1.1                          A bill for an act 
  1.2             relating to liquor; allowing brewpubs to make retail 
  1.3             and wholesale sales of the brewpub's own products 
  1.4             under certain circumstances; removing limits on the 
  1.5             number of on-sale and off-sale liquor licenses that 
  1.6             may be issued by a municipality; amending Minnesota 
  1.7             Statutes 2002, sections 340A.301, subdivisions 1, 6, 
  1.8             7, 8; 340A.308; 340A.601, subdivision 5; repealing 
  1.9             Minnesota Statutes 2002, section 340A.413. 
  1.10  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.11     Section 1.  Minnesota Statutes 2002, section 340A.301, 
  1.12  subdivision 1, is amended to read: 
  1.13     Subdivision 1.  [LICENSES REQUIRED.] No person may directly 
  1.14  or indirectly manufacture or sell at wholesale intoxicating 
  1.15  liquor, or 3.2 percent malt liquor without obtaining an 
  1.16  appropriate license from the commissioner, except where 
  1.17  otherwise provided in this chapter.  A manufacturer's license 
  1.18  includes the right to import.  Except as otherwise provided in 
  1.19  this section, a licensed brewer may sell the brewer's products 
  1.20  at wholesale only if the brewer has been issued a wholesaler's 
  1.21  license.  The commissioner shall issue a wholesaler's license to 
  1.22  a brewer only if (1) the commissioner determines that the brewer 
  1.23  was selling the brewer's own products at wholesale in Minnesota 
  1.24  on January 1, 1991, or (2) the brewer has acquired a 
  1.25  wholesaler's business or assets under subdivision 7a, paragraph 
  1.26  (c) or (d).  A licensed wholesaler of intoxicating malt liquor 
  1.27  may sell 3.2 percent malt liquor at wholesale without an 
  2.1   additional license.  
  2.2      Sec. 2.  Minnesota Statutes 2002, section 340A.301, 
  2.3   subdivision 6, is amended to read: 
  2.4      Subd. 6.  [FEES.] The annual fees for licenses under this 
  2.5   section are as follows: 
  2.6     (a) Manufacturers (except as provided 
  2.7         in clauses (b) and (c))                    $15,000 
  2.8         Duplicates                                 $ 3,000
  2.9     (b) Manufacturers of wines of not more
  2.10        than 25 percent alcohol by volume          $   500
  2.11    (c) Brewers other than those described
  2.12        in clauses (d) and (i)                     $ 2,500
  2.13    (d) Brewers who also hold one or more
  2.14        retail on-sale licenses and who
  2.15        manufacture fewer than 3,500 barrels
  2.16        of malt liquor in a year, at any one
  2.17        licensed premises~~, the entire~~
  2.18        ~~production of which is solely~~ 
  2.19        ~~for consumption on tap on the~~
  2.20        ~~licensed premises~~.  A brewer licensed
  2.21        under this clause must obtain a separate
  2.22        license for each licensed premises where
  2.23        the brewer brews malt liquor.  A brewer
  2.24        licensed under this clause may not be
  2.25        licensed as an importer under this chapter  $  500
  2.26    (e) Wholesalers (except as provided in
  2.27        clauses (f), (g), and (h))                 $15,000
  2.28        Duplicates                                 $ 3,000
  2.29    (f) Wholesalers of wines of not more
  2.30        than 25 percent alcohol by volume          $ 2,000
  2.31    (g) Wholesalers of intoxicating
  2.32        malt liquor                                $   600
  2.33        Duplicates                                 $    25
  2.34    (h) Wholesalers of 3.2 percent 
  2.35        malt liquor                                $    10
  2.36    (i) Brewers who manufacture fewer than
  3.1         2,000 barrels of malt liquor in a year     $   150
  3.2      If a business licensed under this section is destroyed, or 
  3.3   damaged to the extent that it cannot be carried on, or if it 
  3.4   ceases because of the death or illness of the licensee, the 
  3.5   commissioner may refund the license fee for the balance of the 
  3.6   license period to the licensee or to the licensee's estate. 
  3.7      Sec. 3.  Minnesota Statutes 2002, section 340A.301, 
  3.8   subdivision 7, is amended to read: 
  3.9      Subd. 7.  [INTEREST IN OTHER BUSINESS.] (a) Except as 
  3.10  provided in this subdivision, a holder of a license as a 
  3.11  manufacturer, brewer, importer, or wholesaler may not have any 
  3.12  ownership, in whole or in part, in a business holding a retail 
  3.13  intoxicating liquor or 3.2 percent malt liquor license.  The 
  3.14  commissioner may not issue a license under this section to a 
  3.15  manufacturer, brewer, importer, or wholesaler if a retailer of 
  3.16  intoxicating liquor has a direct or indirect interest in the 
  3.17  manufacturer, brewer, importer, or wholesaler.  A manufacturer 
  3.18  or wholesaler of intoxicating liquor may use or have property 
  3.19  rented for retail intoxicating liquor sales only if the 
  3.20  manufacturer or wholesaler has owned the property continuously 
  3.21  since November 1, 1933.  A retailer of intoxicating liquor may 
  3.22  not use or have property rented for the manufacture or 
  3.23  wholesaling of intoxicating liquor. 
  3.24     (b) A brewer licensed under subdivision 6, clause (d), may 
  3.25  be issued an on-sale intoxicating liquor or 3.2 percent malt 
  3.26  liquor license by a municipality for a restaurant operated in 
  3.27  the place of manufacture.  ~~Malt liquor brewed by such a licensee~~ 
  3.28  ~~may not be removed from the licensed premises unless the malt~~ 
  3.29  ~~liquor is entered in a tasting competition where none of the~~ 
  3.30  ~~malt liquor so removed is sold~~ Notwithstanding section 340A.405, 
  3.31  a brewer who holds an on-sale license issued pursuant to this 
  3.32  paragraph may be issued a license by a municipality for off-sale 
  3.33  of malt liquor produced on the licensed premises.  A brewer's 
  3.34  total retail sales at on- or off-sale under this paragraph, plus 
  3.35  total wholesale sales made by the brewer under subdivision 8, 
  3.36  paragraph (b), may not exceed 3,500 barrels per year.  A brewer 
  4.1   licensed under subdivision 6, clause (d), may hold or have an 
  4.2   interest in other retail on-sale licenses, but may not have an 
  4.3   ownership interest in whole or in part, or be an officer, 
  4.4   director, agent, or employee of, any other manufacturer, brewer, 
  4.5   importer, or wholesaler, or be an affiliate thereof whether the 
  4.6   affiliation is corporate or by management, direction, or 
  4.7   control.  Notwithstanding this prohibition, a brewer licensed 
  4.8   under subdivision 6, clause (d), may be an affiliate or 
  4.9   subsidiary company of a brewer licensed in Minnesota or 
  4.10  elsewhere if that brewer's only manufacture of malt liquor is: 
  4.11     (i) manufacture licensed under subdivision 6, clause (d); 
  4.12     (ii) manufacture in another state for consumption 
  4.13  exclusively in a restaurant located in the place of manufacture; 
  4.14  or 
  4.15     (iii) manufacture in another state for consumption 
  4.16  primarily in a restaurant located in or immediately adjacent to 
  4.17  the place of manufacture if the brewer was licensed under 
  4.18  subdivision 6, clause (d), on January 1, 1995. 
  4.19     (c) Except as provided in subdivision 7a, no brewer as 
  4.20  defined in subdivision 7a or importer may have any interest, in 
  4.21  whole or in part, directly or indirectly, in the license, 
  4.22  business, assets, or corporate stock of a licensed malt liquor 
  4.23  wholesaler. 
  4.24     Sec. 4.  Minnesota Statutes 2002, section 340A.301, 
  4.25  subdivision 8, is amended to read: 
  4.26     Subd. 8.  [SALES WITHOUT LICENSE.] (a) A licensed brewer 
  4.27  may without an additional license sell malt liquor to employees 
  4.28  or retired former employees, in amounts of not more than 768 
  4.29  fluid ounces in a week for off-premise consumption only.  A 
  4.30  collector of commemorative bottles, those terms are as defined 
  4.31  in section 297G.01, subdivisions 4 and 5, may sell them to 
  4.32  another collector without a license.  It is also lawful for a 
  4.33  collector of beer cans to sell unopened cans of a brand which 
  4.34  has not been sold commercially for at least two years to another 
  4.35  collector without obtaining a license.  The amount sold to any 
  4.36  one collector in any one month shall not exceed 768 fluid 
  5.1   ounces. A licensed manufacturer of wine containing not more than 
  5.2   25 percent alcohol by volume nor less than 51 percent wine made 
  5.3   from Minnesota-grown agricultural products may sell at on-sale 
  5.4   or off-sale wine made on the licensed premises without a further 
  5.5   license. 
  5.6      (b) A brewer licensed under subdivision 6, clause (d), may 
  5.7   sell its own products at wholesale without a license, provided 
  5.8   that the sum of the brewer's total wholesale sales, plus the 
  5.9   total retail sales of malt liquor made by the brewer at on- or 
  5.10  off-sale under subdivision 7, may not exceed 3,500 barrels per 
  5.11  year. 
  5.12     Sec. 5.  Minnesota Statutes 2002, section 340A.308, is 
  5.13  amended to read: 
  5.14     340A.308 [PROHIBITED TRANSACTIONS.] 
  5.15     (a) Except as otherwise provided in section 340A.301, no 
  5.16  brewer or malt liquor wholesaler may directly or indirectly, or 
  5.17  through an affiliate or subsidiary company, or through an 
  5.18  officer, director, stockholder, or partner: 
  5.19     (1) give, or lend money, credit, or other thing of value to 
  5.20  a retailer; 
  5.21     (2) give, lend, lease, or sell furnishing or equipment to a 
  5.22  retailer; 
  5.23     (3) have an interest in a retail license; or 
  5.24     (4) be bound for the repayment of a loan to a retailer. 
  5.25     (b) No retailer may solicit any equipment, fixture, 
  5.26  supplies, money, or other thing of value from a brewer or malt 
  5.27  liquor wholesaler if furnishing of these items by the brewer or 
  5.28  wholesaler is prohibited by law and the retailer knew or had 
  5.29  reason to know that the furnishing is prohibited by law. 
  5.30     (c) This section does not prohibit a manufacturer or 
  5.31  wholesaler from: 
  5.32     (1) furnishing, lending, or renting to a retailer outside 
  5.33  signs, of a cost of up to $400 excluding installation and repair 
  5.34  costs; 
  5.35     (2) furnishing, lending, or renting to a retailer inside 
  5.36  signs and other promotional material, of a cost of up to $300 in 
  6.1   a year; 
  6.2      (3) furnishing to or maintaining for a retailer equipment 
  6.3   for dispensing malt liquor, including tap trailers, cold plates 
  6.4   and other dispensing equipment, of a cost of up to $100 per tap 
  6.5   in a year; 
  6.6      (4) using or renting property owned continually since 
  6.7   November 1, 1933, for the purpose of selling intoxicating or 3.2 
  6.8   percent malt liquor at retail; 
  6.9      (5) extending customary commercial credit to a retailer in 
  6.10  connection with a sale of nonalcoholic beverages only, or 
  6.11  engaging in cooperative advertising agreements with a retailer 
  6.12  in connection with the sale of nonalcoholic beverages only; or 
  6.13     (6) in the case of a wholesaler, with the prior written 
  6.14  consent of the commissioner, selling beer on consignment to a 
  6.15  holder of a temporary license under section 340A.403, 
  6.16  subdivision 2, or 340A.404, subdivision 10. 
  6.17     Sec. 6.  Minnesota Statutes 2002, section 340A.601, 
  6.18  subdivision 5, is amended to read: 
  6.19     Subd. 5.  [ISSUANCE OF LICENSES TO PRIVATE PERSONS.] A city 
  6.20  owning and operating a municipal liquor store may issue on-sale 
  6.21  liquor licenses to hotels, clubs, and restaurants.  A city 
  6.22  issuing on-sale licenses under this subdivision may continue to 
  6.23  operate the municipal liquor store or may resume operation of a 
  6.24  municipal liquor store previously discontinued. 
  6.25     ~~The number of on-sale licenses issued under this section by~~ 
  6.26  ~~a city is governed by section 340A.413.~~ 
  6.27     A city may not issue licenses under this section, other 
  6.28  than a license issued to a club under section 340A.404, 
  6.29  subdivision 1, clause (4), until authorized by the voters of the 
  6.30  city voting on the question at a special election called for 
  6.31  that purpose.  
  6.32     Sec. 7.  [REPEALER.] 
  6.33     Minnesota Statutes 2002, section 340A.413, is repealed.  
  6.34     Sec. 8.  [EFFECTIVE DATE.] 
  6.35     Sections 1 to 7 are effective the day following final 
  6.36  enactment.