United States: Alcoholic Beverage Law Update

Last Updated: August 5 2015
Article by Angela P. Krahulik and Mark Shublak

The recently concluded 2015 long session of the Indiana General Assembly will likely be remembered for the controversy over the Religious Freedom Restoration Act, the repeal of the Common Construction Wage, and changes to Indiana's public school funding formula.  Perhaps less memorable, but no less important, was the passage of a number of bills related to the sale, production and regulation of alcohol and tobacco products.  A brief summary of some of this newly enacted legislation is set forth below.

Senate Enrolled Act 297

Provides that the commission may issue a small brewer's permit to a brewery which manufacturers up to 90,000 (up from 30,000) barrels of beer in a calendar year for sale or distribution in Indiana.  Further provides that the holder of a brewer's permit or an out-of-state brewer holding either a primary source of supply permit or an out-of-state brewer's permit may sell and deliver a total of not more than 30,000 barrels of beer in a calendar year directly to a person holding a retailer or dealer permit. 

House Enrolled Act 1311

Re-affirms that the holder of a brewer's permit, an out-of-state brewer's permit, or a primary source permit who sells the brewery's beer for on-premises, by-the-glass consumption must provide food to patrons.  Clarifies that this requirement may be satisfied by allowing food-trucks to serve food near the brewer's licensed premises, providing menus of restaurants that will deliver food to the brewer's premises, or providing food at the brewery itself. 

Provides that the holder of a brewer's permit, an out-of-state brewer's permit, or a primary source permit may, with the approval of the commission, participate – either individually or with other permit holders – in a trade show or exposition at which products of each permit holder participant are displayed, promoted and sold.  Such participation may not exceed 45 days in any calendar year. 

Provides that to qualify for an artisan distiller's permit, a person must hold at least a majority ownership interest (instead of 100% ownership interest) in the entity that holds a farm winery, brewer's, or distiller's permit.

House Enrolled Act 1542

Requires that, subject to certain, limited exceptions, the commission shall timely process a permittee's application for renewal of a permit unless the permittee receives a notice of violation.  Provides that where a permittee receives notice of a violation, the commission may still timely process a permit renewal application if the chairman or his designee authorizes the application for renewal to be timely processed. 

Requires that permittees file an application for renewal of a permit not later than one year after the date the permit expires.  Failure to do so shall result in the permit reverting to the commission.  Mandates that the commission provide written notice to the permittee informing the permittee of the date that the permittee's permit will revert to the commission at least 30 days prior to the date of reversion.  Allows a permittee to seek renewal of a permit more than one year after the date the permit expires provided that the permittee either: 1) obtains approval from the chairman or the chairman's designee for an extension to file the application of renewal; or 2) provides evidence that the permitee is engaged in an administrative or court proceeding that prevents the permittee from renewing the permit.  Mandates that a permit is effective upon final approval of the commission and, upon final approval of a permit, the commission shall provide the permittee with a letter of authority to operate.

Adds a provision that a permit application may be processed while the location of the permit premises is pending, upon a showing of need by the applicant.  A permit issued while the location of the permit premises is pending shall be placed into escrow until the permittee obtains approval of the location from the local board.

Provides that a "senior residence facility" may, without a permit, possess, give, or furnish (but not sell) alcoholic beverages for on-premises consumption to its residents and non-minor guests. 

Repeals the ban on the sale of alcoholic beverages on Christmas Day.

Requires the six month suspension of the employee license of an employee convicted of operating while intoxicated so long as the conviction is the employee's first and the employee was at least 21 years of age at the time of the offense.  Provides that an employee may avoid license suspension if the employee submits the appropriate form to the commission verifying that the employee has completed an appropriate substance abuse treatment or education program.  Failure to submit the required information concerning completion of an appropriate treatment or education program within six months of the date of sentencing shall result in a revocation of the employee's permit.

Provides that, if the commission receives a written statement from the authorized representative of a church or school that the church or school does not object to the issuance of an alcoholic beverage permit for certain premises, the commission may not consider subsequent objections from a church or school to the issuance of the same permit type at the same premises location.

Requires the holder of a supplemental caterer's permit to give the commission 48 hours notice of a catered event (instead of 15 days notice of a catered event).

Requires the commission to issue a temporary beer permit or temporary wine permit if: (1) the permit application is submitted not later than five business days (instead of fifteen days) before the event; and (2) the applicant meets all the requirements for a permit. Allows, if authorized by the chairman or chairman's designee and at the commission's discretion, the commission to issue a temporary beer permit or temporary wine permit to an applicant that: (1) submits an application later than five business days before the event; and (2) meets all the requirements for the permit.

Exempts hotels other than the part of a hotel that is a room in a restaurant in which a bar is located over which alcoholic beverages are sold or dispensed by the drink, as well as senior residence facilities and certain qualified charity events, from provisions prohibiting minors in public places where alcoholic beverages are sold or furnished.

Senate Enrolled Act 113

Repeals the requirement that sellers must have consummated a face-to-face transaction with a buyer in order to directly ship wine to that buyer at a later date.  Sets forth the permit fee for direct wine seller's permits.  Requires that in order sell and ship wine directly to a consumer based upon orders transmitted by electronic or other means, a seller must obtain the consumer's name, valid delivery address, phone number, and proof that the consumer is at least 21 years of age via a government issued identification card.

Senate Enrolled Act 463

Adds electronic cigarettes to statutory provisions governing the sale of tobbaco products.  Adds cigar bars to the list of businesses permitted to allow smoking on their premises so long as at least 10 percent of the business's annual gross income from the preceding calendar year was from the sale of cigars and the rental of onsite humidors. 

House Enrolled Act 1432

Adds an entirely new article dealing addressing the manufacture, bottling, sale and importing of vapor pens and e-liquid.  Provides a statutory definition of "electronic cigarette" that is defined as "a powered vaporizer that is in the size and shape of a traditional cigarette, uses a sealed nonrefillable cartridge containing not more than four milliliters of a liquid and is intended to be vaporized and inhaled."  Provides a statutory definition of "E-liquid" that is defined as "a substance that is inteded to be vaporized and inhaled using a vapor pen" but that is not the cartridge contained in an electronic cigarette.  Provides a statutory definition of a "vapor pen" that is defined as a "powered vaporizer, other than an electronic cigarette, that converts e-liquid to a vapor intended for inhalation."  Delegates to the Alcohol and Tobacco Commission the responsibilty for enforcing the statutory provisions governing the manufacture, bottling and sale of electronic cigarettes, e-liquid, and vapor pens.  Requires that the Commission adopt rules in order to issue permits, charge fees, audit facilities that manufacture or sell e-liquid, and test samples of e-liquid.  Sets forth standards for the manufacture, labeling and packaging of e-liquid. 

House Enrolled Act 1435

Allows a nonprofit corporation that is a qualified organization under the charity gaming law (qualified organization) to give sealed bottles or cases of alcoholic beverages as prizes in a charity gaming event without obtaining an alcoholic beverage permit. Allows a qualified organization to auction purchased or donated alcoholic beverages in sealed bottles or cases, without obtaining an alcoholic beverage permit. Prohibits alcoholic beverages that are auctioned or given as prizes from being consumed on the premises. Repeals and replaces the current statute regarding payments to the commission.

Senate Enrolled Act 6

Makes it a Class B infraction to possess, purchase, sell, offer to sell, or use powdered or crystalline alcohol. Establishes exceptions. Urges the legislative council to assign to the public policy interim study committee topics related to powdered or crystalline alcohol.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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