WSR 16-15-032 PROPOSED RULES LIQUOR AND CANNABIS BOARD [Filed July 13, 2016, 11:33 a.m.]
Original Notice.
Preproposal statement of inquiry was filed as WSR 16-10-109.
Title of Rule and Other Identifying Information: WAC 314-02-103 What is a wine retailer reseller endorsement?, 314-05-020 What is a special occasion license?, 314-24-240 Domestic wineries at special occasion licensed events, 314-38-020 Permits—Fees established, 314-38-080 Class 18 special winery permit, 314-38-090 Class 19 special distillery permit, 314-38-095 Class 20 special brewery permit, and 314-38-100 Accommodation sale permit.
Hearing Location(s): Washington State Liquor Control [and Cannabis] Board (WSLCB), Board Room, 3000 Pacific Avenue S.E., Olympia, WA 98504, on August 24, 2016, at 10:00 a.m.
Date of Intended Adoption: September 7, 2016.
Submit Written Comments to: Karen McCall, P.O. Box 43080, Olympia, WA 98504, e-mail rules@lcb.wa.gov, fax (360) 664-9689, by August 24, 2016.
Assistance for Persons with Disabilities: Contact Karen McCall by August 24, 2016, (360) 664-1631.
Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: Rules are needed to implement 2016 legislation.
Reasons Supporting Proposal: Licensees need to know what requirements they must meet for permits and privileges passed in the 2016 legislative session.
Statute Being Implemented: RCW 66.20.010.
Rule is not necessitated by federal law, federal or state court decision.
Name of Proponent: WSLCB, governmental.
Name of Agency Personnel Responsible for Drafting: Karen McCall, Rules Coordinator, 3000 Pacific Avenue S.E., Olympia, WA 98504, (360) 664-1631; Implementation: Becky Smith, Licensing Director, 3000 Pacific Avenue S.E., Olympia, WA 98504, (360) 664-1615; and Enforcement: Justin Nordhorn, Chief Enforcement, 3000 Pacific Avenue S.E., Olympia, WA 98504, (360) 664-1726.
No small business economic impact statement has been prepared under chapter 19.85 RCW. A small business economic impact statement was not required.
A cost-benefit analysis is not required under RCW 34.05.328. A cost-benefit analysis was not required.
July 13, 2016
Jane Rushford
Chairman
AMENDATORY SECTION (Amending WSR 12-12-065, filed 6/5/12, effective 7/6/12)
WAC 314-02-103 What is a wine retailer reseller endorsement?
(1) A wine retailer reseller endorsement is issued to the holder of a grocery store liquor license or the holder of a beer and/or wine specialty shop license to allow the sale of wine at retail to on-premises liquor licensees.
(2) For holders of a grocery store license: No single sale to an on-premises liquor licensee may exceed twenty-four liters. Single sales to an on-premises licensee are limited to one per day.
(3) For holders of a beer and/or wine specialty shop license:
(a) No single sale may exceed twenty-four liters, unless the sale is made by a licensee that was formerly a state liquor store or contract liquor store.
(b) May sell a maximum of five thousand liters of wine per day for resale to retailers licensed to sell wine for consumption on the premises.
(4) A grocery store licensee or a beer and/or wine specialty shop licensee with a wine retailer reseller endorsement may accept delivery at its licensed premises or at one or more warehouse facilities registered with the board.
(((4))) (5) The holder of a wine retailer reseller endorsement may also deliver wine to its own licensed premises from the registered warehouse; may deliver wine to on-premises licensees, or to other warehouse facilities registered with the board. A grocery store licensee or a beer and/or wine specialty shop licensee wishing to obtain a wine retailer reseller endorsement that permits sales to another retailer must possess and submit a copy of their federal basic permit to purchase wine at wholesale for resale under the Federal Alcohol Administration Act. A federal basic permit is required for each location from which the grocery store licensee or beer and/or wine specialty shop licensee holding a wine retailer reseller endorsement plans to sell wine to another retailer.
(((5))) (6) The annual fee for the wine retailer reseller endorsement for a grocery store licensee is one hundred sixty-six dollars.
(7) The annual fee for the wine retailer reseller endorsement for a beer and/or wine specialty shop licensee is one hundred ten dollars.
(8) Sales made under the reseller endorsement are not classified as retail sales for taxation purposes.
AMENDATORY SECTION (Amending WSR 12-17-006, filed 8/1/12, effective 9/1/12)
WAC 314-05-020 What is a special occasion license?
(1) Per RCW 66.24.380, a special occasion license allows a nonprofit organization to sell, at a specified date, time, and place:
(a) Spirits, beer, and wine by the individual serving for on-premises consumption; ((and))
(b) Spirits, beer, and wine in original, unopened containers for off-premises consumption; and
(c) Wine in original, unopened containers for on-premises consumption if permission is obtained from the WSLCB prior to the event.
(2) Special occasion licensees are limited to twelve days per calendar year (see RCW 66.24.380(1) for an exception for agricultural fairs).
(3) The fee for this license is $60 per day, per event. Multiple alcohol service locations at an event are an additional sixty dollars per location.
(4) Per RCW 66.24.375, all proceeds from the sale of alcohol at a special occasion event must go directly back into the nonprofit organization, except for reasonable operating costs for actual services performed at compensation levels comparable to like services within the state.
(5) A charitable nonprofit organization or a local winery industry association is not disqualified from obtaining a special occasion license even if its board members are also officers, directors, owners, or employees of either a licensed domestic winery or a winery certificate of approval holder. The charitable nonprofit organization must be registered under section 501 (c)(3) of the Internal Revenue Code, and the local wine industry association must be registered under section 501 (c)(6) of the Internal Revenue Code.
NEW SECTION
WAC 314-24-245 Domestic wineries at special occasion licensed events.
(1) A domestic winery may take orders and accept payment for product of its own production from consumers at a special occasion event, to be delivered at a later date from one of its authorized locations.
(2) A domestic winery must be invited and/or authorized by the special occasion licensee in order to attend the special occasion event in this capacity.
(3) In order for the winery to exercise this privilege, the special occasion licensee must be providing the winery's product at the event for on-premises consumption.
(4) The special occasion licensee is the only licensee allowed to sell wine to be consumed on the premises.
(5) The winery is not allowed to give free tastings of wine of their own production to consumers.
(6) The winery shall notify the board or its designee of the name of the special occasion licensee, date, time, place, and location of the event.
AMENDATORY SECTION (Amending WSR 84-14-028, filed 6/27/84)
WAC 314-38-020 Permits—Fees established.
The fees for permits authorized under RCW 66.20.010 are hereby established as follows:
(1) A fee of five dollars is established for a special permit as authorized by RCW 66.20.010(1).
(2) The fee for a special permit as authorized by RCW 66.20.010(2) for purchase of five gallons or less is established as five dollars and for purchase of over five gallons is established as ten dollars.
(3) A fee for a banquet permit, as authorized by RCW 66.20.010(3), is established in WAC 314-18-040.
(4) The fee for a special business permit, as authorized by RCW 66.20.010(4), is established in WAC 314-38-010(2).
(5) The fee of ten dollars is established for a special permit as authorized by RCW 66.20.010(5).
(6) A fee of five dollars is established for a special permit as authorized by RCW 66.20.010(6).
(7) A special permit as authorized by RCW 66.20.010(7) shall be issued without charge to those eligible entities.
(8) The fee of twenty-five dollars is established for a special permit as authorized by RCW 66.20.010(8).
(9) The fee of twenty-five dollars is established for a special permit as authorized by RCW 66.20.010(9).
(10) The fee of thirty dollars is established for a special permit as authorized by RCW 66.20.010(10).
(11) The fee of seventy-five dollars is established for a special permit as authorized by RCW 66.20.010(11).
(12) The fee of ten dollars is established for a special permit as authorized by RCW 66.20.010(12).
(13) The fee of ten dollars is established for a special permit as authorized by RCW 66.20.010(13).
(14) The fee of ten dollars is established for a special permit as authorized by RCW 66.20.010(14).
(15) The fee of twenty-five dollars is established for a special permit as authorized by RCW 66.20.010(15).
AMENDATORY SECTION (Amending WSR 16-01-102, filed 12/16/15, effective 1/16/16)
WAC 314-38-080 Class 18 special winery permit.
(1) The special winery permit is for domestic wineries.
(2) A special winery permit allows a manufacturer of wine to ((have)) be present at a private event not open to the general public at a specific place and date for the purpose of tasting wine and selling wine of its own production for off-premises consumption.
(3) ((The activities at the event are limited to the activities allowed on the winery premises.
(4))) The winery must obtain the special permit by submitting an application for a class 18 special winery permit to the board with a ten dollar permit fee.
(a) The application must be submitted to the board at least ten days prior to the event.
(b) The special permit must be posted at the event.
(((5))) (4) The winery is limited to twelve events per calendar year.
AMENDATORY SECTION (Amending WSR 16-01-102, filed 12/16/15, effective 1/16/16)
WAC 314-38-090 Class 19 special distillery permit.
(1) A special distillery/craft distillery permit is for Washington distillers only.
(2) A special distillery/craft distillery permit allows a manufacturer of spirits to ((have)) be present at a private event not open to the general public at a specific place and date for the purpose of tasting spirits and selling spirits of its own production for off-premises consumption.
(3) The activities at the event are limited to the activities allowed on the distillery/craft distillery premises.
(4) The distillery or craft distillery must obtain the special permit by submitting an application for a class 19 special distillery/craft distillery permit to the board with a ten dollar permit fee.
(a) The application must be submitted to the board at least ten days prior to the event.
(b) The special permit must be posted at the event.
(5) The licensee is limited to twelve events per calendar year.
NEW SECTION
WAC 314-38-095 Class 20 special brewery permit.
(1) A special brewery/microbrewery permit is for Washington brewers only.
(2) A special brewery/microbrewery permit allows a manufacturer of beer to be present at a private event not open to the general public at a specific place and date for the purpose of tasting beer and selling beer of its own production for off-premises consumption.
(3) The brewery or microbrewery must obtain the special permit by submitting an application for a class 20 special brewery/microbrewery permit to the board with a ten dollar permit fee.
(a) The application must be submitted to the board at least ten days prior to the event.
(b) The special permit must be posted at the event.
(4) The licensee is limited to twelve events per calendar year.
NEW SECTION
WAC 314-38-100 Accommodation sale permit.
(1) An accommodation sale permit is for an individual or business to sell a private collection of wine or spirits to another individual or business.
(2) The seller must complete an application for accommodation sale permit and submit with a fee of twenty-five dollars to the WSLCB.
(3) Once the WSLCB verifies the information on the application, a permit for the sale will be issued to the seller.
(4) The seller must wait at least five business days after receiving the permit to release the wine and/or spirits to the buyer.
(5) Within twenty calendar days of the sale, the seller must complete an accommodation sale inventory report and submit it to the WSLCB.
(6) The following are definitions for the purpose of this section:
(a) "Accommodation sale" means the sale of a private collection of wine or spirits to an individual or business. Both the seller and the buyer must be located in Washington state.
(b) "Buyer" means the individual or business buying a private collection of wine or spirits. A buyer may be a liquor licensee.
(c) "Private collection" means a privately owned collection of wine or spirits. There is no minimum or maximum quantity to be considered a collection.
(d) "Seller" means the individual or business selling a private collection of wine or spirits. The seller cannot be a liquor licensee.
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