WSR 22-07-058

PROPOSED RULES

LIQUOR AND CANNABIS

BOARD

[Filed March 16, 2022, 10:33 a.m.]

Original Notice.

Preproposal statement of inquiry was filed as WSR 21-20-067.

Title of Rule and Other Identifying Information: New WAC 314-03-060 Axe throwing at liquor licensed premises. The Washington state liquor and cannabis board (WSLCB) proposes a new rule section allowing axe throwing at liquor licensed premises with the approval of a safety operating plan. WAC 314-29-030 Group 3 license violations. WSLCB proposes a technical amendment to the penalty schedule for violations of a board-approved operating plan to add a cross-reference to the proposed new rule section related to axe throwing at liquor licensed premises.

Hearing Location(s): On April 27, 2022, at 10:00 a.m. In response to the coronavirus disease 2019 (COVID-19) public health emergency, WSLCB will not provide a physical location for this hearing to promote social distancing and the safety of the citizens of Washington state. A virtual public hearing, without a physical meeting space, will be held instead. Board members, presenters, and staff will all participate remotely. The public may log in using a computer or device, or call-in using a phone, to listen to the meeting through the Microsoft Teams application. The public may provide verbal comments during the specified public comment and rules hearing segments. For more information about board meetings, please visit https://lcb.wa.gov/Boardmeetings/Board_meetings.

Date of Intended Adoption: No earlier than May 11, 2022.

Submit Written Comments to: Audrey Vasek, Policy and Rules Coordinator, P.O. Box 43080, Olympia, WA 98504-3080, email rules@lcb.wa.gov, fax 360-704-5027, by April 27, 2022.

Assistance for Persons with Disabilities: Contact Anita Bingham, ADA coordinator, human resources, phone 360-664-1739, fax 360-664-9689, TTY 711 or 1-800-833-6388, email anita.bingham@lcb.wa.gov, by April 20, 2022.

Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: The purpose of this rule proposal is to establish a framework for axe throwing activities at liquor licensed premises. The proposed new rules require licensees that offer axe throwing to create a safety operating plan that includes protocols for monitoring patron intoxication and consumption of alcoholic beverages, and a floor plan designating where alcohol may be sold or consumed and identifying the axe throwing areas where alcohol is not allowed. The proposed rules also outline how to request a change in operating plan and include a reference to penalties for noncompliance.

Reasons Supporting Proposal: Axe throwing has become increasingly popular as an activity that liquor licensed businesses would like to offer to their customers. Beginning in 2018, the agency began receiving applications from businesses that either had axe throwing as their primary activity and wanted to add liquor service, or from established liquor licensed businesses that wanted to add axe throwing as an on-premises activity. WSLCB considers axe throwing at liquor licensed premises to be a high-risk activity with implications for public health and safety. Current rules do not provide any framework to address the public health and safety concerns that arise when alcohol service is combined with axe throwing. New rules are needed to provide such a framework, as well as consistency for licensees and applicants that seek agency approval to offer axe throwing.

Statutory Authority for Adoption: RCW 66.08.030.

Rule is not necessitated by federal law, federal or state court decision.

Name of Proponent: WSLCB, governmental.

Name of Agency Personnel Responsible for Drafting: Audrey Vasek, Policy and Rules Coordinator, 1025 Union Avenue, Olympia, WA 98501, 360-664-1758; Implementation: Becky Smith, Director of Licensing, 1025 Union Avenue, Olympia, WA 98501, 360-664-1753; and Enforcement: Chandra Brady, Director of Enforcement and Education, 1025 Union Avenue, Olympia, WA 98501, 360-664-1726.

A school district fiscal impact statement is not required under RCW 28A.305.135.

A cost-benefit analysis is not required under RCW 34.05.328. The proposed rules do not qualify as a type of rule requiring a cost-benefit analysis under RCW 34.05.328(5). WSLCB is not a listed agency under RCW 34.05.328 (5)(a)(i), so the cost-benefit analysis requirements in RCW 34.05.328 are not applicable to the proposed rules unless voluntarily applied or made applicable by the joint administrative rules review committee under RCW 34.05.328 (5)(a)(ii).

The proposed rule does not impose more-than-minor costs on businesses. Following is a summary of the agency's analysis showing how costs were calculated.

Estimated Costs of Compliance: The proposed rules would allow businesses the new option to add axe throwing as an activity at liquor licensed premises with WSLCB approval of a safety operating plan. Because this rule proposal concerns an entirely optional new activity, this proposal does not impose new or additional regulatory burden or increased administrative costs. However, businesses seeking to combine liquor service and axe throwing will be required to submit a safety operating plan and receive approval from WSLCB prior to providing axe throwing activities at their liquor licensed premises.

The proposed rules state that the safety operating plan must address how the licensee will mitigate safety concerns associated with axe throwing, including the following: Protocols for monitoring consumption of alcoholic beverages and ensuring patrons are not intoxicated prior to axe throwing, and a floor plan for the premises. The floor plan is required to include designated areas where alcoholic beverages may be sold, served, or consumed on-premises that are separate from the axe throwing zone, as well as barriers to keep the axe throwing zone separate from the designated consumption areas and prevent axes from traveling out of the axe throwing zone. The proposed rules do not require that businesses use specific methods or materials to comply with these requirements.

Within the parameters established by the proposed rules, businesses have the flexibility to develop a unique safety operating plan. The agency anticipates that preparation of such a plan will not impose more-than-minor administrative costs associated with submission, including the following:

Note: These administrative costs are one-time costs that can be amortized over the period of business operation. Additional administrative costs might be incurred if a licensee decides to make changes to their safety operating plan after it has been approved. Under the proposal, the licensee would be required to resubmit the safety operating plan to the agency for approval.

Based on the anticipated administrative costs described above, WSLCB applied an estimated cost of compliance of $50 when analyzing whether the proposed rules impose more than "minor costs" as defined in RCW 19.85.020(2) on businesses potentially impacted by the proposed rules.

Minor Cost Threshold Estimates: Businesses potentially impacted by the proposed rules include liquor licensees that might choose to add axe throwing activities (such as Spirits, Beer, and Wine (SBW) Restaurants and Beer/Wine (BW) restaurants, taverns, nightclubs, and snack bars; and distillery, winery, and brewery tasting rooms/additional locations) and axe throwing businesses that might choose to add liquor service. The agency applied the following North American Industry Classification System (NAICS) codes to estimate minor cost thresholds for licensees:

As shown in the table below, the estimated cost of compliance for businesses in each of these industries does not exceed the minor cost estimate for these industries, so a small business economic impact statement is not required under RCW 19.85.030.

The revenue and wage thresholds used to determine the minor cost estimates for each of the business industries listed in the table above were calculated using the minor cost threshold calculator (updated October 2021) provided by the governor's office for regulatory innovation and assistance (ORIA). For more information, see the ORIA Regulatory Fairness Act Tools & Guidance web page at https://www.oria.wa.gov/site/alias__oria/934/Regulatory-Fairness-Act-Support.aspx.

March 16, 2022

David Postman

Chair

OTS-3661.1

OTS-3662.1