichever occurs later, a tavern licensed under this section that does not have as its principal business the sale of alcohol beverages, has a valid license on the effective date of this section, and is a lodging and entertainment facility may apply to, and the applicable local licensing authority shall, convert the tavern license to a lodging and entertainment license under section 12-47-426, and the licensee may continue to operate as a lodging and entertainment facility licensee. If a tavern licensee does not have as its principal business the sale of alcohol beverages but is not a lodging and entertainment facility, at the time the tavern license is due for renewal or by one year after the effective date of this subsection (9), whichever occurs later, the licensee may apply to, and the applicable local licensing authority shall, convert the tavern license to another license under this article, if any, for which the person qualifies. (b) A person applying under this subsection (9) to convert an existing tavern license to another license under this article may apply to convert the license, even if the location of the licensed premises is within five hundred feet of any public or parochial school or the principal campus of any college, university, or seminary, so long as the local licensing authority has previously approved the location of the licensed premises in accordance with section 12-47-313 (1) (d). SECTION 10. In Colorado Revised Statutes, 12-47-413, amend (2) (b) as follows: 12-47-413. Optional premises license. (2) (b) Notwithstanding paragraph (a) of this subsection (2), an owner, part owner, shareholder, or person interested directly or indirectly in an optional premises license may own, either in whole or in part, or be directly or indirectly interested in a license described in section 12-46-104 (1) (c), 12-47-401 (1) (j) to (1) (t), 12-47-401 (1) (v), or (1) (w), or 12-47-410 (1) or in a financial institution referred to in section 12-47-308 (4). SECTION 11. In Colorado Revised Statutes, 12-47-414, amend (4) as follows: 12-47-414. Retail gaming tavern license. (4) It is unlawful for any owner, part owner, shareholder, or person interested directly or indirectly in a retail gaming tavern license to conduct, own either in whole or in part, or be directly or indirectly interested in any other business licensed pursuant to this article or article 46 of this title; except that the person may have an interest in a license described in section 12-46-104 (1) (c), 12-47-401 (1) (j) to (1) (t), 12-47-401 (1) (v), or (1) (w), or 12-47-410 (1) or in a financial institution referred to in section 12-47-308 (4). SECTION 12. In Colorado Revised Statutes, 12-47-415, amend (5) (b) as follows: 12-47-415. Brew pub license. (5) (b) Notwithstanding paragraph (a) of this subsection (5), a person interested directly or indirectly in a brew pub license may conduct, own either in whole or in part, or be directly or indirectly interested in a license described in section 12-46-104 (1) (c), 12-47-401 (1) (j) to (1) (t), 12-47-401 (1) (v), or (1) (w), or 12-47-410 (1) or in a financial institution referred to in section 12-47-308 (4). SECTION 13. In Colorado Revised Statutes, 12-47-418, amend (4) as follows: 12-47-418. Racetrack license. (4) It is unlawful for any owner, part owner, shareholder, or person interested directly or indirectly in a racetrack license to conduct, own either in whole or in part, or be directly or indirectly interested in any other business licensed pursuant to this article or article 46 of this title; except that a person licensed under this section may have an interest in a license described in section 12-46-104 (1) (c), 12-47-401 (1) (j) to (1) (t), 12-47-401 (1) (v), or (1) (w), or 12-47-410 (1) or in a financial institution referred to in section 12-47-308 (4). SECTION 14. In Colorado Revised Statutes, 12-47-420, amend (5) (b) as follows: 12-47-420. Vintner's restaurant license. (5) (b) A person interested directly or indirectly in a vintner's restaurant license may conduct, own either in whole or in part, or be directly or indirectly interested in a license described in section 12-46-104 (1) (c), 12-47-401 (1) (j) to (1) (t), 12-47-401 (1) (v), or (1) (w), or 12-47-410 (1) or in a financial institution referred to in section 12-47-308 (4). SECTION 15. In Colorado Revised Statutes, 12-47-421, amend (2) (a) (VIII) and (2) (a) (IX); and add (2) (a) (X) as follows: 12-47-421. Removal of vinous liquor from licensed premises. (2) This section applies to a person: (a) That is duly licensed as a: (VIII) Club under section 12-47-416; or (IX) Distillery pub under section 12-47-424; and or (X) Lodging and entertainment facility under section 12-47-426; and SECTION 16. In Colorado Revised Statutes, 12-47-422, amend (6) as follows: 12-47-422. Art gallery permit - definition. (6) It is unlawful for any owner, part owner, shareholder, or person interested directly or indirectly in an art gallery permit to conduct, own either in whole or in part, or be directly or indirectly interested in any other business licensed pursuant to this article or article 46 of this title; except that a person regulated under this section may have an interest in other art gallery permits; in a license described in section 12-46-104 (1) (c), 12-47-401 (1) (j) to (1) (t), 12-47-401 (1) (v), or (1) (w), or 12-47-410 (1); or in a financial institution referred to in section 12-47-308 (4). SECTION 17. In Colorado Revised Statutes, 12-47-423, amend (2) (a) as follows: 12-47-423. Wine packaging permit - limitations - rules. (2) A licensed winery or limited winery that obtains a wine packaging permit pursuant to this section shall not sell or distribute tax-paid wine it packages: (a) To a person licensed to sell alcohol beverages at retail, for consumption on or off the licensed premises, under section 12-47-407, 12-47-408, 12-47-409, 12-47-410, 12-47-411, 12-47-412, 12-47-413, 12-47-414, 12-47-415, 12-47-416, 12-47-417, 12-47-418, 12-47-419, 12-47-420, 12-47-422, or 12-47-424, or 12-47-426; or SECTION 18. In Colorado Revised Statutes, 12-47-424, amend (5) (b) (II) as follows: 12-47-424. Distillery pub license - legislative declaration - definition. (5) (b) A person interested directly or indirectly in a distillery pub license may conduct, own either in whole or in part, or be directly or indirectly interested in: (II) A license described in section 12-46-104 (1) (c), 12-47-401 (1) (j) to (1) (t), (1) (v), or (1) (w), or 12-47-410 (1); or SECTION 19. In Colorado Revised Statutes, 12-47-501, add (1) (t) as follows: 12-47-501. State fees. (1) The following license and permit fees shall be paid to the department of revenue annually in advance: (t) For each lodging and entertainment license, seventy-five dollars. SECTION 20. In Colorado Revised Statutes, 12-47-505, add (1) (p) as follows: 12-47-505. Local license fees. (1) The following license fees shall be paid to the treasurer of the municipality, city and county, or county where the licensed premises is located annually in advance: (p) For each lodging and entertainment license, five hundred dollars. SECTION 21. In Colorado Revised Statutes, 12-47-901, amend (5) (a) (I), (5) (i) (I), and (9) (b) as follows: 12-47-901. Unlawful acts - exceptions. (5) It is unlawful for any person licensed to sell at retail pursuant to this article: (a) (I) To sell an alcohol beverage to any person under the age of twenty-one years, to a habitual drunkard, or to a visibly intoxicated person, or to permit any alcohol beverage to be sold or dispensed by a person under eighteen years of age, or to permit any such person to participate in the sale or dispensing thereof. If a person who, in fact, is not twenty-one years of age exhibits a fraudulent proof of age, any action relying on such fraudulent proof of age shall not constitute grounds for the revocation or suspension of any license issued under this article or article 46 of this title. Notwithstanding any provision in this subparagraph (I) to the contrary, no a person under twenty-one years of age shall not be employed to sell or dispense malt, vinous, or spirituous liquors unless he or she is supervised by another person who is on premise and has attained twenty-one years of age. No An employee of a tavern licensed pursuant to section 12-47-412 or a lodging and entertainment facility licensed pursuant to section 12-47-426, that does not regularly serve meals as defined in section 12-47-103 (20), or a retail liquor store shall not sell malt, vinous, or spirituous liquors unless such the person is at least twenty-one years of age. (i) (I) To sell malt, vinous, or spirituous liquors or fermented malt beverages in a place where the alcohol beverages are to be consumed, unless the place is a hotel, restaurant, tavern, lodging and entertainment facility, racetrack, club, retail gaming tavern, or arts licensed premises or unless the place is a dining, club, or parlor car; plane; bus; or other conveyance or facility of a public transportation system. (9) (b) This subsection (9) applies to persons licensed or permitted to sell or serve alcohol beverages for consumption on the licensed premises pursuant to section 12-47-403, 12-47-409, 12-47-410, 12-47-411, 12-47-412, 12-47-413, 12-47-414, 12-47-415, 12-47-416, 12-47-417, 12-47-418, 12-47-419, 12-47-420, 12-47-422, or 12-47-424, or 12-47-426. SECTION 22. In Colorado Revised Statutes, 12-47-901, amend as added by Senate Bill 16-197 (5) (p) (II) as follows: 12-47-901. Unlawful acts - exceptions - definitions. (5) It is unlawful for any person licensed to sell at retail pursuant to this article or article 46 of this title: (p) (II) If licensed as a tavern under section 12-47-412, a lodging and entertainment facility under section 12-47-426, a retail liquor store under section 12-47-407, or a liquor-licensed drugstore under section 12-47-408, to permit an employee who is under twenty-one years of age to sell malt, vinous, or spirituous liquors; or SECTION 23. Effective date. (1) This act takes effect on the effective date; except that: (a) Section 12-47-901 (5) (a) (I), Colorado Revised Statutes, as amended in section 21 of this act, becomes law and takes effect only if Senate Bill 16-197 does not become law; and (b) Section 12-47-901 (5) (p) (II), Colorado Revised Statutes, as amended in section 22 of this act, becomes law and takes effect only if Senate Bill 16-197 becomes law, and the section takes effect either upon the effective date of this act or Senate Bill 16-197, whichever is later. SECTION 24. Act subject to petition - effective date. This act takes effect at 12:01 a.m. on the day following the expiration of the ninety-day period after final adjournment of the general assembly (August 10, 2016, if adjournment sine die is on May 11, 2016); except that, if a referendum petition is filed pursuant to section 1 (3) of article V of the state constitution against this act or an item, section, or part of this act within such period, then the act, item, section, or part will not take effect unless approved by the people at the general election to be held in November 2016 and, in such case, will take effect on the date of the official declaration of the vote thereon by the governor. ________________________________________________________ Dickey Lee Hullinghorst Bill L. Cadman SPEAKER OF THE HOUSE PRESIDENT OF OF REPRESENTATIVES THE SENATE ____________________________ ____________________________ Marilyn Eddins Effie Ameen CHIEF CLERK OF THE HOUSE SECRETARY OF OF REPRESENTATIVES THE SENATE APPROVED________________________________________ _________________________________________ John W. Hickenlooper GOVERNOR OF THE STATE OF COLORADO