1.1                          A bill for an act 
  1.2             relating to liquor; providing for conformity in 
  1.3             license fees and production levels for brewpubs and 
  1.4             small brewers; authorizing issuance of temporary 
  1.5             licenses to small brewers; authorizing off-sale of 
  1.6             growlers by small brewers; clarifying restrictions on 
  1.7             location of retail licenses in proximity to certain 
  1.8             institutions; modifying sampling provisions; providing 
  1.9             that the on-sale license for Elko Speedway authorizes 
  1.10            sales on all days of the week; changing the issuer of 
  1.11            a certain license at the state fair; authorizing the 
  1.12            city of Duluth to issue a liquor license for Wade 
  1.13            Municipal Stadium; authorizing the city of St. Paul to 
  1.14            issue a liquor license for special events at the State 
  1.15            Capitol; amending Minnesota Statutes 2002, sections 
  1.16            340A.404, subdivision 10; 340A.412, subdivision 4; 
  1.17            340A.702; Minnesota Statutes 2003 Supplement, sections 
  1.18            340A.301, subdivisions 6, 7; 340A.510, subdivision 2; 
  1.19            Laws 2003, chapter 126, section 28; Laws 2003, chapter 
  1.20            126, section 29; proposing coding for new law in 
  1.21            Minnesota Statutes, chapter 340A. 
  1.22  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.23     Section 1.  Minnesota Statutes 2003 Supplement, section 
  1.24  340A.301, subdivision 6, is amended to read: 
  1.25     Subd. 6.  [FEES.] The annual fees for licenses under this 
  1.26  section are as follows: 
  1.27    (a) Manufacturers (except as provided 
  1.28        in clauses (b) and (c))                    $15,000 
  1.29        Duplicates                                 $ 3,000
  1.30    (b) Manufacturers of wines of not more
  1.31        than 25 percent alcohol by volume          $   500
  1.32    (c) Brewers other than those described
  1.33        in clauses (d) and (i) who
  2.1         manufacture more than 3,500 barrels
  2.2         of malt liquor in a year                   $ 2,500
  2.3     (d) Brewers who also hold one or more
  2.4         retail on-sale licenses and who
  2.5         manufacture fewer than 3,500 barrels
  2.6         of malt liquor in a year, at any one
  2.7         licensed premises, using only wort produced 
  2.8         in Minnesota, the entire
  2.9         production of which is solely 
  2.10        for consumption on tap on the
  2.11        licensed premises or for off-sale
  2.12        from that licensed premises.
  2.13        A brewer licensed
  2.14        under this clause must obtain a separate
  2.15        license for each licensed premises where
  2.16        the brewer brews malt liquor.  A brewer
  2.17        licensed under this clause may not be
  2.18        licensed as an importer under this chapter  $  500
  2.19    (e) Wholesalers (except as provided in
  2.20        clauses (f), (g), and (h))                 $15,000
  2.21        Duplicates                                 $ 3,000
  2.22    (f) Wholesalers of wines of not more
  2.23        than 25 percent alcohol by volume          $ 2,000
  2.24    (g) Wholesalers of intoxicating
  2.25        malt liquor                                $   600
  2.26        Duplicates                                 $    25
  2.27    (h) Wholesalers of 3.2 percent 
  2.28        malt liquor                                $    10
  2.29    (i) Brewers who manufacture fewer than
  2.30        2,000 barrels of malt liquor
  2.31        in a year                                  $   150
  2.32    (j) Brewers who manufacture 2,000 to
  2.33        3,500 barrels of malt liquor in a
  2.34        a year                                     $   500
  2.35     If a business licensed under this section is destroyed, or 
  2.36  damaged to the extent that it cannot be carried on, or if it 
  3.1   ceases because of the death or illness of the licensee, the 
  3.2   commissioner may refund the license fee for the balance of the 
  3.3   license period to the licensee or to the licensee's estate. 
  3.4      Sec. 2.  Minnesota Statutes 2003 Supplement, section 
  3.5   340A.301, subdivision 7, is amended to read: 
  3.6      Subd. 7.  [INTEREST IN OTHER BUSINESS.] (a) Except as 
  3.7   provided in this subdivision, a holder of a license as a 
  3.8   manufacturer, brewer, importer, or wholesaler may not have any 
  3.9   ownership, in whole or in part, in a business holding a retail 
  3.10  intoxicating liquor or 3.2 percent malt liquor license.  The 
  3.11  commissioner may not issue a license under this section to a 
  3.12  manufacturer, brewer, importer, or wholesaler if a retailer of 
  3.13  intoxicating liquor has a direct or indirect interest in the 
  3.14  manufacturer, brewer, importer, or wholesaler.  A manufacturer 
  3.15  or wholesaler of intoxicating liquor may use or have property 
  3.16  rented for retail intoxicating liquor sales only if the 
  3.17  manufacturer or wholesaler has owned the property continuously 
  3.18  since November 1, 1933.  A retailer of intoxicating liquor may 
  3.19  not use or have property rented for the manufacture or 
  3.20  wholesaling of intoxicating liquor. 
  3.21     (b) A brewer licensed under subdivision 6, clause (d), may 
  3.22  be issued an on-sale intoxicating liquor or 3.2 percent malt 
  3.23  liquor license by a municipality for a restaurant operated in 
  3.24  the place of manufacture.  Notwithstanding section 340A.405, a 
  3.25  brewer who holds an on-sale license issued pursuant to this 
  3.26  paragraph or a brewer who manufactures fewer than 3,500 barrels 
  3.27  of malt liquor in a year may, with the approval of the 
  3.28  commissioner, be issued a license by a municipality for off-sale 
  3.29  of malt liquor produced and packaged on the licensed premises.  
  3.30  Off-sale of malt liquor shall be limited to the legal hours for 
  3.31  off-sale at exclusive liquor stores in the jurisdiction in which 
  3.32  the brewer is located, and the malt liquor sold off-sale must be 
  3.33  removed from the premises before the applicable off-sale closing 
  3.34  time at exclusive liquor stores.  The malt liquor shall be 
  3.35  packaged in 64-ounce containers commonly known as "growlers."  
  3.36  The containers shall bear a twist-type closure, cork, stopper, 
  4.1   or plug.  At the time of the sale, a paper or plastic adhesive 
  4.2   band, strip, or sleeve shall be applied to the container and 
  4.3   extend over the top of the twist-type closure, cork, stopper, or 
  4.4   plug forming a seal that must be broken upon opening of the 
  4.5   container.  The adhesive band, strip, or sleeve shall bear the 
  4.6   name and address of the brewer.  The containers shall be 
  4.7   identified as malt liquor, contain the name of the malt liquor, 
  4.8   bear the name and address of the brewer selling the malt liquor, 
  4.9   and shall be considered intoxicating liquor unless the alcoholic 
  4.10  content is labeled as otherwise in accordance with the 
  4.11  provisions of Minnesota Rules, part 7515.1100.  A brewer's total 
  4.12  retail sales at on- or off-sale under this paragraph may not 
  4.13  exceed 3,500 barrels per year, provided that off-sales may not 
  4.14  total more than 50 percent of the brewer's production or 500 
  4.15  barrels, whichever is less.  A brewer licensed under subdivision 
  4.16  6, clause (d), may hold or have an interest in other retail 
  4.17  on-sale licenses, but may not have an ownership interest in 
  4.18  whole or in part, or be an officer, director, agent, or employee 
  4.19  of, any other manufacturer, brewer, importer, or wholesaler, or 
  4.20  be an affiliate thereof whether the affiliation is corporate or 
  4.21  by management, direction, or control.  Notwithstanding this 
  4.22  prohibition, a brewer licensed under subdivision 6, clause (d), 
  4.23  may be an affiliate or subsidiary company of a brewer licensed 
  4.24  in Minnesota or elsewhere if that brewer's only manufacture of 
  4.25  malt liquor is: 
  4.26     (i) manufacture licensed under subdivision 6, clause (d); 
  4.27     (ii) manufacture in another state for consumption 
  4.28  exclusively in a restaurant located in the place of manufacture; 
  4.29  or 
  4.30     (iii) manufacture in another state for consumption 
  4.31  primarily in a restaurant located in or immediately adjacent to 
  4.32  the place of manufacture if the brewer was licensed under 
  4.33  subdivision 6, clause (d), on January 1, 1995. 
  4.34     (c) Except as provided in subdivision 7a, no brewer as 
  4.35  defined in subdivision 7a or importer may have any interest, in 
  4.36  whole or in part, directly or indirectly, in the license, 
  5.1   business, assets, or corporate stock of a licensed malt liquor 
  5.2   wholesaler. 
  5.3      Sec. 3.  Minnesota Statutes 2002, section 340A.404, 
  5.4   subdivision 10, is amended to read: 
  5.5      Subd. 10.  [TEMPORARY ON-SALE LICENSES.] (a) The governing 
  5.6   body of a municipality may issue to (1) a club or charitable, 
  5.7   religious, or other nonprofit organization in existence for at 
  5.8   least three years, (2) a political committee registered under 
  5.9   section 10A.14, or (3) a state university, a temporary license 
  5.10  for the on-sale of intoxicating liquor in connection with a 
  5.11  social event within the municipality sponsored by the licensee.  
  5.12  The license may authorize the on-sale of intoxicating liquor for 
  5.13  not more than four consecutive days, and may authorize on-sales 
  5.14  on premises other than premises the licensee owns or permanently 
  5.15  occupies.  The license may provide that the licensee may 
  5.16  contract for intoxicating liquor catering services with the 
  5.17  holder of a full-year on-sale intoxicating liquor license issued 
  5.18  by any municipality.  The licenses are subject to the terms, 
  5.19  including a license fee, imposed by the issuing municipality.  
  5.20  Licenses issued under this subdivision are subject to all laws 
  5.21  and ordinances governing the sale of intoxicating liquor except 
  5.22  sections 340A.409 and 340A.504, subdivision 3, paragraph (d), 
  5.23  and those laws and ordinances which by their nature are not 
  5.24  applicable.  Licenses under this subdivision are not valid 
  5.25  unless first approved by the commissioner of public safety. 
  5.26     (b) A county under this section may issue a temporary 
  5.27  license only to a premises located in the unincorporated or 
  5.28  unorganized territory of the county. 
  5.29     (c) The governing body of a municipality may issue to a 
  5.30  brewer who manufactures fewer than 3,500 barrels of malt liquor 
  5.31  in a year a temporary license for the on-sale of intoxicating 
  5.32  liquor in connection with a social event within the municipality 
  5.33  sponsored by the brewer.  The terms and conditions specified for 
  5.34  temporary licenses under paragraph (a) shall apply to a license 
  5.35  issued under this paragraph, except that the requirements of 
  5.36  section 340A.409 shall apply to such license. 
  6.1      Sec. 4.  Minnesota Statutes 2002, section 340A.412, 
  6.2   subdivision 4, is amended to read: 
  6.3      Subd. 4.  [LICENSES PROHIBITED IN CERTAIN AREAS.] (a) No 
  6.4   license to sell intoxicating liquor may be issued within the 
  6.5   following areas: 
  6.6      (1) where restricted against commercial use through zoning 
  6.7   ordinances and other proceedings or legal processes regularly 
  6.8   had for that purpose, except licenses may be issued to 
  6.9   restaurants in areas which were restricted against commercial 
  6.10  uses after the establishment of the restaurant; 
  6.11     (2) within the capitol or on the capitol grounds, except as 
  6.12  provided under Laws 1983, chapter 259, section 9, or Laws 1999, 
  6.13  chapter 202, section 13; 
  6.14     (3) on the state fairgrounds or at any place in a city of 
  6.15  the first class within one-half mile of the fairgrounds, except 
  6.16  as otherwise provided by charter; 
  6.17     (4) on the campus of the College of Agriculture of the 
  6.18  University of Minnesota or at any place in a city of the first 
  6.19  class within one-half mile of the campus, provided that a city 
  6.20  may issue one on-sale wine license in this area that is not 
  6.21  included in the area described in clause (3), except as provided 
  6.22  by charter; 
  6.23     (5) within 1,000 feet of a state hospital, state training 
  6.24  school, state reformatory, or state prison, or other institution 
  6.25  under the supervision or control, in whole or in part, of the 
  6.26  commissioner of human services or the commissioner of 
  6.27  corrections; 
  6.28     (6) in a town or municipality in which a majority of votes 
  6.29  at the last election at which the question of license was voted 
  6.30  upon were not in favor of license under section 340A.416, or 
  6.31  within one-half mile of any such town or municipality, except 
  6.32  that intoxicating liquor manufactured within this radius may be 
  6.33  sold to be consumed outside it; 
  6.34     (7) at any place on the east side of the Mississippi River 
  6.35  within one-tenth of a mile of the main building of the 
  6.36  University of Minnesota unless (i) the licensed establishment is 
  7.1   on property owned or operated by a nonprofit corporation 
  7.2   organized prior to January 1, 1940, for and by former students 
  7.3   of the University of Minnesota, or (ii) the licensed premises is 
  7.4   Northrop Auditorium; 
  7.5      (8) within 1,500 feet of a state university, except that: 
  7.6      (i) the minimum distance in the case of Winona and 
  7.7   Southwest State University is 1,200 feet, measured by a direct 
  7.8   line from the nearest corner of the administration building to 
  7.9   the main entrance of the licensed establishment; 
  7.10     (ii) within 1,500 feet of St. Cloud State University one 
  7.11  on-sale wine and two off-sale intoxicating liquor licenses may 
  7.12  be issued, measured by a direct line from the nearest corner of 
  7.13  the administration building to the main entrance of the licensed 
  7.14  establishment; 
  7.15     (iii) at Mankato State University the distance is measured 
  7.16  from the front door of the student union of the Highland campus; 
  7.17     (iv) a temporary license under section 340A.404, 
  7.18  subdivision 10, may be issued to a location on the grounds of a 
  7.19  state university for an event sponsored or approved by the state 
  7.20  university; and 
  7.21     (v) this restriction does not apply to the area surrounding 
  7.22  the premises leased by Metropolitan State University at 730 
  7.23  Hennepin Avenue South in Minneapolis; and 
  7.24     (9) within 1,500 feet of any public school that is not 
  7.25  within a city. 
  7.26     (b) The restrictions of this subdivision do not apply to a 
  7.27  manufacturer or wholesaler of intoxicating liquor or to a 
  7.28  drugstore or to a person who had a license originally issued 
  7.29  lawfully prior to July 1, 1967. 
  7.30     Sec. 5.  Minnesota Statutes 2003 Supplement, section 
  7.31  340A.510, subdivision 2, is amended to read: 
  7.32     Subd. 2.  [MALT LIQUOR SAMPLES AUTHORIZED.] (a) 
  7.33  Notwithstanding section 340A.308, a brewer may purchase from or 
  7.34  furnish at no cost to a licensed retailer malt liquor the brewer 
  7.35  manufactures if: 
  7.36     (1) the malt liquor is dispensed by the retailer only for 
  8.1   samples in a quantity of less than 100 milliliters of malt 
  8.2   liquor per variety per customer; 
  8.3      (2) where the brewer furnishes the malt liquor, the 
  8.4   retailer makes available for return to the brewer any unused 
  8.5   malt liquor and empty containers; 
  8.6      (3) the samples are dispensed by an employee of the 
  8.7   retailer or brewer or by a sampling service retained by the 
  8.8   retailer or brewer and not affiliated directly or indirectly 
  8.9   with a malt liquor wholesaler; 
  8.10     (4) not more than three cases of malt liquor are purchased 
  8.11  from or furnished to the retailer by the brewer for each 
  8.12  sampling; 
  8.13     (5) each sampling continues for not more than eight hours; 
  8.14     (6) the brewer has furnished malt liquor for not more than 
  8.15  five samplings for any retailer in any calendar year; 
  8.16     (7) where the brewer furnishes the malt liquor, the brewer 
  8.17  delivers the malt liquor for the sampling to its exclusive 
  8.18  wholesaler for that malt liquor; 
  8.19     (8) the brewer has at least seven days before the sampling 
  8.20  filed with the commissioner, on a form the commissioner 
  8.21  prescribes, written notice of intent to furnish malt liquor for 
  8.22  the sampling, which contains (i) the name and address of the 
  8.23  retailer conducting the sampling, (ii) the maximum amount of 
  8.24  malt liquor to be furnished or purchased by the brewer, (iii) 
  8.25  the number of times the brewer has furnished malt liquor to the 
  8.26  retailer in the calendar year in which the notice is filed, (iv) 
  8.27  the date and time of the sampling, (v) where the brewer 
  8.28  furnishes the malt liquor, the exclusive wholesaler to whom the 
  8.29  brewer will deliver the malt liquor, and (vi) a statement by the 
  8.30  brewer to the effect that to the brewer's knowledge all 
  8.31  requirements of this section have been or will be complied with; 
  8.32  and 
  8.33     (9) the commissioner has not notified the brewer filing the 
  8.34  notice under clause (8) that the commissioner disapproves the 
  8.35  notice. 
  8.36     (b) For purposes of this subdivision, "licensed retailer" 
  9.1   means a licensed on-sale or off-sale retailer of alcoholic 
  9.2   beverages and a municipal liquor store. 
  9.3      (c) A brewer may provide samples of its own products on its 
  9.4   premises to persons touring the brewery in a quantity of less 
  9.5   than 100 milliliters of malt liquor per variety per person. 
  9.6      Sec. 6.  Minnesota Statutes 2002, section 340A.702, is 
  9.7   amended to read: 
  9.8      340A.702 [GROSS MISDEMEANORS.] 
  9.9      It is a gross misdemeanor:  
  9.10     (1) to sell an alcoholic beverage without a license 
  9.11  authorizing the sale; 
  9.12     (2) for a licensee to refuse or neglect to obey a lawful 
  9.13  direction or order of the commissioner or the commissioner's 
  9.14  agent, withhold information or a document the commissioner calls 
  9.15  for examination, obstruct or mislead the commissioner in the 
  9.16  execution of the commissioner's duties or swear falsely under 
  9.17  oath; 
  9.18     (3) to violate the provisions of sections 340A.301 to 
  9.19  340A.312; 
  9.20     (4) to violate the provisions of section 340A.508; 
  9.21     (5) for any person, partnership, or corporation to 
  9.22  knowingly have or possess direct or indirect interest in more 
  9.23  than one off-sale intoxicating liquor license in a municipality 
  9.24  in violation of section 340A.412, subdivision 3; 
  9.25     (6) to sell or otherwise dispose of intoxicating liquor 
  9.26  within 1,000 feet of a state hospital, state training school, 
  9.27  state reformatory, or state prison, or other institution under 
  9.28  the supervision and control, in whole or in part, of the 
  9.29  commissioner of human services or the commissioner of 
  9.30  corrections; 
  9.31     (7) to violate the provisions of section 340A.502; 
  9.32     (8) except as otherwise provided in section 340A.701, to 
  9.33  violate the provisions of section 340A.503, subdivision 2, 
  9.34  clause (1) or (3); 
  9.35     (9) to withhold any information, book, paper, or other 
  9.36  thing called for by the commissioner for the purpose of an 
 10.1   examination; 
 10.2      (10) to obstruct or mislead the commissioner in the 
 10.3   execution of the commissioner's duties; 
 10.4      (11) to swear falsely concerning any matter stated under 
 10.5   oath; or 
 10.6      (12) to violate the provisions of section 340A.503, 
 10.7   subdivision 5, after having been convicted previously of 
 10.8   violating section 340A.503, subdivision 5. 
 10.9      Sec. 7.  [340A.910] [SEVERABILITY.] 
 10.10     In the event that a court of competent jurisdiction holds 
 10.11  that any section of this chapter is unconstitutional or 
 10.12  otherwise invalid, the invalidity does not affect other 
 10.13  provisions or applications of this chapter that can be given 
 10.14  effect without the invalid provisions or application, and to 
 10.15  this end the provisions of chapter 340A are severable. 
 10.16     Sec. 8.  Laws 2003, chapter 126, section 28, is amended to 
 10.17  read: 
 10.18     Sec. 28.  [ELKO SPEEDWAY; ON-SALE LICENSE.] 
 10.19     Notwithstanding Minnesota Statutes, section 340A.404, 
 10.20  subdivision 1, the city of Elko may issue an on-sale 
 10.21  intoxicating liquor license to the Elko Speedway in addition to 
 10.22  the number authorized by law.  The license may authorize sales 
 10.23  only to persons attending racing events at the speedway.  The 
 10.24  license authorizes sales on all days of the week.  All 
 10.25  provisions of Minnesota Statutes, chapter 340A, not inconsistent 
 10.26  with this provision, apply to the license authorized under this 
 10.27  section.  The license may be issued for a space that is not 
 10.28  compact and contiguous, provided that the licensed premises may 
 10.29  include only the space within the fenced grandstand area as 
 10.30  described in the approved license application. 
 10.31     Sec. 9.  Laws 2003, chapter 126, section 29, is amended to 
 10.32  read: 
 10.33     Sec. 29.  [WINE LICENSES; STATE FAIR.] 
 10.34     (a) Notwithstanding Minnesota Statutes, sections 37.21 and 
 10.35  340A.412, subdivision 4, paragraph (a), clause (3), the city of 
 10.36  St. Paul Ramsey County may issue a license to the holder of a 
 11.1   state fair concessions contract with the state agricultural 
 11.2   society which authorizes the licensee to sell Minnesota-produced 
 11.3   wine by the glass at the state fair in connection with the sale 
 11.4   of food by the concessionaire.  All provisions of Minnesota 
 11.5   Statutes, chapter 340A, not inconsistent herewith, apply to 
 11.6   licenses issued under this section. 
 11.7      (b) For purposes of this section "Minnesota-produced wine" 
 11.8   means wine produced by a farm winery licensed under Minnesota 
 11.9   Statutes, section 340A.315, and made from at least 75 percent 
 11.10  Minnesota-grown grapes, grape juice, other fruit bases, other 
 11.11  juices, and honey. 
 11.12     Sec. 10.  [WADE MUNICIPAL STADIUM; LIQUOR LICENSE.] 
 11.13     Notwithstanding any other law to the contrary, the city of 
 11.14  Duluth may issue an on-sale wine and malt liquor license in 
 11.15  addition to the number authorized by law for the premises known 
 11.16  as Wade Municipal Stadium, for use during baseball games and 
 11.17  other events sponsored by the Duluth Huskies.  The license may 
 11.18  authorize the sale and consumption of wine and malt liquor in 
 11.19  the grandstand and dining areas of the stadium.  The license 
 11.20  authorizes sales on all days of the week.  
 11.21     Sec. 11.  [CITY OF MINNEAPOLIS; LIQUOR LICENSE.] 
 11.22     Notwithstanding any law, ordinance, or charter provision to 
 11.23  the contrary, the city of Minneapolis may issue an intoxicating 
 11.24  liquor license to an establishment located at 2200 Como Avenue 
 11.25  Southeast, which currently holds an on-sale wine license. 
 11.26     Sec. 12.  [STATE CAPITOL CENTENNIAL EVENTS.] 
 11.27     Notwithstanding any other law to the contrary, the city of 
 11.28  St. Paul may issue an on-sale wine and malt liquor license to 
 11.29  the Capitol 2005 Commission or Friends of the Minnesota State 
 11.30  Capitol for special events held in the State Capitol and on the 
 11.31  capitol grounds relating to the centennial anniversary of the 
 11.32  Capitol Building.  The license authorized by this section is 
 11.33  valid from November 30, 2004, to January 2, 2006.  All 
 11.34  provisions of Minnesota Statutes, chapter 340A, not inconsistent 
 11.35  with this section, apply to the license authorized by this 
 11.36  section. 
 12.1      Sec. 13.  [EFFECTIVE DATE.] 
 12.2      Section 1 is effective July 1, 2004.  Sections 2 to 7, 9, 
 12.3   10, 11, and 12 are effective the day following final enactment.  
 12.4   Section 8 is effective on approval by the Elko City Council and 
 12.5   compliance with Minnesota Statutes, section 645.021.