Legislature(2017 - 2018)BELTZ 105 (TSBldg)
04/14/2018 09:00 AM JUDICIARY
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SB 76-ALCOHOLIC BEVERAGE CONTROL; ALCOHOL REG 9:10:18 AM CHAIR COGHILL announced the consideration of SB 76 and noted the proposed committee substitute (CS). 9:10:49 AM SENATOR COSTELLO moved to adopt the work draft committee substitute (CS) for SB 76, version 30-LS0015\Y, as the working document. CHAIR COGHILL objected to hear an explanation of the changes. 9:12:14 AM SENATOR WIELECHOWSKI joined the committee. JORDAN SHILLING, Staff, Senator John Coghill, Alaska State Legislature, Juneau, Alaska, reviewed the following changes between version M and version Y of SB 76: 1. Page 13, line 14: Lower $2,500 biennial club license fee to $1,500. 2. Page 18, line 24: Amends the sporting event license by inserting "at multiple noncontiguous locations" after "wine". 3. Page 20, line 22: Amends the destination resort license by inserting "at multiple noncontiguous locations" after "beverages". 9:13:43 AM At ease 9:19:17 AM CHAIR COGHILL reconvened the meeting and asked Mr. Shilling to supplement the explanation of "multiple noncontiguous locations." Mr. Shilling pointed to the Chena Hot Springs Resort in Fairbanks as an example of multiple noncontiguous locations. It has multiple serving locations on a single site. CHAIR COGHILL asked Ms. Brawley if she had anything to add. 9:20:56 AM ANNA BRAWLEY, Project Coordinator, Title IV Review Project and Senior Associate, Agnew Beck Consulting, Anchorage, Alaska, said the proposed language allows both the destination resort and the sporting event license types to designate multiple areas on the same property as a licensed premises. She cited the example of two beer gardens on the same property. MR. SHILLING continued to discuss the changes between version M and version Y of SB 76. 4. Page 27, line 27: Insert "with a zip code" following "address". 5. Page 28, lines 21-22: Insert "zip codes that are located within" following "public inspection of". [He noted that this allows wine shippers from out-of-state to understand to which locations they can and cannot ship. For example, they should not be shipping to a local option area.] 6. Page 48, lines 26-31 through page 50, line 3: Creates new Article 7. Common Carrier Approval in section 9 using subsections AS 04.16.125(a)-(f) and (i)-(l) from section 105. This makes an important distinction between administrative violations against a common carrier licensee and the crime of unauthorized transportation of alcoholic beverages by a common carrier into a local option area by a person. MR. SHILLING deferred further explanation to Ms. Brawley. 9:23:15 AM MS. BRAWLEY explained that the original bill put the new concept of shipping alcohol by an approved common carrier from an out- of-state source such as a winery to an Alaskan customer in with the existing law that restricts the shipment of alcohol by common carrier into a local option area. Those are completely separate issues and the proposed language separates the new concept from the original section. SENATOR WIELECHOWSKI read the language on page 48, lines 27-29, regarding common carrier approval and the definition of "common carrier" on page 50, lines 1-2. He asked if this would create a legal liability for someone driving an Uber, Lyft, or taxi it they picked up someone carrying a six pack of beer. MS. BRAWLEY opined that the sections relating to approved common carrier are contemplating shippers like FEDEX and UPS that are sending alcohol from a business to a customer. She said the statute relating to local option in AS 04.16.125 is current law and she didn't believe that the liability is on the carrier, but she would defer to the Department of Law. 9:25:51 AM GUSTAF OLSON, District Attorney, Criminal Division, Kodiak District Attorney Office, Department of Law, Kodiak, Alaska, advised that between 2011 and 2013 he was the statewide prosecutor for Title IV violations and he did prosecute common carriers. His understanding of the proposed modification is that it clarifies the liability and the expectations of the common carrier that is providing the service as opposed to the individual who is utilizing that service to transport alcohol. In the two years that he was the statewide prosecutor, he never charged a common carrier with a common carrier violation. Each time he brought a charge under this title, it was against the person who was trying to subvert the will of the people in the local option community by not properly marking the alcohol container. 9:27:07 AM SENATOR WIELECHOWSKI described the proposed language as broad. He posed a hypothetical of someone calling an Uber or Lyft from a liquor store and climbing into the car with a six pack of beer. He asked if that violates Sec. 04.09.750. MR. OLSON said he had never seen that type of scenario in rural Alaska. The crimes that are charged relating to common carrier are generally in areas that do not allow the sale of alcohol, but people are allowed to bring in alcohol that is properly marked. The common carrier provisions are in Title IV because alcohol can sometimes be delivered through a packing store license. CHAIR COGHILL asked if it would be a violation for an Uber or Lyft driver in Anchorage or Fairbanks to pick up and transport a bottle of wine or spirits without a passenger. MR. OLSON said he didn't believe so based on his reading of the bill and prior enforcement of Title IV. 9:29:10 AM SENATOR WIELECHOWSKI commented that the language on page 48, lines 27-29, doesn't seem to limit this to local option communities. He added, "If you're saying that you're not going to prosecute people for that scenario, I just wanted to have a record of that." MR. OLSON referenced AS 04.16.125(a) and offered his reading that it applies to a person who is using a common carrier to transport alcoholic beverages into an area that has restricted the sale of alcoholic beverages per AS 04.11.491 regarding to local options. CHAIR COGHILL asked Ms. Brawley what she contemplated with the new Article 7 regarding common carrier approval. MS. BRAWLEY said the idea is to ensure that the people that are transporting and delivering alcohol to customers are checking IDs and making sure they are following safe alcohol handling policy. The new section covers both non-local option areas and local option areas and addresses a business such as a winery or package store shipping alcohol to an individual. A business with the winery direct shipment license would not be able to ship to a local option community because they would not have access to the written order database that the ABC Board uses to track monthly order limits. An Alaska package store could ship to a local option area because they have access to the database. 9:31:48 AM MR. SHILLING continued to discuss the changes between version M and version Y of SB 76. 7.Page 70, line 1: Lower the waiting period between board petitions from 10 years to 5 years. CHAIR COGHILL asked Ms. Brawley to discuss the history of this issue and why the reductions gives some comfort to communities. MS. BRAWLEY explained that this relates to a city petitioning the ABC Board to get additional restaurant licenses outside the population limits for that city. The bill proposes that a city could revise their denied petition and essentially submit it the next day. If the petition is approved, the board can authorize additional licenses for the municipality after five years. Previously it was after 10 years. CHAIR COGHILL offered his understanding that this became an issue for cities that saw 10 years as too long to wait when they were growing so rapidly. MS. BRAWLEY said that's correct. 9:33:40 AM SENATOR SHOWER said he'd check with the four cities in his district that would like the timeframe to be three years as opposed to five years. Those cities also requested a change in the appeal process to potentially include the commissioner. His understanding was that the sponsor worked to address those concerns. 9:34:20 AM RACHEL HANKE, Staff, Senator Peter Micciche, Alaska State Legislature, Juneau, Alaska, said her understanding was that an appeal process that includes the commissioner is not allowed for the ABC Board, but there is an existing appeal process to [superior] court. She deferred further explanation to Erika McConnell. ERIKA MCCONNELL, Director, Alcohol and Marijuana Control Office, Anchorage, Alaska, explained that the ABC Board is an independent quasi-judicial and regulatory board whose decisions can be appealed to the Office of Administrative Hearings where an administrative law judge holds a hearing. The judge offers a recommended decision and the ABC Board makes a final decision. An unsatisfied appellant may appeal to superior court. 9:35:56 AM MR. SHILLING continued to discuss the changes between version M and version Y of SB 76. 8. Page 86: Deletes previous sections 92 and 93 which amended the charges for furnishing or delivering to a minor. Statute will remain unchanged. MR. SHILLING explained that the deleted sections relate to furnishing or delivering alcohol to a minor. The conduct would remain a class A misdemeanor or a class C felony. CHAIR COGHILL said this change was at his request. He asked Ms. Henke if the sponsor had an issue with it. MS. HENKE said no. CHAIR COGHILL asked Mr. Olson to discuss the felony penalty. 9:37:06 AM MR. OLSON said he was a career prosecutor who has been involved in enforcement of the crimes of furnishing alcohol to underage individuals and he believed that the criminal penalties were appropriate. MR. SHILLING continued to discuss the changes between version M and version Y of SB 76. 9. Page 87, lines 12-18: Renumbers previous section 95 as section 93 and renumbers the following accordingly. Removes violation penalty for renting a room for the purpose of providing alcoholic beverages to a person under 21 years of age and makes the crime a class A misdemeanor. 10. Page 88, lines 19, 22: Amends sections by specifying that a person 21 years of age or older is subject to the $100 fine for consumption at a school event. MR. SHILLING explained that the bill previously was silent on age, which was problematic because it conflicted with the existing crime of consuming alcohol as a minor. This clarifies that this fine only applies to individuals over 21 years of age. CHAIR COGHILL asked if the Catholic school fundraiser in Fairbanks would be considered a school event. The event is held at the school and alcohol is served. MS. BRAWLEY suggested Erika McConnell answer the question because the event had been held for several years and would have received a permit. 9:40:17 AM MS. MCCONNELL said AMCO issues permits for events that happen at schools, but she was unsure if the definition of school event would be an event that happens at the school or an event such as a fundraiser that is related to a school event. She said she would look into that. CHAIR COGHILL said the question should be answered before the bill leaves this body. He offered his understanding that this was a new section in the law. MR. SHILLING offered his understanding that this was existing law. The bill establishes a fine that previously was a class A misdemeanor. CHAIR COGHILL asked Mr. Olson if he had anything to add. 9:41:47 AM MR. OLSON deferred the question saying the scenario needed more scrutiny. CHAIR COGHILL said he would follow the question and would like the sponsor to do the same. MR. SHILLING discussed the final change between version M and version Y of SB 76. 11. Page 89, lines 26-31 through page 90, lines 1-21: Adds reference to new approved common carriers section [see change 6]. Simplifies existing AS 04.16.125 and relocates existing class A misdemeanor into new subsections (d) and (e) for clarity. He deferred the explanation to Anna Brawley. 9:42:53 AM MS. BRAWLEY said this was a modification of existing law relating to the transport of alcohol into a local option area. The language in the original bill was appropriate for other common carrier regulations regarding shipping to customers but this would cover multiple scenarios in which an individual may accompany the alcohol rather than shipping it through a commercial carrier. 9:43:52 AM CHAIR COGHILL removed his objection and version Y was adopted. CHAIR COGHILL opened public testimony on SB 76. 9:44:55 AM SASSAN MOSSANEN, representing the Brewers Guild of Alaska, and founding partner of Denali Brewing Company, Talkeetna, Alaska, stated support for SB 76 as currently drafted. He expressed gratitude for the steering committee and the sponsor's work throughout the long process. 9:45:51 AM MICHAEL CERVANTES, owner, Banks Ale House, Fairbanks, Alaska, stated support for SB 76. He opined that the current version provided an even playing field for all the licensees and would help clarify contradictory information. He pointed out that the rewrite allowed cross utilization of licenses, would help the industry going forward, and would bring the title up to date. 9:47:52 AM ROBIN MINARD, Director of Public Affairs, Matsu Health Foundation, Wasilla, Alaska, stated support for SB 76. She advised that in their 2013 community health needs assessment MatSu residents ranked alcohol and substance abuse as the number one health issue in the MatSu. Police captains also confirmed that alcohol was the number one substance abuse problem. When the MatSu regional emergency department visits were analyzed from 2013 to 2016, they found that alcohol disorders were the number one reason for behavioral health visits. She opined that the systematic redraft of Title IV proposed in SB 76 would help the ABC Board carry out its mission and would benefit organizations and individuals whose work, community, or business is affected by alcohol. She encouraged the committee to move the bill forward for passage this year. 9:49:37 AM MATTHEW JONES, Moose's Tooth, Bear Tooth, and Broken Tooth, Anchorage, Alaska, stated support for SB 76 and described the long process as a once in a lifetime opportunity to rewrite Title IV in a sensible way. He opined that it would level the playing field between competitors and provide AMCO a sensible road map for enforcing the law. 9:51:09 AM DALE FOX, President, Alaska CHARR, Anchorage, Alaska, testified in support of SB 76. He posited that a well-regulated alcohol industry was good for public safety, for public health, and the industry. He commented that what was interesting about this long process was the coming together of people. The Alaska CHARR Board, which is comprised of every segment of the industry, unanimously supports SB 76. They encourage passage of the bill. 9:52:28 AM TIFFANY HALL, Executive Director, Recover Alaska, said her board was very different than the CHARR Board but it too was in full support of SB 76. Their primary funders include Providence, Southcentral Foundation, MatSu Health Foundation, Rasmuson, the Mental Health Trust Authority, DHSS, and many other tribal, nonprofit, and governmental agencies across the state. The work has been ongoing for six years and it took all of that time to reach consensus between health, public safety, and the industry. She said it was important to pass the bill this year. These are the things on which there is consensus. She said Recover Alaska was committed to continue working on areas where consensus was not achieved. CHAIR COGHILL asked Ms. Brawley to give members an idea of the numbers of meetings it took to put this together. MS. BRAWLEY said she understands that the project was initiated by the ABC Board in 2012. The board hired Agnew Beck Consulting initially to facilitate a meeting and it has shepherded the project since then organizing meetings, taking notes, and tracking the discussion and decisions. She estimated that stakeholders spent 12,000 hours in meetings. 9:56:06 AM CHAIR COGHILL closed public testimony on SB 76 an asked the will of the committee. SENATOR SHOWER said he was working on an amendment. 9:57:06 AM At ease 9:57:52 AM CHAIR COGHILL reconvened the meeting. 9:58:06 AM SENATOR COSTELLO moved to report the CS for SSSB 76, version Y, from committee with individual recommendations and attached fiscal note(s). 9:58:18 AM SENATOR SHOWER objected. He said he wanted to discuss the question of public convenience with Ms. Brawley. CHAIR COGHILL asked if he wanted to hold the bill until Monday or follow it to the next committee. SENATOR SHOWER said his preference was to hold it until Monday but would defer to the committee. 9:59:03 AM At ease 9:59:51 AM CHAIR COGHILL reconvened the meeting. 10:00:00 AM SENATOR SHOWER said his proposed amendment would maintain the existing statute and communities would have the opportunity to apply for additional licenses. CHAIR COGHILL said he would commit to work on that as the bill moves forward, but it may not need to be added to the bill. SENATOR SHOWER said he preferred not to slow the bill. CHAIR COGHILL asked if there was objection to moving SB 76 from committee. 10:00:30 AM SENATOR WIELECHOWSKI said a few issues came up during the last hearing that the committee asked the Department of Law to clarify. Those have not been resolved but if the next committee of referral could address them he would be comfortable moving the bill. He listed the following questions that are based on version M: Section 79, subsection (b), on page 81, lines 28-30. The question was what the legal standard was. Section 81, subsection (e), on page 82, lines 20-25, The question was whether the penalty was limited to $250 or if it was strict and vicarious liability plus the penalty of $250. Section 100, subsections (b) and (c), on page 87. The question was the definition of school event. Section 105, on page 89. The question was about the liability for a common carrier transporting or delivering alcoholic beverages. Section 106, subsection (c), on page 91, lines 2-3. The question was about the definition of unauthorized storage. SENATOR WIELECHOWSKI said his concerns would be resolved if he received answers to the forgoing questions in the next several days and there was some discussion on the record in the Finance Committee. 10:03:04 AM SENATOR SHOWER said he would also like clarification about the appeal process for a petition for additional restaurant or eating place licenses for certain local governing bodies. The sponsor said there would be the opportunity for a second appeal. He wanted to verify that that was the case and who would hear the appeal. CHAIR COGHILL advised that Erika McConnell said the appeal was to the ABC Board and then an administrative law judge. SENATOR SHOWER said he wanted clarification because he'd received two different answers. CHAIR COGHILL said he would depend on the sponsor to follow the bill with the answers. 10:04:24 AM CHAIR COGHILL found no objection and CSSSSB 76(JUD) moved from the Senate Judiciary Standing Committee.
|SB 76 - Explanation of Changes Ver. M to Ver. Y.pdf||
SJUD 4/14/2018 9:00:00 AM
|CS to SB 76 - Version Y.pdf||
SJUD 4/14/2018 9:00:00 AM