FISCAL NOTE
Date Requested: February 03, 2020
Time Requested: 11:32 AM |
| Agency: |
Alcohol Beverage Control Administration |
|---|
| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 2909 |
Introduced |
HB4663 |
|
|---|
| CBD Subject: |
Economic Development |
|---|
|
FUND(S):
General
Sources of Revenue:
General Fund
Legislation creates:
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
Summarize in a clear and concise manner what impact this measure will have on costs and revenues of state government.
This is not an agency bill.
The stated purpose of this bill is to eliminate certain payments to the WVABCA from distilleries and mini-distilleries that the WVABCA distributes to market zone retailers as set forth in the Code.
WV retail liquor outlets have over the years paid substantial amounts for the rights to sell liquor in market zones throughout the state (2010 – approximately $38 million, … license bids have gone above $600,000 for one license). At or near the time, when mini-distilleries were enacted the ability to: (1) provide complimentary samples and (2) sell liquor bottles at retail were negotiated with the retail liquor outlets so that mini-distilleries could sell liquor bottles like a retail liquor outlet without having to purchase a retail liquor outlet license.
During the 2015 Legislative session, SB 574 was passed, among other things, the bill reduced the original market zone payments percentage from 10% to 2% for the retail liquor outlets in the same market zone as an in-state distillery or mini-distillery and the max annual payment made by an in-state distillery or mini-distillery would be capped at $15,000 per year. This again was agreed upon language between the distilleries, mini-distilleries and the retail liquor outlets.
The market zone payments to retail liquor outlets were a compromise. This compromise kept the distilleries and mini-distilleries license fees relatively low at $1,500 and $50, respectively, rather than making the distilleries and mini-distilleries acquire a retail liquor outlet license.
Again, the bill would eliminate the calculation, collection and disbursement of the market zone payments from distilleries and mini-distilleries to retail liquor outlets in various market zones. The quarterly calculation, collection and disbursement is conducted by WVABCA staff.
WVABCA Staff advises that the market zone payments effects 16 distilleries and mini-distilleries and 37 retail liquor outlets.
WVABCA Staff advises that they have not received any complaints regarding market zone payments from distilleries, mini-distilleries and retail liquor outlets.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2020
Increase/Decrease
(use"-") |
2021
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
0 |
0 |
0 |
| Personal Services |
0 |
0 |
0 |
| Current Expenses |
0 |
0 |
0 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
0 |
0 |
| Other |
0 |
0 |
0 |
| 2. Estimated Total Revenues |
0 |
0 |
0 |
Explanation of above estimates (including long-range effect):
Please explain increases and decreases in personal services, current expenses, repairs and alterations, assets, other costs and revenues, including assumptions and data sources and delineation between start-up and ongoing costs. Please also include a long-range schedule of costs and revenues if fiscal impact is expected to vary in future years.
The bill upon passage may decrease WVABCA staff time by an hour or two that was spent to calculate, collect and disburse the market zone payments.
WVABCA Staff advises that 37 retail liquor outlets would no longer receive the quarterly market zone payments which for 2019 totaled $ 16,537.64.
WVABCA Staff advised for 2018 the amount totaled $ 25,359.73
WVABCA Staff advised for 2016 the amount totaled $ 18,531.99
Before the law changed in 2015, WVABCA Staff advised for 2014 the amount totaled
$ 82,148.68 wit fewer distilleries in operation at that time.
Memorandum
Please identify any areas of vagueness, technical defects, reasons a bill would not have a fiscal impact, and/or any special issues not captured elsewhere on this form.
See above.
The current law is fair to all sides and resulted in a reduction in the total amount of market zone payments by distilleries and mini-distilleries where these licenses were able to retain the privilege of selling liquor bottles for off-premises consumption at retail from the licensed premises.
Person submitting Fiscal Note: Anoop Bhasin, General Counsel on behalf of WVABCA
Email Address: anoop.k.bhasin@wv.gov