SB 535

This bill modifies certain aspects of the liquor license quota system and creates

new liquor license quota exceptions.

Current law prohibits a person from selling alcohol beverages at retail unless

the seller possesses a license or permit authorizing the sale. A "Class B" license

authorizes the retail sale of intoxicating liquor for consumption on the licensed

premises and, depending on the type of intoxicating liquor and whether a municipal

ordinance has been adopted, may also authorize the retail sale of intoxicating liquor

for consumption off the licensed premises, subject to certain limitations. Current law

imposes a quota on the number of "Class B" liquor licenses that a municipality may

issue. This quota is generally determined by a formula based on the number of

licenses previously issued by the municipality and the municipality's population.

For purposes of the quota system, a reserve "Class B" license is a "Class B" liquor

license first issued on or after December 1, 1997. Current law provides a limited

number of quota exceptions, including an exception for a full-service restaurant that

has a seating capacity of 300 or more persons and an exception for a capital

improvement area designated by the legislature.

This bill allows a municipality to transfer a reserve "Class B" liquor license to

another municipality that is contiguous with, or within two miles of, the transferring

municipality. The receiving municipality may then issue the license for a premises

within that municipality. The quota of the transferring municipality is decreased,

and the quota of the receiving municipality is increased, for each license transferred.

A municipality may transfer no more than three reserve "Class B" licenses in this

manner. The transferring municipality establishes the issuance fee for the license

after it is transferred, which may not be less than $10,000, and this fee must be

remitted to the transferring municipality. This fee may not be rebated or refunded.

The bill also allows a municipality to designate a geographic area within the

municipality as a premier economic development district, if certain requirements are

met, and to issue two "Class B" liquor licenses in connection with an economic

development project within the premier economic development district. These

licenses are in addition to the "Class B" licenses counted toward the municipality's

quota. The bill includes a definition of an economic development project. The

municipality must establish an initial issuance fee for these "Class B" licenses, which

may not be less than $30,000, and this fee may not be rebated or refunded.

Current law generally requires a municipality to establish an initial issuance

fee for a reserve "Class B" license of at least $10,000. This bill specifies that this fee

may not be rebated or refunded.

This bill also modifies the quota exception for a full-service restaurant that has

a seating capacity of at least 300 persons to require an interior, permanent seating

capacity of at least 300 persons.