69th OREGON LEGISLATIVE ASSEMBLY--1997 Regular Session
Enrolled
Senate Bill 300
Sponsored by COMMITTEE ON LIVABILITY (at the request of Clear
Creek Distillery)
CHAPTER ................
AN ACT
Relating to alcoholic beverages; creating new provisions; and
amending ORS 471.230, 471.253, 471.265, 471.396 and 471.542.
Be It Enacted by the People of the State of Oregon:
SECTION 1. ORS 471.230 is amended to read:
471.230. (1) A distillery license shall allow the holder
thereof to import, manufacture, distill, rectify, blend, denature
and store spirits of an alcoholic content greater than 17 percent
alcohol by weight, to sell the same to the Oregon Liquor Control
Commission, and to transport the same out of this state for sale
outside this state. Distillery licensees shall be permitted to
purchase from and through the commission alcoholic beverages for
blending and manufacturing purposes upon such terms and
conditions as the commission may provide. No such licensee shall
sell any alcoholic beverage within this state except to the
commission or as provided in subsection (2) of this section.
However, any agricultural producer or association of agricultural
producers or legal agents thereof who manufacture and convert
agricultural surpluses, by-products and wastes into denatured
ethyl and industrial alcohol for use in the arts and industry
shall not be required to obtain a license from the commission.
(2) A distillery licensee { - which - } { + that + }
distills brandy { + or pot distilled liquor + } may:
(a) Permit tastings of such brandy { + or pot distilled
liquor + } by visitors on the premises and on at least one other
premises owned or leased by the licensee. The licensee must
purchase the brandy { + or pot distilled liquor + } from the
commission.
(b) Apply for appointment as a retail sales agent of the
commission for purposes of retailing only brandy { + or pot
distilled liquor + } { - which - } { + that + } the licensee
distilled in Oregon at the two locations at which tastings are
permitted pursuant to paragraph (a) of this subsection.
SECTION 2. ORS 471.253 is amended to read:
471.253. (1) A brewery-public house license shall allow the
licensee:
(a) To manufacture annually on the licensed premises, store,
transport, sell to wholesale malt beverage and wine licensees of
the Oregon Liquor Control Commission and export malt beverages;
(b) To sell malt beverages manufactured on or off the licensed
premises at retail for consumption on or off the premises;
Enrolled Senate Bill 300 (SB 300-B) Page 1
(c) To sell malt beverages in brewery-sealed packages at retail
directly to the consumer for consumption off the premises;
(d) To sell on the licensed premises at retail malt beverages
manufactured on or off the licensed premises in unpasteurized or
pasteurized form directly to the consumer for consumption off the
premises, delivery of which may be made in a securely covered
container supplied by the consumer;
(e) To sell wine and cider containing not more than 21 percent
alcohol by weight at retail for consumption on or off the
premises; and
(f) To conduct the activities described in paragraphs (b) to
(e) of this subsection at one location other than the premises
where the manufacturing occurs.
(2) A brewery-public house licensee, or any person having an
interest in the licensee, is a retail licensee for the purposes
of ORS 471.394 and, except as otherwise provided by this section
and ORS 471.396, may not acquire or hold any right, title, lien,
claim or other interest, financial or otherwise, in, upon or to
the premises, equipment, business or merchandise of any
manufacturer or wholesaler, as defined in ORS 471.392. A
brewery-public house licensee, or any person having an interest
in the licensee, is also a manufacturer for the purposes of ORS
471.398 and, except as otherwise provided by this section and ORS
471.400, may not acquire or hold any right, title, lien, claim or
other interest, financial or otherwise, in, upon or to the
premises, equipment, business or merchandise of any other retail
licensee, as defined in ORS 471.392.
(3) A brewery-public house licensee, or any person having an
interest in the licensee, is a retail licensee for the purposes
of ORS 471.398 and, except as otherwise provided by this section
and ORS 471.400, may not accept directly or indirectly any
financial assistance described in ORS 471.398 from any
manufacturer or wholesaler, as defined in ORS 471.392. A
brewery-public house licensee, or any person having an interest
in the licensee, is also a manufacturer for the purposes of ORS
471.398 and, except as otherwise provided by this section and ORS
471.400, may not provide directly or indirectly any financial
assistance described in ORS 471.398 to any retail licensee, as
defined in ORS 471.392. The prohibitions on financial assistance
in ORS 471.398 do not apply to financial assistance between
manufacturing and retail businesses licensed to the same person
under the provisions of this section.
(4) Notwithstanding subsection (2) of this section, a
brewery-public house licensee, or any person having an interest
in the licensee, may also hold a winery license authorized by ORS
471.223. A brewery-public house licensee, or any person having an
interest in the licensee, may also hold a warehouse license
authorized by ORS 471.242.
(5) Notwithstanding subsection (2) of this section, a
brewery-public house licensee is eligible for a retail malt
beverage license and for special one-day retail beer and wine
licenses.
(6)(a) Notwithstanding subsection (2) of this section, and
except as provided by paragraph (b) of this subsection, a
brewery-public house licensee, or any person having an interest
in the licensee, may also hold a dispenser license issued under
ORS chapter 472. If a person holds both a brewery-public house
license and a dispenser license, nothing in this chapter shall
prevent the sale by the licensee of both distilled liquor and
Enrolled Senate Bill 300 (SB 300-B) Page 2
malt beverages manufactured under the brewery-public house
license.
(b) The commission may not issue a dispenser license to a
brewery-public house licensee under the provisions of this
subsection if the brewery-public house licensee, or any person
having an interest in the licensee or exercising control over the
licensee, is a brewery that brews more than 200,000 barrels of
malt beverages annually or a winery that produces more than
200,000 gallons of wine annually.
(c) The commission may not issue a dispenser license to a
brewery-public house licensee under the provisions of this
subsection if the brewery-public house licensee, or any person
having an interest in the licensee or exercising control over the
licensee, is a distillery, unless the distillery produces only
{ - brandy - } { + pot distilled liquor + } and produces no
more than { - 2,500 - } { + 12,000 + } gallons of
{ - brandy - } { + pot distilled liquor + } annually.
(7) Notwithstanding any other provision of this chapter, a
brewery-public house licensee, or any person having an interest
in the licensee, may also hold a distillery license if the
licensee produces only { - brandy - } { + pot distilled
liquor + }, and produces no more than { - 2,500 - } { +
12,000 + } gallons of { - brandy - } { + pot distilled
liquor + } annually. No provision of this chapter prevents a
brewery-public house licensee from becoming a retail sales agent
of the commission for the purpose of selling distilled liquors.
(8) Notwithstanding subsection (2) of this section, the
commission by rule may authorize a brewery-public house licensee
to co-produce special events with other manufacturers.
(9)(a) Notwithstanding subsection (2) of this section, a
brewery-public house licensee may hold, directly or indirectly,
an interest in a manufacturer or wholesaler, provided that the
interest does not result in exercise of control over, or
participation in the management of, the manufacturer's or
wholesaler's business or business decisions and does not result
in exclusion of any competitor's brand of alcoholic liquor.
(b) Notwithstanding subsection (3) of this section, a
manufacturer or wholesaler, and any officer, director or
substantial stockholder of any corporate manufacturer or
wholesaler, may hold, directly or indirectly, an interest in a
brewery-public house licensee, provided that the interest does
not result in exercise of control over, or participation in the
management of, the licensee's business or business decisions and
does not result in exclusion of any competitor's brand of
alcoholic liquor.
(10) For purposes of ORS chapter 473, a brewery-public house
licensee shall be considered to be a manufacturer.
SECTION 3. { + The amendments to ORS 471.230 and 471.253 by
sections 1 and 2 of this Act apply to all distillery and
brewery-public house licenses, whether issued before, on or after
the effective date of this Act. + }
SECTION 4. ORS 471.396 is amended to read:
471.396. (1) The prohibitions of ORS 471.394 (1) do not apply
to persons holding winery licenses, winery salesperson licenses,
grower sales privilege licenses or brewery-public house licenses
or to any brewery licensee brewing fewer than 200,000 barrels of
malt beverages annually.
(2)(a) The prohibitions of ORS 471.394 (2) and (3) do not apply
to a person who wholesales alcoholic liquor and who is not
required to be licensed under the provisions of this chapter or
Enrolled Senate Bill 300 (SB 300-B) Page 3
ORS chapter 472 if the retail licensee does not sell any brand of
alcoholic liquor sold or distributed by the person and does not
sell any brand of alcoholic liquor produced by any manufacturer
doing business with the person selling at wholesale.
(b) The prohibitions of ORS 471.394 (2) and (3) do not apply to
a manufacturer of alcoholic liquor if the retail licensee does
not sell any brand of alcoholic liquor sold, distributed or
produced by the manufacturer and does not sell any brand of
alcoholic liquor sold, distributed or produced by any subsidiary
or other business entity that the manufacturer owns or manages,
or that the manufacturer exercises control over.
(3) The prohibitions of ORS 471.394 do not apply solely by
reason of the family relationship of a spouse or family member to
a manufacturer or wholesaler if:
(a) The manufacturer or wholesaler is licensed by the Oregon
Liquor Control Commission to sell alcoholic liquor at wholesale;
(b) The license authorizing sale of alcoholic liquor at
wholesale was first issued before January 1, 1965, and has been
held continuously since that date;
(c) The spouse or family member holds or seeks a license that
authorizes the retail sale of alcoholic liquor for off-premises
consumption only; and
(d) The manufacturer or wholesaler does not directly or
indirectly sell alcoholic liquor to the spouse or family member.
(4) The prohibitions of ORS 471.394 do not apply solely by
reason of the family relationship of a spouse or family member to
the retail licensee if the manufacturer or wholesaler is licensed
by the commission to sell alcoholic liquor at wholesale and does
not directly or indirectly sell alcoholic liquor to the spouse or
family member.
(5) Notwithstanding ORS 471.394, a manufacturer or wholesaler,
and any officer, director or substantial stockholder of any
corporate manufacturer or wholesaler, may hold, directly or
indirectly, an interest in a Class A dispenser, Class C
dispenser, seasonal dispenser, tour boat, retail malt beverage or
restaurant licensee, provided that the interest does not result
in exercise of control over, or participation in the management
of, the licensee's business or business decisions, and does not
result in exclusion of any competitor's brand of alcoholic
liquor.
(6) Notwithstanding ORS 471.394, a Class A dispenser, Class C
dispenser, seasonal dispenser, tour boat, retail malt beverage or
restaurant licensee, and any officer, director or substantial
stockholder of any corporate Class A dispenser, Class C
dispenser, seasonal dispenser, tour boat, retail malt beverage or
restaurant licensee, may hold, directly or indirectly, an
interest in a manufacturer or wholesaler, provided that the
interest does not result in exercise of control over, or
participation in the management of, the manufacturer's or
wholesaler's business or business decisions, and does not result
in exclusion of any competitor's brand of alcoholic liquor.
{ + (7) Notwithstanding ORS 471.394, an institutional
investor with a financial interest in a wholesaler or
manufacturer may hold, directly or indirectly, an interest in a
retail licensee unless the institutional investor controls, is
controlled by, or is under common control with, a wholesaler or
manufacturer. Notwithstanding ORS 471.394, an institutional
investor with a financial interest in a retail licensee may hold,
directly or indirectly, an interest in a wholesaler or
manufacturer unless the institutional investor controls, is
Enrolled Senate Bill 300 (SB 300-B) Page 4
controlled by, or is under common control with, a retail
licensee. The provisions of this subsection apply only to an
institutional investor that is a state or federally chartered
bank, a state or federally chartered mutual savings bank, a
mutual fund or pension fund, or a private investment firm. The
principal business activity of the institutional investor must be
the investment of capital provided by depositors, participants or
investors. The institutional investor must maintain a diversified
portfolio of investments. The majority of the institutional
investor's investments may not be in businesses that manufacture,
distribute or otherwise sell alcoholic beverages. The
institutional investor, and the officers, directors, substantial
shareholders, partners, employees and agents of the institutional
investor, may not participate in management decisions relating to
the sale or purchase of alcoholic beverages made by a licensee in
which the institutional investor holds an interest. + }
SECTION 5. ORS 471.265 is amended to read:
471.265. (1) A retail malt beverage license shall allow anyone
operating a place of business where refreshments are served to
sell malt beverages, hard cider containing not more than 10
percent alcohol by volume and wine containing not more than 14
percent by volume.
(2) A retail malt beverage license shall permit the licensee to
sell malt beverages for consumption on the licensed premises,
malt beverages in brewery-sealed packages for consumption off the
licensed premises, not more than two gallons of malt beverages in
a securely covered container or containers supplied by the
purchaser for consumption off the licensed premises, hard cider
for consumption on the licensed premises, hard cider in sealed
containers for consumption off the licensed premises, wine for
consumption on the licensed premises and wine in winery-sealed
packages for consumption off the licensed premises. { + Sales of
alcoholic beverages under a retail malt beverage license must
consist principally of sales by the drink for consumption on the
licensed premises. + }
(3) Such licensees shall not sell any malt beverages containing
more than 14 percent alcohol by volume, nor wine containing more
than 14 percent by volume. In the absence of municipal ordinance
or local regulation to the contrary, such licensees shall be
permitted to allow dancing and to have and permit singing and
other proper forms of entertainment upon the licensed premises.
SECTION 6. { + The amendments to ORS 471.265 by section 5 of
this Act apply only to retail malt beverage licenses issued or
renewed on or after January 1, 1998. + }
SECTION 7. ORS 471.542 is amended to read:
471.542. (1) The Oregon Liquor Control Commission shall require
applicants for Class A, Class B, Class C, retail malt beverage,
restaurant, seasonal dispenser, annual community events
dispenser, tour boat, brewery-public house, caterer and winery
salesperson licenses and service permits and all renewing Class
A, Class B, Class C, retail malt beverage, restaurant, seasonal
dispenser, annual community events dispenser, tour boat,
brewery-public house, caterer and winery salesperson licensees
and permittees to complete an approved alcohol server education
program and examination in order to qualify { - or
requalify - } for a license or permit { - unless a
probationary extension is granted for hardship reasons - } .
{ - After the completion of an initial alcohol server education
program and examination, licensees and permittees shall complete
an alcohol server education program and examination every five
Enrolled Senate Bill 300 (SB 300-B) Page 5
years unless a probationary extension is granted for hardship
reasons. - }
{ + (2) The commission by rule shall establish requirements
that licensees and permittees must comply with as a condition of
requalifying for a license or permit. The licensee or permittee
must comply with those requirements once every five years after
completing the initial alcohol server education program and
examination. The requirements established by the commission may
include retaking the alcohol server education program and
examination.
(3) The commission may extend the time periods established by
this section upon a showing of hardship. + } The commission by
rule may exempt { - licensees who do - } { + a licensee from
the requirements of this section if the licensee does + } not
participate in the management of the business.
{ - (2) - } { + (4) + } The standards and curriculum of
alcohol server education programs shall include but not be
limited to the following:
(a) Alcohol as a drug and its effects on the body and behavior,
especially driving ability.
(b) Effects of alcohol in combination with commonly used legal,
prescription or nonprescription, drugs and illegal drugs.
(c) Recognizing the problem drinker and community treatment
programs and agencies.
(d) State alcohol beverage laws such as prohibition of sale to
minors and sale to intoxicated persons, sale for on-premises or
off-premises consumption, hours of operation and penalties for
violation of the laws.
(e) Drunk driving laws and liquor liability statutes.
(f) Intervention with the problem customer including ways to
cut off service, ways to deal with the belligerent customer and
alternative means of transportation to get the customer safely
home.
(g) Advertising and marketing for safe and responsible drinking
patterns and standard operating procedures for dealing with
customers.
{ - (3) - } { + (5) + } The commission shall impose a fee
not to exceed $2.60 a year for each license subject to the
alcohol server education requirement, and a fee not to exceed $13
for each service permit application. These fees shall be used for
administrative costs of the program and shall be in addition to
any other license or permit fees required by law or rule.
{ - (4) - } { + (6) + } The commission shall adopt rules to
impose reasonable fees for administrative costs of the program on
alcohol server education instructors and providers.
{ - (5) - } { + (7) + } The commission shall provide the
program through independent contractors, private persons or
private or public schools certified by the commission.
SECTION 8. { + (1) The Oregon Liquor Control Commission shall
develop a plan for simplifying the current licensing structure
and process under ORS chapters 471 and 472. For the purpose of
developing the plan, the commission shall establish a task force
to study alternatives to the existing licensing structure and
process and to provide advice to the commission on the relative
merits of those alternatives. The task force must include
representatives of licensees and other persons who would be
affected by changes to the licensing system. The plan developed
by the commission must contain recommendations for implementation
of the plan, including but not limited to recommendations on
whether some licenses should be issued for more than one year,
Enrolled Senate Bill 300 (SB 300-B) Page 6
recommendations on new processes for renewal of licenses when
there has been a history of problems associated with the licensee
or licensed premises and recommendations on the levels of
staffing needed for the effective enforcement of the provisions
of ORS chapters 471 and 472.
(2) The Oregon Liquor Control Commission shall prepare a report
that contains the plan developed under this section and that
contains recommendations for legislation needed to implement the
plan. The report shall be submitted to the Seventieth Legislative
Assembly in the manner provided by ORS 192.245. + }
SECTION 9. { + Section 10 of this Act is added to and made a
part of ORS chapter 471. + }
SECTION 10. { + Nothing in this chapter prevents a brewery
licensed under ORS 471.220 or a brewery-public house licensed
under ORS 471.253 from establishing a refund value for malt
beverage containers under the provisions of ORS 459A.705 that is
in excess of five cents per container for the purpose of
encouraging purchasers to return the containers directly to the
brewery or brewery-public house. A refund value in excess of five
cents per container may be paid under this section only to
persons who are not licensed under this chapter or ORS chapter
472 and who return the containers directly to the brewery or
brewery-public house. + }
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Passed by Senate March 6, 1997
Repassed by Senate June 11, 1997
...........................................................
Secretary of Senate
...........................................................
President of Senate
Passed by House June 5, 1997
...........................................................
Speaker of House
Enrolled Senate Bill 300 (SB 300-B) Page 7
Received by Governor:
......M.,............., 1997
Approved:
......M.,............., 1997
...........................................................
Governor
Filed in Office of Secretary of State:
......M.,............., 1997
...........................................................
Secretary of State
Enrolled Senate Bill 300 (SB 300-B) Page 8