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A07510 Memo:

BILL NUMBER:A7510

TITLE OF BILL:  An act to amend chapter 118 of the laws of 2012
amending the alcoholic beverage control law relating to the powers of
the chairman and members of the authority, in relation to the
effectiveness of certain provisions thereof

Purpose of the Bill:  This bill would extend for three years changes
made to sections 15, 17 and 18 of the Alcoholic Beverage Control Law
("ABCL") via Chapter 118 of the Laws of 2012 that delegated to the
Chairman of the State Liquor Authority exclusive executive authority
over the State Liquor Authority and the Division of Alcoholic Beverage
Control.

Summary of provisions:

Section 1 of the bill would amend Chapter 118 of the Laws of 2012, by
extending the expiration date of same for three years from July 18,
2015 until July 18, 2018.

Section 2 of the bill would make the amendment effective immediately.

Existing law:  Prior to enactment of Chapter 118 of the Laws of 2012,
the powers which this bill would continue to extend to the Chairman
were vested in the board of the State Liquor Authority. Pursuant to
the budget for State Fiscal Year 2011-12, all Members of the Authority
except the Chairman became per diem members of the board, with the
goal of vesting day-to-day exclusive executive authority over the
State Liquor Authority and the Division of Alcoholic Beverage Control
in the Chairman.

Legislative History:  As stated above, this is a proposal to extend
for three years amendments to ABCL SS 15, 17 and 18 that were made via
Chapter 118 of the Laws of 2012.

Statement in support:  Extension of these amendments will allow the
Authority to continue to operate in keeping with recommendations of
the New York State Law Revision Commission, who stated in their Report
on the Alcoholic Beverage Control Law and its Administration
("Report"), in relevant part, as follows (Report, p.25):

The ABC Law should be amended to grant the Chairman of the Authority
exclusive executive authority over both the division of alcoholic
beverage control and the Authority, including the authority to hire,
assign, and fire deputies, counsels, assistants, investigators and all
other employees within the limits of the agency appropriation, in
consultation with the other members of the Authority, removing all
such responsibility from the Authority.

ABC Law SS 15 and 17(4) formerly delegated the power to hire and fire
to the three-member State Liquor Authority acting as a Full Board.
The Law Revision Commission noted that the full board control over
hiring and firing may well prevent employment decisions from being
made where there is a vacancy on the Full Board and a disagreement
between the two serving board members (Report, p. 122):


Although by statute, the Chairman has administrative control, he does
not have the power to hire and fire. The entire Board has to agree on
an employment decision. If there were not unanimous agreement between
the two current Commissioners, no employment decisions could be made.

Even where the Authority's board is fully staffed with its three
members, the Chairman's ability to take administrative action may be
called into question by a challenge to the scope of his authority
(Report, p.129):

The multiple agency head exercising administrative authority could
result in the Chairman being undermined if the other members disagree
with him or her. For example, in 2008, two of the Commissioners
disagreed with certain actions of the Chairman so they voted to
rescind previous delegations of authority to the Chairman.

Chapter 118 of the Laws of 2012, in the first instance, sought to
implement the Law Revision Commission recommendation that the Chairman
be delegated exclusive administrative control over hiring and firing.
These sections also make clear the scope of the Chairman's authority
over budget and fiscal matters, the submission of required reports,
and the development of minimum criteria for ATAP.

In addition, providing the Chairman, rather than the Full Board, with
administrative power over the agency recognizes the impact of another
significant change made to the organizational structure of the State
Liquor Authority. Commencing in Fiscal Year 2011-2012, the
Commissioners of the Authority are no longer "full time" employees.
Instead, they serve on a per diem basis centered primarily on their
duties at Full Board meetings. The Chairman, as the sole remaining
"full time" Member of the Authority, is best situated to address the
administrative functions of the agency.

Extension of the delegation of administrative functions to the
exclusive control of the Chairman does not diminish the regulatory
powers exercised by the three-member Authority. The three members of
the Authority, acting together as a full board, will continue to
regulate alcoholic beverage traffic within the State. Briefly stated,
ABCL S 17 will continue to empower the three-member Authority:

1. To approve or disapprove license and permit applications;

2. To limit the number of licenses of each class to be issued within
the state or any political subdivision thereof;

3. To revoke, cancel or suspend for cause any license or permit issued
under this chapter and/or to impose a civil penalty for cause against
any holder of a license or permit issued pursuant to this chapter;

4. To fix by rule the standards in the manufacture of alcoholic
beverages to be sold or consumed in the state;

5. To hold hearings, subpoena and examine any person under oath, and
require the production of any books or papers relative to the inquire;

6. To prohibit during a period of a public emergency the sale of any
or all alcoholic beverages;


7. To delegate the powers provided in this section to the chairman, or
to such other officers or employees as may be designated by the
chairman;

8. To appoint advisory groups; and

9. To approve or disapprove the request of a county legislative body
to restrict or modify the legal hours of sale within such county.

Thus, while extending the grant of exclusive administrative authority
to the Chairman, this legislation also prudently preserves for the
Full Board those functions best performed by a deliberative body, and
those regulatory determinations involving broad policy considerations
that are best left to a contemplative body.

Budget implications:  None.

Local impact:  None.

Effective Date:  This act shall take effect immediately.
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