WSR 98-05-103

PROPOSED RULES

LIQUOR CONTROL BOARD

[Filed February 18, 1998, 10:32 a.m.]

Original Notice.

Preproposal statement of inquiry was filed as WSR 97-22-038.

Title of Rule: Converting retail liquor licenses to brewery or winery licenses.

Purpose: This rule sets forth conditions for converting a retail liquor, primarily a public house license, to a brewery, microbrewery or winery license.

Other Identifying Information: Requests from licensees prompted the board to add this rule for clarity.

Statutory Authority for Adoption: RCW 66.06.030.

Statute Being Implemented: RCW 66.24.580.

Summary: This rule clarifies the conditions under which a public house license holder or any other retail license holder may convert businesses to brewery, microbrewery or winery licenses.

Reasons Supporting Proposal: Previous rules have not made clear the process for such a conversion. Since there are several technicalities involved in these conversions, this rule will be necessary for clarification.

Name of Agency Personnel Responsible for Drafting: Greg Nordlund, P.O. Box 43080, Olympia, WA 98504-3080, (360) 586-0875; Implementation and Enforcement: Dave Goyette, P.O. Box 43098, Olympia, WA 98504-3098, (360) 753-2724.

Name of Proponent: Washington State Liquor Control Board, governmental.

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

Explanation of Rule, its Purpose, and Anticipated Effects: Although the board previously allowed public house licensees to convert to a brewery or winery, the business was required to close its doors for forty-five days. At the request of licensees who felt this was a financial burden, the board is proposing this rule which removes the forty-five day closure requirement and clarifies all conditions of converting a license.

Proposal does not change existing rules.

No small business economic impact statement has been prepared under chapter 19.85 RCW. No involuntary impact to business.

Section 201, chapter 403, Laws of 1995, does not apply to this rule adoption. The Washington State Liquor Control Board is not a listed agency in section 201.

Hearing Location: Washington State Liquor Control Board, Fifth Floor Board Room, 1025 East Union Avenue, Olympia, WA 98504, on April 22, 1998, at 9:30 a.m.

Assistance for Persons with Disabilities: Contact Greg Nordlund by April 22, 1998, TDD (360) 753-1452, or (360) 586-0875.

Submit Written Comments to: Greg Nordlund, Rules Coordinator, P.O. Box 43080, Olympia, WA 98504-3080, FAX (360) 704-4925.

Date of Intended Adoption: May 6, 1998.

February 18, 1998

Nathan S. Ford, Jr.

Chair

NEW SECTION

WAC 314-12-200 Converting a public house license (RCW 66.24.580) to a domestic brewery, microbrewery or domestic winery license. (1) Can a person who holds a public house license (Class Q) convert to a domestic brewery, microbrewery or domestic winery license (Class B1 or W1)?

Yes, if the licensee has held a public house license for at least six months.

(2) If a person holds several different retail liquor licenses, are those licenses affected by the conversion?

Yes. All other retail liquor licenses must either be converted to a domestic brewery, microbrewery or domestic winery license at the same time or the licensee must discontinue business or divest themselves of all interest in those nonbrewery/winery licenses.

For instance, if a licensee holds three public house licenses, two grocery licenses and a tavern license and only wants to convert the three public house licenses to brewery or winery license, they must discontinue business or divest themselves of all interest in the other three businesses or they must convert them to a brewery or winery license as well.

Additionally, if the licensee has held any public house license for less than 6 months, they must discontinue business or divest themselves of all interest in that business as well.

(3) If a person currently holds a restaurant license (Class H) in conjunction with their public house license, will the restaurant license be affected?

No. If the restaurant remains on the same or contiguous property as the brewery or winery, the restaurant license will be unaffected.

(4) Is there a waiting period between the closure of the public house business and the opening of the brewery or winery?

No. The licensee does not have to close the existing business before the domestic brewery, microbrewery or domestic winery license can be issued.