H. B. 4205
(By Delegates Kominar, Shook, Brown,
Hunt, Cann, Varner, Beach and Williams)
[Introduced Judiciary 27, 2010; referred to the
Committee on the Judiciary.]
A BILL to amend and reenact §60-3A-2 and §60-3A-17 of the Code of
West Virginia, 1931, as amended; to amend and reenact §60-7-11
of said code; and to amend and reenact §60-8-2 of said code,
all relating to the sale of fortified wines; permitting the
sale of fortified wine by distributors licensed under article
eight, chapter sixty of the code; requiring retail licensees
to purchase fortified wine from those distributors; requiring
those distributors to sell fortified wines to private clubs at
the same price that the fortified wines would be sold to
retail licensees; and defining terms.
Be it enacted by the Legislature of West Virginia:
That §60-3A-2 and §60-3A-17 of the Code of West Virginia,
1931, as amended, be amended and reenacted; that §60-7-11 of said
code be amended and reenacted; and that §60-8-2 of said code be
amended and reenacted, all to read as follows:
ARTICLE 3A. SALES BY RETAIL LIQUOR LICENSEES.
§60-3A-2. Legislative findings and declaration; legislative
purpose.
(a) The Legislature
hereby finds and declares that the sale of
liquor at retail should no longer be by the state, but rather by
retail licensees; that there is a need for the state to control the
wholesale sales of liquor; that the health and welfare of the
citizens of this state will be adequately protected by the
licensing and control of
such those retail licensees; that the sale
of liquor through retail licensees will satisfy reasonable consumer
concerns of availability and price; and that the operation and
efficiency of state government will be improved by removing the
state from the retail sale of liquor and permitting sales of liquor
by retail licensees under licenses issued by the state together
with strict enforcement of laws and rules relating to the sale of
liquor.
(b) It is the purpose of the Legislature in providing for the
retail sale of liquor to:
(1) Continue revenue to the state from the wholesale sale of
liquor by requiring all retail licensees to purchase all liquor
(other than wine
and fortified wine) from the commissioner and by
further requiring all private clubs licensed under the provisions
of article seven of this chapter to purchase all liquor (other than
wine
and fortified wine) from retail licensees;
(2) Provide a system of controls, through limitations on the
numbers of retail outlets and application of the police power of
the state, to discourage the intemperate use of liquor;
(3) Preserve and continue the tax base of counties and
municipalities derived from the retail sale of liquor;
(4) Obtain revenue for the state from the issuance of retail
licenses;
(5) Facilitate the responsible marketing and growth of
existing retail outlets; and
(6) Encourage the sale of liquor in freestanding liquor retail
outlets that offer a wide variety of liquor at competitive prices.
§60-3A-17. Wholesale prices set by commissioner; retail licensees
to purchase liquor from state; transportation and
storage; method of payment.
(a) The commissioner shall fix wholesale prices for the sale
of liquor, other than wine
and fortified wine, to retail licensees.
The commissioner shall sell liquor, other than wine
and fortified
wine, to retail licensees according to a uniform pricing schedule.
The commissioner shall obtain if possible, upon request, any liquor
requested by a retail licensee.
(b) Wholesale prices shall be established in order to yield a
net profit for the General Fund of not less than $6,500,000
annually on an annual volume of business equal to the average for
the past three years. The net revenue derived from the sale of
alcoholic liquors shall be deposited into the General Revenue Fund
in the manner provided in section seventeen, article three of this
chapter.
(c) The commissioner shall specify the maximum wholesale
markup percentage which may be applied to the prices paid by the
commissioner for all liquor, other than wine
or fortified wine, in
order to determine the prices at which all liquor, other than wine
or fortified wine, will be sold to retail licensees. A retail
licensee shall purchase all liquor, other than wine
or fortified
wine, for resale in this state only from the commissioner, and the
provisions of sections twelve and thirteen, article six of this
chapter
shall do not apply to the transportation of the liquor:
Provided, That a retail licensee shall purchase wine
or fortified
wine from a wine distributor who is duly licensed under article
eight of this chapter. All liquor, other than wine
or fortified
wine, purchased by retail licensees shall be stored in the state at
the retail outlet or outlets operated by the retail licensee:
Provided, however, That the commissioner, in his or her discretion,
may upon written request permit a retail licensee to store liquor
at a site other than the retail outlet or outlets.
(d) The sale of liquor by the commissioner to retail licensees
shall be paid by electronic funds transfer which shall be initiated
by the commissioner on the business day following the retail
licensees order or by money order, certified check or cashier's
check which shall be received by the commissioner at least
twenty-four hours
prior to before the shipping of the alcoholic
liquors:
Provided, That if a retail licensee posts with the
commissioner an irrevocable letter of credit or bond with surety
acceptable to the commissioner from a financial institution
acceptable to the commissioner guaranteeing payment of checks, then
the commissioner may accept the retail licensee's checks in an
amount up to the amount of the letter of credit.
(e)(1) A retail licensee may not sell liquor to persons licensed under the provisions of article seven of this chapter at
less than one hundred ten percent of the retail licensee's cost as
defined in section six, article eleven-a, chapter forty-seven of
this code.
(2) A retail licensee may not sell liquor to the general
public at less than one hundred ten percent of the retail
licensee's cost as defined in section six, article eleven-a,
chapter forty-seven of this code.
ARTICLE 7. LICENSES TO PRIVATE CLUBS.
§60-7-11. Licensee must purchase alcoholic liquors from or
through commissioner or retail licensee; exceptions.
(a)(1)
All Licensees shall purchase
all alcoholic liquors sold
by them from the West Virginia Alcohol Beverage Control
Commissioner at prices established by the commissioner for sales of
the alcoholic liquors to the public generally or from any retail
licensee licensed under the provisions of article three-a of this
chapter, except that:
(A) The licensees may purchase those wines permitted to be
sold at retail pursuant to article eight of this chapter from those
distributors licensed pursuant to
said that article at the same
prices the distributors sell the wines to retailers licensed
pursuant to
said article
three-a of this chapter; and
(B) The licensees may purchase those fortified wines permitted
to be sold at retail pursuant to this chapter from those
distributors licensed pursuant to article eight of this chapter at
the same prices the distributors sell the wines to retailers licensed pursuant to article three-a of this chapter.
(2) A licensee may by contract approved by the commissioner
receive deliveries of alcoholic liquor from a retail liquor store,
and the provisions of sections twelve and thirteen, article six of
this chapter
shall do not apply to the transportation of that
alcoholic liquor.
(b) In all reports filed under section sixteen, article
fifteen, chapter eleven of this code, retail licensees licensed
under the provisions of article three-a of this chapter shall
separately identify the amount of sales tax on sales of liquor to
licensees in the manner required by the Tax Commissioner.
(c) Notwithstanding the provisions of section thirty, article
fifteen, chapter eleven of this code to the contrary, the amount of
the sales taxes collected by the Tax Commissioner shall be
deposited in a revolving fund account in the State Treasurer's
office, designated the "drunk driving prevention fund", and
administered by the commission on drunk driving prevention, subject
to appropriations by the Legislature.
ARTICLE 8. SALE OF WINES.
§60-8-2. Definitions.
Unless the context in which used clearly requires a different
meaning, as used in this article:
"Commissioner" or "commission" means the West Virginia Alcohol
Beverage Control Commissioner.
"Distributor" means any person whose principal place of
business is within the State of West Virginia who makes purchases from a supplier to sell or distribute wine to retailers, grocery
stores, private wine bed and breakfasts, private wine restaurants,
private wine spas, private clubs or wine specialty shops; and that
sells or distributes
fortified wine, nonfortified dessert wine,
port, sherry and Madeira wines to wine specialty shops, private
wine restaurants, private clubs or retailers under authority of
this article and maintains a warehouse in this state for the
distribution of wine
or fortified wine.
"Fortified wine"
shall mean means any wine to which brandy or
other alcohol has been added and
shall include includes dessert
wines which are not fortified having an alcohol content by volume
of at least fourteen and one-tenths percent and not exceeding
sixteen percent.
"Grocery store" means any retail establishment, commonly known
as a grocery store, supermarket, delicatessen, caterer or party
supply store, where food, food products and supplies for the table
are sold for consumption off the premises with average monthly
sales (exclusive of sales of wine) of not less than $500 and an
average monthly inventory (exclusive of inventory of wine) of not
less than $3,000. The term "grocery store"
shall also include and
mean also includes a separate and segregated portion of any other
retail store which is dedicated solely to the sale of food, food
products and supplies for the table for consumption off the
premises with average monthly sales with respect to such separate
or segregated portion (exclusive of sales of wine) of not less than
$3,000 and an average monthly inventory (exclusive of inventory of wine) of not less than $3,000.
"Licensee" means the holder of a license granted under the
provisions of this article.
"Private wine bed and breakfast" means any business with the
sole purpose of providing, in a residential or country setting, a
hotel, motel, inn or other such establishment properly zoned as to
its municipality or local ordinances, lodging and meals to its
customers in the course of their stay at the establishment, which
business also: (1) Is a partnership, limited partnership,
corporation, unincorporated association or other business entity
which as part of its general business purpose provides meals on its
premises to its members and their guests; (2) is licensed under the
provisions of this article as to all of its premises or as to a
separate segregated portion of its premises to serve wine to its
members and their guests when such sale accompanies the serving of
food or meals; and (3) admits only duly elected and approved dues-
paying members and their guests while in the company of a member
and does not admit the general public.
"Private wine restaurant" means a restaurant which: (1) Is a
partnership, limited partnership, corporation, unincorporated
association or other business entity which has as its principal
purpose the business of serving meals on its premises to its
members and their guests; (2) is licensed under the provisions of
this article as to all of its premises or as to a separate
segregated portion of its premises to serve wine to its members and
their guests when such sale accompanies the serving of food or meals; (3) admits only duly elected and approved dues-paying
members and their guests while in the company of a member and does
not admit the general public.
Such Those private clubs that meet
the private wine restaurant requirements numbered one, two and
three in this definition shall be considered private wine
restaurants.
"Private wine spa" means any business with the sole purpose of
providing commercial facilities devoted especially to health,
fitness, weight loss, beauty, therapeutic services and relaxation,
and may be also a licensed massage parlor or a salon with licensed
beauticians or stylists, which business also: (1) Is a
partnership, limited partnership, corporation, unincorporated
association or other business entity which as part of its general
business purpose provides meals on its premises to its members and
their guests; (2) is licensed under the provisions of this article
as to all of its premises or as to a separate segregated portion of
its premises to serve up to two glasses of wine to its members and
their guests when such sale accompanies the serving of food or
meals; and (3) admits only duly elected and approved dues-paying
members and their guests while in the company of a member, and does
not admit the general public.
"Retailer" means any person licensed to sell wine at retail to
the public at his or her established place of business for off-
premises consumption and who is licensed to do so under authority
of this article.
"Supplier" means any manufacturer, producer, processor, winery, farm winery, national distributor or other supplier of wine
who sells or offers to sell or solicits or negotiates the sale of
wine to any licensed West Virginia distributor.
"Tax" includes within its meaning interest, additions to tax
and penalties.
"Taxpayer" means any person liable for any tax, interest,
additions to tax or penalty under the provisions of this article
and any person claiming a refund of tax.
"Varietal wine" means any wine labeled according to the grape
variety from which
such the wine is made.
"Vintage wine" or "vintage-dated wine" means wines from which
the grapes used to produce such wine are harvested during a
particular year or wines produced from the grapes of a particular
harvest in a particular region of production.
"Wine" means any alcoholic beverage obtained by the natural
fermentation of the natural content of grapes, other fruits or
honey or other agricultural products containing sugar and to which
no alcohol has been added and
shall include includes table wine,
and
shall exclude excludes fortified wine and
shall also exclude
also excludes any product defined as or embraced within the
definition of nonintoxicating beer under the provisions of article
sixteen, chapter eleven of this code.
"Wine specialty shop" means a retailer who
shall deal deals
principally in the sale of table wine, nonfortified dessert wines,
wine accessories and food or foodstuffs normally associated with
wine and: (1) Who
shall maintain maintains a representative number of such wines for sale in his or her inventory which are designated
by label as varietal wine, vintage, generic and/or according to
region of production and the inventory shall contain not less than
fifteen percent vintage or vintage-dated wine by actual bottle
count; and (2) who, any other provisions of this code to the
contrary notwithstanding, may maintain an inventory of port, sherry
and Madeira wines having an alcoholic content of not more than
twenty-two percent alcohol by volume and which have been matured in
wooden barrels or casks.
NOTE: The purpose of this bill is to authorize licensed wine
distributors to sell fortified wine.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.
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