Legislature(2017 - 2018)BELTZ 105 (TSBldg)
04/10/2018 01:30 PM LABOR & COMMERCE
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HB 301-ALCOHOL LICENSES:BEV DISP/RESTAUR./LODGE 1:35:12 PM CHAIR COSTELLO announced the consideration of HB 301. [CSHB 301(FIN) was before the committee.] 1:35:28 PM REPRESENTATIVE ADAM WOOL, Alaska State Legislature, Juneau, Alaska, sponsor of HB 301, introduced the legislation speaking to the following sponsor statement: "An Act relating to the renewal and transfer of ownership of a beverage dispensary license or restaurant or eating place license." House Bill 301 would grandfather hospitality businesses that have been operating for at least thirty years, some for close to one hundred, and allow them to continue operating with a tourism beverage dispensary license [BDL]. These businesses essentially function as roadhouses, a place to stay for the weary traveler (or miner as it were when their doors first opened) and have long held a place in Alaska's storied past. When Title 4 was last rewritten in 1985, the law was interpreted to let them function under the tourism dispensary license despite not providing as many rooms as was required by the population parameters. Some of these establishments would have to build an additional forty rooms to comply with the interpretation of the current statute. HB 301 simply allows long-time Alaskan businesses to continue operating as they have been for decades. REPRESENTATIVE WOOL explained that in 2016 Legislative Audit determined that 34 long-standing businesses that were operating with tourism beverage dispensary licenses were non-compliant and that a legislative fix was needed. HB 301 provides that fix and allows businesses that qualified when they received their license initially would continue to qualify. This is important in communities that have grown significantly because some businesses would be required to add 30-40 rooms to comply with the population requirements. HB 301 essentially grandfathers 34 businesses and allows them to stay open. He noted that his staff could talk about the changes the bill has undergone since it was introduced. CHAIR COSTELLO asked Ms. Stidolph to walk through those changes. 1:38:02 PM LAURA STIDOLPH, Staff, Representative Adam Wool, Alaska State Legislature, Juneau, Alaska, explained that in Section 1 AS 4.11.330(a) was amended to change the annual operating hours of a licensed premises from 30 8-hour days to 240 hours. This was done to accommodate bars and seasonal businesses that don't operate on an 8-hour day. In Section 4, AS 4.11.491(a) was amended to add an outdoor recreation lodge license to those that may be approved by voters in a municipality on a local option ballot. This was done to accommodate a couple of lodges in Bristol Bay that have been operating since 2011 and are in a local option area. The community voted to opt in those businesses for a liquor license, but a legislative audit determined that outdoor recreation lodge licenses did not qualify for an opt in vote. Adding this license type to those that a community may opt in provides the fix. 1:39:59 PM SENATOR MEYER asked how this interacts with the Title 4 rewrite. REPRESENTATIVE WOOL replied the 240-hour aggregate hour requirement is in the current Title 4 draft, he wasn't sure about the opt in list or the grandfathering, but the communities and businesses wanted a more immediate legislative fix because the Title 4 rewrite is still in committee. SENATOR MEYER asked if the grandfather provision applies only to businesses started before 1985. REPRESENTATIVE WOOL said most of the 34 businesses started pre- 1985, but there are several exceptions. CHAIR COSTELLO noted that someone from the Duck Inn was online. SENATOR MEYER questioned whether businesses that started after 1985 would be adversely affected. REPRESENTATIVE WOOL replied any business that started after 1985 would need to comply with the law at the time of licensure. For example, a business that received a tourism BDL in 1990 with a 20-room requirement would continue to only need 20 rooms regardless of the community population growth. 1:43:05 PM CHAIR COSTELLO opened public testimony on HB 301. 1:43:16 PM NANCY TRUMP, owner, Latitude 62 Lodge/Motel, Talkeetna, Alaska, said she and her partner have owned and operated the lodge and motel since May 1986. They have 13 rooms, a bar, and a restaurant. The liquor license is critical to the business just as with two other businesses in Talkeetna. Without liquor licenses, all three would probably shut down and the community would lose 55 rooms. She asked the committee to support HB 301 and grandfather the business with a tourism dispensary license so she could continue to operate. 1:45:24 PM DEBBIE CAREY, owner, Inlet View Lodge, Ninilchik, Alaska, said the loss of tourism beverage dispensary licenses would have a huge impact on communities, families, and the state. When she received her license initially she believed she met all the legal requirements and the license has continually been renewed for 27 years. She argued that the existing requirements for number of rooms based on population is unreasonable in some areas. Under the current requirement her business would need four times the number it had 27 years ago. This would be cost prohibitive. She pointed out that the licenses in question are all small "mom and pop" operations that are the cornerstones of communities. She urged the committee to support HB 301. 1:49:06 PM LINDA SUPERMAN, President, Hunger Hut Bar/Liquor Store and Motel, Nikiski, Alaska, said she has owned the business for the last 25 years. The Alcoholic Beverage Control Board approved their 10 rooms in 1997 and it's not feasible to meet the current requirement to build another 30 rooms. She agreed with the previous testimony and asked the committee to look out for the best interest of these businesses. 1:50:49 PM PETE HANSON, President and CEO, Alaska CHARR, Anchorage, Alaska, said Alaska CHARR is strongly supportive of HB 301 to grandfather these long-standing businesses that provide important services to their communities and the traveling public. Because of an unintended ambiguity in the law they face the prospect of losing their liquor licenses and thus their businesses. Maintaining the original intent of the law is the right thing to do. 1:51:49 PM ARDEN RANKINS, owner, Sunrise Inn, Cooper Landing, Alaska, said she faces the same situation as the other testifiers. Cooper Landing has a population of 275-300 and under the current law she would need to add 40 rooms. The Sunrise Inn was licensed in the early 1960s and she used her retirement savings to purchase it in November 2015. Like the other businesses, she would be forced to close the day after she lost her liquor license. That would negatively impact the schools because the inn is the only gathering place in the community and the only establishment open between Girdwood, Sterling, and Seward. It's a safety spot on a dangerous road. 1:53:43 PM LELA ROSIN, owner, Duck Inn, Soldotna, Alaska, said she and her partner have owned this small motel, caf?, and lounge for 11 years. The tourism beverage dispensary license was transferred to her in 2007 and has renewed every odd year since then. That license is now in jeopardy because of the recent interpretation by the ABC Board. She opined that the Alcohol & Marijuana Control Office has set a precedent for her and similar businesses by allow these licenses to operate and transfer. She listed the contributions the business has made in the past 11 years, including paying nearly $1 million to the community and state in tax revenue. She said this change is unrealistic and unreasonable financially and dynamically. Removing the option to sell the license also jeopardizes her family's economic future. She urged the committee to support the solution represented by HB 301. 1:57:20 PM DALE FOX, President, Alaska CHARR, shared that 33 years ago he supported the bill that now needs a correction. The intent was to promote tourism by allowing businesses with 10 rooms to receive a beverage dispensary license. It was the same concept as the Roadhouse license during Territorial days. There was no thought about transfers or grandfathering because there was never any intent to "kick the licenses out from underneath these hardworking families that you're hearing from," he said. He pointed out that if this isn't fixed it's not just the 34 business owners who will be hurt; it's all their employees and their communities too. Fixing this issue by passing HB 301 is the only descent thing to do, he said. 1:59:56 PM LYN CARDEN, Deputy Administrator, City of Wasilla, Wasilla, Alaska, stated that the City of Wasilla supports HB 301. Two businesses inside the City of Wasilla are affected and the MatSu Borough has several licenses that are affected. It makes sense economically. 2:00:36 PM CHAIR COSTELLO closed public testimony on HB 301 and noted that Erika McConnel, the Director of the Alcohol & Marijuana Control Office had been listening online to the testimony. She asked if there were questions. 2:00:53 PM SENATOR GARDNER pointed out the letter of support from the ABC Board in the bill packet. CHAIR COSTELLO stated she would hold HB 301 in committee.