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Introduced Version House Bill 208 History

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Key: Green = existing Code. Red = new code to be enacted

WEST virginia legislature

2019 FIRsT extraordinary session

Introduced

House Bill 208

By Delegate Hanshaw (Mr. Speaker) and Miley

(By Request of the Executive)

[Introduced July 22, 2019; Referred
to the Committee on
]

A BILL to repeal §29-22B-327 of the Code of West Virginia, 1931, as amended; to amend and reenact §11-16-3 and §11-16-8 of said code; to amend and reenact §16A-6-3 of said code; to amend and reenact §29-22B-503, §29-22B-504, and §29-22B-512 of said code; to amend and reenact §60-1-5 of said code; to amend and reenact §60-3A-8 of said code; to amend and reenact §60-7-4 and §60-7-5 of said code; and to amend and reenact §60-8-16 and §60-8-17 of said code, all relating to residency, manager, and licensure requirements for West Virginia Alcohol Beverage Control Administration applicants and licensees; removing residency requirements for granting permits under the Medical Cannabis Act; and removing residency requirements for the West Virginia Lottery.

Be it enacted by the Legislature of West Virginia:


CHAPTER 11. TAXATION.


ARTICLE 16. NONINTOXICATING BEER.


§11-16-3. Definitions.

For the purpose of this article, except where the context clearly requires differently:

(1) “Brand” means a nonintoxicating beer product manufactured, brewed, mixed, concocted, blended, bottled or otherwise produced, imported, or transshipped by a brewer or manufacturer, the labels of which have been registered and approved by the commissioner, that is being offered for sale or sold in West Virginia by a distributor who has been appointed in a valid franchise agreement or a valid amendment thereto.

(2) “Brewer” or “manufacturer” means any person manufacturing, otherwise producing, importing, or transshipping nonintoxicating beer or nonintoxicating craft beer for sale at wholesale to any licensed distributor. Brewer or manufacturer may be used interchangeably throughout this article. A brewer may obtain only one brewer’s license for its nonintoxicating beer or nonintoxicating craft beer.

(3) “Brewpub” means a place of manufacture of nonintoxicating beer or nonintoxicating craft beer owned by a resident brewer, subject to federal and state regulations and guidelines, a portion of which premises is designated for retail sales of nonintoxicating beer or nonintoxicating craft beer by the resident brewer owning the brewpub.

(4) “Class A retail license” means a retail license permitting the retail sale of liquor at a freestanding liquor retail outlet licensed pursuant to chapter 60 of this code.

(5) “Class B retail license” means a retail license permitting the retail sale of liquor at a mixed retail liquor outlet licensed pursuant to chapter 60 of this code.

(6) “Commissioner” means the West Virginia Alcohol Beverage Control Administration Commissioner.

(7) “Distributor” means and includes any person jobbing or distributing nonintoxicating beer or nonintoxicating craft beer to retailers at wholesale and whose warehouse and chief place of business shall be within this state. For purposes of a distributor only, the term “person” means and includes an individual, firm, trust, partnership, limited partnership, limited liability company, association, or corporation. Any trust licensed as a distributor or any trust that is an owner of a distributor licensee, and the trustee or other persons in active control of the activities of the trust relating to the distributor license, is liable for acts of the trust or its beneficiaries relating to the distributor license that are unlawful acts or violations of §11-11-1 et seq. of this code notwithstanding the liability of trustees in §44D-10-1 et seq. of this code.

(8) “Franchise agreement” means the written agreement between a brewer and a distributor that is identical as to terms and conditions between the brewer and all its distributors, which agreement has been approved by the commissioner. The franchise agreement binds the parties so that a distributor, appointed by a brewer, may distribute all of the brewer’s nonintoxicating beer products, brands or family of brands imported and offered for sale in West Virginia, including, but not limited to, existing brands, line extensions, and new brands all in the brewer’s assigned territory for the distributor. All brands and line extensions being imported or offered for sale in West Virginia must be listed by the brewer in the franchise agreement or a written amendment to the franchise agreement. A franchise agreement may be amended by mutual written agreement of the parties as approved by the commissioner with identical terms and conditions for a brewer and all of its distributors. Any approved amendment to the franchise agreement becomes a part of the franchise agreement. A brewer and a distributor may mutually agree in writing to cancel a franchise agreement. A distributor terminated by a brewer as provided in this article and the promulgated rules no longer has a valid franchise agreement. If a brewer has reached an agreement to cancel a distributor or has terminated a distributor, then a brewer may appoint a successor distributor who accedes to all the rights of the cancelled or terminated distributor.

(9) “Franchise distributor network” means the distributors who have entered into a binding written franchise agreement, identical as to terms and conditions, to distribute nonintoxicating beer products, brands, and line extensions in an assigned territory for a brewer. A brewer may only have one franchise distributor network: Provided, That a brewer that has acquired the manufacturing, bottling, or other production rights for the sale of nonintoxicating beer at wholesale from a selling brewer as specified in §11-16-21(a)(2) of this code shall continue to maintain and be bound by the selling brewer’s separate franchise distributor’s network for any of its existing brands, line extensions, and new brands.

(10) “Freestanding liquor retail outlet” means a retail outlet that sells only liquor, wine, beer, nonintoxicating beer, and other alcohol-related products, as defined pursuant to §60-3A-4 of this code.

(11) “Growler” means a container or jug that is made of glass, ceramic, metal, or other material approved by the commissioner, that may be no larger than 128 fluid ounces in size and must be capable of being securely sealed. The growler is utilized by an authorized licensee for purposes of off-premise sales only of nonintoxicating beer or nonintoxicating craft beer for personal consumption not on a licensed premise and not for resale. Notwithstanding any other provision of this code to the contrary, a securely sealed growler is not an open container under federal, state, and local law. A growler with a broken seal is an open container under federal, state, and local law unless it is located in an area of the motor vehicle physically separated from the passenger compartment. The secure sealing of a growler requires the use of a tamper-resistant seal, security tape, or other material, as approved by the commissioner, placed on or over the growler’s opening, which seal, security tape, or other material is clearly marked with the date of the secure sealing by the authorized licensee who is selling the growler.

(12) “Line extension” means any nonintoxicating beer product that is an extension of brand or family of brands that is labeled, branded, advertised, marketed, promoted, or offered for sale with the intent or purpose of being manufactured, imported, associated, contracted, affiliated, or otherwise related to a brewer’s existing brand through the use of a brewer, its subsidiaries, parent entities, contracted entities, affiliated entities, or other related entities. In determining whether a nonintoxicating beer product is a line extension, the commissioner may consider, but is not limited to, the following factors: Name or partial name; trade name or partial trade name; logos; copyrights; trademarks or trade design; product codes; advertising promotion; or pricing.

(13) “Manager” means an individual who is the applicant’s or licensee’s on-premises employee, member, partner, shareholder, director, or officer who meets licensure requirements of §11-16-1 et seq. of this code and the legislative rules and who actively manages, conducts, and carries on the day to day operations of the applicant or licensee with full and apparent authority or actual authority to act on behalf of the applicant or licensee, including but not limited to: coordinating staffing; reviewing and approving payroll; ordering and paying for inventory, such as nonintoxicating beer, wine, and liquor, as applicable; and managing security staff, security systems, video and other security equipment; and any further acts or actions involved in managing the affairs of the business, on behalf of owners, partners, members, shareholders, officers, or directors.

(14) “Nonintoxicating beer” means all natural cereal malt beverages or products of the brewing industry commonly referred to as beer, lager beer, ale, and all other mixtures and preparations produced by the brewing industry, including malt coolers and nonintoxicating craft beers with no caffeine infusion or any additives masking or altering the alcohol effect containing at least one half of one percent alcohol by volume, but not more than 11.9 percent of alcohol by weight, or 15 percent alcohol by volume, whichever is greater. The word “liquor” as used in chapter 60 of this code does not include or embrace nonintoxicating beer nor any of the beverages, products, mixtures, or preparations included within this definition.

(14)(15) “Nonintoxicating beer floor plan extension” means a temporary one-day extension of an existing Class A licensee’s floor plan to a contiguous, adjoining and bounded area, such as a parking lot or outdoor area, which shall for the temporary period encompass the licensee’s licensed premises; further such license shall be endorsed or approved by the county or municipality where the license is located; such license shall be in good standing with the commissioner, and further such temporary event shall cease on or before midnight of the approved temporary one-day event.

(15)(16) “Nonintoxicating beer sampling event” means an event approved by the commissioner for a Class A retail licensee to hold a nonintoxicating beer sampling authorized pursuant to §11-16-11a of this code.

(16)(17) “Nonintoxicating beer sampling day” means any days and hours of the week where Class A retail licensees may sell nonintoxicating beer pursuant to §11-16-11a and §11-16-18(a)(1) of this code, and is approved, in writing, by the commissioner to conduct a nonintoxicating beer sampling event.

(17)(18) “Nonintoxicating craft beer” means any beverage obtained by the natural fermentation of barley, malt, hops, or any other similar product or substitute and containing not less than one half of one percent by volume and not more than 15 percent alcohol by volume or 11.9 percent alcohol by weight with no caffeine infusion or any additives masking or altering the alcohol effect.

(18)(19) “Original container” means the container used by a resident brewer or brewer at the place of manufacturing, bottling, or otherwise producing nonintoxicating beer or nonintoxicating craft beer for sale at wholesale.

(19)(20) “Person” means and includes an individual, firm, partnership, limited partnership, limited liability company, association, or corporation.

(20)(21) “Private club” means a license issued pursuant to §60-7-1 et seq. of this code.

(21)(22) “Residence” or “residency” means a state where an individual maintains a bona fide primary place of abode and spends in the aggregate more than 183 days (at least eight hour days) of the preceding taxable year; which is verifiable by providing any two items of: (1) certified property tax records; (2) a valid voter’s registration card and verifiable registration dates; (3) if licensed to drive, a valid driver's license issued by the state or certified driving records with dates of licensure from the state, and if not licensed to drive, a valid state issued identification card with a listed address and date of issuance; (4) timely filed personal income tax returns as a resident of the state for the preceding calendar year; or (5) proof of not residing in any other state for any purpose whatsoever.  

(23) “Resident brewer” means any brewer or manufacturer of nonintoxicating beer or nonintoxicating craft beer whose principal place of business and manufacture is located in the State of West Virginia and which does not brew or manufacture more than 25,000 barrels of nonintoxicating beer or nonintoxicating craft beer annually, and does not self-distribute more than 10,000 barrels thereof in the State of West Virginia annually.

(22)(24) “Retailer” means any person selling, serving, or otherwise dispensing nonintoxicating beer and all products regulated by this article, including, but not limited to, malt coolers at his or her established and licensed place of business.

(23)(25) “Tax Commissioner” means the Tax Commissioner of the State of West Virginia or the commissioner’s designee.


§11-16-8. Form of application for license; fee and bond; refusal of license.

 (a) A license may be issued by the commissioner to any person who submits an application, accompanied by a license fee and, where required, a bond, and states under oath:

(1) The name and residence of the applicant, the duration of such residency, that the applicant has been a resident of the state for a period of two years preceding the date of the application and that the applicant is 21 years of age. If the applicant is a firm, association, partnership, limited partnership, limited liability company, or corporation, the application shall include the residence of the members or officers for a period of two years preceding the date of such application. If a person, firm, partnership, limited partnership, limited liability company, association, corporation, or trust applies for a license as a distributor, such person, or in the case of a firm, partnership, limited partnership, limited liability company, association, or trust, the members, officers, trustees or other persons in active control of the activities of the limited liability company, association, or trust relating to the license, shall state under oath that each has been a bona fide resident of the state for include the residency for the previous four years preceding the date of such for such persons on the application. All applicants and licensees must list a manager or managers on the applicant’s license application, or a licensee’s renewal application, who maintains a residence within 100 miles, as determined by the commissioner, of the applicant’s proposed premises or a licensee’s licensed premises, and further that the manager shall meet all other requirements of licensure, including, but not limited to United States citizenship or naturalization, passing a background investigation, being at least 21 years of age, being a suitable person, being of good morals and character, and other requirements, all as set forth in this code and the legislative rules, in order for the manager to be able to meet and conduct any regulatory matters, including, but not limited to: licensure or enforcement matters related to the applicant or licensee all in the interest of protecting public health and safety and being a suitable applicant or licensee. In order to maintain active licensure, any change by a licensee in any manager listed on an application must be made immediately to the commissioner, in order to verify that the new manager or managers meet licensure requirements. If the applicant is a trust or has a trust as an owner, the trustees or other persons in active control of the activities of the trust relating to the license shall provide a certification of trust as described in §44D-10-1013 of this code. This certification of trust shall include the excerpts described in §44D-10-1013(e), of this code and shall further state, under oath, the names, addresses, Social Security numbers, and birth dates of the beneficiaries of the trust and certify that the trustee and beneficiaries are 21 years of age or older. If a beneficiary is not 21 years of age, the certification of trust must state that such beneficiary’s interest in the trust is represented by a trustee, parent, or legal guardian who is 21 years of age and who will direct all actions on behalf of such beneficiary related to the trust with respect to the distributor until the beneficiary is 21 years of age. Any beneficiary who is not 21 years of age or older shall have his or her trustee, parent, or legal guardian include included in the certification of trust and state under oath his or her name, address, Social Security number, and birth date;

(2) The place of birth of applicant, that he or she is a citizen of the United States and of good moral character and, if a naturalized citizen, when and where naturalized. If the applicant is a corporation organized or authorized to do business under the laws of the state, the application must state when and where incorporated, the name and address of each officer, and that each officer is a citizen of the United States and a person of good moral character. If the applicant is a firm, association, limited liability company, partnership, limited partnership, trust or has a trust as an owner, the application shall provide the place of birth of each member of the firm, association, limited liability company, partnership, or limited partnership and of the trustees, beneficiaries, or other persons in active control of the activities of the trust relating to the license and that each member or trustee, beneficiary, or other persons in active control of the activities of the trust relating to the license is a citizen of the United States, and if a naturalized citizen, when and where naturalized, each of whom must qualify and sign the application. The requirements as to residence do not apply to the officers of a corporation applying for a retailer’s license but the officers, agent, or employee who manages and is in charge of the licensed premises shall possess all of the qualifications required of an individual applicant for a retailer’s license including the requirement as to residence;

(3) The particular place for which the license is desired and a detailed description thereof;

(4) The name of the owner of the building and, if the owner is not the applicant, that the applicant is the actual and bona fide lessee of the premises;

(5) That the place or building in which is proposed to do business conforms to all applicable laws of health, fire, and zoning regulations and is a safe and proper place or building not within 300 feet of a school or church measured from front door to front door, along the street or streets. This requirement does not apply to a Class B license or to a place occupied by a beer licensee so long as it is continuously so occupied. The prohibition against locating a proposed business in a place or building within 300 feet of a school does not apply to a college or university that has notified the commissioner, in writing, that it has no objection to the location of a proposed business in a place or building within 300 feet of the college or university;

(6) That the applicant is not incarcerated and has not during the five years preceding the date of said application been convicted of a felony;

(7) That the applicant is the only person in any manner pecuniarily interested in the business so asked to be licensed and that no other person is in any manner pecuniarily interested during the continuance of the license; and

(8) That the applicant has not during five years preceding the date of the application had a nonintoxicating beer license revoked.

(b) In the case of an applicant that is a trust or has a trust as an owner, a distributor license may be issued only upon submission by the trustees or other persons in active control of the activities of the trust relating to the distributor license of a true and correct copy of the written trust instrument to the commissioner for his or her review. Notwithstanding any provision of law to the contrary, the copy of the written trust instrument submitted to the commissioner pursuant to this section is confidential and is not a public record and is not available for release pursuant to the West Virginia Freedom of Information Act codified in §29B-1-1 et seq. of this code.

(c) The provisions and requirements of subsection (a) of this section are mandatory prerequisites for the issuance and, if any applicant fails to qualify, the license shall be refused. In addition to the information furnished in any application, the commissioner may make such additional and independent investigation of each applicant, manager, and of the place to be occupied as necessary or advisable and, for this reason, all applications, with license fee and bond, must be submitted with all true and correct information. For the purpose of conducting such independent investigation, the commissioner may withhold the granting or refusal to grant such license for a 30-day period or until the applicant has completed the conditions set forth in this section. If it shall appear that such applicant and manager meets the requirements in the code and the rules, including, but not limited to, being a suitable person of good reputation and morals; having made no false statements or material misrepresentations; involving no hidden ownership; and having no persons with an undisclosed pecuniary interest contained in such application; and if there are no other omissions or failures by the applicant to complete the application, as determined by the commissioner, the commissioner shall issue a license authorizing the applicant to sell nonintoxicating beer or nonintoxicating craft beer.

(d) The commissioner may refuse a license to any applicant under the provisions of this article if the commissioner is of the opinion:

(1) That the applicant or manager is not a suitable person to be licensed;

(2) That the place to be occupied by the applicant is not a suitable place or is within 300 feet of any school or church measured from front door to front door along the street or streets. This requirement does not apply to a Class B licensee or to a place now occupied by a beer licensee so long as it is continuously so occupied. The prohibition against locating any such place within 300 feet of a school does not apply to a college or university that has notified the commissioner, in writing, that it has no objection to the location of any such place within 300 feet; or

(3) That the manager is an active employee of the West Virginia Alcohol Beverage Control Commissioner or such active employee of the West Virginia Alcohol Beverage Control Commissioner is involved in the applicant’s ownership, management, or employ; including an independent contractor, or otherwise involved in any possible hidden ownership;

(4) That the license should not be issued for reason of conduct declared to be unlawful by this article.


Chapter 16A. Medical Cannabis Act.

Article 6. Medical Cannabis Organizations.

§16A-6-3.  Granting of permit.


(a) The bureau may grant or deny a permit to a grower, processor, or dispensary. In making a decision under this subsection, the bureau shall determine that:

(1) The applicant will maintain effective control of and prevent diversion of medical cannabis.

(2) The applicant will comply with all applicable laws of this state.

(3) The applicant is a resident of this state as defined in §29-22B-327 of this code or is organized under the law of this state. If the applicant is a business entity, majority ownership in the business entity must be held by a state resident or residents.

(4) (3) The applicant is ready, willing, and able to properly carry on the activity for which a permit is sought.

(5) (4) The applicant possesses the ability to obtain in an expeditious manner sufficient land, buildings, and equipment to properly grow, process, or dispense medical cannabis.

(6) (5) It is in the public interest to grant the permit.

(7) (6) The applicant, including the financial backer or principal, is of good moral character and has the financial fitness necessary to operate.

(8) (7) The applicant is able to implement and maintain security, tracking, recordkeeping, and surveillance systems relating to the acquisition, possession, growth, manufacture, sale, delivery, transportation, distribution, or the dispensing of medical cannabis as required by the bureau.

(9) (8) The applicant satisfies any other conditions as determined by the bureau.

(b) Nontransferability. — A permit issued under this chapter shall be nontransferable.

(c) Privilege. — The issuance or renewal of a permit shall be a revocable privilege.

(d) Dispensary location. The bureau shall consider the following when issuing a dispensary permit:

(1) Geographic location;

(2) Regional population;

(3) The number of patients suffering from serious medical conditions;

(4) The types of serious medical conditions;

(5) Access to public transportation;

(6) Approval by local health departments;

(7) Whether the county has disallowed the location of a grower, processor, or dispensary; and

(8) Any other factor the bureau deems relevant.

(e) Application procedure. — The bureau shall establish a procedure for the fair and objective evaluation of all applications for all medical cannabis organization permits. Such evaluations shall score each applicant numerically according to standards set forth in this chapter.

CHAPTER 29. MISCELLANEOUS BOARDS AND OFFICERS.


ARTICLE 22B. LIMITED VIDEO LOTTERY.

§29-22B-327. Resident of this state defined.

[Repealed.]


§29-22B-503. Additional qualifications for an applicant for an operator's license.

(a) No operator's license or license renewal may be granted unless the Lottery Commission has determined that, in addition to the general requirements set forth in §29-22B-502 of this code, the applicant satisfies all of the following qualifications:

(1)(A) If the applicant is an individual, the applicant has been a citizen of the United States and a resident of this state for the four year period immediately preceding the application; or

(B) If the applicant is a corporation, partnership or other business entity, the chief executive officer and the majority of the officers, directors, members and partners (to the extent each of these groups exists with respect to a particular business organization), both in number and percentage of ownership interest, have been citizens of the United States and residents of this state for the four year period immediately preceding the application.

(2)(1) The applicant has demonstrated the training, education, business ability, and experience necessary to establish, operate and maintain the business for which the license application is made;

(3)(2) The applicant has secured any necessary financing for the business for which the license application is made, and the financing: (A) Is from a source that meets the qualifications of this section, and (B) is adequate to support the successful performance of the duties and responsibilities of the licensee. A licensee shall request commission approval of any change in financing or leasing arrangements at least 30 days before the effective date of the change;

(4)(3)The applicant has disclosed all financing or refinancing arrangements for the purchase, lease, or other acquisition of video lottery terminals and associated equipment in the degree of detail requested by the Lottery Commission;

(5)(4)The applicant has filed with the Lottery Commission a copy of any current or proposed agreement between the applicant and any manufacturer for the sale, lease, or other assignment to the operator of video lottery terminals, the electronic computer components of the terminals, the random number generators of the terminals, or the cabinets in which they are housed; and

(6)(5) The applicant does not hold any other license under this article, §19-23-1 et seq. of this code, §29-22-1 et seq. of this code, §29-22A-1 et seq. of this code, or §29-25-1 et seq. of this code, except that an applicant may also be licensed as a service technician.  In addition, an applicant may also be licensed as a limited video lottery retailerProvided, That a licensed operator that also is a licensed retailer may operate limited video lottery terminals as a limited video lottery retailer at no more than 10 locations:  Provided, however, That the Director may authorize the operator to operate limited video lottery terminals as a limited video lottery retailer at more than 10 locations if the applicant provides sufficient justification that such approval is necessary to sustain state revenues without a detrimental impact on public interest, further shows that a qualified retailer is unavailable and a good faith effort to identify a qualified retailer was made prior to the request, and an explanation of other relevant information supporting such request.

(b)(1) A person or a member of his or her immediate family who has an ownership interest in a business entity that submits an application for an operator's license may not: (A) Submit an application for another operator's license as an individual, (B) serve as an officer, director, member, or partner of a business entity that submits an application for another operator's license, or (C) have an ownership interest in any other business entity that submits an application for an operator's license.

(2) Business entities that have common owners or common officers, directors, members, or partners may not hold more than one operator's license.


§29-22B-504. Additional qualifications for an applicant for a limited video lottery retailer's license.

No limited video lottery retailer's license or license renewal may be granted unless the Lottery Commission has determined that, in addition to the general requirements set forth in §29-22B-502 of this code, the applicant satisfies all of the following qualifications:

(1)(A) If the applicant is an individual, the applicant has been a citizen of the United States and a resident of this state for the four year period immediately preceding the application;

(B) If the applicant is a corporation, partnership or other business entity, the chief executive officer and the majority of the officers, directors, members and partners (to the extent each of these groups exists with respect to a particular business organization), both in number and percentage of ownership interest, have been citizens of the United States and residents of this state for the four year period immediately preceding the application;

(2)(1) The applicant has disclosed to the Lottery Commission the identity of each person who has control of the applicant, as control is described in §29-22B-507 of this code;

(3)(2) The applicant holds either: (A) A valid license issued under §60-7-1 et seq. of this code to operate a private club, (B) a valid Class A license issued under §11-16-1 et seq. of this code to operate a business where nonintoxicating beer is sold for consumption on the premises, or (C) both licenses;

(4)(3) The applicant has demonstrated the training, education, business ability, and experience necessary to establish, operate and maintain the business for which the license application is made;

(5)(4) The applicant has secured any necessary financing for the business for which the license application is made and the financing: (A) Is from a source that meets the qualifications of this section, and (B) is adequate to support the successful performance of the duties and responsibilities of the licensee;

(6)(5) The applicant has disclosed all financing or refinancing arrangements for placement on the applicant's premises of video lottery terminals and associated equipment in the degree of detail requested by the Lottery Commission;

(7)(6) The applicant has filed with the Lottery Commission a copy of any current or proposed agreement between the applicant and a licensed operator for the placement on the applicant's premises of video lottery terminals;

(8)(7) The applicant has filed with the Lottery Commission a copy of any current or proposed agreement between the applicant and a licensed operator or other person for the servicing and maintenance of video lottery terminals by licensed service technicians; and

(9)(8) The applicant does not hold any other license under this article, §19-23-1 et seq. of this code, or §29-22A-1 et seq. of this code, or §29-25-1 et seq. of this code except that an applicant may also be licensed as a service technician.  In addition, an applicant may also be licensed as an operator, subject to provisions of §29-22B-503(a)(6) of this code. 


§29-22B-512. Review of continuing eligibility for license.

The Lottery Commission shall determine on a continuing basis the eligibility of licensees to hold a license. Notwithstanding any other provision of this article, each operator and limited video lottery retailer shall meet the residency requirements in sections 22B - 503 and 22B - 504 of this article and shall be a resident of this state during the period in which the licensed issued for the operator or limited video lottery retailer is in effect.

CHAPTER 60. STATE CONTROL OF ALCOHOLIC LIQUORS.


ARTICLE 1. GENERAL PROVISIONS.


§60-1-5. Definitions.


For the purposes of this chapter:

"Alcohol" shall means ethyl alcohol whatever its origin and shall include synthetic ethyl alcohol but not denatured alcohol.

"Alcoholic liquor" includes alcohol, beer, wine, and spirits and any liquid or solid capable of being used as a beverage, but shall not include nonintoxicating beer.

"An agency" means a drugstore, grocery store, or general store designated by the commission as a retail distributor of alcoholic liquor for the West Virginia Alcohol Beverage Control Commissioner.

"Beer" means any beverage obtained by the fermentation of barley, malt, hops, or any other similar product or substitute, and containing more alcohol than that of nonintoxicating beer.

"Brewery" means an establishment where beer is manufactured or in any way prepared.

"Commissioner" or "commission" means the West Virginia Alcohol Beverage Control Commissioner.

"Department" means the organization through which the commission exercises powers imposed upon it by this chapter.

“Distillery” means an establishment where alcoholic liquor other than wine or beer is manufactured or in any way prepared.

"Intoxicated" means having one's faculties impaired by alcohol or other drugs to the point where physical or mental control or both are markedly diminished.

“Manager” means an individual who is an applicant’s or licensee’s on-premises employee, member, partner, shareholder, director, or officer who meets licensure requirements of Chapter 60 of this code, and the legislative rules and who actively manages, conducts and carries on the day to day operations of the applicant or licensee with full and apparent authority or actual authority to act on behalf of the applicant or licensee, including but not limited to: coordinating staffing; reviewing and approving payroll; ordering and paying for inventory, such as nonintoxicating beer, wine, and liquor, as applicable; and managing security staff, security systems, video and other security equipment, and any further acts or actions involved in managing the affairs of the business, on behalf of owners, partners, members, shareholders, officers, or directors. Further that the manager shall not be an active employee of the West Virginia Alcohol Beverage Control Commissioner or such active employee of the West Virginia Alcohol Beverage Control Commissioner shall not be involved in an applicant’s or licensee’s ownership, management, or employ, including an independent contractor and any possible hidden ownership;

"Manufacture" means to distill, rectify, ferment, brew, make, mix, concoct, process, blend, bottle, or fill an original package with any alcoholic liquor.

"Manufacturer" means any person engaged in the manufacture of any alcoholic liquor, and among others includes a distiller, a rectifier, a wine maker, and a brewer.

"Nonintoxicating beer"  means any beverage obtained by the fermentation of barley, malt, hops, or similar products or substitute, and containing not more alcohol than that specified by §11-16-2 of this code.

"Original package" means any closed or sealed container or receptacle used for holding alcoholic liquor.

"Person" means an individual, firm, partnership, limited partnership, corporation, or voluntary association.

"Powdered alcohol" means an alcohol manufactured in a powder or crystalline form for either direct use or reconstitution as an alcoholic liquor or food. For purposes of this chapter, powdered alcohol excludes any material intended for industrial purposes.

"Public place" means any place, building, or conveyance to which the public has, or is permitted to have access, including restaurants, soda fountains, hotel dining rooms, lobbies, and corridors of hotels and any highway, street, lane, park, or place of public resort or amusement: Provided, That the term "public place" shall not mean or include any of the above-named places or any portion or portions thereof which qualify and are licensed under the provisions of this chapter to sell alcoholic liquors for consumption on the premises: Provided, however, That the term "public place" shall not mean or include any legally demarcated area designated solely for the consumption of beverages and freshly prepared food that directly connects and adjoins any portion or portions of a premise that qualifies and is licensed under the provisions of this chapter to sell alcoholic liquors for consumption thereupon: Provided further, That the term "public place" shall not include a facility constructed primarily for the use of a Division I, II, or III college or university that is a member of the National Collegiate Athletic Association, or its successor, and used as a football, basketball, baseball, soccer, or other Division I, II, or III sports stadium which holds a special license to sell wine pursuant to the provisions of §60-8-3 of this code, in the designated areas of sale and consumption of wine and other restrictions established by that section and the terms of the special license issued thereunder.

“Residence” or “residency” means a state where an individual maintains a bona fide primary place of abode and spends in the aggregate more than 183 days (at least eight hour days) of the preceding taxable year; which is verifiable by providing any two items of: (1) certified property tax records; (2) a valid voter’s registration card and verifiable registration dates; (3) if licensed to drive, a valid driver's license issued by the state or certified driving records with dates of licensure from the state, and if not licensed to drive, a valid state issued identification card with a listed address and date of issuance; (4) timely filed personal income tax returns as a resident of the state for the preceding calendar year; or (5) proof of not residing in any other state for any purpose whatsoever. This definition shall not apply to §60-3A-10, §60-3A-10a, §60-3A-10b, §60-3A-10c, or §60-3A-10d of this code.

"Sale" means any transfer, exchange, or barter in any manner or by any means, for a consideration, and shall include all sales made by principal, proprietor, agent, or employee.

"Selling" includes solicitation or receipt of orders; possession for sale; and possession with intent to sell.

"Spirits" means any alcoholic beverage obtained by distillation and mixed with potable water and other substances in solution and includes brandy, rum, whiskey, cordials, and gin.

"State liquor store” means a store established and operated by the commission under this chapter for the sale of alcoholic liquor in the original package for consumption off the premises.

"Wine" means any alcoholic beverage obtained by the fermentation of the natural content of fruits, or other agricultural products, containing sugar.

"Winery" means an establishment where wine is manufactured or in any way prepared.

"Spirits" means any alcoholic beverage obtained by distillation and mixed with potable water and other substances in solution and includes brandy, rum, whiskey, cordials and gin.

"Alcoholic liquor" includes alcohol, beer, wine and spirits and any liquid or solid capable of being used as a beverage, but shall not include nonintoxicating beer.

"Original package" means any closed or sealed container or receptacle used for holding alcoholic liquor.

"Sale" means any transfer, exchange, or barter in any manner or by any means, for a consideration, and shall include all sales made by principal, proprietor, agent or employee.

"Selling" includes solicitation or receipt of orders; possession for sale; and possession with intent to sell.

"Person" means an individual, firm, partnership, limited partnership, corporation, or voluntary association.

"Manufacture" means to distill, rectify, ferment, brew, make, mix, concoct, process, blend, bottle, or fill an original package with any alcoholic liquor.

"Manufacturer" means any person engaged in the manufacture of any alcoholic liquor, and among others includes a distiller, a rectifier, a wine maker, and a brewer.

"Brewery" means an establishment where beer is manufactured or in any way prepared.

"Winery" means an establishment where wine is manufactured or in any way prepared.

"Distillery" means an establishment where alcoholic liquor other than wine or beer is manufactured or in any way prepared.

"Public place" means any place, building, or conveyance to which the public has, or is permitted to have access, including restaurants, soda fountains, hotel dining rooms, lobbies, and corridors of hotels and any highway, street, lane, park, or place of public resort or amusement: Provided, That the term "public place" shall not mean or include any of the above-named places or any portion or portions thereof which qualify and are licensed under the provisions of this chapter to sell alcoholic liquors for consumption on the premises: Provided, however, That the term "public place" shall not mean or include any legally demarcated area designated solely for the consumption of beverages and freshly prepared food that directly connects and adjoins any portion or portions of a premises that qualifies and is licensed under the provisions of this chapter to sell alcoholic liquors for consumption thereupon: Provided further, That the term "public place" shall also not include a facility constructed primarily for the use of a Division I college that is a member of the National Collegiate Athletic Association, or its successor, and used as a football, basketball, baseball, soccer or other Division I sports stadium which holds a special license to sell wine pursuant to the provisions of §60-8-3 of this code, in the designated areas of sale and consumption of wine and other restrictions established by that section and the terms of the special license issued thereunder.

"State liquor store means a store established and operated by the commission under this chapter for the sale of alcoholic liquor in the original package for consumption off the premises.

"An agency" means a drugstore, grocery store, or general store designated by the commission as a retail distributor of alcoholic liquor for the West Virginia Alcohol Beverage Control Commissioner.

"Department" means the organization through which the commission exercises powers imposed upon it by this chapter.

"Commissioner" or "commission" means the West Virginia Alcohol Beverage Control Commissioner.

"Intoxicated" means having one's faculties impaired by alcohol or other drugs to the point where physical or mental control or both are markedly diminished.

"Powdered alcohol" means an alcohol manufactured in a powder or crystalline form for either direct use or reconstitution as an alcoholic liquor or food. For purposes of this chapter, powdered alcohol excludes any material intended for industrial purposes.

ARTICLE 3A. SALES BY RETAIL LIQUOR LICENSEES.


§60-3A-8. Retail license application requirements; retail licensee qualifications.

(a) Prior to or simultaneously with the submission of a bid for a retail license or the payment of a purchase option for a Class A retail license, each applicant shall file an application with the commissioner, stating under oath, the following:

(1) If the applicant is an individual, his or her name and residence address;

(2) If the applicant is other than an individual, the name and business address of the applicant; the state of its incorporation or organization; the names and residence addresses of each executive officer and other principal officer, partner, or member of the entity; a copy of the entity's charter or other agreement under which the entity operates; and the names and residence addresses of any person owning, directly or indirectly, at least 20 percent of the outstanding stock, partnership, or other interests in the applicant; and all applicants and licensees must list a manager or managers on the applicant’s license application, or a licensee’s renewal application, who must maintain a residence within 100 miles, as determined by the commissioner, of the applicant’s proposed premises or a licensee’s licensed premises, and further that the manager shall meet all other requirements of licensure, including, but not limited to United States citizenship or naturalization, passing a background investigation, being at least 21 years of age, being a suitable person, being of good morals and character, and other requirements, all as set forth in the code and the legislative rules, in order for the manager to be able to meet and conduct any regulatory matters, including, but not limited to: licensure or enforcement matters related to the applicant or licensee all in the interest of protecting public health and safety and being a suitable applicant or licensee. In order to maintain active licensure, any change by a licensee in any manager listed on an application must be made immediately to the commissioner, in order to verify that the new manager or managers meet licensure requirements;

(3) That the applicant and manager has have never been convicted in this state or any other state of any felony or other crime involving moral turpitude or convicted of any felony in this or any other state court or any federal court for a violation of any state or federal liquor law, and if the applicant is other than an individual, that none of its executive officers, other principal officers, partners, or members, or any person owning, directly or indirectly, at least 20 percent of the outstanding stock, partnership or other interests in the applicant, has been convicted; and

(4) That the applicant  and the manager, each is a United States citizen of good moral character and, if a naturalized citizen, when and where naturalized; and, if a corporation organized and authorized to do business under the laws of this state, when and where incorporated, with the name and address of each officer; that each officer is a citizen of the United States and a person of good moral character; and if a firm, association, partnership or limited partnership, that each member is a citizen of the United States and, if a naturalized citizen, when and where naturalized, each of whom must sign the application.

(b) An applicant and manager shall provide the commissioner any additional information requested by the commissioner including, but not limited to, authorization to conduct a criminal background and credit records check.

(c) Whenever a change occurs in any information provided to the commissioner, the change shall immediately be reported to the commissioner in the same manner as originally provided.

(d) The commissioner shall disqualify each bid submitted by an applicant under §60-3A-10 of this code and no applicant shall be issued or eligible to hold a retail license under this article, if:

(1) The applicant has been convicted in this state of any felony or other crime involving moral turpitude or convicted of any felony in this or any other state court or any federal court for a violation of any state or federal liquor law; or

(2) Any executive officer or other principal officer, partner, or member of the applicant, or any person owning, directly or indirectly, at least twenty percent of the outstanding stock, partnership, or other interests in the applicant, has been convicted in this state of any felony or other crime involving moral turpitude or convicted of any felony in this or any other state court or any federal court for a violation of any state or federal liquor law.

(e) The commissioner shall not issue a retail license to an applicant which does not hold a license issued pursuant to federal law to sell liquor at wholesale.


ARTICLE 7. LICENSES TO PRIVATE CLUBS.


§60-7-4. Application for license; information required; verification; application to be accompanied by fees; bond; college fraternities and sororities ineligible for license; racial discrimination by applicants prohibited.

(a) Application for a license to operate a private club shall be made on such form as may be prescribed by the commissioner and shall include:

(1) The name and residence of the applicant and list the same for its manager or managers;

(2) If the applicant is an unincorporated association, the names and residence addresses of the members of its governing board;

(3) If the applicant is a corporation, the names and residence addresses of its officers and directors;

(4) The place at which the applicant will conduct its operations and whether the same is owned or leased by the applicant;

(5) The number of members of the applicant;

(6) A listed manager or managers on the applicant’s license application, or a licensee’s renewal application, who must maintain a residence within 100 miles, as determined by the commissioner, of the applicant’s proposed premises or a licensee’s licensed premises, and further that the manager shall meet all other requirements of licensure, including, but not limited to United States citizenship or naturalization, passing a background investigation, being at least 21 years of age, being a suitable person, being of good morals and character, being capable of operating a bona fide private club of good reputation in the community, and other requirements, all as set forth in the code and the legislative rules, in order for the manager to be able to meet and conduct any regulatory matters, including, but not limited to: licensure or enforcement matters related to the applicant or licensee all in the interest of protecting public health and safety and being a suitable applicant or licensee. In order to maintain active licensure, any change by a licensee in any manager listed on an application must be made immediately to the commissioner, in order to verify that the new manager or managers meet licensure requirements;

(7) The name or names of any national organizations with which the applicant is affiliated and the nature of such affiliation;

(7)(8) The size and nature of the dining and kitchen facilities operated by applicant;

(8)(9) Accurate and complete ownership information;

(9)(10) An attestation that the information in the application is true and accurate; and

(10)(11) Such other information as the commissioner may reasonably require of the applicant and manager which shall include, but not be limited to, the criminal records, if any, of each member of the applicant’s governing board and/or its officers and directors who have been convicted of a felony or a crime involving moral turpitude.

(b) The application shall be verified by the manager, each member of the governing board of the applicant if an unincorporated association or, if the applicant is a corporation, by each of its officers and all members of its board of directors. The application shall be accompanied by the license fee hereinafter prescribed and by a bond of the applicant in the penal sum of $5,000 with a corporate surety authorized to transact business in the state of West Virginia, payable to the State of West Virginia, which bond shall be conditioned on the payment of all fees herein prescribed and on the faithful performance of and compliance with the provisions of this article.

(c) Under no circumstance may any college fraternity or sorority be issued a license to operate a private club.

(d) No license to operate a private club will be issued to applicants who discriminate against any person or group of persons because of race or color of such person or group of persons.


§60-7-5. Investigation by commissioner; issuance or refusal of license; special requirements for clubs at parks and airports; form of license; license valid at one location only; expiration and renewal; transferability.

(a) Upon receipt of a completed application referred to in §60-7-4 of this code, together with the accompanying fee and bond, the commissioner shall conduct an investigation to determine the accuracy of the matters contained in such completed application and whether applicant is a bona fide private club of good reputation in the community in which it shall operate. For the purpose of conducting such investigation, the commissioner may withhold the granting or refusal to grant such license for a period not to exceed 30 days or until the applicant has completed the conditions set forth in this article and in §60-7-4(a) of this code, all as determined by the commissioner. If it shall appear that such applicant is a bona fide private club of good reputation in the community in which it shall operate and that the applicant and the manager or managers in the application or a licensee and manager or managers in the renewal application, subject to investigation set forth in §60-7-4 of this code, have made there is no false statement, no material misrepresentations, no hidden ownership, or persons with an undisclosed pecuniary interest, and no omissions or failures to disclose in such application, as determined by the commissioner, he or she shall issue a license authorizing the applicant to sell alcoholic liquors as provided in §60-7-3 of this code, and otherwise shall refuse to issue such license, except that in the case of an application by a corporation or association to operate a private club in connection with:

(1) A state park, the Director of the Department of Natural Resources must grant his or her approval before the license can be issued; or

(2) A county or municipal park, or an airport, the authority governing the park or airport must grant its approval before the license can be issued.

A license may not be issued for a private club in any state park unless a dining facility comparable to the dining facility for the proposed private club will be available to serve meals to the general public. A license may not be issued for a private club in any county or municipal park, or an airport, unless a dining facility comparable to the dining facility for the proposed private club will be available to serve meals to the general public.

(b) Upon refusal to issue such license the commissioner shall make and enter an order denying such application, which denial and refusal shall be final unless a hearing is requested in accordance with the provisions of §60-7-13 of this code. When such refusal or denial becomes final the commissioner shall forthwith refund to the applicant his or her fees and bond accompanying the application.

(c) Such license shall be of such form and design as the commissioner may prescribe by reasonable rule or regulation and shall authorize the licensee to sell alcoholic liquors at only one location.

(d) Such license shall expire on June 30 next following the date of issue and may be renewed upon the same showing as required for the issuance of the initial license, together with the payment of fees and filing of the bond as required by this article.

(e) A license issued under the provisions of this article may not be transferable.


ARTICLE 8. SALE OF WINES.


§60-8-16. Application for license.

(a) Any person desiring a license under this article shall file a written application for a license with the commissioner and in the application shall state under oath:

(1) The name of the applicant, including his or her trade name if any, his or her residence address and the length of his or her residence within this state;

(2) The address of the place of business for which the license is desired, or other description that definitely locates it; and that the place of business conforms to all health and fire laws and regulations applicable thereto;

(3) The name of the owner of the premises upon which the business is to be conducted and, if the owner is not the applicant, that such applicant is the bona fide lessee of the business;

(4) If the application is for a retailer's license, that the applicant is the proprietor or owner of a bona fide grocery store, private wine bed and breakfast, private wine restaurant, private wine spa, or wine specialty shop;

(5) That the applicant intends to carry on the business authorized by the license for himself or herself or under his or her immediate supervision or direction;

(6) That the applicant is a citizen of the United States;

(7) That the applicant is an actual bona fide resident of the State of West Virginia, except for those applicants applying for a supplier's license or a direct shipper's license shall include a manager or managers on the applicant’s license application, or a licensee’s renewal application, who must maintain a residence within 100 miles, as determined by the commissioner, of the applicant’s proposed premises or a licensee’s licensed premises, and further that the manager shall meet all other requirements of an applicant for licensure set forth in this section, including, but not limited to United States citizenship or naturalization, passing a background investigation, being at least 21 years of age, being a suitable person, being of good morals and character, and other requirements, all as set forth in the code and the legislative rules, in order for the manager to be able to meet and conduct any regulatory matters, including, but not limited to: licensure or enforcement matters related to the applicant or licensee all in the interest of protecting public health and safety and being a suitable applicant or licensee. In order to maintain active licensure, any change by a licensee in any manager listed on an application must be made immediately to the commissioner, in order to verify that the new manager or managers meet licensure requirements;

(8) That the applicant is not less than eighteen 21 years of age;

(9) That the applicant has not been convicted of a felony or other crime involving moral turpitude within the three years next preceding the filing of the application; and that he or she has not, within the two years next preceding the filing of the application, been convicted of violating the liquor laws of any state or of the United States;

(10) That the applicant has not during the five years next preceding the date of said application had any license revoked under this chapter or under the liquor laws of any other state;

(11) If the applicant is a firm, association, partnership, limited partnership, limited liability company, or corporation, the application shall state the matters required in subdivisions (6), (7), (8), (9), and (10), with respect to each of the members and the manager or managers thereof, and each of said members and the manager must meet all the requirements in said subdivisions;

(12) If the applicant is a corporation, organized or authorized to do business in this state, the application shall state the matters required in subdivisions (6), (7), (8), (9), and (10), with respect to the manager and each of the officers and directors thereof, and any stockholder owning 20 percent or more of the stock of such corporation and any other the persons who conduct and manage the licensed premises for the corporation. Each of said individuals must meet all the requirements provided in those subdivisions except that the requirements as to citizenship and residence shall not apply to the officers, directors, and stockholders of a corporation applying for a retailer's license; and

(13) If the applicant is a trust or has a trust as an owner, the trustees or other persons in active control of the activities of the trust relating to the license shall provide a certification of trust as described in §44D-10-1013 of this code. This certification of trust shall include the excerpts described §44D-10-1013(e) this code and shall further state, under oath, the names, addresses, Social Security numbers, and birth dates of the beneficiaries of the trust and certify that the trustee and beneficiaries are 21 years of age or older. If a beneficiary is not 21 years of age, the certification of trust must state that the beneficiary's interest in the trust is represented by a trustee, parent, or legal guardian who is 21 years of age and who will direct all actions on behalf of the beneficiary related to the trust with respect to the distributor until the beneficiary is 21 years of age. Any beneficiary who is not 21 years of age or older shall have his or her trustee, parent or legal guardian include in the certification of trust and state under oath his or her name, address, social security number, and birth date.

(14) Any other information that the commissioner may reasonably require of the applicant, or licensee, or such applicant or licensee’s manager.

The foregoing statements required in an application are mandatory prerequisites for the issuance of a license.

The application must be verified by the owner, manager, or in the case of a firm, partnership, limited partnership, limited liability company, association, or trust, the members, officers, trustees, or other persons in active control of the activities of the limited liability company, association, or trust relating to the license. The application of a corporation applying for a retailer's license need be verified only by its president or vice president.

(b) In the case of an applicant that is a trust or has a trust as an owner, a distributor license may be issued only upon submission by the trustees or other persons in active control of the activities of the trust relating to the distributor license of a true and correct copy of the written trust instrument to the commissioner for his or her review. Notwithstanding any provision of law to the contrary, the copy of the written trust instrument submitted to the commissioner pursuant to this section is confidential and is not a public record and is not available for release pursuant to the West Virginia Freedom of Information Act codified in §29B-1-1 of this code.


§60-8-17. License issuance or refusal; terms of license.

(a) Upon receipt of the completed application, fee, and bond if required, the commissioner shall conduct any investigation he or she considers necessary to determine the accuracy of the matters contained in the completed application for the applicant or manager. For the purposes of conducting such investigation, the commissioner may withhold the granting or refusal to grant a license for a period not to exceed 30 days or until the applicant has completed the conditions set forth in §60-8-16 of this code. If it appears that the applicant, and the manager or managers in the application or a licensee and manager or managers in the renewal application, subject to investigation set forth in this section, is a suitable person, is located at a suitable premise, there is no false statement, no material misrepresentations, no hidden ownership, no persons with an undisclosed pecuniary interest contained in the application, and that the issuance of the license would not be in conflict with any of the provisions of this chapter, the commissioner shall issue the license. Otherwise the commissioner shall refuse to issue such license.

(b) The commissioner shall refuse the license of any applicant if he or she finds that any such applicant or manager is not a suitable person, that the place of business of such applicant is not a suitable place, or that such applicant has not complied with the provisions of this chapter. Upon refusal to issue such license, the commissioner shall enter an order refusing such application. The refusal is final unless a hearing is requested in accordance with the provisions of §60-8-18 of this code. When such refusal becomes final the commissioner shall immediately refund to the applicant his or her fees and bond accompanying the application.

(c) The license expires on June 30 next following the date it was issued and may be renewed upon the same showing as required for the issuance of the initial license, together with the payment of fee and filing of any bond required by this article.

(d) A licensee that fails to complete a renewal application and make payment of its annual license fee in renewing its license on or before June 30 of any subsequent year, after initial application, shall be charged an additional $150 reactivation fee. The licensee must pay the applicable full-year annual license fee and the reactivation fee prior to the processing of any renewal application. A licensee who continues to operate upon the expiration of its license is subject to all fines, penalties, and sanctions available in §11-16-23 of this code, as determined by the commissioner.

(e) Such license shall not be transferred to another person, but the location of the premises to which the license relates may be changed with the written consent of the commissioner, if the new location satisfies the requirements of this article upon an initial application and payment of a new application fee.

 

NOTE: The purpose of this bill is to address the residency issue that was struck down under the Dormant Commerce Clause in Tennessee Wine and Spirits Retailers Assn. v. Russel F. Thomas, Executive Director of the Tennessee Alcoholic Beverage Commission, et al., No. 18-96 (U.S. June 26, 2019). While West Virginia does not have the same restrictions set forth in Tennessee, the WVABCA is revising its requirements to set forth manager requirements for all licensees requiring that the manager is readily available to address licensure and public health and safety issues with the WVABCA’s agents; WVDHHR is removing the residency requirements from the Medical Cannabis Act; and the WV Lottery is removing residency requirements.

Strike-throughs indicate language that would be stricken from a heading or the present law and underscoring indicates new language that would be added.

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