BILL REQ. #: S-1180.7
| State of Washington | 62nd Legislature | 2011 Regular Session |
Read first time 04/13/11. Referred to Committee on Labor, Commerce & Consumer Protection.
AN ACT Relating to enhancing state revenues by reforming laws regulating the distribution and sale of spirits and wine; amending RCW 66.24.360, 82.08.150, 66.08.050, 66.08.060, 66.20.010, 66.20.160, 66.24.310, 66.24.380, 66.28.030, 66.24.440, 66.24.540, 66.24.590, 66.28.040, 66.28.060, 66.28.070, 66.28.170, 66.28.180, 66.28.190, 66.28.280, 43.19.19054, 66.08.020, 66.08.026, 66.08.030, 66.24.145, 66.24.160, 66.28.060, 66.32.010, 66.44.120, 66.44.140, 66.44.150, 66.44.340, 19.126.010, and 19.126.040; reenacting and amending RCW 66.04.010 and 19.126.020; adding new sections to chapter 66.24 RCW; adding new sections to chapter 66.28 RCW; creating new sections; repealing RCW 66.08.070, 66.08.075, 66.08.160, 66.08.165, 66.08.166, 66.08.167, 66.08.220, 66.08.235, 66.16.010, 66.16.040, 66.16.041, 66.16.050, 66.16.060, 66.16.070, 66.16.100, 66.16.110, 66.16.120, and 66.28.045; providing an effective date; and declaring an emergency.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
NEW SECTION. Sec. 101 The legislature of the state of Washington
finds that consumers of distilled spirits in the state will enjoy a
greater variety of products, with potential for lower prices, reduced
diversion of consumer purchases to out-of-state sources, and a more
convenient shopping experience than is currently available to them
through the present control system, while enhancing state revenues and
retaining suitable security and public safety in the handling and sale
of all alcoholic beverages, by adoption of a private licensee system of
distribution of distilled spirits in place of purchase and resale of
distilled spirits by the state; and that reform of outdated laws
governing the distribution of wine will lead to greater efficiencies
for wineries, distributors, and retailers of wine, to the benefit of
consumers of wine in Washington state.
NEW SECTION. Sec. 102 The holder of a spirits distributor
license or spirits retail license issued under this act may commence
sale of spirits upon issuance thereof, but in no event earlier than
March 30, 2012, for distributors, or June 30, 2012, for retailers. The
liquor control board shall do all things necessary to complete
processing by said dates of all complete applications for spirits
licenses on file with the board on or before ninety days from the
effective date of this section. Until June 30, 2012, the board shall
operate state liquor stores so as to serve consumer demand for spirits
in the same manner and to the same extent as under the system
immediately preceding the system established by this act. The board
shall effect orderly closure of all state liquor stores no later than
September 1, 2012, and shall thereafter refrain from purchase of
liquor, from sale or distribution of liquor, except for asset sales
authorized by this act. Beginning upon the effective date of this
section, the board shall devote sufficient resources to planning and
preparation for sale of all assets of state liquor stores and
distribution centers, and all other assets of the state over which the
board has power of disposition, including without limitation goodwill
and location value associated with state liquor stores, with the
objective of depleting all inventory of liquor by August 31, 2012, and
closing all other asset sales no later than July 1, 2013. The board,
in furtherance of said objective, may sell liquor to spirits licensees.
Disposition of any state liquor store or distribution center assets
remaining after July 1, 2013, shall be managed by the department of
revenue. All asset sales under this section have the objective of
obtaining maximum reasonable value therefor, taking into account all
relevant factors, including without limitation present value
equivalents of delayed or deferred consideration. To the maximum
practicable extent consistent with securing the highest value, the
board shall sell by auction open to the public the right to operate a
liquor store at each state-store location. The rights shall be freely
alienable, but shall be subject to all state and local zoning and land
use requirements applicable to the property. Acquisition of the
operating rights shall be a precondition to, but shall not establish
eligibility for, any liquor license at the location of a state store
and shall not confer any privilege conferred by a liquor license.
Holding the rights shall not require the holder of the right to operate
a liquor-licensed business or apply for a liquor license. All sales
proceeds under this section, net of direct sales and other transition
costs, shall be deposited into the liquor excise tax fund. For the
purposes of this section, a long-term lease with payout materially
equivalent to sale on ordinary commercial property terms is deemed a
sale. The board shall do all things necessary to complete orderly
transition from the current state controlled system to the private
licensee system of spirits retailing and distribution under this act by
August 31, 2012. The transition shall include, without limitation, a
provision for operating and asset sale revenues of the board for (a)
retraining and/or outplacement services for state employees displaced
thereby, and (b) just and reasonable measures to avert harm to
interests of tribes, military buyers, and nonemployee liquor store
operators under then existing contracts for supply by the board of
distilled spirits, taking into account present value of issuance of a
spirits retail license to the holder of such interest. All exemptions
from tax available to military buyers for purchase of beer or wine
shall be available on the same terms for purchase of spirits from any
licensee of the board authorized to make such sale. The provisions may
extend beyond the time for completion of transition to a spirits
licensee system.
NEW SECTION. Sec. 103 A new section is added to chapter 66.24
RCW to read as follows:
(1) There is a spirits retail license to: Sell spirits in original
containers to consumers for consumption off the licensed premises and
to permit holders; sell spirits in original containers to retailers
licensed to sell spirits for consumption on the premises, for resale at
their licensed premises according to the terms of their licenses,
provided, however, that no such single sale shall exceed twenty-four
liters, which limit shall not apply to such sales by licensees who were
contract-operated state stores; and export spirits. For the purposes
of this title, a spirits retail license is a retail license, and a sale
by a spirits retailer is a retail sale only if not for resale. Nothing
in this section or title authorizes sales by on-sale licensees to other
retail licensees. The board shall establish by rule, the obligation of
on-sale spirits retailers to provide to the distributor or distiller
acting as distributor information by stock keeping unit of that
distributor or distiller concerning the identity of the purchasing on-premise licensee and quantities purchased.
(2)(a) The board shall issue spirits retail licenses only for
premises comprising at least nine thousand square feet of retail space,
including storerooms and other auxiliary areas, within a single
structure and only to applicants it reasonably believes will maintain
systems for inventory management, employee training, employee
supervision, and physical security of the product substantially as
effective as those of stores currently operated by the board with
respect to preventing sales to or pilferage by underage or inebriated
persons. The board shall not deny a spirits retail license to an
otherwise qualified nonemployee contractor operating a contract liquor
store or to the holder of former state liquor store operating rights
sold at auction pursuant to section 102 of this act on the grounds of
location or size of the premises to be licensed. The board may issue
a retail spirits license for premises comprising less than nine
thousand square feet if the board determines that:
(i) There is no retail spirits license holder in the community the
applicant serves or proposes to serve;
(ii) The applicant meets or upon licensure will meet operational
requirements established by the board by rule; and
(iii) The licensee has not committed more than one public safety
violation within the two years preceding application.
(b) A retailer authorized to sell spirits for consumption on or off
the licensed premises may accept delivery of spirits at its licensed
premises or at one or more warehouse facilities registered with the
board, which facilities may also warehouse and distribute nonliquor
items, and from which it may deliver to its own licensed premises and,
pursuant to sales permitted by (a) of this subsection (2) and
subsection (1) of this section, (i) to other retailer premises licensed
to sell spirits for consumption on the licensed premises, (ii) to other
registered facilities, or (iii) to lawful purchasers without the state.
The facilities may be registered and utilized by associations,
cooperatives, or comparable groups of retailers, including at least one
retailer licensed to sell spirits.
(3) Each spirits retail licensee shall pay to the board, for
deposit into the state general fund, a license issuance fee equivalent
to the following, calculated for the five-year period commencing upon
the licensee's first sale of spirits under the license: Ten percent on
all spirits sales in each of the first two years and, for each of the
following three years, five percent on all spirits sales; provided,
however, that twenty-one million dollars of such fees annually
beginning with the first year of collection of such fees shall be
distributed three-tenths of one percent to border areas, nineteen and
four-tenths percent to counties, and seventy-seven and six-tenths
percent to incorporated cities and towns. The board shall establish
rules setting forth the frequency and timing of such payments and
reporting of sales dollar volume by the licensee, with payments
required quarterly in arrears. No spirits inventory shall be subject
to calculation of more than a single retail license issuance fee. A
licensee who has paid a license issuance fee and relocates shall not be
required to pay a new license issuance fee.
(4) In addition to the payment set forth in subsection (3) of this
section, each licensee must pay an annual license renewal fee of one
hundred sixty-six dollars. The board shall periodically review and
adjust the fee as may be required to maintain it as comparable to
annual license renewal fees for licenses to sell beer and wine not for
consumption on the licensed premises. If required by law at the time,
any increase of the annual renewal fee shall become effective only upon
ratification by the legislature.
Sec. 104 RCW 66.24.360 and 2007 c 226 s 2 are each amended to
read as follows:
(1) There ((shall be)) is a ((beer and/or wine retailer's license
to be designated as a)) grocery store license to sell wine and/or beer,
including without limitation, strong beer((, and/or wine)) at retail in
((bottles, cans, and)) original containers, not to be consumed upon the
premises where sold((, at any store other than the state liquor
stores)).
(((1))) (2) There is a wine retailer reseller endorsement of a
grocery store license, to sell wine at retail in original containers to
other retailers licensed to sell the same for consumption on the
premises, for resale at their licensed premises according to the terms
of the license; provided, however that no such single sale shall exceed
twenty-four liters, which limit shall not apply to such sales by
licensees who were contract-operated state stores. For the purposes of
this title, a grocery store license is a retail license, and a sale by
a grocery store licensee with a reseller endorsement is a retail sale
only if not for resale.
(3) Licensees obtaining a written endorsement from the board may
also sell malt liquor in kegs or other containers capable of holding
less than five and one-half gallons of liquid.
(((2))) (4) The annual fee for the grocery store license is one
hundred fifty dollars for each store.
(((3))) (5) The annual fee for the wine retailer reseller
endorsement is one hundred sixty-six dollars for each store.
(6) The board shall issue a restricted grocery store license
authorizing the licensee to sell beer and only table wine, if the board
finds upon issuance or renewal of the license that the sale of strong
beer or fortified wine would be against the public interest. In
determining the public interest, the board shall consider at least the
following factors:
(a) The likelihood that the applicant will sell strong beer or
fortified wine to persons who are intoxicated;
(b) Law enforcement problems in the vicinity of the applicant's
establishment that may arise from persons purchasing strong beer or
fortified wine at the establishment; and
(c) Whether the sale of strong beer or fortified wine would be
detrimental to or inconsistent with a government-operated or funded
alcohol treatment or detoxification program in the area.
If the board receives no evidence or objection that the sale of
strong beer or fortified wine would be against the public interest, it
shall issue or renew the license without restriction, as applicable.
The burden of establishing that the sale of strong beer or fortified
wine by the licensee would be against the public interest is on those
persons objecting.
(((4))) (7) Licensees holding a grocery store license must maintain
a minimum three thousand dollar inventory of food products for human
consumption, not including pop, beer, strong beer, or wine.
(((5))) (8) A grocery store licensee with a wine retailer reseller
endorsement may accept delivery of wine at its licensed premises or at
one or more warehouse facilities registered with the board, which
facilities may also warehouse and distribute nonliquor items, and from
which it may deliver to its own licensed premises and, pursuant to
sales permitted by this title, to other licensed premises, to other
registered facilities, or to lawful purchasers without the state.
Facilities may be registered and utilized by associations,
cooperatives, or comparable groups of grocery store licensees.
(9) Upon approval by the board, the grocery store licensee may also
receive an endorsement to permit the international export of beer,
strong beer, and wine.
(a) Any beer, strong beer, or wine sold under this endorsement must
have been purchased from a licensed beer or wine distributor licensed
to do business within the state of Washington.
(b) Any beer, strong beer, and wine sold under this endorsement
must be intended for consumption outside the state of Washington and
the United States and appropriate records must be maintained by the
licensee.
(c) A holder of this special endorsement to the grocery store
license shall be considered not in violation of RCW 66.28.010.
(d) Any beer, strong beer, or wine sold under this ((license))
endorsement must be sold at a price no less than the acquisition price
paid by the holder of the license.
(e) The annual cost of this endorsement is five hundred dollars and
is in addition to the license fees paid by the licensee for a grocery
store license.
(((6))) (10) A grocery store licensee holding a snack bar license
under RCW 66.24.350 may receive an endorsement to allow the sale of
confections containing more than one percent but not more than ten
percent alcohol by weight to persons twenty-one years of age or older.
NEW SECTION. Sec. 105 A new section is added to chapter 66.24
RCW to read as follows:
(1) There is a license for spirits distributors to (a) sell spirits
purchased from manufacturers, distillers, or suppliers including,
without limitation, licensed Washington distilleries, licensed spirits
importers, other Washington spirits distributors, or suppliers of
foreign spirits located outside of the United States, to spirits
retailers including, without limitation, spirits retail licensees,
special occasion license holders, interstate common carrier license
holders, restaurant spirits retailer license holders, spirits, beer,
and wine private club license holders, hotel license holders, sports
entertainment facility license holders, and spirits, beer, and wine
nightclub license holders, and to other spirits distributors; and (b)
export the same from the state.
(2) By June 30, 2012, the board shall issue spirits distributor
licenses to all applicants who, upon the effective date of this
section, have the right to purchase spirits from a spirits
manufacturer, spirits distiller, or other spirits supplier for resale
in the state, or are agents of such supplier authorized to sell to
licensees in the state, unless the board determines that issuance of a
license to such applicant is not in the public interest.
(3) Each spirits distributor licensee shall pay to the board for
deposit into the state general fund, a license issuance fee equivalent
to the following, calculated for a five-year period commencing upon the
licensee's first sale of spirits under the license, on sales of spirits
such licensee was the first spirits distributor licensee to receive
from the distiller, in the case of spirits manufactured in the state,
or an authorized out-of-state distiller or other supplier: Ten percent
on all spirits sales in each of the first two years and three and
three-tenths percent on all spirits sales in each of the following
three years; provided, however, that twenty-one million dollars of such
fees annually beginning with the collection of such fees shall be
distributed three-tenths of one percent to border areas, nineteen and
four-tenths percent to counties, and seventy-seven and six-tenths
percent to incorporated cities and towns. A retail licensee selling
for resale shall pay a distributor license fee under the terms and
conditions stated in this section on resales of spirits it has
purchased on which no other distributor license fee has been paid. The
board shall establish rules setting forth the frequency and timing of
such payments and reporting of sales dollar volume by the licensee,
with payments due quarterly in arrears. No spirits inventory shall be
subject to calculation of more than a single spirits distributor
license issuance fee. A licensee who has paid a license issuance fee
and relocates shall not be required to pay a new license issuance fee.
(4) In addition to the payment set forth in subsection (3) of this
section, each spirits distributor licensee renewing its annual license
shall pay an annual license renewal fee of one thousand three hundred
twenty dollars for each licensed location.
(5) There shall be no minimum facility size or capacity for spirits
distributor licenses, and no limit on the number of such licenses
issued to qualified applicants.
Sec. 106 RCW 82.08.150 and 2009 c 479 s 65 are each amended to
read as follows:
(1) There is levied and shall be collected a tax upon each retail
sale of spirits in the original package at the rate of fifteen percent
of the selling price((. The tax imposed in this subsection shall apply
to all such sales including sales by the Washington state liquor stores
and agencies, but excluding sales to spirits, beer, and wine restaurant
licensees)).
(2) There is levied and shall be collected a tax upon each sale of
spirits in the original package at the rate of ten percent of the
selling price on sales by ((Washington state liquor stores and agencies
to spirits, beer, and wine restaurant licensees)) a spirits distributor
licensee or other licensee acting as a spirits distributor pursuant to
Title 66 RCW to restaurant spirits retailers.
(3) There is levied and shall be collected an additional tax upon
each ((retail)) sale of spirits in the original package by a spirits
distributor licensee or other licensee acting as a spirits distributor
pursuant to Title 66 RCW to a restaurant spirits retailer and upon each
retail sale of spirits in the original package by a licensee of the
board at the rate of one dollar and seventy-two cents per liter. ((The
additional tax imposed in this subsection shall apply to all such sales
including sales by Washington state liquor stores and agencies, and
including sales to spirits, beer, and wine restaurant licensees.))
(4) An additional tax is imposed equal to fourteen percent
multiplied by the taxes payable under subsections (1), (2), and (3) of
this section.
(5) An additional tax is imposed upon each ((retail)) sale of
spirits in the original package by a spirits distributor licensee or
other licensee acting as a spirits distributor pursuant to Title 66 RCW
to a restaurant spirits retailer and upon each retail sale of spirits
in the original package by a licensee of the board at the rate of seven
cents per liter. ((The additional tax imposed in this subsection shall
apply to all such sales including sales by Washington state liquor
stores and agencies, and including sales to spirits, beer, and wine
restaurant licensees.)) All revenues collected during any month from
this additional tax shall be deposited in the state general fund by the
twenty-fifth day of the following month.
(6)(a) An additional tax is imposed upon retail sale of spirits in
the original package at the rate of ((one and seven-tenths percent of
the selling price through June 30, 1995, two and six-tenths percent of
the selling price for the period July 1, 1995, through June 30, 1997,
and)) three and four-tenths percent of the selling price ((thereafter.
This additional tax applies to all such sales including sales by
Washington state liquor stores and agencies, but excluding sales to
spirits, beer, and wine restaurant licensees)).
(b) An additional tax is imposed upon retail sale of spirits in the
original package to a restaurant spirits retailer at the rate of ((one
and one-tenth percent of the selling price through June 30, 1995, one
and seven-tenths percent of the selling price for the period July 1,
1995, through June 30, 1997, and)) two and three-tenths percent of the
selling price ((thereafter. This additional tax applies to all such
sales to spirits, beer, and wine restaurant licensees)).
(c) An additional tax is imposed upon each ((retail)) sale of
spirits in the original package by a spirits distributor licensee or
other licensee acting as a spirits distributor pursuant to Title 66 RCW
to a restaurant spirits retailer and upon each retail sale of spirits
in the original package by a licensee of the board at the rate of
((twenty cents per liter through June 30, 1995, thirty cents per liter
for the period July 1, 1995, through June 30, 1997, and)) forty-one
cents per liter ((thereafter. This additional tax applies to all such
sales including sales by Washington state liquor stores and agencies,
and including sales to spirits, beer, and wine restaurant licensees)).
(d) All revenues collected during any month from additional taxes
under this subsection shall be deposited in the state general fund by
the twenty-fifth day of the following month.
(7)(a) An additional tax is imposed upon each retail sale of
spirits in the original package at the rate of one dollar and thirty-three cents per liter. ((This additional tax applies to all such sales
including sales by Washington state liquor stores and agencies, but
excluding sales to spirits, beer, and wine restaurant licensees.))
(b) All revenues collected during any month from additional taxes
under this subsection shall be deposited by the twenty-fifth day of the
following month into the general fund.
(8) The tax imposed in RCW 82.08.020 shall not apply to sales of
spirits in the original package.
(9) The taxes imposed in this section shall be paid by the buyer to
the seller, and each seller shall collect from the buyer the full
amount of the tax payable in respect to each taxable sale under this
section. The taxes required by this section to be collected by the
seller shall be stated separately from the selling price, and for
purposes of determining the tax due from the buyer to the seller, it
shall be conclusively presumed that the selling price quoted in any
price list does not include the taxes imposed by this section. Sellers
shall report and return all taxes imposed in this section in accordance
with rules adopted by the department.
(10) As used in this section, the terms, "spirits" and "package"
shall have the meaning ascribed to them in chapter 66.04 RCW.
Sec. 107 RCW 66.08.050 and 2005 c 151 s 3 are each amended to
read as follows:
The board, subject to the provisions of this title and the rules,
shall:
(1) ((Determine the localities within which state liquor stores
shall be established throughout the state, and the number and situation
of the stores within each locality;)) Determine the nature, form and capacity of all packages to be
used for containing liquor kept for sale under this title;
(2) Appoint in cities and towns and other communities, in which no
state liquor store is located, contract liquor stores. In addition,
the board may appoint, in its discretion, a manufacturer that also
manufactures liquor products other than wine under a license under this
title, as a contract liquor store for the purpose of sale of liquor
products of its own manufacture on the licensed premises only. Such
contract liquor stores shall be authorized to sell liquor under the
guidelines provided by law, rule, or contract, and such contract liquor
stores shall be subject to such additional rules and regulations
consistent with this title as the board may require;
(3) Establish all necessary warehouses for the storing and
bottling, diluting and rectifying of stocks of liquors for the purposes
of this title;
(4) Provide for the leasing for periods not to exceed ten years of
all premises required for the conduct of the business; and for
remodeling the same, and the procuring of their furnishings, fixtures,
and supplies; and for obtaining options of renewal of such leases by
the lessee. The terms of such leases in all other respects shall be
subject to the direction of the board;
(5)
(((6))) (2) Execute or cause to be executed, all contracts, papers,
and documents in the name of the board, under such regulations as the
board may fix;
(((7))) (3) Pay all customs, duties, excises, charges and
obligations whatsoever relating to the business of the board;
(((8))) (4) Require bonds from all employees in the discretion of
the board, and to determine the amount of fidelity bond of each such
employee;
(((9))) (5) Perform services for the state lottery commission to
such extent, and for such compensation, as may be mutually agreed upon
between the board and the commission;
(((10))) (6) Accept and deposit into the general fund-local account
and disburse, subject to appropriation, federal grants or other funds
or donations from any source for the purpose of improving public
awareness of the health risks associated with alcohol consumption by
youth and the abuse of alcohol by adults in Washington state. The
board's alcohol awareness program shall cooperate with federal and
state agencies, interested organizations, and individuals to effect an
active public beverage alcohol awareness program;
(((11))) (7) Perform all other matters and things, whether similar
to the foregoing or not, to carry out the provisions of this title, and
shall have full power to do each and every act necessary to the conduct
of its ((business)) regulatory functions, including all ((buying,
selling)) supplies procurement, preparation and approval of forms, and
every other undertaking necessary to perform its regulatory functions
((of the business)) whatsoever, subject only to audit by the state
auditor((: PROVIDED, That)). However, the board shall have no
authority to regulate the content of spoken language on licensed
premises where wine and other liquors are served and where there is not
a clear and present danger of disorderly conduct being provoked by such
language or to restrict advertising of lawful prices.
Sec. 108 RCW 66.08.060 and 2005 c 231 s 3 are each amended to
read as follows:
(((1) The board shall not advertise liquor in any form or through
any medium whatsoever.)) The board shall have power to adopt any and all reasonable
rules as to the kind, character, and location of advertising of liquor
that are consistent with this title and with applicable rights of
commercial speech.
(2) In-store liquor merchandising is not advertising for the
purposes of this section.
(3)
Sec. 109 RCW 66.20.010 and 2008 c 181 s 602 are each amended to
read as follows:
Upon application in the prescribed form being made to any employee
authorized by the board to issue permits, accompanied by payment of the
prescribed fee, and upon the employee being satisfied that the
applicant should be granted a permit under this title, the employee
shall issue to the applicant under such regulations and at such fee as
may be prescribed by the board a permit of the class applied for, as
follows:
(1) Where the application is for a special permit by a physician or
dentist, or by any person in charge of an institution regularly
conducted as a hospital or sanitorium for the care of persons in ill
health, or as a home devoted exclusively to the care of aged people, a
special liquor purchase permit, except that the governor may waive the
requirement for a special liquor purchase permit under this subsection
pursuant to an order issued under RCW 43.06.220(2);
(2) Where the application is for a special permit by a person
engaged within the state in mechanical or manufacturing business or in
scientific pursuits requiring alcohol for use therein, or by any
private individual, a special permit to purchase alcohol for the
purpose named in the permit, except that the governor may waive the
requirement for a special liquor purchase permit under this subsection
pursuant to an order issued under RCW 43.06.220(2);
(3) Where the application is for a special permit to consume liquor
at a banquet, at a specified date and place, a special permit to
purchase liquor for consumption at such banquet, to such applicants as
may be fixed by the board;
(4) Where the application is for a special permit to consume liquor
on the premises of a business not licensed under this title, a special
permit to purchase liquor for consumption thereon for such periods of
time and to such applicants as may be fixed by the board;
(5) Where the application is for a special permit by a manufacturer
to import or purchase within the state alcohol, malt, and other
materials containing alcohol to be used in the manufacture of liquor,
or other products, a special permit;
(6) Where the application is for a special permit by a person
operating a drug store to purchase liquor at retail prices only, to be
thereafter sold by such person on the prescription of a physician, a
special liquor purchase permit, except that the governor may waive the
requirement for a special liquor purchase permit under this subsection
pursuant to an order issued under RCW 43.06.220(2);
(7) Where the application is for a special permit by an authorized
representative of a military installation operated by or for any of the
armed forces within the geographical boundaries of the state of
Washington, a special permit to purchase liquor for use on such
military installation ((at prices to be fixed by the board));
(8) Where the application is for a special permit by a
manufacturer, importer, or distributor, or representative thereof, to
serve liquor without charge to delegates and guests at a convention of
a trade association composed of licensees of the board, when the said
liquor is served in a hospitality room or from a booth in a board-approved suppliers' display room at the convention, and when the liquor
so served is for consumption in the said hospitality room or display
room during the convention, anything in Title 66 RCW to the contrary
notwithstanding. Any such spirituous liquor shall be purchased from
((the board or a spirits, beer, and wine restaurant licensee)) a
spirits retailer or distributor, and any such ((beer and wine)) liquor
shall be subject to the taxes imposed by chapter 66.24 RCW ((66.24.290
and 66.24.210));
(9) Where the application is for a special permit by a
manufacturer, importer, or distributor, or representative thereof, to
donate liquor for a reception, breakfast, luncheon, or dinner for
delegates and guests at a convention of a trade association composed of
licensees of the board, when the liquor so donated is for consumption
at the said reception, breakfast, luncheon, or dinner during the
convention, anything in this title ((66 RCW)) to the contrary
notwithstanding. Any such spirituous liquor shall be purchased from
((the board or a spirits, beer, and wine restaurant licensee)) a
spirits retailer or distributor, and any such ((beer and wine)) liquor
shall be subject to the taxes imposed by chapter 66.24 RCW ((66.24.290
and 66.24.210));
(10) Where the application is for a special permit by a
manufacturer, importer, or distributor, or representative thereof, to
donate and/or serve liquor without charge to delegates and guests at an
international trade fair, show, or exposition held under the auspices
of a federal, state, or local governmental entity or organized and
promoted by a nonprofit organization, anything in this title ((66 RCW))
to the contrary notwithstanding. Any such spirituous liquor shall be
purchased from ((the board)) a spirits retailer or distributor, and any
such ((beer or wine)) liquor shall be subject to the taxes imposed by
chapter 66.24 RCW ((66.24.290 and 66.24.210));
(11) Where the application is for an annual special permit by a
person operating a bed and breakfast lodging facility to donate or
serve wine or beer without charge to overnight guests of the facility
if the wine or beer is for consumption on the premises of the facility.
"Bed and breakfast lodging facility," as used in this subsection, means
a facility offering from one to eight lodging units and breakfast to
travelers and guests.
Sec. 110 RCW 66.20.160 and 2005 c 151 s 8 are each amended to
read as follows:
((Words and phrases)) As used in RCW 66.20.160 ((to)) through
66.20.210, inclusive, ((shall have the following meaning:))
"Card of identification" means any one of those cards described in
RCW 66.16.040.
"licensee" means the holder of a retail liquor license issued by
the board, and includes any employee or agent of the licensee.
(("Store employee" means a person employed in a state liquor store
to sell liquor.))
Sec. 111 RCW 66.24.310 and 1997 c 321 s 17 are each amended to
read as follows:
(1) No person shall canvass for, solicit, receive, or take orders
for the purchase or sale of liquor, nor contact any licensees of the
board in goodwill activities, unless ((such)) the person ((shall be))
is the ((accredited)) representative of a ((person, firm, or
corporation holding a certificate of approval issued pursuant to RCW
66.24.270 or 66.24.206, a beer distributor's license, a microbrewer's
license, a domestic brewer's license, a beer importer's license, a
domestic winery license, a wine importer's license, or a wine
distributor's license within the state of Washington, or the accredited
representative of a distiller, manufacturer, importer, or distributor
of spirituous liquor, or foreign produced beer or wine, and shall
have)) licensee or certificate holder authorized by this title to sell
liquor for resale in the state and has applied for and received a
representative's license: PROVIDED, HOWEVER, That the provisions of
this section shall not apply to drivers who deliver spirits, beer, or
wine;
(2) Every representative's license issued under this title shall be
subject to all conditions and restrictions imposed by this title or by
the rules and regulations of the board; the board, for the purpose of
maintaining an orderly market, may limit the number of representative's
licenses issued for representation of specific classes of eligible
employers;
(3) Every application for a representative's license must be
approved by a holder of a certificate of approval ((issued pursuant to
RCW 66.24.270 or 66.24.206)), a licensed beer distributor, a licensed
domestic brewer, a licensed beer importer, a licensed microbrewer, a
licensed domestic winery, a licensed wine importer, a licensed wine
distributor, or by a distiller, manufacturer, importer, or distributor
of ((spirituous liquor)) spirits, or of foreign-produced beer or wine,
as the rules and regulations of the board shall require;
(4) The fee for a representative's license shall be twenty-five
dollars per year((;)).
(5) An accredited representative of a distiller, manufacturer,
importer, or distributor of spirituous liquor may, after he or she has
applied for and received a representative's license, contact retail
licensees of the board only in goodwill activities pertaining to
spirituous liquor products
Sec. 112 RCW 66.24.380 and 2005 c 151 s 10 are each amended to
read as follows:
There shall be a retailer's license to be designated as a special
occasion license to be issued to a not-for-profit society or
organization to sell spirits, beer, and wine by the individual serving
for on-premises consumption at a specified event, such as at picnics or
other special occasions, at a specified date and place; fee sixty
dollars per day.
(1) The not-for-profit society or organization is limited to sales
of no more than twelve calendar days per year. For the purposes of
this subsection, special occasion licensees that are "agricultural area
fairs" or "agricultural county, district, and area fairs," as defined
by RCW 15.76.120, that receive a special occasion license may, once per
calendar year, count as one event fairs that last multiple days, so
long as alcohol sales are at set dates, times, and locations, and the
board receives prior notification of the dates, times, and locations.
The special occasion license applicant will pay the sixty dollars per
day for this event.
(2) The licensee may sell spirits, beer, and/or wine in original,
unopened containers for off-premises consumption if permission is
obtained from the board prior to the event.
(3) Sale, service, and consumption of spirits, beer, and wine is to
be confined to specified premises or designated areas only.
(4) ((Spirituous)) Liquor sold under this special occasion license
must be purchased ((at a state liquor store or contract liquor store
without discount at retail prices, including all taxes)) from a
licensee of the board.
(5) Any violation of this section is a class 1 civil infraction
having a maximum penalty of two hundred fifty dollars as provided for
in chapter 7.80 RCW.
Sec. 113 RCW 66.28.030 and 2004 c 160 s 10 are each amended to
read as follows:
Every domestic distillery, brewery, and microbrewery, domestic
winery, certificate of approval holder, licensed liquor importer,
licensed wine importer, and licensed beer importer shall be responsible
for the conduct of any licensed spirits, beer, or wine distributor in
selling, or contracting to sell, to retail licensees, spirits, beer, or
wine manufactured by such domestic distillery, brewery, microbrewery,
domestic winery, manufacturer holding a certificate of approval, sold
by an authorized representative holding a certificate of approval, or
imported by such liquor, beer, or wine importer. Where the board finds
that any licensed spirits, beer, or wine distributor has violated any
of the provisions of this title or of the regulations of the board in
selling or contracting to sell spirits, beer, or wine to retail
licensees, the board may, in addition to any punishment inflicted or
imposed upon such distributor, prohibit the sale of the brand or brands
of spirits, beer, or wine involved in such violation to any or all
retail licensees within the trade territory usually served by such
distributor for such period of time as the board may fix, irrespective
of whether the distiller manufacturing such spirits or the liquor
importer importing such spirits, brewer manufacturing such beer or the
beer importer importing such beer, or the domestic winery manufacturing
such wine or the wine importer importing such wine or the certificate
of approval holder manufacturing such spirits, beer, or wine or acting
as authorized representative actually participated in such violation.
Sec. 114 RCW 66.24.440 and 2009 c 271 s 8 are each amended to
read as follows:
((Each spirits, beer, and wine restaurant, spirits, beer, and wine
private club, hotel, spirits, beer, and wine nightclub, and sports
entertainment facility licensee shall be entitled to)) A retailer for
consumption on the premises may purchase any spirituous liquor items
salable under such license from spirits licensees of the board ((at a
discount of not less than fifteen percent from the retail price fixed
by the board, together with)) licensed under section 103 or 105 of this
act, subject to all taxes.
Sec. 115 RCW 66.24.540 and 1999 c 129 s 1 are each amended to
read as follows:
There shall be a retailer's license to be designated as a motel
license. The motel license may be issued to a motel regardless of
whether it holds any other class of license under this title. No
license may be issued to a motel offering rooms to its guests on an
hourly basis. The license authorizes the licensee to:
(1) Sell, at retail, in locked honor bars, spirits in individual
bottles not to exceed fifty milliliters, beer in individual cans or
bottles not to exceed twelve ounces, and wine in individual bottles not
to exceed one hundred eighty-seven milliliters, to registered guests of
the motel for consumption in guest rooms.
(a) Each honor bar must also contain snack foods. No more than
one-half of the guest rooms may have honor bars.
(b) All spirits to be sold under the license must be purchased from
a spirits retailer or a spirits distributor licensee of the board.
(c) The licensee shall require proof of age from the guest renting
a guest room and requesting the use of an honor bar. The guest shall
also execute an affidavit verifying that no one under twenty-one years
of age shall have access to the spirits, beer, and wine in the honor
bar.
(2) Provide without additional charge, to overnight guests of the
motel, spirits, beer, and wine by the individual serving for on-premises consumption at a specified regular date, time, and place as
may be fixed by the board. Self-service by attendees is prohibited.
All spirits, beer, and wine service must be done by an alcohol server
as defined in RCW 66.20.300 and comply with RCW 66.20.310.
The annual fee for a motel license is five hundred dollars.
"Motel" as used in this section means a transient accommodation
licensed under chapter 70.62 RCW.
((As used in this section, "spirits," "beer," and "wine" have the
meanings defined in RCW 66.04.010.))
Sec. 116 RCW 66.24.590 and 2008 c 41 s 11 are each amended to
read as follows:
(1) There shall be a retailer's license to be designated as a hotel
license. No license may be issued to a hotel offering rooms to its
guests on an hourly basis. Food service provided for room service,
banquets or conferences, or restaurant operation under this license
shall meet the requirements of rules adopted by the board.
(2) The hotel license authorizes the licensee to:
(a) Sell ((spiritous)) spirituous liquor, beer, and wine, by the
individual glass, at retail, for consumption on the premises, including
mixed drinks and cocktails compounded and mixed on the premises;
(b) Sell, at retail, from locked honor bars, in individual units,
spirits not to exceed fifty milliliters, beer in individual units not
to exceed twelve ounces, and wine in individual bottles not to exceed
three hundred eighty-five milliliters, to registered guests of the
hotel for consumption in guest rooms. The licensee shall require proof
of age from the guest renting a guest room and requesting the use of an
honor bar. The guest shall also execute an affidavit verifying that no
one under twenty-one years of age shall have access to the spirits,
beer, and wine in the honor bar;
(c) Provide without additional charge, to overnight guests,
spirits, beer, and wine by the individual serving for on-premises
consumption at a specified regular date, time, and place as may be
fixed by the board. Self-service by attendees is prohibited;
(d) Sell beer, including strong beer, wine, or spirits, in the
manufacturer's sealed container or by the individual drink to guests
through room service, or through service to occupants of private
residential units which are part of the buildings or complex of
buildings that include the hotel;
(e) Sell beer, including strong beer, spirits, or wine, in the
manufacturer's sealed container at retail sales locations within the
hotel premises;
(f) Sell for on or off-premises consumption, including through room
service and service to occupants of private residential units managed
by the hotel, wine carrying a label exclusive to the hotel license
holder;
(g) Place in guest rooms at check-in, a complimentary bottle of
((beer, including strong beer, or wine)) liquor in a manufacturer-sealed container, and make a reference to this service in promotional
material.
(3) If all or any facilities for alcoholic beverage service and the
preparation, cooking, and serving of food are operated under contract
or joint venture agreement, the operator may hold a license separate
from the license held by the operator of the hotel. Food and beverage
inventory used in separate licensed operations at the hotel may not be
shared and shall be separately owned and stored by the separate
licensees.
(4) All spirits to be sold under this license must be purchased
from a spirits retailer or spirits distributor licensee of the board.
(5) All on-premise alcoholic beverage service must be done by an
alcohol server as defined in RCW 66.20.300 and must comply with RCW
66.20.310.
(6)(a) The hotel license allows the licensee to remove from the
liquor stocks at the licensed premises, liquor for sale and service at
event locations at a specified date and place not currently licensed by
the board. If the event is open to the public, it must be sponsored by
a society or organization as defined by RCW 66.24.375. If attendance
at the event is limited to members or invited guests of the sponsoring
individual, society, or organization, the requirement that the sponsor
must be a society or organization as defined by RCW 66.24.375 is
waived.
(b) The holder of this license shall, if requested by the board,
notify the board or its designee of the date, time, place, and location
of any event. Upon request, the licensee shall provide to the board
all necessary or requested information concerning the society or
organization that will be holding the function at which the endorsed
license will be utilized.
(c) Licensees may cater events on a domestic winery, brewery, or
distillery premises.
(7) The holder of this license or its manager may furnish spirits,
beer, or wine to the licensee's employees who are twenty-one years of
age or older free of charge as may be required for use in connection
with instruction on spirits, beer, and wine. The instruction may
include the history, nature, values, and characteristics of spirits,
beer, or wine, the use of wine lists, and the methods of presenting,
serving, storing, and handling spirits, beer, or wine. The licensee
must use the ((beer or wine)) liquor it obtains under its license for
the sampling as part of the instruction. The instruction must be given
on the premises of the licensee.
(8) Minors may be allowed in all areas of the hotel where
((alcohol)) liquor may be consumed; however, the consumption must be
incidental to the primary use of the area. These areas include, but
are not limited to, tennis courts, hotel lobbies, and swimming pool
areas. If an area is not a mixed use area, and is primarily used for
alcohol service, the area must be designated and restricted to access
by ((minors)) persons of lawful age to purchase liquor.
(9) The annual fee for this license is two thousand dollars.
(10) As used in this section, "hotel," "spirits," "beer," and
"wine" have the meanings defined in RCW 66.24.410 and 66.04.010.
Sec. 117 RCW 66.28.040 and 2009 c 373 s 8 are each amended to
read as follows:
Except as permitted by the board under RCW 66.20.010, no domestic
brewery, microbrewery, distributor, distiller, domestic winery,
importer, rectifier, certificate of approval holder, or other
manufacturer of liquor shall, within the state of Washington, give to
any person any liquor; but nothing in this section nor in RCW 66.28.010
shall prevent a domestic brewery, microbrewery, distributor, domestic
winery, distiller, certificate of approval holder, or importer from
furnishing samples of beer, wine, or spirituous liquor to authorized
licensees for the purpose of negotiating a sale, in accordance with
regulations adopted by the liquor control board, provided that the
samples are subject to taxes imposed by RCW 66.24.290 and 66.24.210((,
and in the case of spirituous liquor, any product used for samples must
be purchased at retail from the board; nothing in this section shall
prevent the furnishing of samples of liquor to the board for the
purpose of negotiating the sale of liquor to the state liquor control
board)); nothing in this section shall prevent a domestic brewery,
microbrewery, domestic winery, distillery, certificate of approval
holder, or distributor from furnishing beer, wine, or spirituous liquor
for instructional purposes under RCW 66.28.150; nothing in this section
shall prevent a domestic winery, certificate of approval holder, or
distributor from furnishing wine without charge, subject to the taxes
imposed by RCW 66.24.210, to a not-for-profit group organized and
operated solely for the purpose of enology or the study of viticulture
which has been in existence for at least six months and that uses wine
so furnished solely for such educational purposes or a domestic winery,
or an out-of-state certificate of approval holder, from furnishing wine
without charge or a domestic brewery, or an out-of-state certificate of
approval holder, from furnishing beer without charge, subject to the
taxes imposed by RCW 66.24.210 or 66.24.290, or a domestic distiller
licensed under RCW 66.24.140 or an accredited representative of a
distiller, manufacturer, importer, or distributor of spirituous liquor
licensed under RCW 66.24.310, from furnishing spirits without charge,
to a nonprofit charitable corporation or association exempt from
taxation under section 501(c)(3) or (6) of the internal revenue code of
1986 (26 U.S.C. Sec. 501(c)(3) or (6)) for use consistent with the
purpose or purposes entitling it to such exemption; nothing in this
section shall prevent a domestic brewery or microbrewery from serving
beer without charge, on the brewery premises; nothing in this section
shall prevent donations of wine for the purposes of RCW 66.12.180;
nothing in this section shall prevent a domestic winery from serving
wine without charge, on the winery premises; and nothing in this
section shall prevent a craft distillery from serving spirits without
charge, on the distillery premises subject to RCW 66.24.145.
Sec. 118 RCW 66.28.060 and 2008 c 94 s 7 are each amended to read
as follows:
Every distillery licensed under this title shall make monthly
reports to the board pursuant to the regulations. ((No such distillery
shall make any sale of spirits within the state of Washington except to
the board and as provided in RCW 66.24.145.))
Sec. 119 RCW 66.28.070 and 2006 c 302 s 8 are each amended to
read as follows:
(1) Except as provided in subsection (2) of this section, it shall
be unlawful for any retail spirits, beer, or wine licensee to purchase
spirits, beer, or wine, except from a duly licensed distributor,
domestic winery, domestic brewer, or certificate of approval holder
with a direct shipment endorsement((, or the board)).
(2) A spirits, beer, or wine retailer ((licensee)) may purchase
spirits, beer, or wine (a) from a government agency which has lawfully
seized ((beer or wine from)) liquor possessed by a licensed ((beer))
distributor or ((wine)) retailer, ((or)) (b) from a board-authorized
((retailer)) manufacturer or certificate holder authorized by this
title to act as a distributor of liquor, ((or)) (c) from a licensed
retailer which has discontinued business if the distributor has refused
to accept spirits, beer, or wine from that retailer for return and
refund((. Beer and wine)), or (d) for a retailer of wine and/or
spirits for consumption on the premises, purchasing wine and/or spirits
it is authorized to sell, from a retailer whose license or license
endorsement permits such resale. Goods purchased under this subsection
shall meet the quality standards set by its manufacturer.
(3) Special occasion licensees holding a special occasion license
may only purchase spirits, beer, or wine from a spirits, beer, or wine
retailer duly licensed to sell spirits, beer, or wine for off-premises
consumption, ((the board,)) or from a duly licensed spirits, beer, or
wine distributor.
Sec. 120 RCW 66.28.170 and 2004 c 160 s 17 are each amended to
read as follows:
It is unlawful for a manufacturer of spirits, wine, or malt
beverages holding a certificate of approval ((issued under RCW
66.24.270 or 66.24.206)) or the manufacturer's authorized
representative, a distillery, brewery, or a domestic winery to
discriminate in price in selling to any purchaser for resale in the
state of Washington. Price differentials for sales of spirits or wine
based upon competitive conditions, costs of servicing a purchaser's
account, efficiencies in handling goods, or other bona fide business
factors, to the extent the differentials are not unlawful under trade
regulation laws applicable to goods of all kinds, do not violate this
section.
NEW SECTION. Sec. 121 A new section is added to chapter 66.28
RCW to read as follows:
(1) No price for spirits sold in the state by a distributor or
other licensee acting as a distributor pursuant to this title may be
below acquisition cost unless the item sold below acquisition cost has
been stocked by the seller for a period of at least six months. The
seller may not restock the item for a period of one year following the
first effective date of such below cost price.
(2) Spirits sold to retailers for resale for consumption on or off
the licensed premises may be delivered to the retailer's licensed
premises, to a location specified by the retailer and approved for
deliveries by the board, or to a carrier engaged by either party to the
transaction.
(3) In selling spirits to another retailer, to the extent
consistent with the purposes of this act, a spirits retail licensee
shall comply with all provisions of and regulations under this title
applicable to wholesale distributors selling spirits to retailers.
(4) A distiller holding a license or certificate of compliance as
a distiller under this title may act as distributor in the state of
spirits of its own production or of foreign-produced spirits it is
entitled to import. The distiller shall, to the extent consistent with
the purposes of this act, comply with all provisions of and regulations
under this title applicable to wholesale distributors selling spirits
to retailers.
(5) With respect to any alleged violation of this title by sale of
spirits at a discounted price, all defenses under applicable trade
regulation laws shall be available, including without limitation good
faith meeting of a competitor's lawful price and absence of harm to
competition.
(6) No licensee shall import, purchase, distribute, or accept
delivery of any brand of distilled spirits unless the licensee is
designated in writing as an authorized importer or distributor of such
brand by the brand owner or his or her authorized agent. Such
distilled spirits imported into Washington shall come to rest at the
warehouse of the licensed importer or distributor or an authorized
warehouse for the account of such licensed importer or distributor,
before sale and delivery to a retail licensee. The authorization
required by this section shall be filed with the board.
Sec. 122 RCW 66.28.180 and 2009 c 506 s 10 are each amended to
read as follows:
(1) Beer and/or wine distributors.
(a) Every beer ((or wine)) distributor shall maintain at its
liquor-licensed location a price list showing the wholesale prices at
which any and all brands of beer ((and wine)) sold by ((such beer
and/or wine)) the distributor shall be sold to retailers within the
state.
(b) Each price list shall set forth:
(i) All brands, types, packages, and containers of beer ((or wine))
offered for sale by ((such beer and/or wine)) the distributor; and
(ii) The wholesale prices thereof to retail licensees, including
allowances, if any, for returned empty containers.
(c) No beer ((and/or wine)) distributor may sell or offer to sell
any package or container of beer ((or wine)) to any retail licensee at
a price differing from the price for such package or container as shown
in the price list, according to rules adopted by the board.
(d) Quantity discounts of sales prices of beer are prohibited. No
distributor's sale price of beer may be below the distributor's
acquisition cost.
(e) Distributor prices below acquisition cost on a "close-out" item
shall be allowed if the item to be discontinued has been listed for a
period of at least six months, and upon the further condition that the
distributor who offers such a close-out price shall not restock the
item for a period of one year following the first effective date of
such close-out price.
(f) Any beer ((and/or wine)) distributor ((or employee authorized
by the distributor-employer)) may sell beer ((and/or wine)) at the
distributor's listed prices to any annual or special occasion retail
licensee upon presentation to the distributor ((or employee)) at the
time of purchase or delivery of an original or facsimile license or a
special permit issued by the board to such licensee.
(g) Every annual or special occasion retail licensee, upon
purchasing any beer ((and/or wine)) from a distributor, shall
immediately cause such beer ((or wine)) to be delivered to the licensed
premises, and the licensee shall not thereafter permit such beer to be
disposed of in any manner except as authorized by the license.
(h) Beer ((and wine)) sold as provided in this section shall be
delivered by the distributor ((or an authorized employee either)) to
the retailer's licensed premises or directly to the retailer at the
distributor's licensed premises. When a ((domestic winery,)) brewery,
microbrewery, or certificate of approval holder with a direct shipping
endorsement is acting as a distributor of beer of its own production,
a licensed retailer may contract with a common carrier to obtain the
((product)) beer directly from the ((domestic winery,)) brewery,
microbrewery, or certificate of approval holder with a direct shipping
endorsement. A distributor's prices to retail licensees for beer shall
be the same at both such places of delivery. Wine sold to retailers
shall be delivered to the retailer's licensed premises, to a location
specified by the retailer and approved for deliveries by the board, or
to a carrier engaged by either party to the transaction.
(2) Beer ((and wine)) suppliers' contracts and memoranda.
(a) Every domestic brewery, microbrewery, ((domestic winery,))
certificate of approval holder, and beer and/or wine importer offering
beer ((and/or wine)) for sale to distributors within the state and any
beer ((and/or wine)) distributor who sells to other beer ((and/or
wine)) distributors shall maintain at its liquor-licensed location a
beer price list and a copy of every written contract and a memorandum
of every oral agreement which such brewery ((or winery)) may have with
any beer ((or wine)) distributor for the supply of beer, which
contracts or memoranda shall contain:
(i) All advertising, sales and trade allowances, and incentive
programs; and
(ii) All commissions, bonuses or gifts, and any and all other
discounts or allowances.
(b) Whenever changed or modified, such revised contracts or
memoranda shall also be maintained at its liquor licensed location.
(c) Each price list shall set forth all brands, types, packages,
and containers of beer ((or wine)) offered for sale by such ((licensed
brewery or winery)) supplier.
(d) Prices of a domestic brewery, microbrewery, ((domestic
winery,)) or certificate of approval holder for beer shall be uniform
prices to all distributors or retailers on a statewide basis less bona
fide allowances for freight differentials. Quantity discounts of
suppliers' prices for beer are prohibited. No price shall be below the
supplier's acquisition((/)) or production cost.
(e) A domestic brewery, microbrewery, ((domestic winery,))
certificate of approval holder, ((beer or wine)) importer, or ((beer or
wine)) distributor acting as a supplier to another distributor must
file ((a distributor appointment)) with the board a list of all
distributor licensees of the board to which it sells or offers to sell
beer.
(f) No domestic brewery, microbrewery, ((domestic winery,)) or
certificate of approval holder may sell or offer to sell any package or
container of beer ((or wine)) to any distributor at a price differing
from the price list for such package or container as shown in the price
list of the domestic brewery, microbrewery, ((domestic winery,)) or
certificate of approval holder and then in effect, according to rules
adopted by the board.
(3) In selling wine to another retailer, to the extent consistent
with the purposes of this act, a grocery store licensee with a reseller
endorsement shall comply with all provisions of and regulations under
this title applicable to wholesale distributors selling wine to
retailers.
(4) With respect to any alleged violation of this title by sale of
wine at a discounted price, all defenses under applicable trade
regulation laws shall be available including, without limitation, good
faith meeting of a competitor's lawful price and absence of harm to
competition.
Sec. 123 RCW 66.28.190 and 2003 c 168 s 305 are each amended to
read as follows:
((RCW 66.28.010)) Any other provision of this title
notwithstanding, persons licensed under ((RCW 66.24.200 as wine
distributors and persons licensed under RCW 66.24.250 as beer
distributors)) this title to sell liquor for resale may sell at
wholesale nonliquor food and food ingredients on thirty-day credit
terms to persons licensed as retailers under this title, but complete
and separate accounting records shall be maintained on all sales of
nonliquor food and food ingredients to ensure that such persons are in
compliance with ((RCW 66.28.010)) this title.
For the purpose of this section, "nonliquor food and food
ingredients" includes, without limitation, all food and food
ingredients for human consumption as defined in RCW 82.08.0293 as it
((exists)) existed on July 1, 2004.
NEW SECTION. Sec. 124 A new section is added to chapter 66.28
RCW to read as follows:
A retailer authorized to sell wine may accept delivery of wine at
its licensed premises or at one or more warehouse facilities registered
with the board, which facilities may also warehouse and distribute
nonliquor items, and from which it may deliver to its own licensed
premises and, pursuant to sales permitted by this title, to other
licensed retailers, to other registered facilities, or to lawful
purchasers without the state; such facilities may be registered and
utilized by associations, cooperatives, or comparable groups of
retailers including at least one retailer licensed to sell wine. A
restaurant retailer authorized to sell spirits may accept delivery of
spirits at its licensed premises or at one or more warehouse facilities
registered with the board, which facilities may also warehouse and
distribute nonliquor items, from which it may deliver to its own
licensed premises and, pursuant to sales permitted by this title, to
other licensed retailers, to other registered facilities, or to lawful
purchasers without the state; such facilities may be registered and
utilized by associations, cooperatives, or comparable groups of
retailers including at least one restaurant retailer licensed to sell
spirits. Nothing in this section authorizes sales of spirits or wine
by a retailer holding only an on-sale privilege to another retailer.
Sec. 125 RCW 66.28.280 and 2009 c 506 s 1 are each amended to
read as follows:
((The legislature recognizes that Washington's current three-tier
system, where the functions of manufacturing, distributing, and
retailing are distinct and the financial relationships and business
transactions between entities in these tiers are regulated, is a
valuable system for the distribution of beer and wine.)) The
legislature ((further)) recognizes that the historical total
prohibition on ownership of an interest in one tier by a person with an
ownership interest in another tier, as well as the historical
restriction on financial incentives and business relationships between
tiers, is unduly restrictive. The legislature finds the modifications
contained in chapter 506, Laws of 2009 ((are)) appropriate for all four
varieties of liquor defined in this title, because the modifications do
not impermissibly interfere with ((the goals of orderly marketing of
alcohol in the state, encouraging moderation in consumption of alcohol
by the citizens of the state,)) protecting the public interest and
advancing public safety by preventing the use and consumption of
alcohol by minors and other abusive consumption, and promoting the
efficient collection of taxes by the state.
Sec. 126 RCW 66.04.010 and 2009 c 373 s 1 and 2009 c 271 s 2 are
each reenacted and amended to read as follows:
In this title, unless the context otherwise requires:
(1) "Alcohol" is that substance known as ethyl alcohol, hydrated
oxide of ethyl, or spirit of wine, which is commonly produced by the
fermentation or distillation of grain, starch, molasses, or sugar, or
other substances including all dilutions and mixtures of this
substance. The term "alcohol" does not include alcohol in the
possession of a manufacturer or distiller of alcohol fuel, as described
in RCW 66.12.130, which is intended to be denatured and used as a fuel
for use in motor vehicles, farm implements, and machines or implements
of husbandry.
(2) "Authorized representative" means a person who:
(a) Is required to have a federal basic permit issued pursuant to
the federal alcohol administration act, 27 U.S.C. Sec. 204;
(b) Has its business located in the United States outside of the
state of Washington;
(c) Acquires ownership of spirits, beer, or wine for transportation
into and resale in the state of Washington; and which spirits, beer, or
wine is produced by a distiller, brewery, or winery in the United
States outside of the state of Washington; and
(d) Is appointed by the distiller, brewery, or winery referenced in
(c) of this subsection as its authorized representative for marketing
and selling its products within the United States in accordance with a
written agreement between the authorized representative and such
distiller, brewery, or winery pursuant to this title.
(3) "Beer" means any malt beverage, flavored malt beverage, or malt
liquor as these terms are defined in this chapter.
(4) "Beer distributor" means a person who buys beer from a domestic
brewery, microbrewery, beer certificate of approval holder, or beer
importers, or who acquires foreign produced beer from a source outside
of the United States, for the purpose of selling the same pursuant to
this title, or who represents such brewer or brewery as agent.
(5) "Beer importer" means a person or business within Washington
who purchases beer from a beer certificate of approval holder or who
acquires foreign produced beer from a source outside of the United
States for the purpose of selling the same pursuant to this title.
(6) "Board" means the liquor control board, constituted under this
title.
(7) "Brewer" or "brewery" means any person engaged in the business
of manufacturing beer and malt liquor. Brewer includes a brand owner
of malt beverages who holds a brewer's notice with the federal bureau
of alcohol, tobacco, and firearms at a location outside the state and
whose malt beverage is contract-produced by a licensed in-state
brewery, and who may exercise within the state, under a domestic
brewery license, only the privileges of storing, selling to licensed
beer distributors, and exporting beer from the state.
(8) "Club" means an organization of persons, incorporated or
unincorporated, operated solely for fraternal, benevolent, educational,
athletic or social purposes, and not for pecuniary gain.
(9) "Confection" means a preparation of sugar, honey, or other
natural or artificial sweeteners in combination with chocolate, fruits,
nuts, dairy products, or flavorings, in the form of bars, drops, or
pieces.
(10) "Consume" includes the putting of liquor to any use, whether
by drinking or otherwise.
(11) "Contract liquor store" means a business that sells liquor on
behalf of the board through a contract with a contract liquor store
manager.
(12) "Craft distillery" means a distillery that pays the reduced
licensing fee under RCW 66.24.140.
(13) "Dentist" means a practitioner of dentistry duly and regularly
licensed and engaged in the practice of his profession within the state
pursuant to chapter 18.32 RCW.
(14) "Distiller" means a person engaged in the business of
distilling spirits.
(15) "Domestic brewery" means a place where beer and malt liquor
are manufactured or produced by a brewer within the state.
(16) "Domestic winery" means a place where wines are manufactured
or produced within the state of Washington.
(17) "Drug store" means a place whose principal business is, the
sale of drugs, medicines and pharmaceutical preparations and maintains
a regular prescription department and employs a registered pharmacist
during all hours the drug store is open.
(18) "Druggist" means any person who holds a valid certificate and
is a registered pharmacist and is duly and regularly engaged in
carrying on the business of pharmaceutical chemistry pursuant to
chapter 18.64 RCW.
(19) "Employee" means any person employed by the board.
(20) "Flavored malt beverage" means:
(a) A malt beverage containing six percent or less alcohol by
volume to which flavoring or other added nonbeverage ingredients are
added that contain distilled spirits of not more than forty-nine
percent of the beverage's overall alcohol content; or
(b) A malt beverage containing more than six percent alcohol by
volume to which flavoring or other added nonbeverage ingredients are
added that contain distilled spirits of not more than one and one-half
percent of the beverage's overall alcohol content.
(21) "Fund" means 'liquor revolving fund.'
(22) "Hotel" means buildings, structures, and grounds, having
facilities for preparing, cooking, and serving food, that are kept,
used, maintained, advertised, or held out to the public to be a place
where food is served and sleeping accommodations are offered for pay to
transient guests, in which twenty or more rooms are used for the
sleeping accommodation of such transient guests. The buildings,
structures, and grounds must be located on adjacent property either
owned or leased by the same person or persons.
(23) (("Importer" means a person who buys distilled spirits from a
distillery outside the state of Washington and imports such spirituous
liquor into the state for sale to the board or for export.)) "Imprisonment" means confinement in the county jail.
(24)
(((25))) (24) "Liquor" includes the four varieties of liquor herein
defined (alcohol, spirits, wine and beer), and all fermented,
spirituous, vinous, or malt liquor, or combinations thereof, and mixed
liquor, a part of which is fermented, spirituous, vinous or malt
liquor, or otherwise intoxicating; and every liquid or solid or
semisolid or other substance, patented or not, containing alcohol,
spirits, wine or beer, and all drinks or drinkable liquids and all
preparations or mixtures capable of human consumption, and any liquid,
semisolid, solid, or other substance, which contains more than one
percent of alcohol by weight shall be conclusively deemed to be
intoxicating. Liquor does not include confections or food products
that contain one percent or less of alcohol by weight.
(((26))) (25) "Malt beverage" or "malt liquor" means any beverage
such as beer, ale, lager beer, stout, and porter obtained by the
alcoholic fermentation of an infusion or decoction of pure hops, or
pure extract of hops and pure barley malt or other wholesome grain or
cereal in pure water containing not more than eight percent of alcohol
by weight, and not less than one-half of one percent of alcohol by
volume. For the purposes of this title, ((any such beverage)) "strong
beer" is beer containing more than eight percent ((of)) alcohol by
weight ((shall be referred to as "strong beer.")).
(((27))) (26) "Manufacturer" means a person engaged in the
preparation of liquor for sale, in any form whatsoever.
(((28))) (27) "Nightclub" means an establishment that provides
entertainment and has as its primary source of revenue (a) the sale of
alcohol for consumption on the premises, (b) cover charges, or (c)
both, and has an occupancy load of one hundred or more.
(((29))) (28) "Package" means any container or receptacle used for
holding liquor.
(((30))) (29) "Passenger vessel" means any boat, ship, vessel,
barge, or other floating craft of any kind carrying passengers for
compensation.
(((31))) (30) "Permit" means a permit for the purchase of liquor
under this title.
(((32))) (31) "Person" means an individual, copartnership,
association, or corporation.
(((33))) (32) "Physician" means a medical practitioner duly and
regularly licensed and engaged in the practice of his profession within
the state pursuant to chapter 18.71 RCW.
(((34))) (33) "Prescription" means a memorandum signed by a
physician and given by him to a patient for the obtaining of liquor
pursuant to this title for medicinal purposes.
(((35))) (34) "Public place" includes streets and alleys of
incorporated cities and towns; state or county or township highways or
roads; buildings and grounds used for school purposes; public dance
halls and grounds adjacent thereto; those parts of establishments where
beer may be sold under this title, soft drink establishments, public
buildings, public meeting halls, lobbies, halls and dining rooms of
hotels, restaurants, theatres, stores, garages and filling stations
which are open to and are generally used by the public and to which the
public is permitted to have unrestricted access; railroad trains,
stages, and other public conveyances of all kinds and character, and
the depots and waiting rooms used in conjunction therewith which are
open to unrestricted use and access by the public; publicly owned
bathing beaches, parks, and/or playgrounds; and all other places of
like or similar nature to which the general public has unrestricted
right of access, and which are generally used by the public.
(((36))) (35) "Regulations" means regulations made by the board
under the powers conferred by this title.
(((37))) (36) "Restaurant" means any establishment provided with
special space and accommodations where, in consideration of payment,
food, without lodgings, is habitually furnished to the public, not
including drug stores and soda fountains.
(37) "Retailer," except as qualified expressly or by context, means
any licensee authorized to sell liquor to consumers, including for
consumption off the licensed premises and/or for consumption on the
licensed premises. With respect to retailer licenses, "on-sale" refers
to the license privilege of selling for consumption upon the licensed
premises.
(38) "Sale" and "sell" include exchange, barter, and traffic; and
also include the selling or supplying or distributing, by any means
whatsoever, of liquor, or of any liquid known or described as beer or
by any name whatever commonly used to describe malt or brewed liquor or
of wine, by any person to any person; and also include a sale or
selling within the state to a foreign consignee or his agent in the
state. "Sale" and "sell" shall not include the giving, at no charge,
of a reasonable amount of liquor by a person not licensed by the board
to a person not licensed by the board, for personal use only. "Sale"
and "sell" also does not include a raffle authorized under RCW
9.46.0315((: PROVIDED, That)), if the nonprofit organization
conducting the raffle has obtained the appropriate permit from the
board.
(39) "Soda fountain" means a place especially equipped with
apparatus for the purpose of dispensing soft drinks, whether mixed or
otherwise.
(40) "Spirits" means any beverage which contains alcohol obtained
by distillation, except flavored malt beverages, but including wines
exceeding twenty-four percent of alcohol by volume.
(41) (("Store" means a state liquor store established under this
title)) "Spirits distributor" means a person, other than a person who
holds only a retail license, who buys spirits from a domestic
distiller, manufacturer, supplier, spirits distributor, or spirits
importer, or who acquires foreign-produced spirits from a source
outside of the United States, for the purpose of reselling the same not
in violation of this title, or who represents such distiller as agent.
(42) "Spirits importer" means a person who buys distilled spirits
from a distiller outside the state of Washington and imports such
spirits into the state for sale or export.
(((42))) (43) "Tavern" means any establishment with special space
and accommodation for sale by the glass and for consumption on the
premises, of beer, as herein defined.
(((43))) (44)(a) "Wine" means any alcoholic beverage obtained by
fermentation of fruits (grapes, berries, apples, et cetera) or other
agricultural product containing sugar, to which any saccharine
substances may have been added before, during or after fermentation,
and containing not more than twenty-four percent of alcohol by volume,
including sweet wines fortified with wine spirits, such as port,
sherry, muscatel and angelica, not exceeding twenty-four percent of
alcohol by volume and not less than one-half of one percent of alcohol
by volume. For purposes of this title, any beverage containing no more
than fourteen percent of alcohol by volume when bottled or packaged by
the manufacturer shall be referred to as "table wine," and any beverage
containing alcohol in an amount more than fourteen percent by volume
when bottled or packaged by the manufacturer shall be referred to as
"fortified wine." However, "fortified wine" shall not include: (i)
Wines that are both sealed or capped by cork closure and aged two years
or more; and (ii) wines that contain more than fourteen percent alcohol
by volume solely as a result of the natural fermentation process and
that have not been produced with the addition of wine spirits, brandy,
or alcohol.
(b) This subsection shall not be interpreted to require that any
wine be labeled with the designation "table wine" or "fortified wine."
(((44))) (45) "Wine distributor" means a person who buys wine from
a domestic winery, wine certificate of approval holder, or wine
importer, or who acquires foreign produced wine from a source outside
of the United States, for the purpose of selling the same not in
violation of this title, or who represents such vintner or winery as
agent.
(((45))) (46) "Wine importer" means a person or business within
Washington who purchases wine from a wine certificate of approval
holder or who acquires foreign produced wine from a source outside of
the United States for the purpose of selling the same pursuant to this
title.
(((46))) (47) "Winery" means a business conducted by any person for
the manufacture of wine for sale, other than a domestic winery.
Sec. 201 RCW 43.19.19054 and 1975-'76 2nd ex.s. c 21 s 7 are each
amended to read as follows:
The provisions of RCW 43.19.1905 shall not apply to materials,
supplies, and equipment purchased for resale to other than public
agencies by state agencies, including educational institutions. ((In
addition, RCW 43.19.1905 shall not apply to liquor purchased by the
state for resale under the provisions of Title 66 RCW.))
Sec. 202 RCW 66.08.020 and 1933 ex.s. c 62 s 5 are each amended
to read as follows:
The administration of this title((, including the general control,
management and supervision of all liquor stores, shall be)) is vested
in the liquor control board, constituted under this title.
Sec. 203 RCW 66.08.026 and 2008 c 67 s 1 are each amended to read
as follows:
Administrative expenses of the board shall be appropriated and paid
from the liquor revolving fund. These administrative expenses shall
include, but not be limited to: The salaries and expenses of the board
and its employees, ((the cost of opening additional state liquor stores
and warehouses,)) legal services, pilot projects, annual or other
audits, and other general costs of conducting the business of the
board. ((The administrative expenses shall not include costs of liquor
and lottery tickets purchased, the cost of transportation and delivery
to the point of distribution, the cost of operating, maintaining,
relocating, and leasing state liquor stores and warehouses, other costs
pertaining to the acquisition and receipt of liquor and lottery
tickets, agency commissions for contract liquor stores, transaction
fees associated with credit or debit card purchases for liquor in state
liquor stores and in contract liquor stores pursuant to RCW 66.16.040
and 66.16.041, sales tax, and those amounts distributed pursuant to RCW
66.08.180, 66.08.190, 66.08.200, 66.08.210 and 66.08.220. Agency
commissions for contract liquor stores shall be established by the
liquor control board after consultation with and approval by the
director of the office of financial management.)) All expenditures and
payment of obligations authorized by this section are subject to the
allotment requirements of chapter 43.88 RCW.
Sec. 204 RCW 66.08.030 and 2002 c 119 s 2 are each amended to
read as follows:
(((1) For the purpose of carrying into effect the provisions of
this title according to their true intent or of supplying any
deficiency therein, the board may make such regulations not
inconsistent with the spirit of this title as are deemed necessary or
advisable. All regulations so made shall be a public record and shall
be filed in the office of the code reviser, and thereupon shall have
the same force and effect as if incorporated in this title. Such
regulations, together with a copy of this title, shall be published in
pamphlets and shall be distributed as directed by the board.)) The power of the
board to make regulations ((
(2) Without thereby limiting the generality of the provisions
contained in subsection (1), it is declared thatin the manner set out in that subsection))
under chapter 34.05 RCW shall extend to
(((a) regulating the equipment and management of stores and
warehouses in which state liquor is sold or kept, and prescribing the
books and records to be kept therein and the reports to be made thereon
to the board;)):
(b)
(1) Prescribing the duties of the employees of the board, and
regulating their conduct in the discharge of their duties;
(((c) governing the purchase of liquor by the state and the
furnishing of liquor to stores established under this title;)) (2) Prescribing an official seal and official labels and
stamps and determining the manner in which they shall be attached to
every package of liquor sold or sealed under this title, including the
prescribing of different official seals or different official labels
for different classes of liquor;
(d) determining the classes, varieties, and brands of liquor to be
kept for sale at any store;
(e) prescribing, subject to RCW 66.16.080, the hours during which
the state liquor stores shall be kept open for the sale of liquor;
(f) providing for the issuing and distributing of price lists
showing the price to be paid by purchasers for each variety of liquor
kept for sale under this title;
(g)
(((h) providing for the payment by the board in whole or in part of
the carrying charges on liquor shipped by freight or express;)) (3) Prescribing forms to be used for purposes of this title
or the regulations, and the terms and conditions to be contained in
permits and licenses issued under this title, and the qualifications
for receiving a permit or license issued under this title, including a
criminal history record information check. The board may submit the
criminal history record information check to the Washington state
patrol and to the identification division of the federal bureau of
investigation in order that these agencies may search their records for
prior arrests and convictions of the individual or individuals who
filled out the forms. The board shall require fingerprinting of any
applicant whose criminal history record information check is submitted
to the federal bureau of investigation;
(i)
(((j))) (4) Prescribing the fees payable in respect of permits and
licenses issued under this title for which no fees are prescribed in
this title, and prescribing the fees for anything done or permitted to
be done under the regulations;
(((k))) (5) Prescribing the kinds and quantities of liquor which
may be kept on hand by the holder of a special permit for the purposes
named in the permit, regulating the manner in which the same shall be
kept and disposed of, and providing for the inspection of the same at
any time at the instance of the board;
(((l))) (6) Regulating the sale of liquor kept by the holders of
licenses which entitle the holder to purchase and keep liquor for sale;
(((m))) (7) Prescribing the records of purchases or sales of
liquor kept by the holders of licenses, and the reports to be made
thereon to the board, and providing for inspection of the records so
kept;
(((n))) (8) Prescribing the kinds and quantities of liquor for
which a prescription may be given, and the number of prescriptions
which may be given to the same patient within a stated period;
(((o))) (9) Prescribing the manner of giving and serving notices
required by this title or the regulations, where not otherwise provided
for in this title;
(((p))) (10) Regulating premises in which liquor is kept for export
from the state, or from which liquor is exported, prescribing the books
and records to be kept therein and the reports to be made thereon to
the board, and providing for the inspection of the premises and the
books, records and the liquor so kept;
(((q))) (11) Prescribing the conditions and qualifications
requisite for the obtaining of club licenses and the books and records
to be kept and the returns to be made by clubs, prescribing the manner
of licensing clubs in any municipality or other locality, and providing
for the inspection of clubs;
(((r))) (12) Prescribing the conditions, accommodations, and
qualifications requisite for the obtaining of licenses to sell beer
((and)), wines, and spirits, and regulating the sale of beer ((and)),
wines, and spirits thereunder;
(((s))) (13) Specifying and regulating the time and periods when,
and the manner, methods and means by which manufacturers shall deliver
liquor within the state; and the time and periods when, and the manner,
methods and means by which liquor may lawfully be conveyed or carried
within the state;
(((t))) (14) Providing for the making of returns by brewers of
their sales of beer shipped within the state, or from the state,
showing the gross amount of such sales and providing for the inspection
of brewers' books and records, and for the checking of the accuracy of
any such returns;
(((u))) (15) Providing for the making of returns by the wholesalers
of beer whose breweries are located beyond the boundaries of the state;
(((v))) (16) Providing for the making of returns by any other
liquor manufacturers, showing the gross amount of liquor produced or
purchased, the amount sold within and exported from the state, and to
whom so sold or exported, and providing for the inspection of the
premises of any such liquor manufacturers, their books and records, and
for the checking of any such return;
(((w))) (17) Providing for the giving of fidelity bonds by any or
all of the employees of the board: PROVIDED, That the premiums
therefor shall be paid by the board;
(((x))) (18) Providing for the shipment ((by mail or common
carrier)) of liquor to any person holding a permit and residing in any
unit which has, by election pursuant to this title, prohibited the sale
of liquor therein;
(((y))) (19) Prescribing methods of manufacture, conditions of
sanitation, standards of ingredients, quality and identity of alcoholic
beverages manufactured, sold, bottled, or handled by licensees and the
board; and conducting from time to time, in the interest of the public
health and general welfare, scientific studies and research relating to
alcoholic beverages and the use and effect thereof;
(((z))) (20) Seizing, confiscating and destroying all alcoholic
beverages manufactured, sold or offered for sale within this state
which do not conform in all respects to the standards prescribed by
this title or the regulations of the board: PROVIDED, Nothing herein
contained shall be construed as authorizing the liquor board to
prescribe, alter, limit or in any way change the present law as to the
quantity or percentage of alcohol used in the manufacturing of wine or
other alcoholic beverages.
Sec. 205 RCW 66.24.145 and 2010 c 290 s 2 are each amended to
read as follows:
(1) Any craft distillery may sell spirits of its own production for
consumption off the premises, up to two liters per person per day.
((Spirits sold under this subsection must be purchased from the board
and sold at the retail price established by the board.)) A craft
distillery selling spirits under this subsection must comply with the
applicable laws and rules relating to retailers.
(2) Any craft distillery may contract distill spirits for, and sell
contract distilled spirits to, holders of distillers' or manufacturers'
licenses, including licenses issued under RCW 66.24.520, or for export.
(3) Any craft distillery licensed under this section may provide,
free of charge, one-half ounce or less samples of spirits of its own
production to persons on the premises of the distillery. The maximum
total per person per day is two ounces. Every person who participates
in any manner in the service of samples must obtain a class 12 alcohol
server permit. ((Spirits used for samples must be purchased from the
board.))
(4) The board shall adopt rules to implement the alcohol server
permit requirement and may adopt additional rules to implement this
section.
(5) Distilling is an agricultural practice.
NEW SECTION. Sec. 206 A new section is added to chapter 66.24
RCW to read as follows:
Any distiller licensed under this title may act as a retailer
and/or distributor to retailers selling for consumption on or off the
licensed premises of spirits of its own production, and any
manufacturer, importer, or bottler of spirits holding a certificate of
approval may act as a distributor of spirits it is entitled to import
into the state under such certificate. The board shall by rule provide
for issuance of certificates of approval to spirits suppliers. An
industry member operating as a distributor and/or retailer under this
section shall comply with the applicable laws and rules relating to
distributors and/or retailers, except that an industry member operating
as a distributor under this section may maintain a warehouse off the
distillery premises for the distribution of spirits of its own
production to spirits retailers within the state, if the warehouse is
within the United States and has been approved by the board.
Sec. 207 RCW 66.24.160 and 1981 1st ex.s. c 5 s 30 are each
amended to read as follows:
A ((liquor)) spirits importer's license may be issued to any
qualified person, firm or corporation, entitling the holder thereof to
import into the state any liquor other than beer or wine; to store the
same within the state, and to sell and export the same from the state;
fee six hundred dollars per annum. Such ((liquor)) spirits importer's
license shall be subject to all conditions and restrictions imposed by
this title or by the rules and regulations of the board, and shall be
issued only upon such terms and conditions as may be imposed by the
board. ((No liquor importer's license shall be required in sales to
the Washington state liquor control board.))
Sec. 208 RCW 66.28.060 and 2008 c 94 s 7 are each amended to read
as follows:
Every distillery licensed under this title shall make monthly
reports to the board pursuant to the regulations. ((No such distillery
shall make any sale of spirits within the state of Washington except to
the board and as provided in RCW 66.24.145.))
Sec. 209 RCW 66.32.010 and 1955 c 39 s 3 are each amended to read
as follows:
((Except as permitted by)) The board may, ((no liquor shall be kept
or had by any person within this state unless the package in which the
liquor was contained had, while containing that liquor, been)) to the
extent required to control unlawful diversion of liquor from legitimate
channels of distribution, require that packages of liquor transported
within the state be sealed with ((the)) such official seal as may be
adopted by the board, except in the case of:
(1) ((Liquor imported by the board; or)) Liquor manufactured in the state ((
(2)for sale to the board or
for export)); or
(((3) Beer,)) (2) Liquor purchased within the state or for shipment
to a consumer within the state in accordance with the provisions of
law; or
(((4))) (3) Wine or beer exempted in RCW 66.12.010.
Sec. 210 RCW 66.44.120 and 2005 c 151 s 11 are each amended to
read as follows:
(1) No person other than an employee of the board shall keep or
have in his or her possession any official seal ((prescribed)) adopted
by the board under this title, unless the same is attached to a package
((which has been purchased from a liquor store or contract liquor
store)) in accordance with the law; nor shall any person keep or have
in his or her possession any design in imitation of any official seal
prescribed under this title, or calculated to deceive by its
resemblance thereto, or any paper upon which any design in imitation
thereof, or calculated to deceive as aforesaid, is stamped, engraved,
lithographed, printed, or otherwise marked.
(2)(a) Except as provided in (b) of this subsection, every person
who willfully violates this section is guilty of a gross misdemeanor
and shall be liable on conviction thereof for a first offense to
imprisonment in the county jail for a period of not less than three
months nor more than six months, without the option of the payment of
a fine, and for a second offense, to imprisonment in the county jail
for not less than six months nor more than one year, without the option
of the payment of a fine.
(b) A third or subsequent offense is a class C felony, punishable
by imprisonment in a state correctional facility for not less than one
year nor more than two years.
Sec. 211 RCW 66.44.140 and 1980 c 140 s 4 are each amended to
read as follows:
Every person who shall sell or offer for sale, or transport in any
manner, any spirituous liquor, without ((government stamp or)) such
official seal as the board may require pursuant to this title attached
thereto, or who shall operate without a license, any still or other
device for the production of spirituous liquor, or shall have in his
possession or under his control any mash capable of being distilled
into spirituous liquor except as provided in RCW 66.12.130, shall be
guilty of a gross misdemeanor and upon conviction thereof shall upon
his first conviction be fined not less than five hundred dollars and
confined in the county jail not less than six months, and upon second
and subsequent conviction shall be fined not less than one thousand
dollars and confined in the county jail not less than one year.
Sec. 212 RCW 66.44.150 and 1955 c 289 s 5 are each amended to
read as follows:
If any person in this state buys alcoholic beverages from any
person other than ((the board, a state liquor store, or)) some person
authorized by the board to sell them, he shall be guilty of a
misdemeanor.
Sec. 213 RCW 66.44.340 and 1999 c 281 s 11 are each amended to
read as follows:
Employers holding grocery store or beer and/or wine specialty shop
licenses exclusively are permitted to allow their employees, between
the ages of eighteen and twenty-one years, to sell, stock, and handle
((beer or wine)) liquor in, on or about any establishment holding a
((grocery store or beer and/or wine specialty shop)) license
((exclusively)) to sell such liquor: PROVIDED, That there is an adult
twenty-one years of age or older on duty supervising the sale of liquor
at the licensed premises: PROVIDED, That minor employees may make
deliveries of ((beer and/or wine purchased from licensees holding
grocery store or beer and/or wine specialty shop licenses exclusively,
when delivery is made)) such liquor to cars of customers adjacent to
such licensed premises but only, however, when the minor employee is
accompanied by the purchaser.
Sec. 214 RCW 19.126.010 and 2003 c 59 s 1 are each amended to
read as follows:
(1) The legislature recognizes that both suppliers and wholesale
distributors of malt beverages and spirits are interested in the goal
of best serving the public interest through the fair, efficient, and
competitive distribution of such beverages. The legislature encourages
them to achieve this goal by:
(a) Assuring the wholesale distributor's freedom to manage the
business enterprise, including the wholesale distributor's right to
independently establish its selling prices; and
(b) Assuring the supplier and the public of service from wholesale
distributors who will devote their best competitive efforts and
resources to sales and distribution of the supplier's products which
the wholesale distributor has been granted the right to sell and
distribute.
(2) This chapter governs the relationship between suppliers of malt
beverages and spirits and their wholesale distributors to the full
extent consistent with the Constitution and laws of this state and of
the United States.
Sec. 215 RCW 19.126.020 and 2009 c 155 s 1 are each reenacted and
amended to read as follows:
The definitions in this section apply throughout this chapter
unless the context clearly requires otherwise.
(1) "Agreement of distributorship" means any contract, agreement,
commercial relationship, license, association, or any other
arrangement, for a definite or indefinite period, between a supplier
and distributor.
(2) "Authorized representative" has the same meaning as "authorized
representative" as defined in RCW 66.04.010.
(3) "Brand" means any word, name, group of letters, symbol, or
combination thereof, including the name of the distiller or brewer if
the distiller's or brewer's name is also a significant part of the
product name, adopted and used by a supplier to identify ((a)) specific
spirits or a specific malt beverage product and to distinguish that
product from other spirits or malt beverages produced by that supplier
or other suppliers.
(4) "Distributor" means any person, including but not limited to a
component of a supplier's distribution system constituted as an
independent business, importing or causing to be imported into this
state, or purchasing or causing to be purchased within this state, any
spirits or malt beverages for sale or resale to retailers licensed
under the laws of this state, regardless of whether the business of
such person is conducted under the terms of any agreement with a
distiller or malt beverage manufacturer.
(5) "Importer" means any distributor importing spirits or beer into
this state for sale to retailer accounts or for sale to other
distributors designated as "subjobbers" for resale.
(6) "Malt beverage manufacturer" means every brewer, fermenter,
processor, bottler, or packager of malt beverages located within or
outside this state, or any other person, whether located within or
outside this state, who enters into an agreement of distributorship for
the resale of malt beverages in this state with any wholesale
distributor doing business in the state of Washington.
(7) "Person" means any natural person, corporation, partnership,
trust, agency, or other entity, as well as any individual officers,
directors, or other persons in active control of the activities of such
entity.
(8) "Spirits manufacturer" means every distiller, processor,
bottler, or packager of spirits located within or outside this state,
or any other person, whether located within or outside this state, who
enters into an agreement of distributorship for the resale of spirits
in this state with any wholesale distributor doing business in the
state of Washington.
(9) "Successor distributor" means any distributor who enters into
an agreement, whether oral or written, to distribute a brand of spirits
or malt beverages after the supplier with whom such agreement is made
or the person from whom that supplier acquired the right to manufacture
or distribute the brand has terminated, canceled, or failed to renew an
agreement of distributorship, whether oral or written, with another
distributor to distribute that same brand of spirits or malt beverages.
(((9))) (10) "Supplier" means any spirits or malt beverage
manufacturer or importer who enters into or is a party to any agreement
of distributorship with a wholesale distributor. "Supplier" does not
include: (a) Any domestic distillery licensed under RCW 66.24.140 or
66.24.145 and producing less than sixty thousand proof gallons of
spirits annually or any brewery or microbrewery licensed under RCW
66.24.240 and producing less than two hundred thousand barrels of malt
liquor annually; (b) any brewer or manufacturer of malt liquor
producing less than two hundred thousand barrels of malt liquor
annually and holding a certificate of approval issued under RCW
66.24.270; or (c) any authorized representative of distillers or malt
liquor manufacturers who holds an appointment from one or more
distillers or malt liquor manufacturers which, in the aggregate,
produce less than two hundred thousand barrels of malt liquor or sixty
thousand proof gallons of spirits.
(((10))) (11) "Terminated distribution rights" means distribution
rights with respect to a brand of malt beverages which are lost by a
terminated distributor as a result of termination, cancellation, or
nonrenewal of an agreement of distributorship for that brand.
(((11))) (12) "Terminated distributor" means a distributor whose
agreement of distributorship with respect to a brand of spirits or malt
beverages, whether oral or written, has been terminated, canceled, or
not renewed.
Sec. 216 RCW 19.126.040 and 2009 c 155 s 3 are each amended to
read as follows:
Wholesale distributors are entitled to the following protections
which are deemed to be incorporated into every agreement of
distributorship:
(1) Agreements between wholesale distributors and suppliers shall
be in writing;
(2) A supplier shall give the wholesale distributor at least sixty
days prior written notice of the supplier's intent to cancel or
otherwise terminate the agreement, unless such termination is based on
a reason set forth in RCW 19.126.030(5) or results from a supplier
acquiring the right to manufacture or distribute a particular brand and
electing to have that brand handled by a different distributor. The
notice shall state all the reasons for the intended termination or
cancellation. Upon receipt of notice, the wholesale distributor shall
have sixty days in which to rectify any claimed deficiency. If the
deficiency is rectified within this sixty-day period, the proposed
termination or cancellation is null and void and without legal effect;
(3) The wholesale distributor may sell or transfer its business, or
any portion thereof, including the agreement, to successors in interest
upon prior approval of the transfer by the supplier. No supplier may
unreasonably withhold or delay its approval of any transfer, including
wholesaler's rights and obligations under the terms of the agreement,
if the person or persons to be substituted meet reasonable standards
imposed by the supplier;
(4) If an agreement of distributorship is terminated, canceled, or
not renewed for any reason other than for cause, failure to live up to
the terms and conditions of the agreement, or a reason set forth in RCW
19.126.030(5), the wholesale distributor is entitled to compensation
from the successor distributor for the laid-in cost of inventory and
for the fair market value of the terminated distribution rights. For
purposes of this section, termination, cancellation, or nonrenewal of
a distributor's right to distribute a particular brand constitutes
termination, cancellation, or nonrenewal of an agreement of
distributorship whether or not the distributor retains the right to
continue distribution of other brands for the supplier. In the case of
terminated distribution rights resulting from a supplier acquiring the
right to manufacture or distribute a particular brand and electing to
have that brand handled by a different distributor, the affected
distribution rights will not transfer until such time as the
compensation to be paid to the terminated distributor has been finally
determined by agreement or arbitration;
(5) When a terminated distributor is entitled to compensation under
subsection (4) of this section, a successor distributor must compensate
the terminated distributor for the fair market value of the terminated
distributor's rights to distribute the brand, less any amount paid to
the terminated distributor by a supplier or other person with respect
to the terminated distribution rights for the brand. If the terminated
distributor's distribution rights to a brand of spirits or malt
beverages are divided among two or more successor distributors, each
successor distributor must compensate the terminated distributor for
the fair market value of the distribution rights assumed by that
successor distributor, less any amount paid to the terminated
distributor by a supplier or other person with respect to the
terminated distribution rights assumed by the successor distributor.
A terminated distributor may not receive total compensation under this
subsection that exceeds the fair market value of the terminated
distributor's distribution rights with respect to the affected brand.
Nothing in this section shall be construed to require any supplier or
other third person to make any payment to a terminated distributor;
(6) For purposes of this section, the "fair market value" of
distribution rights as to a particular brand means the amount that a
willing buyer would pay and a willing seller would accept for such
distribution rights when neither is acting under compulsion and both
have knowledge of all facts material to the transaction. "Fair market
value" is determined as of the date on which the distribution rights
are to be transferred in accordance with subsection (4) of this
section;
(7) In the event the terminated distributor and the successor
distributor do not agree on the fair market value of the affected
distribution rights within thirty days after the terminated distributor
is given notice of termination, the matter must be submitted to binding
arbitration. Unless the parties agree otherwise, such arbitration must
be conducted in accordance with the American arbitration association
commercial arbitration rules with each party to bear its own costs and
attorneys' fees;
(8) Unless the parties otherwise agree, or the arbitrator for good
cause shown orders otherwise, an arbitration conducted pursuant to
subsection (7) of this section must proceed as follows: (a) The notice
of intent to arbitrate must be served within forty days after the
terminated distributor receives notice of terminated distribution
rights; (b) the arbitration must be conducted within ninety days after
service of the notice of intent to arbitrate; and (c) the arbitrator or
arbitrators must issue an order within thirty days after completion of
the arbitration;
(9) In the event of a material change in the terms of an agreement
of distribution, the revised agreement must be considered a new
agreement for purposes of determining the law applicable to the
agreement after the date of the material change, whether or not the
agreement of distribution is or purports to be a continuing agreement
and without regard to the process by which the material change is
effected.
NEW SECTION. Sec. 217 The following acts or parts of acts are
each repealed:
(1) RCW 66.08.070 (Purchase of liquor by board -- Consignment not
prohibited -- Warranty or affirmation not required for wine or malt
purchases) and 1985 c 226 s 2, 1973 1st ex.s. c 209 s 1, & 1933 ex.s.
c 62 s 67;
(2) RCW 66.08.075 (Officer, employee not to represent manufacturer,
wholesaler in sale to board) and 1937 c 217 s 5;
(3) RCW 66.08.160 (Acquisition of warehouse authorized) and 1947 c
134 s 1;
(4) RCW 66.08.165 (Strategies to improve operational efficiency and
revenue) and 2005 c 231 s 1;
(5) RCW 66.08.166 (Sunday sales authorized--Store selection and
other requirements) and 2005 c 231 s 2;
(6) RCW 66.08.167 (Sunday sales--Store selection) and 2005 c 231 s
4;
(7) RCW 66.08.220 (Liquor revolving fund -- Separate account--Distribution) and 2009 c 271 s 4, 2007 c 370 s 15, 1999 c 281 s 2, &
1949 c 5 s 11;
(8) RCW 66.08.235 (Liquor control board construction and
maintenance account) and 2005 c 151 s 4, 2002 c 371 s 918, & 1997 c 75
s 1;
(9) RCW 66.16.010 (Board may establish -- Price standards -- Prices in
special instances) and 2005 c 518 s 935, 2003 1st sp.s. c 25 s 928,
1939 c 172 s 10, 1937 c 62 s 1, & 1933 ex.s. c 62 s 4;
(10) RCW 66.16.040 (Sales of liquor by employees -- Identification
cards -- Permit holders -- Sales for cash -- Exception) and 2005 c 206 s 1,
2005 c 151 s 5, 2005 c 102 s 1, 2004 c 61 s 1, 1996 c 291 s 1, 1995 c
16 s 1, 1981 1st ex.s. c 5 s 8, 1979 c 158 s 217, 1973 1st ex.s. c 209
s 3, 1971 ex.s. c 15 s 1, 1959 c 111 s 1, & 1933 ex.s. c 62 s 7;
(11) RCW 66.16.041 (Credit and debit card purchases -- Rules--Provision, installation, maintenance of equipment by board--Consideration of offsetting liquor revolving fund balance reduction)
and 2005 c 151 s 6, 2004 c 63 s 2, 1998 c 265 s 3, 1997 c 148 s 2, &
1996 c 291 s 2;
(12) RCW 66.16.050 (Sale of beer and wine to person licensed to
sell) and 1933 ex.s. c 62 s 8;
(13) RCW 66.16.060 (Sealed packages may be required, exception) and
1943 c 216 s 1 & 1933 ex.s. c 62 s 9;
(14) RCW 66.16.070 (Liquor cannot be opened or consumed on store
premises) and 1933 ex.s. c 62 s 10;
(15) RCW 66.16.100 (Fortified wine sales) and 1997 c 321 s 42 &
1987 c 386 s 5;
(16) RCW 66.16.110 (Birth defects from alcohol -- Warning required)
and 1993 c 422 s 2;
(17) RCW 66.16.120 (Employees working on Sabbath) and 2005 c 231 s
5; and
(18) RCW 66.28.045 (Furnishing samples to board -- Standards for
accountability -- Regulations) and 1975 1st ex.s. c 173 s 9.
NEW SECTION. Sec. 301 This act does not increase any tax, create
any new tax, or eliminate any tax. Section 106 of this act applies to
spirits licensees upon the effective date of this section, but all
taxes presently imposed by RCW 82.08.150 on sales of spirits by or on
behalf of the liquor control board shall continue to apply so long as
the liquor control board makes any such sales.
NEW SECTION. Sec. 302 If any provision of this act or its
application to any person or circumstance is held invalid, the
remainder of this act or the application of the provision to other
persons or circumstances is not affected.
NEW SECTION. Sec. 303 This act is necessary for the immediate
preservation of the public peace, health, or safety, or support of the
state government and its existing public institutions, and takes effect
July 1, 2011.