Chapter
797
AN ACT
HB 3442
Relating to wine boards; creating new provisions; amending ORS 182.454, 473.030, 473.045, 473.047, 576.750 and 576.763; repealing ORS 576.755, 576.760 and 576.765 and section 120, chapter 158, Oregon Laws 1987; appropriating money; and declaring an emergency.
Be It Enacted by the People of the State of
SECTION 1. Sections 2 to 11 of this 2003 Act are added to and made a part of ORS 576.750 to 576.765.
FINDINGS
SECTION
2. The Legislative Assembly finds
and declares that:
(1)
The development of world-class wine grape growing and wine making industries is
important to
(2)
It is in the public interest to encourage the orderly growth and development of
sustainable, labor-intensive, value-added agricultural industries, such as the
wine grape growing and wine making industries.
(3) State involvement in the wine grape growing and wine making industries must be coordinated to respond to state interests and to encourage appropriate partnership and cooperation between the public and private sectors in ensuring orderly growth and realizing statewide objectives for world-class wine grape growing and wine making industries.
SECTION
3. (1) The
(2)
The board shall consist of nine members appointed by the Governor. In making
appointments, the Governor shall consider nominations or recommendations made
by organizations with nominating committees representative of all major wine
industry regions of the state.
(3)
The term of office for a member is three years, but a member serves at the
pleasure of the Governor. Before the expiration of a term, the Governor shall
appoint a successor whose term begins on January 1 next following. A member is
eligible for reappointment.
(4)
If a vacancy occurs on the board, the Governor shall appoint a qualified person
to serve the unexpired term.
(5)
A person appointed to the board must have:
(a)
Expertise and experience in the
(b)
A demonstrated ability and disposition to serve the state’s interests regarding
all aspects of the Oregon wine grape growing and wine making industries,
including but not limited to the various types and sizes of wine grape growing
and wine making operations, grape varieties and growing regions within the
state.
(6)
A member of the board must maintain the following qualifications during the
term of office:
(a)
Be a bona fide resident of the state or an officer or principal owner of an
entity organized or registered to do business in this state.
(b)
Have a demonstrated interest in the positive development of the
(c)
Be actively engaged in wine grape growing or wine making.
(7) The members of the board shall elect a chairperson and vice-chairperson with duties and powers as determined by the board.
SECTION
4. Notwithstanding the term of
office specified in section 3 of this 2003 Act, of the members initially
appointed to the Oregon Wine Board on or after the effective date of this
section:
(1)
Three shall serve a term ending January 1, 2007.
(2)
Three shall serve a term ending January 1, 2006.
(3) Three shall serve a term ending January 1, 2005.
SECTION
5. To carry out the purposes
specified in ORS 576.750 to 576.765, the Oregon Wine Board may:
(1)
Appoint officers and enter into agreements with consultants, agents and
advisers, and prescribe their duties;
(2)
Appear on the board’s own behalf before boards, commissions, departments or
other agencies of municipal or county governments, the state government or the
federal government;
(3)
Procure insurance against any losses in connection with properties of the board
in such amounts and from such insurers as may be necessary or desirable;
(4)
Accept donations, grants, bequests and devises, conditional or otherwise, of
money, property, services or other things of value, including the interest or
earnings thereon but excluding corporate stock, that may be received from a
government agency or a public or private institution or person, to be held,
used or applied for any or all of the purposes specified in ORS 576.750 to
576.765 in accordance with the terms and conditions of the donation, grant,
bequest or devise;
(5)
Organize, conduct, sponsor, cooperate with and assist the private sector and other
state agencies in the conduct of conferences and tours relating to the wine
grape growing and wine making industries;
(6)
Provide and pay for advisory services and technical assistance that the board
finds necessary or desirable; and
(7) Exercise any other powers necessary for the operation and functioning of the board under ORS 576.750 to 576.765.
SECTION
6. (1) In accordance with
applicable provisions of ORS 183.310 to 183.550, the Oregon Wine Board may
adopt rules necessary for the administration of ORS 576.750 to 576.765.
(2) Notwithstanding section 3 (1) of this 2003 Act and ORS 182.460, employees of the Oregon Wine Board are not eligible for inclusion within the Public Employees Retirement System.
SECTION 7. The Oregon Wine Board shall operate for the purpose of supporting enological, viticultural and economic research to develop sustainable business practices for wine grape growing and wine making within Oregon and supporting the promotion of Oregon’s wine grape growing and wine making industries. The board shall create and maintain a long term strategic plan and use that plan to guide the granting and funding decisions of the board. To the extent practicable, the board shall allocate funds and award grants in a manner that encourages coordinated, cost-effective projects that are integrated to implement the board’s strategic statewide objectives for the development of world-class wine grape growing and wine making within Oregon.
SECTION
8. (1) If a person selling or
providing grape product to a winery performs part of the processing function of
a winery, the person shall report the sale or provision of the grape product
and pay the tax imposed under ORS 473.045 (5).
(2)
A person or winery required to pay a tax under ORS 473.045 (5) shall keep
accurate records sufficient to enable the Oregon Liquor Control Commission to
determine by inspection and audit the accuracy of the taxes paid or due the
Oregon Wine Board and of reports made or due to the commission.
(3)
The commission or a designee of the commission may inspect and audit the
records referred to in subsection (2) of this section for the purpose referred
to in subsection (2) of this section.
(4)
A person or winery may not refuse to permit an inspection and audit under
subsection (3) of this section during business hours.
(5)
In addition to the penalties prescribed in section 9 of this 2003 Act, a person
or winery that delays transmittal of tax payments under ORS 473.045 (5) beyond
the due date specified in ORS 473.045 shall pay five percent of the overdue
amount for the first full or partial month of delay and one percent of the
overdue amount for each full or partial month of delay thereafter.
(6) If a winery willfully refuses to turn over tax moneys withheld under ORS 473.045 (5), the winery shall pay an additional amount equal to twice the amount of the tax moneys not turned over.
SECTION 9. Failure to pay a tax under ORS 473.045 (5) is punishable, upon conviction, by a fine of not more than $500, or by imprisonment in the county jail for not more than 90 days, or both.
SECTION 10. Moneys received on behalf of the Oregon Wine Board pursuant to ORS 473.030 (4) and 473.045 shall be deposited into the account created by the board under ORS 182.470 and are continuously appropriated exclusively for use by the board in carrying out the provisions of ORS 576.750 to 576.765. The board shall allocate a portion of the moneys received from sources other than fees toward research in enology and viticulture and toward promotion of the Oregon wine grape growing and wine making industries, including administrative costs associated with either category.
SECTION
11. (1) The report submitted by
the Oregon Wine Board under ORS 182.472 must include a description of the long
term strategic plan created by the board and a description of the progress made
in implementing the statewide strategic objectives of the board during the most
recent biennium.
(2)
Notwithstanding ORS 182.462:
(a)
The board shall prepare and submit annual plans and a budget recommended by the
board for promotion and for research during the next fiscal year.
(b)
The board shall adopt rules specifying the procedures, criteria and timelines
for the preparation and approval of the annual plans and budget for promotion
and for research.
(c)
The Director of the Economic and Community Development Department shall review
the budget and plans submitted under this section. In reviewing the annual
plans and budget, the director shall consider whether the information supplied
by the board is factual and consistent with ORS 576.750 to 576.765 and the
positive development of the Oregon wine grape growing and wine making
industries. The director shall either approve the budget and plans prior to the
commencement of the next fiscal year or disapprove and return the budget and
plans to the board with conditions necessary for approval prior to the
commencement of the next fiscal year. In reviewing the budget and plans, the
director may consult with and receive coordinated support from:
(A)
The State Department of Agriculture;
(B)
The Oregon Tourism Commission;
(C)
The Department of Higher Education;
(D)
The Department of Community Colleges and Workforce Development; and
(E) The Oregon Liquor Control Commission.
ABOLISH AND TRANSFER
SECTION
12. (1) The Wine Advisory Board
is abolished. On the operative date of this section, the tenure of office of
the members of the Wine Advisory Board ceases.
(2) All of the duties, functions and powers of the Wine Advisory Board are imposed upon, transferred to and vested in the Oregon Wine Board.
RECORDS, PROPERTY, EMPLOYEES
SECTION
13. (1) The Director of
Agriculture shall:
(a)
Deliver to the temporary administrator appointed under section 21 of this 2003
Act for the Oregon Wine Board all records and property within the jurisdiction
of the director that relate to the duties, functions and powers transferred by
section 12 of this 2003 Act; and
(b)
Transfer to the temporary administrator all employees, if any, engaged
primarily in the exercise of the duties, functions and powers transferred by
section 12 of this 2003 Act. Section 6 (2) of this 2003 Act does not apply to
an employee transferred under this section.
(2)
The temporary administrator shall take possession of the records and property,
and shall take charge of the employees and employ them in the exercise of the
duties, functions and powers transferred by section 12 of this 2003 Act,
without reduction of compensation but subject to change or termination of
employment or compensation as provided by law and subject to section 6 (2) of
this 2003 Act.
(3) The Governor shall resolve any dispute between the director and the temporary administrator relating to transfers of records, property and employees under this section, and the Governor’s decision is final.
UNEXPENDED REVENUES
SECTION 14. The unexpended balances of amounts authorized to be expended by the Wine Advisory Board for the biennium beginning July 1, 2003, from revenues dedicated, continuously appropriated, appropriated or otherwise made available for the purpose of administering and enforcing the duties, functions and powers of the Wine Advisory Board transferred by section 12 of this 2003 Act, all moneys in the Wine Advisory Board Account on the operative date of the repeal of ORS 576.765 by section 28 of this 2003 Act and all moneys received by the Wine Advisory Board or placed to the credit of the board and remaining unobligated and unexpended on the operative date of the repeal of ORS 576.765, shall be deposited in the account established by the Oregon Wine Board pursuant to ORS 182.470.
ACTION, PROCEEDING, PROSECUTION
SECTION 15. The transfer of duties, functions and powers to the Oregon Wine Board by section 12 of this 2003 Act does not affect any action, proceeding or prosecution involving or with respect to such duties, functions and powers begun before and pending at the time of the transfer, except that the Oregon Wine Board is substituted for the Wine Advisory Board in the action, proceeding or prosecution.
LIABILITY, DUTY, OBLIGATION
SECTION
16. (1) Nothing in sections 2 to
21 of this 2003 Act relieves a person of a liability, duty or obligation
accruing under or with respect to the duties, functions and powers transferred
by section 12 of this 2003 Act. The Oregon Wine Board may undertake the
collection or enforcement of any such liability, duty or obligation.
(2) The rights and obligations of the Wine Advisory Board legally incurred under contracts, leases and business transactions executed, entered into or begun before the operative date of section 12 of this 2003 Act are transferred to the Oregon Wine Board. For the purpose of succession to these rights and obligations, the Oregon Wine Board is a continuation of the Wine Advisory Board and not a new authority.
RULES
SECTION 17. Notwithstanding the transfer of duties, functions and powers by section 12 of this 2003 Act, the rules of the Wine Advisory Board in effect on the operative date of section 12 of this 2003 Act continue in effect as rules of the Oregon Wine Board until superseded or repealed by rules of the Oregon Wine Board. References in rules of the Wine Advisory Board to the Wine Advisory Board or an officer or employee of the Wine Advisory Board are considered to be references to the Oregon Wine Board or an officer or employee of the Oregon Wine Board.
SECTION 18. Whenever, in any uncodified law or resolution of the Legislative Assembly or in any rule, document, record or proceeding authorized by the Legislative Assembly, reference is made to the Wine Advisory Board or an officer or employee of the Wine Advisory Board, the reference is considered to be a reference to the Oregon Wine Board or an officer or employee of the Oregon Wine Board.
AGENCY NAME CHANGE
SECTION 19. For the purpose of harmonizing and clarifying statute sections published in Oregon Revised Statutes, the Legislative Counsel may substitute for words designating the “Wine Advisory Board” or its officers, wherever they occur in Oregon Revised Statutes, words designating the “Oregon Wine Board” or its officers.
ACCOUNT NAME CHANGE
SECTION 20. For the purpose of harmonizing and clarifying statute sections published in Oregon Revised Statutes, the Legislative Counsel may substitute for words designating the Wine Advisory Board Account, wherever they occur in Oregon Revised Statutes, words designating the account established by the Oregon Wine Board under ORS 182.470.
TEMPORARY ADMINISTRATOR
SECTION 21. The Governor may appoint a temporary administrator for the Oregon Wine Board. The temporary administrator may take any action prior to the operative date of sections 1 to 20 of this 2003 Act necessary to enable the members of the Oregon Wine Board to exercise, on and after the operative date of sections 1 to 20 of this 2003 Act, the duties, functions and powers of the board. The temporary administrator may establish a bank account of the type described in ORS 182.470 in the name of the Oregon Wine Board. The office of the temporary administrator shall cease 30 days after the appointment of a majority of the members of the Oregon Wine Board, unless otherwise provided by the board.
AMENDMENTS TO
OREGON REVISED STATUTES
SECTION 22. ORS 473.030 is amended to read:
473.030. (1) A tax is imposed upon the privilege of engaging in business as a manufacturer or as an importing distributor of malt beverages at the rate of $2.60 per barrel of 31 gallons on all such beverages.
(2) A tax is imposed upon the privilege of engaging in business as a manufacturer or as an importing distributor of wines at the rate of 65 cents per gallon on all such beverages.
(3) In addition to the tax imposed by subsection (2) of this section, a manufacturer or an importing distributor of wines containing more than 14 percent alcohol by volume shall be taxed at the rate of 10 cents per gallon.
(4) In addition to the taxes imposed by subsections (2) and (3) of this section, a manufacturer or an importing distributor of wines shall be taxed at the rate of two cents per gallon. Notwithstanding any other provision of law, all moneys collected by the Oregon Liquor Control Commission pursuant to this subsection shall be paid into the [Wine Advisory Board Account established under ORS 576.765] account established by the Oregon Wine Board under ORS 182.470.
(5) The rates of tax imposed by this section upon malt beverages apply proportionately to quantities in containers of less capacity than those quantities specified in this section.
(6) The taxes imposed by this section shall be measured by the volume of wine or malt beverages produced, purchased or received by any manufacturer. If the wine or malt beverage remains unsold and in the possession of the producer at the plant where it was produced, no tax imposed or levied by this section is required to be paid until the wine or malt beverage has become sufficiently aged for marketing at retail, but this subsection shall not be construed so as to alter or affect any provision of this chapter relating to tax liens or the filing of statements.
SECTION 23. ORS 473.045, as amended by section 101, chapter 604, Oregon Laws 2003 (Enrolled Senate Bill 854), is amended to read:
473.045. (1) A tax is hereby imposed upon the sale or use of all agricultural products used in a winery for making wine.
(2) The amount of the tax shall be $25 per ton of grapes of the vinifera varieties, whether true or hybrid.
(3) An equivalent tax is imposed upon the sale or use of vinifera or hybrid grape products imported for use in a winery licensed under ORS chapter 471 for making wine. Such tax shall be $25 per ton of grapes used to produce the imported grape product. The tax shall be determined on the basis of one ton of grapes for each 150 gallons of wine made from such vinifera or hybrid grape products.
(4) A tax on the sale or use of products that are not subject to subsection (2) or (3) of this section that are used to make wine in this state shall be imposed at a rate of $.021 per gallon of wine made from those products.
(5) In the case of vinifera or hybrid grape products harvested in this state, $12.50 of such tax shall be levied and assessed against the person selling or providing such grape products to the winery. If the purchasing winery is licensed under ORS chapter 471, that winery shall deduct the tax levied under this subsection from the price paid to the seller. If the purchasing winery is not licensed under ORS chapter 471, the seller shall report all sales on forms provided by the [State Department of Agriculture] Oregon Liquor Control Commission and pay $12.50 per ton as a tax directly to the [department] commission.
(6) Taxes paid by sellers under subsection (5) of this section shall be collected by the Oregon Liquor Control Commission on behalf of the Oregon Wine Board. The commission may retain an amount sufficient to cover the cost of collecting the taxes paid under subsection (5) of this section and shall transfer the remainder of those taxes to the board for deposit as provided in section 10 of this 2003 Act. Failure to pay a tax imposed under subsection (5) of this section subjects the violator to the penalty provided in section 9 of this 2003 Act.
[(6)] (7) Except for the tax specified in subsection (4) of this section the taxes specified under this section shall be levied and assessed to the licensed winery at the time of purchase of the product by the winery or of importation of the product, whichever is later. The tax specified in subsection (4) of this section shall be levied and assessed to the licensed winery at the time the wine is made.
[(7)] (8) [Except for taxes to be paid to the State Department of Agriculture pursuant to subsection (5) of this section,] The taxes imposed by this section shall be paid by the licensed winery and collected by the [Oregon Liquor Control] commission subject to the same powers as taxes imposed and collected under ORS chapter 473. [Taxes to be paid by sellers under subsection (5) of this section shall be collected by the State Department of Agriculture in the same manner as provided for the collection of an assessment by a commodity commission under ORS 576.345 to 576.365 as set forth in the 2001 Edition of Oregon Revised Statutes. Failure to pay the tax is punishable, upon conviction, by a fine of not more than $500 or by imprisonment in the county jail for not more than 90 days, or both.] The tax obligation for a calendar year shall be paid in two installments. Half shall be due on December 31 of the current calendar year. The remaining half shall be due the following June 30.
SECTION 24. ORS 473.047 is amended to read:
473.047. (1) As used in this section, “qualified marketing activity” means marketing activity:
(a) That promotes the sale of wine or wine products;
(b) That does not promote specific brands of wine or wine products or exclusively promote the products of any particular winery; and
(c) That has been approved by the [Wine Advisory] Oregon Wine Board.
(2) A credit against the privilege tax otherwise due under ORS 473.030 (2) is allowed to a manufacturer or importing distributor of wine for the qualified marketing activity expenditures made by the manufacturer or importing distributor in the calendar year prior to the year for which the credit is claimed.
(3) The credit allowed under this section shall be 28 percent of the sum of the following:
(a) One hundred percent of the cost of qualified marketing activity to the extent that the cost of the activity does not exceed the amount of taxes the manufacturer or importing distributor of wine owed under ORS 473.030 (2) on the first 40,000 gallons, or 151,000 liters, of wine sold annually in Oregon; and
(b) Twenty-five percent of the tax owed under ORS 473.030 (2) for qualified marketing activity on wine sales above 40,000 gallons, or 151,000 liters, of wine sold annually in Oregon.
(4) The credit allowed under this section may not exceed the tax liability of the manufacturer or importing distributor of wine under ORS 473.030 (2) for the calendar year following the year in which qualified marketing activity occurred.
(5) A manufacturer or importing distributor of wine that wishes to claim the credit allowed under this section shall submit with the manufacturer’s or importing distributor’s tax return form a certificate issued by the [Wine Advisory] board verifying that the marketing activity was a qualified marketing activity. The credit shall be claimed on the form and include the information required by the Oregon Liquor Control Commission by rule.
(6) The credit shall be claimed against the taxes reported on the return filed under ORS 473.060 for each month in the calendar year following the year in which the qualified marketing activity occurred, until the credit is completely used or the year ends, whichever occurs first.
(7) The [Wine Advisory] board shall by rule further define, consistent with the definition in subsection (1) of this section, the marketing activities that constitute qualified marketing activity.
SECTION 25. ORS 576.750 is amended to read:
576.750. As used in ORS 576.750 to 576.765, unless the context requires otherwise:
[(1) “Board” means the Wine Advisory Board.]
[(2)] (1) “Grape product” means any juice, must, concentrate or extract made from vinifera grapes, true or hybrid, whether or not partially fermented. It does not include alcoholic liquor as defined in ORS 471.001.
[(3)] (2) “Wine” [means any wine containing not more than 21 percent alcohol by volume and produced in all respects in conformity with the laws of the United States and the regulations of the Bureau of Alcohol, Tobacco and Firearms, Department of the Treasury] has the meaning given that term in ORS 471.001.
[(4)] (3) “Wine grape growing” means the cultivation in commercial quantities of vinifera grapes in this state.
[(5)] (4) “Wine making” means the ownership and control of or the management of a licensed winery in this state.
SECTION 26. ORS 576.763 is amended to read:
576.763. The [Wine Advisory] Oregon Wine Board shall establish a state wine cellar by purchasing or receiving donations of wines made in this state from fruit or grapes grown in this state. Wines collected in the state wine cellar may be:
(1) Held as standards to compare against other wines to develop and improve Oregon viticultural and enological practices.
(2) Sold to state governmental agencies for service at official governmental entertainment functions.
(3) Sold to the Governor and to the administrative heads of state agencies on official government business to present as gifts when required by protocol or social custom.
(4) Displayed and offered for tasting in connection with promotional campaigns to encourage the purchase of Oregon wines.
SECTION 27. ORS 182.454 is amended to read:
182.454. [On October 31, 1999,] The following semi-independent state agencies are [made] subject to ORS 182.456 to 182.472:
(1) The State Board of Architect Examiners.
(2) The State Landscape Architect Board.
(3) The State Board of Examiners for Engineering and Land Surveying.
(4) The State Board of Geologist Examiners.
(5) The Oregon Board of Optometry.
(6) The Oregon Wine Board.
SECTION 28. ORS 576.755, 576.760 and 576.765 and section 120, chapter 158, Oregon Laws 1987, are repealed.
OPERATIVE DATE
SECTION 29. Sections 1 to 21 of this 2003 Act, the amendments to ORS 182.454, 473.030, 473.045, 473.047, 576.750 and 576.763 by sections 22 to 27 of this 2003 Act and the repeal of ORS 576.755, 576.760 and 576.765 and section 120, chapter 158, Oregon Laws 1987, by section 28 of this 2003 Act become operative on the later of July 1, 2003, or 20 days after the effective date of this 2003 Act.
UNIT CAPTIONS
SECTION 30. The unit captions used in this 2003 Act are provided only for the convenience of the reader and do not become part of the statutory law of this state or express any legislative intent in the enactment of this 2003 Act.
EMERGENCY CLAUSE
SECTION 31. This 2003 Act being necessary for the immediate preservation of the public peace, health and safety, an emergency is declared to exist, and this 2003 Act takes effect on its passage.
Approved
by the Governor
Filed
in the office of Secretary of State
Effective
date
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