A01110 Summary:

BILL NO    A01110 

SAME AS    No same as

SPONSOR    Destito (MS)

COSPNSR    Benedetto, Bing, Cahill, Millman, Schroeder, Magnarelli

MLTSPNSR   Christensen, Farrell, Gottfried, Koon, Magee, Mayersohn, Pheffer,
           Sweeney, Towns

Add SS53-b & 53-c, amd S102, ABC L

Relates to providing for certain limited direct interstate and intrastate
shipments of beer and malt beverages to persons in this state who are over the
age of 21; requires reciprocity in the state where the manufacturer is located.

A01110 Actions:

BILL NO    A01110 

01/07/2009 referred to economic development
06/29/2009 enacting clause stricken

A01110 Votes:

A01110 Memo:

 BILL NUMBER:  A1110

 TITLE OF BILL :  An act to amend the alcoholic beverage control law,
in relation to providing for certain limited direct interstate
shipments of beer and other malt beverages

 PURPOSE OR GENERAL IDEA OF BILL : This Bill will amend the alcoholic
beverage control law to enable beer producers licensed by the State of
New York to ship beer and other malt beverages to individual consumers
in other states that have reciprocal direct shipping statutes. New
York has witnessed the rapid growth of breweries in the last decade
and today there are fifty-eight brewing facilities in the Empire
State. The U.S. Supreme Court, on May 16, 2006 in a 5-4 decision
written by Justice Kennedy, held that a ban on direct shipment of wine
and other alcoholic beverages from out-of-state wineries is
unconstitutional. The court found that the law discriminates against
interstate commerce because in-state wineries are treated differently
from out-of-state wineries.

To accomplish the purpose of this bill, the proposal permits brewers
licensees in other states that have reciprocal direct shipping
statutes to apply to the New York State Liquor Authority (SLA) for
out-of-state shippers licenses that will permit them to make direct
shipments in limited quantities to individual adult consumers in New
York subject to appropriate SLA regulations and payment of all sales
and excise taxes.

 SUMMARY OF SPECIFIC PROVISIONS :  A) The bill permits an out-of-state
beer manufacturer to obtain from the State Liquor Authority for a $100
fee an annual out-of-state shippers license to permit them to make
direct shipments of beer or other malt beverages to individual adult
consumers who are 21 years of age or older.

B) The out-of-state shipper must provide the SLA a copy of their
current license and/or federal basic permit and report accurately to
the SLA, the names of such purchaser, the quantity of beer purchased
and the name of such carrier used.

C) The out-of-state shipper shall ensure each package shipped is
marked as directed by the SLA; requires proof of age from prospective
customers; require the common carrier to obtain proof of age and
obtain such signature that the product will not be resold and is for
person's use only; file return and pay all sales and excise taxes to
the Department of Taxation and Finance; retain records for three
years; execute consent to jurisdiction of NY, its agencies and courts,
and report to the SLA within 5 business days of receipt of an order
for two cases or more, or five cases in a thirty day period.  (Cases
shall consist of twenty-four l2-ounce units of packaged beer or less.)

D) Rules and Regulations: The SLA and Department of Taxation of
Finance are authorized to promulgate rules and regulations to affect
the purpose and provisions of this legislation. The SLA may suspend or
revoke a license, or impose a fine in lieu of suspension and shall
report violations to the Treasury Department for action relative to
federal basic permits.

E) Sever ability any provision found invalid shall not invalidate any
other provisions.

 JUSTIFICATION : A recent United States Supreme Court decision held
that New York's law banning direct shipment from out-of-state wineries
was discriminatory and therefore unconstitutional. As such, the
legislature acted to address the ruling by providing a reasonable and
working process for such direct shipment, both interstate and
intra-state, while safeguarding the state's right to regulate the sale
of alcoholic beverages within the state. Accordingly, the legislature
passed such a bill in 2005 and the bill was signed into law, Chapter
210 of the Laws of 2005. The Supreme Court ruling included all
alcoholic beverages. Beer is an alcoholic beverage and therefore, the
state's brewing industry seeks the same privilege as that granted wine
in the above Chapter.

This bill includes safeguards to ensure that only state residents 21
or older may order and sign for a shipment. Proof of age is required
at the place of delivery and a receipt must be signed. Delivery can be
refused by the Common Carrier if the recipient does not provide valid
proof of age or appears to be under the legal age. The bill also
provides for regulation by the SLA requiring an out-of-state shipper's
license while subjecting such license to the jurisdiction of NY's
agencies and courts.

At the present time, New York licenses fifty-eight brewing facilities
that manufacture beer. This bill will strengthen the economic
development of this industry, especially in upstate New York, and
allow these facilities to compete in the 8 states that presently have
reciprocal direct shipping statutes for beer. Approximately 7
additional states are considering like legislation. (In 2005,
twenty-four states enacted law to allow for the direct shipment of
wine, and today, thirty-four states have direct wine shipping
statutes.)

 PRIOR LEGISLATIVE HISTORY :

2007-08: A.4345-A - Referred to the Assembly Economic Development
Cmts.  In the year 2000 a version of this bill to allow for the direct
shipping of beer was referred to the appropriate Assembly and Senate
Committees. This is a new bill that addresses the State Supreme Court
decision relative to providing a reasonable and working process, both
inter-state and intra-state while it includes appropriate safeguards
to regulate the sale of beer and other malt beverages within the
state.

 FISCAL IMPLICATIONS : The state of New York will collect additional
revenue from granting shipping licenses and from the collection of the
state sales and excise tax on beer delivered within the state.

 EFFECTIVE DATE : This Act shall take effect sixty days after it shall
become law; effective immediately upon the signature of the Governor,
the SLA is authorized to provide such rule or regulation to
effectively implement this Act.