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SB1478 - 572R - H Ver
House Engrossed
Senate Bill
liquor; policies;
procedures
State of Arizona
Senate
Fifty-seventh Legislature
Second Regular Session
2026
SENATE BILL 1478
AN
ACT
amending sections 4-101, 4-201, 4-203,
4-203.01, 4-205.02, 4-205.04, 4-205.08, 4-205.10,
4-209, 4-212, 4-214, 4-221, 4-222 and 4-223,
arizona revised statutes; repealing section 4-225, arizona revised
statutes; amending sections 4-226, 4-244, 42-3001, 42-3352
and 42-3355, arizona revised statutes; relating to liquor.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it
enacted by the Legislature of the State of Arizona:
Section 1. Section 4-101, Arizona Revised
Statutes, is amended to read:
START_STATUTE
4-101.
Definitions
In this title, unless the context otherwise requires:
1. "Act of violence":
(a) Means an incident that consists of a riot, a
fight, an altercation or tumultuous conduct and that meets at least one of the
following criteria:
(i) Bodily injuries are sustained by any person and
the injuries would be obvious to a reasonable person.
(ii) Is of sufficient intensity as to require the
intervention of a peace officer to restore normal order.
(iii) A weapon is brandished, displayed or used.
(iv) A licensee or an employee or contractor of the
licensee fails to follow a clear and direct lawful order from a law enforcement
officer or a fire marshal.
(b) Does not include the use of nonlethal devices by
a peace officer.
2. "Aggrieved party" means a person who
resides at, owns or leases property within a one-mile radius of premises
proposed to be licensed and who filed a written request with the department to
speak in favor of or opposition to the issuance of the license not later than
sixty days after filing the application or fifteen days after action by the
local governing body, whichever is sooner.
3. "Beer":
(a) Means any beverage obtained by the alcoholic
fermentation, infusion or decoction of barley malt, hops, rice, bran or other
grain, glucose, sugar or molasses, or any combination of them, and may include,
as adjuncts in fermentation, honey, fruit, fruit juice, fruit concentrate,
herbs, spices and other food materials.
(b) Includes beer aged in an empty wooden barrel
previously used to contain wine or distilled spirits and as such is not
considered a dilution or mixture of any other spirituous liquor.
4. "Biometric identity verification
device" means a device authorized by the department that instantly
verifies the identity and age of a person by an electronic scan of a biometric
of the person, through a fingerprint, iris image, facial image or other
biometric characteristic, or any combination of these characteristics, that
references the person's identity and age against any record described in
section 4-241, subsection K, and that meets all of the following
conditions:
(a) The authenticity of the record was previously
verified by an electronic authentication process.
(b) The identity of and information about the record
holder was previously verified through either:
(i) A secondary, electronic authentication process
or set of processes using commercially available data, such as a public records
query or a knowledge-based authentication quiz.
(ii) Using a state or federal government system of
records for digital authentication.
(c) The authenticated record was securely linked to
biometrics contemporaneously collected from the verified record holder and is
stored in a centralized, highly secured, encrypted biometric database.
5. "Board" means the state liquor board.
6. "Bona fide guest" means:
(a) An individual who is personally familiar to the
member, who is personally sponsored by the member and whose presence as a guest
is in response to a specific and personal invitation.
(b) In the case of a club that meets the criteria
prescribed in paragraph
8
9
,
subdivision (a) of this section, a current member of the armed services of the
United States who presents proper military identification and any member of a
recognized veterans' organization of the United States and of any country
allied with the United States during current or past wars or through treaty
arrangements.
7. "Broken package" means any container of
spirituous liquor on which the United States tax seal has been broken or
removed or from which the cap, cork or seal placed on the container by the
manufacturer
producer
has been removed.
8. "Cider":
(
a
) means any
beverage that is made from the normal alcoholic fermentation of the juice of
sound and ripe apples, pears or other pome fruit and that contains more than
one-half of one percent of alcohol by volume and
not
more than eight and one-half percent of alcohol by volume.
(
b
) INcludes flavored,
sparkling and carbonated cider and cider made from condensed apple, pear or
other pome fruit must.
8.
9.
"Club"
includes any of the following organizations where the sale of spirituous liquor
for consumption on the premises is made only to members, spouses of members,
families of members, bona fide guests of members and guests at other events
authorized in this title:
(a) A post, chapter, camp or other local unit
composed solely of veterans and its duly recognized auxiliary that has been
chartered by the Congress of the United States for patriotic, fraternal or
benevolent purposes and that has, as the owner, lessee or occupant, operated an
establishment for that purpose in this state.
(b) A chapter, aerie, parlor, lodge or other local
unit of an American national fraternal organization that has, as the owner,
lessee or occupant, operated an establishment for fraternal purposes in this
state. An American national fraternal organization as used in this subdivision
shall actively operate in at least thirty-six states or have been in
active continuous existence for at least twenty years.
(c) A hall or building association of a local unit
mentioned in subdivisions (a) and (b) of this paragraph of which all of the
capital stock is owned by the local unit or the members and that operates the
clubroom facilities of the local unit.
(d) A golf club that has more than fifty bona fide
members and that owns, maintains or operates a bona fide golf links together
with a clubhouse.
(e) A social club that has more than one hundred
bona fide members who are actual residents of the county in which it is
located, that owns, maintains or operates club quarters, that is authorized and
incorporated to operate as a nonprofit club under the laws of this state, and
that has been continuously incorporated and operating for a period of at least
one year. The club shall have had, during this one-year
period, a bona fide membership with regular meetings conducted at least once
each month, and the membership shall be and shall have been actively engaged in
carrying out the objects of the club. The club's membership shall consist of
bona fide dues-paying members paying dues of at least $6 per year,
payable monthly, quarterly or annually, which have been recorded by the
secretary of the club, and the members at the time of application for a club
license shall be in good standing having for at least one full year paid
dues. At least fifty-one percent of the members shall have
signified their intention to secure a social club license by personally signing
a petition, on a form prescribed by the board, which shall also include the
correct mailing address of each signer. The petition shall not have been signed
by a member at a date earlier than one hundred eighty days before the filing of
the application. The club shall qualify for exemption from the payment of state
income taxes under title 43. It is the intent of this subdivision
that a license shall not be granted to a club that is, or has been, primarily
formed or activated to obtain a license to sell liquor, but solely to a bona
fide club, where the sale of liquor is incidental to the main purposes of the
club.
(f) An airline club operated by or for airlines that
are certificated by the United States government and that maintain or operate
club quarters located at airports with international status.
9.
10.
"Company"
or "association", when used in reference to a corporation, includes
successors or assigns.
10.
11.
"Control"
means the power to direct or cause the direction of the management and policies
of an applicant or licensee, whether through the ownership of voting securities
or a partnership interest, by agreement or otherwise. Control is
presumed to exist if a person has the direct or indirect ownership of or power
to vote ten percent or more of the outstanding voting securities of the
applicant or licensee or to control in any manner the election of one or more
of the directors of the applicant or licensee. In the case of a partnership,
control is presumed to mean the general partner or a limited partner who holds
ten percent or more of the voting rights of the partnership. For the
purposes of determining the percentage of voting securities owned, controlled
or held by a person, there shall be aggregated with the voting securities
attributed to the person the voting securities of an officer, partner, employee
or agent of the person or a spouse, parent or child of the person. Control is
also presumed to exist if a creditor of the applicant or licensee holds a
beneficial interest in ten percent or more of the liabilities of the
licensee. The presumptions in this paragraph regarding control are
rebuttable.
11.
12.
"Controlling
person" means a person directly or indirectly possessing control of an
applicant or licensee.
12.
13.
"Craft
distiller" means a distiller in the United States or in a territory or
possession of the United States that holds a license pursuant to section 4-205.10.
13.
14.
"Craft
producer" means a licensed farm winery, a licensed microbrewery or a
licensed craft distiller.
14.
15.
"Department"
means the department of liquor licenses and control.
15.
16.
"Director"
means the director of the department of liquor licenses and control.
16.
17.
"Distilled
spirits" includes alcohol, brandy, whiskey, rum, tequila, mescal, gin,
absinthe, a compound or mixture of any of them or of any of them with any
vegetable or other substance, alcohol bitters,
bitters containing
alcohol, fruits preserved in ardent spirits,
beverages
that contain more than one-half of one percent of alcohol by volume and
that are produced by the distillation or rectification of FERMENTED MATERIAL
and
any alcoholic mixture or preparation, whether patented or otherwise, that may
in sufficient quantities produce intoxication.
17.
18.
"Employee"
:
(
a
)
Means
any person who performs any service on licensed premises on a full-time,
part-time or contract basis with consent of the licensee, whether or not
the person is denominated an employee or independent contractor or
otherwise.
Employee
(
b
)
Does
not include a person who is exclusively on the premises for musical or vocal
performances, for repair or maintenance of the premises or for the delivery of
goods to the licensee.
18.
19.
"Farm
winery" means a winery in the United States or in a territory or
possession of the United States that holds a license pursuant to section 4-205.04.
19.
20.
"Government
license" means a license to serve and sell spirituous liquor on specified
premises available only to a state agency, state board, state commission,
county, city, town, community college or state university or the national guard
or Arizona coliseum and exposition center on application by the governing body
of the state agency, state board, state commission, county, city, town,
community college or state university or the national guard or Arizona
exposition and state fair board.
20.
21.
"Legal
drinking age" means twenty-one years of age or older.
21.
22.
"License"
means a license or an interim retail permit issued pursuant to this title.
22.
23.
"Licensee"
means a person who has been issued a license or an interim retail permit
pursuant to this title or a special event licensee.
23.
24.
"License
fees" means fees collected for license issuance, license application,
license renewal, interim permit issuance and license transfer between persons
or locations.
24.
25.
"Manager"
means a natural person who meets the standards required of licensees and who
has authority to organize, direct, carry on, control or otherwise operate a
licensed business on a temporary or full-time basis.
25.
26.
"Menu
food item" means a food item from a regular menu, special menu or happy
hour menu that is prepared by the licensee or the licensee's employee.
26.
27.
"Microbrewery"
means a brewery in the United States or in a territory or possession of the
United States that meets the requirements of section 4-205.08.
27.
28.
"Mixed
cocktail":
(a) Means any drink combined at the premises of an
authorized licensee that contains a spirituous liquor and that is combined with
at least one other ingredient, which may include additional spirituous liquors,
fruit juice, vegetable juice, mixers, cream, flavored syrup or other
ingredients except water, and that when combined contains more than one-half
of one percent of alcohol by volume.
(b) Does not include a drink sold in an original
manufacturer's packaging or any drink poured from an original manufacturer's
package without the addition of all of the cocktail's other ingredients at the
premises of the licensed bar, liquor store or restaurant.
28.
29.
"Off-sale
retailer" means any person that operates a bona fide regularly established
retail liquor store that sells spirituous liquors, wines and beer and any
established retail store that sells commodities other than spirituous liquors
and that is engaged in the sale of spirituous liquors only in the original
unbroken package, to be taken away from the premises of the retailer and to be
consumed off the premises.
29.
30.
"On-sale
retailer" means any person operating an establishment where spirituous
liquors are sold in the original container for consumption on or off the
premises or in individual portions for consumption on the premises.
30.
31.
"Permanent
occupancy" means the maximum occupancy of the building or facility as set
by the office of the state fire marshal for the jurisdiction in which the
building or facility is located.
31.
32.
"Person"
includes a partnership, limited liability company, association, company or
corporation, as well as a natural person.
32.
33.
"Premises"
or "licensed premises":
(a) Means the area from which the licensee is
authorized to sell, dispense or serve spirituous liquors under the provision of
the license.
(b) Includes a patio that is not contiguous to the
remainder of the premises or licensed premises if the patio is separated from
the remainder of the premises or licensed premises by a public or private
walkway or driveway not to exceed thirty feet, subject to rules the director
may adopt to establish criteria for noncontiguous premises.
33.
34.
"Registered
alcohol delivery contractor":
(a) Means a person who delivers spirituous liquor to
a consumer on behalf of a bar, beer and wine bar, liquor store, beer and wine
store or restaurant.
(b) Does not include:
(i) A motor carrier as defined in section 28-5201.
(ii) An independent contractor, a subcontractor of
an independent contractor, an employee of an independent contractor or an
employee of a subcontractor as provided in section 4-203, subsection J.
34.
35.
"Registered
mail" includes certified mail.
35.
36.
"Registered
retail agent" means any person who is authorized pursuant to section 4-222
to purchase spirituous liquors for and on behalf of the person and other retail
licensees.
36.
37.
"Repeated
acts of violence" means:
(a) For licensed premises with a permanent occupancy
of two hundred or fewer persons, two or more acts of violence occurring within
seven days or three or more acts of violence occurring within thirty days.
(b) For licensed premises with a permanent occupancy
of more than two hundred but not more than four hundred persons, four or more
acts of violence within thirty days.
(c) For licensed premises with a permanent occupancy
of more than four hundred but not more than six hundred fifty persons, five or
more acts of violence within thirty days.
(d) For licensed premises with a permanent occupancy
of more than six hundred fifty but not more than one thousand fifty persons,
six or more acts of violence within thirty days.
(e) For licensed premises with a permanent occupancy
of more than one thousand fifty persons, seven or more acts of violence within
thirty days.
37.
38.
"Sell"
includes soliciting or receiving an order for, keeping or exposing for sale,
directly or indirectly delivering for value, peddling, keeping with intent to
sell and trafficking in.
38.
39.
"Spirituous
liquor"
:
(
a
)
Includes
alcohol, brandy, whiskey, rum, tequila, mescal, gin, wine, porter, ale, beer,
cider,
any malt liquor or malt beverage, absinthe, a compound
or mixture of any of them or of any of them with any vegetable or other
substance, alcohol bitters,
bitters containing alcohol,
any liquid mixture or preparation, whether patented or otherwise, that produces
intoxication
, fruits preserved in ardent spirits,
and
beverages containing more than one-half of one percent of alcohol by
volume.
(
b
) Does not
include nonbeverage products as defined in 27 code of federal regulations part
17 and that are qualified by the United States alcohol and tobacco tax and
trade bureau as nonbeverage products.
39.
40.
"Tamperproof
sealed" means designed to prevent consumption without the removal of a
tamperproof cap, seal, cork or closure that has a device, mechanism or adhesive
that clearly shows whether a container has been opened.
40.
41.
"Vehicle"
means any means of transportation by land, water or air, and includes
everything made use of in any way for such transportation.
41.
42.
"Vending
machine" means a machine that dispenses merchandise through the means of
coin, token, credit card or other nonpersonal means of accepting payment for
merchandise received.
42.
43.
"Veteran"
means a person who has served in the United States air force, army, navy,
marine corps
, space force
or coast guard, as an active
nurse in the services of the American red cross, in the army and navy nurse
corps in time of war, or in any expedition of the armed forces of the United
States, and who has received a discharge other than dishonorable.
43.
44.
"Voting
security" means any security presently entitling the owner or holder of
the security to vote for the election of directors of an applicant or a
licensee.
44.
45.
"Wine"
means the product obtained by the fermentation of grapes, other agricultural
products containing natural or added sugar or cider or any such alcoholic
beverage fortified with grape brandy and containing not more than twenty-four
percent of alcohol by volume.
END_STATUTE
Sec. 2. Section 4-201, Arizona Revised
Statutes, is amended to read:
START_STATUTE
4-201.
Licensing; application procedure in city, town or county; burden
of proof
A. A person desiring a license to
manufacture
PRODUCE
, sell or deal in spirituous liquors shall apply
to the director on a form prescribed and furnished by the director.
B. A person who files an application for a license
within an incorporated city or town shall file the application with the
director. The director shall remit the application to the city or
town clerk. The city or town clerk shall immediately file a copy of
the application in the clerk's office and post a copy for a period of twenty
days in a conspicuous place on the front of the premises where the business is
proposed to be conducted, with a statement requiring any natural person who is
a bona fide resident residing or owning or leasing property within a one-mile
radius from the premises proposed to be licensed, and who is in favor of or
opposed to the issuance of the license, to file written arguments in favor of
or opposed to the issuance of the license with the clerk within twenty days
after the date of posting. The posting shall be limited to a copy of
the license application and shall not contain any attachments filed with the
application. The written argument shall contain the natural person's
complete name, street address or post office box address and written or
electronic signature. If the written arguments are filed by a person
on behalf of a corporation or other legal entity or association, the written
arguments must be accompanied by a copy of the entity's organizing document, a
designation of the office or position that the person holds within the
organization and a copy of the written appointment of the person to speak on
behalf of the organization. If the written arguments are filed by a neighborhood
association, block watch or other unincorporated association, written arguments
must be accompanied by a letter of authority designating that person as a
spokesperson. The posting shall contain substantially the following:
Notice
A hearing on a liquor license application shall be held
before the local governing body at the following date, time and place:
(Insert date, time and address)
The local governing body will recommend to the state liquor
board whether the board should grant or deny the license. The state liquor
board may hold a hearing to consider the recommendation of the local governing
body. Any person residing or owning or leasing property within a one-mile
radius may contact the state liquor board in writing to register as a
protestor. To request information regarding procedures before the
board and notice of any board hearings regarding this application, contact the
state liquor board at:
(Insert address and telephone number).
No arguments shall be filed or accepted by the
city or town clerk thereafter. This subsection
does
not
prevent a bona
fide resident residing or owning or leasing
property within a one-mile
radius from the premises proposed to be licensed from testifying in favor of or
in opposition to the issuance of the license, regardless of whether or not the
person is a user or nonuser of spirituous liquor.
C. The governing body
of the city, town or county shall then enter an order recommending approval or
disapproval within sixty days after the filing of the application and shall
file a certified copy of the order with the director. If the
recommendation is for disapproval, a statement of the specific reasons
containing a summary of the testimony or other evidence supporting the
recommendation for disapproval shall be attached to the order. All
petitions submitted to the governing body within the twenty-day period
for filing protests shall be transmitted to the director with the certified
copy of the order.
D. If a person applies for a license to conduct a
spirituous liquor business outside an incorporated city or town, the director
shall remit the application to the clerk of the board of supervisors of the
county where the applicant desires to do business, and the proceedings by the
clerk and board of supervisors shall be as provided for cities and towns.
E. On receipt of an application for a spirituous
liquor license, the director shall set the application for a hearing by the
board on a date following the expiration of the time fixed for the submitting
of the certified order by the governing body of the city or town or the board
of supervisors. If the city or town or the county recommends
approval of the license a hearing is not required unless the director, the
board or any aggrieved party requests a hearing on the grounds that the public
convenience and the best interest of the community will not be substantially
served if a license is issued. Any natural person residing or owning or leasing
property within a one-mile radius of the proposed location may file a written
protest with the director on a form prescribed by the director not later than
fifteen calendar days after action by the local governing body or sixty days
after the filing of the application, whichever is sooner. The
director shall allow protests to be submitted by
e-mail
email
. The written argument shall contain the
natural person's complete name, street address or post office box address and
written or electronic signature. If the written arguments are filed by a person
on behalf of a corporation or other legal entity or association, the written
arguments must be accompanied by a copy of the entity's organizing document, a
designation of the office or position that the person holds within the
organization and a copy of the written appointment of the person to speak on
behalf of the organization. If the written arguments are filed by a
neighborhood association, block watch or other unincorporated association,
written arguments must be accompanied by a letter of authority designating that
person as a spokesperson. If no hearing is requested by the
director, the board or any aggrieved party, the application may be approved by
the director. If the recommendation is for disapproval of an application, the
board shall hold a hearing. If the city, town or county recommends approval of
the license pursuant to subsection C of this section or makes no
recommendation, the director may cancel the hearing and issue the license
unless the board or any aggrieved party requests a hearing. If the
reason for the protest is clearly removed or deemed satisfied by the director,
the board shall cancel the hearing. If the board cancels the
hearing, the department may administratively issue an order without the
applicant licensee or other parties present. The certified order, the
reasons contained in the order and the summary of the testimony and other
evidence supporting the city, town or county disapproval of the recommendation
shall be read into the record before the board and shall be considered as
evidence by the board. The board shall consider the certified order together
with other facts and a report of the director relating to the qualifications of
the applicant. If the governing body of the city or town or the board of
supervisors fails to return to the director, as provided in
subsections
subsection
C
and D
of this section,
its order of disapproval, no hearing is required. An application shall be
approved or disapproved within one hundred five days after the filing of the
application. If, after a hearing by the board where a license has been
approved, a formal written order is not entered within thirty days after the
hearing, the decision of the board is deemed entered on the thirtieth day after
the hearing.
F. A hearing may be conducted by an administrative
law judge at the request of the board to make findings and recommendations for
use by the board in determining whether to grant or deny a
license. The administrative law judge shall submit a report of
findings to the board within twenty days after the hearing. The
board may affirm, reverse, adopt, modify, supplement, amend or reject the
administrative law judge's report in whole or in part.
G. Except for a person-to-person transfer of a
transferable license for use at the same location and as otherwise provided in
section 4-203, subsection A, in all proceedings before the governing body
of a city or town, the board of supervisors of a county or the board, the
applicant bears the burden of showing that the public convenience requires and
that the best interest of the community will be substantially served by the
issuance of a license.
H. In order to prevent the proliferation of
spirituous liquor licenses
,
the department may deny a
license to a business on the grounds that the business is inappropriate for the
sale of spirituous liquor. An inappropriate business is one that cannot clearly
demonstrate that the sale of spirituous liquor is directly connected to its
primary purpose and that the sale of spirituous liquor is not merely incidental
to its primary purpose.
I. The board shall adopt, by rule, guidelines that
state criteria for use in determining whether the public convenience requires
and the best interest of the community will be substantially served by the
issuance or transfer of a liquor license at the location applied for. These
guidelines shall govern the recommendations and other approvals of the
department and the local governing authority.
J. If the governing body of a city or town
recommends disapproval by a two-thirds vote of the members present and
voting on an application for the issuance or transfer of a spirituous liquor
license that, if approved, would result in a license being issued at a location
either having no license or having a license of a different series, the
application shall not be approved unless the board decides to approve the
application by a two-thirds vote of the members present and voting.
END_STATUTE
Sec. 3. Section 4-203, Arizona Revised
Statutes, is amended to read:
START_STATUTE
4-203.
Licenses; issuance; transfer; reversion to state; tastings;
rules; off-sale privileges; order requirements
A. A spirituous liquor license shall be issued only
after satisfactory showing of the capability, qualifications and reliability of
the applicant and, with the exception of wholesaler, producer, government or
club licenses, that the public convenience requires and that the best interest
of the community will be substantially served by the issuance. If an
application is filed for the issuance of a transferable or nontransferable
license, other than for a craft distiller license, a microbrewery license or a farm
winery license, for a location that on the date the application is filed has a
valid license of the same series, or in the case of a restaurant license
application filed for a location with a valid hotel-motel license, issued
at that location, there shall be a rebuttable presumption that the public
convenience and best interest of the community at that location was established
at the time the location was previously licensed. The presumption may be rebutted
by competent contrary evidence. The presumption shall not apply once
the licensed location has not been in use for more than one hundred eighty days
and the presumption shall not extend to the personal qualifications of the
applicant.
B. The license shall be to
manufacture
PRODUCE
, sell or deal in spirituous liquors only at the
place and in the manner provided in the license. A separate license
shall be issued for each specific business, and each shall specify:
1. The particular spirituous liquors that the
licensee is authorized to
manufacture
PRODUCE
,
sell or deal in.
2. The place of business for which issued.
3. The purpose for which the liquors may be
manufactured
PRODUCED
or sold.
C. A spirituous liquor license issued to a bar, a
liquor store or a beer and wine bar shall be transferable as to any permitted
location within the same county, if the transfer meets the requirements of an
original application. A spirituous liquor license may be transferred to a
person qualified to be a licensee, if the transfer is pursuant to either
judicial decree, nonjudicial foreclosure of a legal or equitable lien,
including security interests held by financial institutions pursuant to section
4-205.05, a sale of the license, a bona fide sale of the entire business
and stock in trade, or other bona fide transactions that are provided for by
rule. Any change in ownership of the business of a licensee, directly or
indirectly, as defined by rule is deemed a transfer, except that there is no
transfer if a new artificial person is added to the ownership of a licensee's
business but the controlling persons remain identical to the controlling
persons that have been previously disclosed to the director as part of the
licensee's existing ownership.
D. All applications for a new license pursuant to
section 4-201 or for a transfer to a new location pursuant to subsection
C of this section shall be filed with and determined by the director, except
when the governing body of the city or town or the board of supervisors
receiving an application pursuant to section 4-201 orders disapproval of
the application or when the director, the state liquor board or any aggrieved
party requests a hearing. The application shall then be presented to
the state liquor board, and the new license or transfer shall not become
effective unless approved by the state liquor board.
E. A person who assigns, surrenders, transfers or
sells control of a liquor license or business that has a spirituous liquor
license shall notify the director within thirty business days after the
assignment, surrender, transfer or sale. A spirituous liquor license
shall not be leased or subleased. A concession agreement entered
into under section 4-205.03 is not considered a lease or sublease in
violation of this section.
F. If a person other than those persons originally
licensed acquires control over a license or licensee, the person shall file
notice of the acquisition with the director within thirty business days after
the acquisition of control and a list of officers, directors or other
controlling persons on a form prescribed by the director. There is
no acquisition of control if a new person is added to the ownership of a
licensee's business but the controlling persons remain identical to the
controlling persons that have been previously disclosed to the director as part
of the licensee's existing ownership. All officers, directors or
other controlling persons shall meet the qualifications for licensure as
prescribed by this title. On request, the director shall conduct a
preinvestigation before the assignment, sale or transfer of control of a
license or licensee, the reasonable costs of which, not more than $1,000, shall
be borne by the applicant. The preinvestigation shall determine
whether the qualifications for licensure as prescribed by this title are met.�
On receipt of notice of an acquisition of control or request of a
preinvestigation, the director, within fifteen days after receipt, shall
forward the notice of the acquisition of control to the local governing body of
the city or town, if the licensed premises is in an incorporated area, or the
county, if the licensed premises is in an unincorporated area.� The director
shall include in the notice to the local governing body written instructions on
how the local governing body may examine, free of charge, the results of the
department's investigation regarding the capabilities, qualifications and
reliability of all officers, directors or other controlling persons listed in
the application for acquisition of control. The local governing
body, or the governing body's designee, may provide the director with a
recommendation, either in favor of or against the acquisition of control,
within sixty days after the director mails the notice, but section 4-201
does not apply to the acquisition of control provided for in this section.� A
local governing body may charge not more than one fee, regardless of the number
of licenses held by the applicant, for review of one or more applications for
acquisition of control submitted to the department at the same time and for the
same entity. Within one hundred five days after filing the notice of the
acquisition of control, the director shall determine whether the applicant is
qualified, capable and reliable for licensure. A recommendation by
the local governing body, or the governing body's designee, against the
acquisition of control or denial by the director shall be set for a hearing
before the board. The person who has acquired control of a license
or licensee has the burden of an original application at the hearing, and the
board shall make its determination pursuant to section 4-202 and this
section with respect to capability, reliability and qualification.
G. A licensee who holds a license in nonuse status
for more than five months shall be required to pay a $100 surcharge for each
month thereafter. The surcharge shall be paid at the time the
license is returned to active status.� A license automatically reverts to the
state after being held in continuous nonuse for more than thirty-six
months.� The director may waive the surcharge and may extend the time period
provided in this subsection for good cause if the licensee files a written
request for an extension of time to place the license in active status before
the date of the automatic reversion. Unless the reverted license of
the licensee has been subsequently reissued, the director shall relieve a
licensee or its legal representative from a prior license reversion under this
section if the request for such relief is filed in writing not later than two
years after the date of reversion.� A license shall not be deemed to have gone
into active status if the license is transferred to a location that at the time
of or immediately before the transfer had an active license of the same type,
unless the licenses are under common ownership or control.
H. A restructuring of a licensee's business is not
an acquisition of control, a transfer of a spirituous liquor license or the
issuance of a new spirituous liquor license if both of the following apply:
1. All of the controlling persons of the licensee
and the new business entity are identical.
2. There is no change in control or beneficial
ownership.
I. If subsection H of this section applies, the
licensee's history of violations of this title is the history of the new
business entity.� The director may prescribe a form and shall require the
applicant to provide the necessary information to ensure compliance with this
subsection and subsections F and G of this section.
J. Notwithstanding subsection B of this section, the
holder of a retail license in this state having off-sale privileges,
except a bar, beer and wine bar or restaurant licensee, may take orders by
telephone, mail, fax or catalog, through the internet or by other means for the
sale and delivery of spirituous liquor off of the licensed premises to a person
in this state in connection with the sale of spirituous liquor. Notwithstanding
the definition of "sell" prescribed in section 4-101, the
placement of an order and payment pursuant to this section is not a sale until
delivery has been made.� At the time that the order is placed, the licensee
shall inform the purchaser that state law requires a purchaser of spirituous
liquor to be at least twenty-one years of age and that the person
accepting delivery of the spirituous liquor is required to comply with this
state's age identification requirements as prescribed in section 4-241,
subsections A and K. The licensee may maintain a delivery service
and may contract with one or more independent contractors, that may also
contract with one or more independent contractors, or may contract with a
common carrier for delivery of spirituous liquor if the spirituous liquor is
loaded for delivery at the premises of the retail licensee in this state and
delivered in this state.� Except if the person delivering the order has
personally retrieved and bagged or otherwise packaged the container of
spirituous liquor for delivery and the licensee records, or requires to be recorded
electronically, the identification information for each delivery, all
containers of spirituous liquor delivered pursuant to this subsection shall be
conspicuously labeled with the words "contains alcohol, signature of
person who is twenty-one years of age or older is required for
delivery". The licensee is responsible for any violation of
this title or any rule adopted pursuant to this title that is committed in
connection with any sale or delivery of spirituous liquor. Delivery
must be made by an employee of the licensee or other authorized person as
provided by this section who is at least twenty-one years of age to a
customer who is at least twenty-one years of age and who displays an
identification at the time of delivery that complies with section 4-241,
subsection K. The retail licensee shall collect payment for the full
price of the spirituous liquor from the purchaser before the product leaves the
licensed premises. The director shall adopt rules that set
operational limits for the delivery of spirituous liquors by the holder of a
retail license having off-sale privileges. With respect to the
delivery of spirituous liquor, for any violation of this title or any rule
adopted pursuant to this title that is based on the act or omission of a
licensee's employee or other authorized person, the mitigation provision of
section 4-210, subsection G applies, with the exception of the training
requirement. For the purposes of this subsection and notwithstanding
the definition of "sell" prescribed in section 4-101, section 4-241,
subsections A and K apply only at the time of delivery. For the
purposes of compliance with this subsection, an independent contractor, a
subcontractor of an independent contractor, the employee of an independent
contractor or the employee of a subcontractor is deemed to be acting on behalf
of the licensee when making a delivery of spirituous liquor for the licensee.
K. Except as provided in subsection J of this
section, Arizona licensees may transport spirituous liquors for themselves in
vehicles owned, leased or rented by the licensee.
L. Notwithstanding subsection B of this section, an
off-sale retail licensee may provide consumer tasting of wines off of the
licensed premises subject to all applicable provisions of section 4-206.01.
M. The director may adopt reasonable rules to
protect the public interest and prevent abuse by licensees of the activities
permitted such licensees by subsections J and L of this section.
N. Failure to pay any surcharge prescribed by
subsection G of this section or failure to report the period of nonuse of a
license shall be grounds for revocation of the license or grounds for any other
sanction provided by this title. The director may consider
extenuating circumstances if control of the license is acquired by another
party in determining whether or not to impose any sanctions under this
subsection.
O. If a licensed location has not been in use for
three years, the location must requalify for a license pursuant to subsection A
of this section and shall meet the same qualifications required for issuance of
a new license except when the director deems that the nonuse of the location
was due to circumstances beyond the licensee's control and an extension of time
has been granted pursuant to subsection G of this section.
P. If the licensee's interest is forfeited pursuant
to section 4-210, subsection L, the location shall requalify for a
license pursuant to subsection A of this section and shall meet the same
qualifications required for issuance of a new license except when a bona fide
lienholder demonstrates mitigation pursuant to section 4-210, subsection
K.
Q. The director may implement a procedure for the
issuance of a license with a licensing period of two years.
R. For any sale of a farm winery or craft distiller
or change in ownership of a farm winery or craft distiller directly or
indirectly, the business, stock-in-trade and spirituous liquor may be
transferred with the ownership, in compliance with the applicable requirements
of this title.
S. Notwithstanding subsection B of this section,
bar, beer and wine bar, liquor store, beer and wine store or restaurant
licensees in this state may take orders by telephone, mail, fax or catalog,
through the internet or by other means for the sale and delivery of spirituous
liquor off the licensed premises as follows:
1. Bar licensees for beer, wine, distilled spirits
and mixed cocktails.
2. Beer and wine bar licensees for beer and wine.
3. Liquor store licensees for beer, wine, distilled
spirits and mixed cocktails.
4. Beer and wine store licensees for beer and wine.
5. Restaurant licensees for any of the following:
(a) Mixed cocktails, with the sale of menu food
items for consumption on or off the licensed premises, if the restaurant holds
a permit issued pursuant to section 4-203.07 and section 4-205.02,
subsection K
or a lease pursuant to section 4-203.06
.
(b) Beer if the restaurant holds a permit issued
pursuant to section 4-205.02, subsection H.
(c) Beer, wine and distilled spirits if the
restaurant holds an off-sale privileges lease with a bar or liquor store
pursuant to section 4-203.07.
(d) Beer and wine if the restaurant holds an
off-sale privileges lease with a beer and wine bar pursuant to section 4-203.07.
T. Notwithstanding the definition of
"sell" prescribed in section 4-101, placing an order and paying
for that order pursuant to subsection S of this section is not a sale until
delivery has been made. At the time that the order is placed, the licensee
shall inform the purchaser that state law requires a purchaser of spirituous
liquor to be at least twenty-one years of age and that the person
accepting delivery of the spirituous liquor is required to comply with this
state's age identification requirements as prescribed in section 4-241,
subsections A and K.� The licensee may maintain a delivery service and may
contract with one or more alcohol delivery contractors registered pursuant to
section 4-205.13 for delivery of spirituous liquor if the spirituous
liquor is packaged and tamperproof sealed by the bar, beer and wine bar, liquor
store, beer and wine store or restaurant licensee or the licensee's employee
and is loaded for delivery at the premises of the restaurant, beer and wine
bar, liquor store, beer and wine store or bar licensee in this state and
delivered in this state on the same business day. A liquor store or
beer and wine store licensee may contract with one or more independent
contractors as provided in subsection J of this section for delivery of
spirituous liquor if the spirituous liquor is loaded for delivery at the
premises of the liquor store or beer and wine store licensee in this state and
delivered in this state on the same business day.� All containers of spirituous
liquor delivered pursuant to subsection S of this section shall be tamperproof
sealed and conspicuously labeled with the words "contains alcohol,
signature of person who is twenty-one years of age or older is required
for delivery". The licensee is responsible for any violation of
this title or any rule adopted pursuant to this title that is committed in
connection with any sale or delivery of spirituous liquor. Delivery
must be made by an employee of the licensee or an employee or authorized
independent contractor of a registered alcohol delivery contractor as provided
by this section who is at least twenty-one years of age and delivery must be
made to a customer who is at least twenty-one years of age and who displays an
identification at the time of delivery that complies with section 4-241,
subsection K. The restaurant, beer and wine bar, liquor store, beer
and wine store or bar licensee shall collect payment for the full price of the
spirituous liquor from the purchaser before the product leaves the licensed
premises. The director shall adopt rules that set operational limits
for the delivery of spirituous liquor pursuant to this subsection and
subsection S of this section with respect to the delivery of spirituous
liquor. For any violation of this title or any rule adopted pursuant
to this title that is based on the act or omission of a licensee's employee or
a registered alcohol delivery contractor, the mitigation provision of section 4-210,
subsection G applies, with the exception of the training
requirement. For the purposes of this subsection and notwithstanding
the definition of "sell" prescribed in section 4-101, section 4-241,
subsections A and K apply only at the time of delivery. An alcohol
delivery contractor, a subcontractor of an alcohol delivery contractor, an
employee of an alcohol delivery contractor or an employee of a subcontractor is
deemed to be acting on behalf of the licensee when making a delivery of
spirituous liquor for the licensee. For the purposes of this
subsection, "business day" means between the hours of 6:00 a.m.
of one day and 2:00 a.m. of the next day.
U. A licensee that has off-sale privileges and
that delivers spirituous liquor as prescribed in this section shall complete a
written record of each delivery at the time of delivery.� The written record
shall include all of the following:
1. The name of the licensee making the delivery.
2. The complete address of the licensee making the
delivery.
3. The licensee's license number.
4. The date and time of the delivery.
5. The address where the delivery was made.
6. The type and brand of all spirituous liquor
delivered.
V. A licensee that has off-sale privileges and
that delivers spirituous liquor as prescribed in this section shall obtain the
following information from the individual who accepts delivery:
1. The individual's name.
2. The individual's date of birth.
3. The individual's signature. The licensee making
the delivery may use an electronic signature system to comply with the
requirements of this paragraph.
END_STATUTE
Sec. 4. Section 4-203.01, Arizona Revised
Statutes, is amended to read:
START_STATUTE
4-203.01.
Interim permit; fee; rules
A. The director may issue an interim permit to the
applicant for a license of the same series, or for the replacement of a
hotel-motel license with a restaurant license, at the same premises
,
regardless of
whether that license is
transferrable or nontransferable and
regardless of whether that
license has been used in the past three years, if
any of the following
conditions exists:
1. The director has good cause to believe the
licensee is no longer in possession of the licensed premises.
2. The license for such premises was surrendered
or expired or was terminated, canceled or in nonuse at that premises
pursuant to rules of the department.
3. The applicant for the interim permit filed with
the department an application for the issuance of a license of the same series
of nontransferable license or the transfer or replacement of a transferable
license of the same series, or for the replacement of a hotel-motel license
with a restaurant license, at the same premises.
B. The application for the interim permit shall be
accompanied by an interim permit fee of
one hundred dollars
$100
.
C. An interim permit issued by the director pursuant
to this section shall be for a period of not more than one hundred five days
and shall not be extended except as provided in subsection D of this section.�
An interim permit is a conditional permit and authorizes the holder to sell
such alcoholic beverages as would be permitted to be sold under the privileges
of the license for which application has been filed with the department.
D. Notwithstanding subsection C of this section, if
the director extends the time limit for action by the department in connection
with a license issuance or transfer pursuant to section 4-201.01,
subsection B, the director shall issue an additional interim permit for a
period equal to such extension unless either:
1. No interim permit has previously been issued.
2. For good cause shown the director denies the
additional interim permit.
E. Notwithstanding any other law, an interim permit
may be canceled or suspended summarily at any time, if the director determines
that good cause for such cancellation or suspension exists. There
shall be no appeal from such cancellation or suspension of an interim permit to
the board. The board may cancel an interim permit on applications
that have been disapproved by the board. The cancellation or
suspension of an interim permit may be appealed directly to the superior court.
F. Application for an interim permit shall be on
such form as the director
shall prescribe
prescribes
. If an application for an interim permit is
withdrawn before issuance or is refused by the director, the fee that
accompanies such application shall be refunded.
G. If an application for transfer of a license,
person to person, or nontransferable spirituous liquor license is denied or an
interim permit is revoked,
is
suspended or expires, the
licensee may request the return of the surrendered license that has been issued
for such premises.
H. The director may prescribe rules governing the
issuance of interim permits under this section.
I. The director may deny an interim permit in
situations in which a current licensee holds a license described in section 4-209,
subsection B, paragraph 12 and the current license is not in compliance with
section 4-205.02.
END_STATUTE
Sec. 5. Section 4-205.02, Arizona Revised
Statutes, is amended to read:
START_STATUTE
4-205.02.
Restaurant license; issuance; regulatory provisions; expiration;
off-sale leases and permits; fee; definitions
A. The director may issue a restaurant license to
any restaurant in this state that is regularly open for serving food to guests
for compensation and that has suitable kitchen facilities connected with the
restaurant for keeping, cooking and preparing foods required for ordinary
meals.
B. The director shall issue the license in the name
of the restaurant on application for the license by the owner or lessee of the
restaurant, if the applicant is otherwise qualified to hold a spirituous liquor
license. The holder of such a license is subject to the penalties
prescribed for any violation of the law relating to alcoholic beverages.
C. The holder of a restaurant license may sell and
serve spirituous liquors solely for consumption on the licensed premises. For
the purpose of this subsection, "licensed premises" may include
rooms, areas or locations in which the restaurant normally sells or serves
spirituous liquors pursuant to regular operating procedures and practices and
that are contiguous to the restaurant or a noncontiguous patio pursuant to
section 4-101, paragraph
32
33
. For
the purposes of this subsection, a restaurant licensee must submit proof of
tenancy or permission from the landowner or lessor for all property to be
included in the licensed premises.
D. In addition to other grounds prescribed in this
title on which a license may be revoked, the director may require the holder of
a restaurant license issued pursuant to this section to surrender the license
in any case in which the licensee ceases to operate as a restaurant, as
prescribed in subsection A of this section.� The surrender of a license
pursuant to this subsection does not prevent the director from revoking the
license for other grounds prescribed in this title or for making deliberate
material misrepresentations to the department regarding the licensee's
equipment, service or entertainment items or seating capacity in applying for
the restaurant license.
E. Neither the director nor the board may initially
issue a restaurant license if either finds that there is sufficient evidence
that the operation will not satisfy the criteria adopted by the director for
issuing a restaurant license described in section 4-209, subsection B,
paragraph 12.� The director shall issue a restaurant license only if the
applicant has submitted a plan for the operation of the
restaurant. The plan shall be completed on forms provided by the
department and shall include listings of all restaurant equipment and service
items, the restaurant seating capacity and other information requested by the
department to substantiate that the restaurant will operate in compliance with
this section.
F. The holder of the license described in section 4-209,
subsection B, paragraph 12 who intends to alter the seating capacity or
dimensions of a restaurant facility shall notify the department in advance on
forms provided by the department.
G. The director may charge a fee for site inspections
conducted before the issuance of a restaurant license.
H. A restaurant applicant or licensee may apply for
a permit allowing for the sale of beer for consumption off the licensed
premises pursuant to section 4-244, paragraph 32, subdivision (c) on a
form prescribed and furnished by the director. The department shall
not issue a permit to a restaurant applicant or licensee that does not meet the
requirements in section 4-207, subsection A. Section 4-207,
subsection B does not apply to this subsection. The permit shall be
issued only after the director has determined that the public convenience
requires and that the best interest of the community will be substantially
served by the issuance of the permit, considering the same criteria adopted by
the director for issuing a restaurant license described in section 4-209,
subsection B, paragraph 12. The amount of beer sold under the permit
shall not exceed ten percent of gross revenue of spirituous liquor sold by the
establishment.� After the permit has been issued, the permit shall be noted on
the license itself and in the records of the department. The
director may charge a fee for processing the application for the permit and a
renewal fee.
I. Notwithstanding any rule adopted by the
department, business establishments that relied on a form issued by the
department that provides for a small restaurant exemption for fifty or fewer
seats before January 31, 2019 are allowed to continue to maintain the capacity
of fifty or fewer seats for the duration of the business.� The rights of a
business establishment subject to this section are not transferable.
J. Notwithstanding section 4-203, subsection
E, section 4-207 and section 4-210, subsection A, paragraph 6,
through December 31, 2025, a restaurant applicant or licensee may apply to the
department for a lease for the privilege of selling mixed cocktails for
consumption off the licensed premises pursuant to
section 4-203.06
and
section 4-244, paragraph 32, subdivision (d).
K. Notwithstanding section 4-207, beginning
January 1, 2026, a restaurant applicant or licensee may apply for a permit to
allow the sale of mixed cocktails for consumption off the licensed premises
pursuant to section 4-203.07 and section 4-244, paragraph 32,
subdivision (d), on a form prescribed and furnished by the
director. The sale of mixed cocktails for consumption off the
licensed premises must be accompanied by the sale of menu food items for
consumption on or off the licensed premises.� The department shall issue the
permit only after the director has determined that the public convenience
requires and that the best interest of the community will be substantially
served by issuing the permit. All permit holders and their
employees, managers and agents must complete alcohol training pursuant to
section 4-112, subsection G, paragraph 2. After the department
issues the permit, the permit shall be noted on the license itself and in the
records of the department. The director may establish and charge a
fee for processing the permit application and a renewal fee.
L. A restaurant licensee shall cease selling
spirituous liquor, including mixed cocktails, for off-premises
consumption when the licensee ceases regular kitchen service for food.
M. For the purposes of this section:
1. "Gross revenue":
(a) Means the revenue derived from all sales of food
and spirituous liquor on the licensed premises, regardless of whether the sales
of spirituous liquor are made under a restaurant license issued pursuant to
this section or under any other license that has been issued for the premises
pursuant to this article.
(b) Includes revenue derived from spirituous liquor
sold for off-sale consumption.
2. "Restaurant" means an establishment
that derives at least forty percent of its gross revenue from the sale of food,
including sales of food for consumption off the licensed premises if the amount
of these sales included in the calculation of gross revenue from the sale of
food does not exceed fifteen percent of all gross revenue of the restaurant.
END_STATUTE
Sec. 6. Section 4-205.04, Arizona Revised
Statutes, is amended to read:
START_STATUTE
4-205.04.
Farm winery license; issuance; regulatory provisions; retail
site; fee
A. The director may issue a farm winery license to
any person who meets the requirements of subsection C of this
section. Each location that engages in producing
or
manufacturing
these products must obtain a separate farm winery
license. The licensee may not transfer the farm winery license from
person to person or from location to location.
B. An applicant for a farm winery license, at the
time of filing the application for the license, shall accompany the application
with the license fee. A person who holds a farm winery license shall
report annually at the end of each calendar year, at the time and in the manner
as the director prescribes, the amount of wine produced
or
manufactured
by the licensee during the calendar year. In
addition to any provision of this title, if the total amount of wine produced
or manufactured
during the year exceeds the amount permitted
annually by the license, the licensee shall apply for and receive a producer's
license only on surrender of the farm winery license or licenses.
C. A person may be licensed as a farm winery to sell
wine produced
or manufactured
if in a calendar year it
produces at least two hundred gallons and not more than forty thousand gallons
of wine and if the winery either holds a winery permit issued by the United
States alcohol and tobacco tax and trade bureau or has a contract pursuant to
subsection D of this section for the production
or manufacturing
of wine from grapes or other fruit grown on at least five producing acres of
land owned or controlled by the applicant and the land has been devoted to
fruit growing for at least three consecutive calendar years. A
licensed farm winery may make sales and deliveries of wine only as specifically
provided in this section and as follows:
1. A licensed farm winery may make sales and
deliveries of wine to wholesalers licensed to sell wine under this title.
2. A licensed farm winery may serve wine produced
or manufactured
on the premises for the purpose of sampling the
wine. The wine may include wine produced pursuant to subsection D of
this section and section 4-243.03.
3. A representative of the licensed farm winery may
consume small amounts of the products of the licensed farm winery on the
premises for the purpose of sampling the wine. The wine may include
wine produced pursuant to subsection D of this section and section 4-243.03.
4. A licensed farm winery may sell to a consumer
physically present on the premises wine produced
or manufactured
on the premises in the original container for consumption on or off the
premises. The wine may include wine produced pursuant to subsection
D of this section and section 4-243.03.
5. A licensed farm winery may purchase and sell wine
produced, packaged and labeled by another licensed farm winery for sampling and
consumption on or off the premises only if the retail sale is to a consumer
physically present on the premises of the farm winery, except that the sales of
wine produced, packaged and labeled by another winery may not exceed twenty
percent of the farm winery's sales by volume. The percentage
limitation shall not apply to wine produced pursuant to subsection D of this
section and section 4-243.03.
6. If the licensed farm winery is not otherwise
engaged in the business of a distiller, vintner, brewer, rectifier, blender or
other producer of spirituous liquor in any jurisdiction, the licensed farm
winery may hold licenses prescribed in section 4-209, subsection B,
paragraph 12 on the licensed farm winery premises or other retail
premises. Except as provided in paragraph 5 of this subsection, the
licensed farm winery shall purchase all other spirituous liquor for sale at the
on-sale retail premises from wholesalers that are licensed in this state,
except that a licensed farm winery may:
(a) Purchase wine from other farm wineries pursuant
to paragraph 7 of this subsection.
(b) Make deliveries of the wine that the farm winery
produces to the farm winery's own commonly controlled retail licensed premises.
7. A licensed farm winery that produces not more
than twenty thousand gallons of wine in a calendar year may make sales and
deliveries of the wine that the licensed farm winery produces to on-sale and
off-sale retailers.
8. Notwithstanding section 4-244, paragraphs 3
and 7, an on-sale or off-sale retailer may purchase and accept delivery
of wine from a licensed farm winery pursuant to paragraph 7 of this subsection.
9. A licensed farm winery that produces not more
than twenty thousand gallons of wine in a calendar year may make sales and
deliveries of wine that the licensed farm winery produces to consumers off of
the licensed premises and that is ordered by telephone, mail, fax or catalogue,
through the internet or by other means if all of the following apply:
(a) The purchaser of the wine provided the licensed
farm winery with verification of the purchaser's legal age to purchase alcohol.
(b) The shipping container in which the wine is
shipped is marked to require the signature on delivery of an adult who is of
legal age to purchase alcohol and delivery confirmation.
(c) The wine is for personal use only and not for
resale.
(d) The wine is delivered by the licensed farm
winery or shipped by the licensed farm winery by a common carrier to a
residential or business address other than a premises licensed pursuant to this
title.
(e) The purchaser could have carried the wine
lawfully into or within this state.
(f) The delivery is made by a person who is at least
twenty-one years of age.
(g) The farm winery collects payment for the price
of the spirituous liquor not later than at the time of delivery.
10. A licensed farm winery may make sales and
deliveries as expressly permitted by sections 4-203.03, 4-203.04
and 4-244.04.
D. A person otherwise qualified to receive a farm
winery license may enter into a custom crush arrangement where a licensed
winery produces
or manufactures
wine from grapes or other
fruit supplied by the person. The winery receiving the fruit shall be licensed
by the United States alcohol and tobacco tax and trade bureau and the
department and is responsible for filing all reports that relate to its wine production
or manufacturing
with the United States alcohol and
tobacco tax and trade bureau and the department. Each person
supplying the grapes or other fruit shall first apply for and receive a farm
winery license and shall report to the department all volumes of wine from its
custom crush arrangements, which shall not be allocated to the gallonage of the
receiving farm winery if the supplying farm winery has an active basic permit
issued by the United States alcohol and tobacco tax and trade bureau.
E. On application by a farm winery licensee, the
director may authorize a farm winery licensee to operate up to two remote
tasting and retail premises if:
1. The wine sold at the premises is limited to wine
produced
or manufactured
by the licensed farm winery and
wines produced
or manufactured
by other licensed farm
wineries, including wines produced
or manufactured
pursuant to subsection D of this section and section 4-243.03. The
farm winery may sell wine to a consumer physically present on the premises for
consumption on or off the premises. Sales of wines not produced
or manufactured
by the farm winery are limited to not more than
twenty percent of the total sales by volume at that location. The
percentage limitation shall not apply to wine produced pursuant to subsection D
of this section and section 4-243.03.
2. The farm winery licensee:
(a) Remains responsible for the premises.
(b) Obtains approval for the premises from the local
governing body before submitting an application to the department. A copy of an
order from the local governing body recommending approval of the premises must
be filed with the department as part of the application.
(c) Does not sublease the premises.
(d) Has an agent who is a natural person who meets
the qualifications of licensure in this state.
(e) Meets the qualifications for a license pursuant
to section 4-203, subsection A.
F. A farm winery licensee may hold a craft distiller
license issued pursuant to section 4-205.10. The farm winery
and craft distiller licensee is subject to all other requirements of this
section and section 4-205.10.� The farm winery may provide sampling and
sales of the distilled spirits pursuant to section 4-205.10, subsection
C, paragraphs 2 and 3 on the same premises as the wine sampling and retail
sales.
G. The farm winery is liable for any violation
committed in connection with any sale or delivery of the wine.� The rules
adopted by the director pursuant to section 4-203, subsection J apply to
the delivery of wine under subsection C, paragraph 9 of this
section. An act or omission of any person who makes a sale or
delivery of wine for a licensee under subsection C, paragraph 9 of this section
is deemed to be an act or omission of the licensee for the purposes of section
4-210, subsection A, paragraph 9.
H. A farm winery that sells or delivers wine
pursuant to this section shall:
1. Pay to the department of revenue all luxury taxes
imposed pursuant to title 42, chapter 3 and all transaction privilege or use
taxes imposed pursuant to title 42, chapter 5.
2. File all returns or reports required by law.
I. A delivery of wine by a farm winery to a
purchaser in this state is a transaction deemed to have occurred in this state.
J. The director shall adopt rules in order to
administer this section.
K. The director may charge an additional farm winery
license fee adopted pursuant to section 4-209 for issuing licenses,
authorizations or approvals pursuant to subsections D and E of this section.
L.
The farm winery licensee that
operates primarily as a remote tasting room premises may exchange the farm
winery license for a remote tasting room license without an additional fee, not
later than December 31, 2018. The new
a
remote
tasting room license must be connected to
a
the
farm winery license, with common ownership,
that
complies
and shall comply
with all requirements
for a farm winery license pursuant to subsections C and E of this section.
M. Production and storage space of the farm winery
is excluded from the licensed farm winery premises and is not the public area
unless that space is also used for the sale of wine to the public or
consumption of or sampling of wine by the public or to provide other services
to the public. Pursuant to section 4-118, the director, the director's
agents or any peace officer may inspect spaces excluded by this
subsection. For the purposes of this subsection, "public
area" means a place within a farm winery that is accessible to the public
and in which the farm winery authorizes the presence of members of the public.
END_STATUTE
Sec. 7. Section 4-205.08, Arizona Revised
Statutes, is amended to read:
START_STATUTE
4-205.08.
Microbrewery license; issuance; regulatory provisions; retail
site
A. The director may issue a microbrewery license to
any microbrewery. Each location that engages in producing
,
manufacturing
and bottling these products must obtain a separate
microbrewery license. The licensee may not transfer the microbrewery license
from person to person or from location to location.
B. An applicant for a microbrewery license, at the
time of filing the application for the license, shall accompany the application
with the license fee. Persons holding a microbrewery license shall
report annually at the end of each calendar year, at the time and in the manner
as the director prescribes, the amount of beer produced
or
manufactured
by them during the calendar year and the amount delivered
pursuant to subsection D, paragraph 4, subdivision (b) of this section.� If the
total amount of beer that is produced
or manufactured
during the calendar year exceeds the amount permitted annually by the license,
the licensee shall apply for and receive a producer's license only on surrender
of the microbrewery license or licenses and shall have no continuing rights as
a microbrewery under this section.� On the surrender of the microbrewery
license or licenses, the licensee shall transfer, surrender or otherwise
relinquish control of all of its retail licenses located remotely from a
microbrewery.
C. Notwithstanding any other law, a licensed
microbrewery may:
1. Sell beer produced
or manufactured
on the premises for consumption on or off the premises.
2. Make sales and deliveries of beer that the
microbrewery produces
or manufactures
to persons licensed
to sell beer under this title through wholesalers licensed under this title or
as provided in subsection D, paragraph 4, subdivision (a) or (b) of this
section.
3. Make sales and deliveries of beer that the
microbrewery produces
or manufactures
to persons licensed
to sell beer in another state if lawful under the laws of that state.
4. Serve beer produced
or manufactured
on the premises for the purpose of sampling the beer.
5. Sell beer produced
or manufactured
by other microbreweries for consumption only on the premises of the licensee,
except that the sales percentage of beer from other microbreweries may not
exceed twenty percent of the licensee's annual sales of beer by volume at the
premises. If the other microbrewery has established a distribution
relationship with one or more wholesalers who are licensed under this title,
the beer shall be purchased through those wholesalers.
6. Maintain at no charge a tapping equipment system
of a licensed retailer when the microbrewery sells beer as provided in
subsection D, paragraphs 3 and 4 of this section, including cleaning the
tapping equipment system and replacing bonnet washers, friction rings, valve
stems, hardware, unions, clamps, air tees, screws, tapping devices, tower heads
and single air and beer lines.
D. A licensed microbrewery is subject to all of the
following requirements:
1. The microbrewery shall produce
or
manufacture
not less than one thousand gallons of beer in each calendar
year following the first year of operation.
2. The microbrewery shall not produce
or
manufacture
more than six million two hundred thousand gallons of beer
in a calendar year.
3. If retail operations are conducted in conjunction
with the microbrewery, the microbrewery may sell other spirituous liquor
products if the microbrewery holds an on-sale retail license for a bar, beer
and wine bar or restaurant.� The microbrewery may be issued up to a combined
total of seven retail licenses in this state, whether the premises are located
on or adjacent to a microbrewery or remotely from a microbrewery. The limit on
the number of retail licenses applies on an aggregated basis to all microbreweries
that are under common control of any person with control of the microbrewery.
4. The microbrewery may make sales and deliveries of
beer that it has produced
or manufactured
to both:
(a) Retail licensees that meet the requirements
prescribed in paragraph 3 of this subsection in any amount.
(b) Any other retail licensee in a cumulative amount
not to exceed ninety-three thousand gallons in total for all licensed
retailers in any calendar year.
E. A microbrewery that produces
or
manufactures
more than one million two hundred forty thousand gallons of
beer in a calendar year maintains all of the rights associated with a
microbrewery license, except that the microbrewery shall not:
1. Apply for or receive a retail license pursuant to
subsection D, paragraph 3 of this section for premises that are located
remotely from the microbrewery.
2. Make sales or deliveries of beer that the
microbrewery has produced
or manufactured
to any retail
licensee as provided in subsection D, paragraph 4 of this section, except for
the microbrewery's retail licensees on or adjacent to the microbrewery.
F. The gallonage amounts prescribed in subsection D,
paragraph 2 and subsection E of this section apply to the aggregate
manufacture or
production of all microbreweries that are under
common control of any person with control of the microbrewery.
G. A microbrewery that is otherwise engaged as a
distiller, vintner, brewer, rectifier, blender or other producer of spirituous
liquor in any jurisdiction is prohibited from holding any retail license that
is located remotely from a microbrewery. This subsection does not
prohibit a person with control of more than one microbrewery from conducting
retail operations remotely from a microbrewery pursuant to subsection D,
paragraph 3 of this section.
H. A microbrewery that sells or delivers beer
pursuant to this section shall:
1. Pay to the department of revenue all luxury taxes
imposed pursuant to title 42, chapter 3 and all transaction privilege or use
taxes imposed pursuant to title 42, chapter 5.
2. File all returns or reports required by law.
I. A delivery of beer by a microbrewery to a
purchaser in this state is a transaction deemed to have occurred in this state.
J. The director shall adopt rules to administer this
section.
END_STATUTE
Sec. 8. Section 4-205.10, Arizona Revised
Statutes, is amended to read:
START_STATUTE
4-205.10.
Craft distiller license; issuance; regulatory provisions; fee
A. The director may issue a craft distiller license
to any person that meets the requirements of subsection C of this
section. Each location that engages in producing and bottling these
products must obtain a separate craft distiller license.� The licensee may not
transfer the craft distiller license from person to person or from location to
location and may not also hold a producer's license. The licensee
and all commonly controlled craft distiller licensees may not
manufacture
or
produce more than twenty thousand gallons of distilled spirits in a
calendar year. For the purposes of this section, annual gallonage
shall be the total proof gallons of finished distilled product available for
wholesale or retail sale as defined by 26 United States Code section 5002 and
rules adopted pursuant to this section or its successor.
B. Persons holding a craft distiller license shall
report annually at the end of each calendar year, at the time and in the manner
as the director prescribes, the amount of distilled spirits that is produced
or manufactured
by that licensee during the calendar
year. In addition to any other provision of this title, if the total
amount of distilled spirits that is produced
or manufactured
during the year exceeds the amount that is permitted annually by the license,
the licensee shall apply for and, on qualification, receive a producer's
license only on the surrender of the craft distiller license and shall have no
continuing rights as a craft distiller licensee under this section.
C. A person may be licensed as a craft distiller to
sell distilled spirits that are produced
or manufactured
by the person if in a calendar year the person produces or manufactures not
more than twenty thousand gallons of distilled spirits and may make sales and
deliveries of distilled spirits only as specified in this section and subject
to the following criteria:
1. A licensed craft distiller may make sales and
deliveries of distilled spirits to wholesalers that are licensed to sell
distilled spirits under this title.
2. A licensed craft distiller may serve distilled
spirits that are produced
or manufactured
on the premises
for the purpose of consumption on the premises and may charge for samples on
the premises of the craft distiller.
3. A licensed craft distiller may sell distilled
spirits that are produced
or manufactured
on the premises
in the original container for consumption off the premises to a consumer who is
physically present on the premises.
4. The licensed craft distiller may hold one license
prescribed in section 4-209, subsection B, paragraph 6 or 12 on or
adjacent to the licensed craft distiller premises. The licensed
craft distiller shall purchase all other spirituous liquor for sale at the
on-sale retail premises from wholesalers that are licensed in this state,
except that a licensed craft distiller may:
(a) Purchase distilled spirits from other craft
distillers that are licensed in this state.� Sales of craft distillery products
not produced
or manufactured
by the craft distiller shall
be limited to
no
not
more than
twenty percent of the total sales by volume.
(b) Make deliveries of the distilled spirits that
the craft distiller
manufactures or
produces to any
commonly controlled retail licensed premises or to the craft distiller's remote
tasting rooms and that are authorized pursuant to this paragraph.
5. A licensed craft distiller that produces not more
than three thousand five hundred sixty-six gallons of distilled spirits in a
calendar year may make sales and deliveries of distilled spirits that the
licensed craft distiller produces to on-sale and off-sale retailers.
6. Notwithstanding section 4-244, paragraphs 3
and 7, an on-sale or off-sale retailer may purchase and accept delivery of
distilled spirits from a licensed craft distiller pursuant to paragraph 5 of
this subsection.
7. A licensed craft distiller may make sales and
deliveries of distilled spirits that the licensed craft distiller
manufactures or
produces to consumers off of the licensed
premises if the sale or delivery is ordered by telephone, mail, fax, catalogue,
the internet or by other means if all of the following conditions exist:
(a) The purchaser of the distilled spirits provided
the licensed craft distiller with verification of the purchaser's legal age to
purchase alcohol and a copy of same is maintained in the records of the craft
distiller.
(b) The shipping container in which the distilled
spirits are shipped is marked to require the signature on delivery of an adult
who is of legal age to purchase alcohol and delivery confirmation.
(c) The distilled spirits are for personal use only
and not for resale.
(d) The distilled spirits are shipped to a
residential or business address other than a premises licensed pursuant to this
title.
(e) The purchaser could have carried the distilled
spirits lawfully into or within this state.
(f) A person who is at least twenty-one years of age
makes the delivery.
(g) The craft distiller collects payment for the
price of the spirituous liquor
no
not
later than at the time of delivery.
D. On application by a craft distiller licensee, the
director may authorize a craft distiller licensee to operate two other remote
tasting and retail premises if:
1. The distilled spirits sold at the premises are
limited to distilled spirits produced
or manufactured
by
the licensed craft distillery and distilled spirits produced
or
manufactured
by another licensed craft distillery. The craft
distillery may sell to a consumer physically present on the premises distilled
spirits produced by the craft distillery or by other licensed craft
distilleries in the original container for consumption on or off the
premises. The sales of the distilled spirits produced
or
manufactured
by other craft distilleries shall not exceed twenty percent
of the craft distillery's total sales by volume.
2. The craft distiller licensee:
(a) Remains responsible for the premises.
(b) Obtains approval for the premises from the local
governing body before submitting an application to the department. A
copy of an order from the local governing body recommending approval of the premises
must be filed with the department as part of the application.
(c) Does not sublease the premises.
(d) Has an agent who is a natural person who meets
the qualifications of licensure in this state.
(e) Meets the qualifications for a license pursuant
to section 4-203, subsection A.
(f) For a tasting room with a shared patio, meets
the requirements prescribed in section 4-205.12.
E. A craft distiller licensee may hold a farm winery
license issued pursuant to section 4-205.04. The craft
distiller licensee and farm winery licensee are subject to all other
requirements of this section and section 4-205.04. The craft
distiller may provide sampling and retail sales of distilled spirits pursuant
to subsection C, paragraphs 2 and 3 of this section on the same premises as the
wine sampling and retail sales.
F. The craft distiller is liable for any violation
that is committed in connection with any sale or delivery of the distilled
spirits. The rules adopted by the director pursuant to section 4-203,
subsection J apply to the delivery of distilled spirits under subsection C of
this section. An act or omission of any person who makes a sale or delivery of
distilled spirits for a licensee under subsection C of this section is deemed
to be an act or omission of the licensee for the purposes of section 4-210,
subsection A, paragraph 9.
G. A craft distiller
that sells or delivers distilled spirits pursuant to this section shall:
1. Pay to the
department of revenue all luxury taxes that are imposed pursuant to title 42,
chapter 3 and all transaction privilege or use taxes that are imposed pursuant
to title 42, chapter 5.
2. File all returns or reports that are required by
law.
H. A delivery of distilled spirits by a craft
distiller to a purchaser in this state is a transaction deemed to have occurred
in this state.
I. The production and storage space of the craft
distiller are excluded from the public area of the licensed craft distiller
premises. Pursuant to section 4-118, the director, the director's agents
or any peace officer may inspect spaces excluded by this
subsection. For the purposes of this subsection:
1. "Production and storage space" means a
bonded area, tax-paid storage area and area that provides no services to
the public.
2. "Public area" means a place within a
licensed and bonded craft distiller that is accessible to the public and in
which the craft distiller sells and samples tax-paid product and
authorizes the presence of members of the public.
J. The director may adopt rules in order to
administer this section.
K. The director may charge a fee adopted pursuant to
section 4-209 for the issuance of a license pursuant to this section.
L. The director may issue a craft distiller license
to be located on the same parcel of land as a farm winery licensed pursuant to
section 4-205.04.
END_STATUTE
Sec. 9. Section 4-209, Arizona Revised
Statutes, is amended to read:
START_STATUTE
4-209.
Fees for license, application, issuance, renewal and transfer;
late renewal penalty; seasonal operation; surcharges
A. A fee shall accompany an application for an
original license or transfer of a license, or in case of renewal, shall be paid
in advance. Every license expires annually, except that a license may be
renewed for a two-year period pursuant to subsection M of this section if
no compliance penalties have been issued to that location during the year
before the renewal. A licensee who fails to renew the license on or
before the due date shall pay a penalty of $150, which the licensee shall pay
with the renewal fee. A license renewal that is deposited, properly
addressed and postage prepaid in an official depository of the United States
mail on or before the due date shall be deemed filed and received by the
department on the date shown by the postmark or other official mark of the
United States postal service stamped on the envelope.� If the due date falls on
a Saturday, Sunday or other legal holiday, the renewal shall be considered
timely if it is received by the department on the next business day. The
director may waive a late renewal penalty if good cause is shown by the
licensee.� A licensee who fails to renew the license on or before the due date
may not sell, purchase or otherwise deal in spirituous liquor until the license
is renewed. A license that is not renewed within sixty days after
the due date is deemed terminated. The director may renew the
terminated license if good cause is shown by the licensee. Except an
application fee for a permit pursuant to section 4-203.07 and section 4-205.02,
subsection K and leases pursuant to
sections 4-203.06 and
section
4-203.07, an application fee for an
original license or the transfer of a license shall be $100, which shall be
retained by this state.
B. Issuance fees for original licenses shall be:
1. For an in-state producer's license to
manufacture or
produce spirituous liquor in this state, $1,500.
2. Except as provided in paragraph 15 of this
subsection, for an out-of-state producer's, exporter's, importer's
or rectifier's license, $200.
3. For a microbrewery license, $300.
4. For a wholesaler's license to sell spirituous
liquors, $1,500.
5. For a government license issued in the name of a
state agency, state commission, state board, county, city, town, community
college or state university or the national guard, $100.
6. For a bar license, which is an on-sale retailer's
license to sell all spirituous liquors primarily by individual portions and in
the original containers, $1,500.
7. For a beer and wine bar license, which is an on-sale
retailer's license to sell beer and wine primarily by individual portions and
in the original containers, $1,500.
8. For a conveyance license issued to an operating
railroad company, to sell all spirituous liquors in individual portions or in
the original containers on all passenger trains operated by the railroad
company, or to an operating airline company, to sell or serve spirituous
liquors solely in individual portions on all passenger planes operated by the
airline company, or to a boat operating in the waters of this state, to sell
all spirituous liquors in individual portions or in the original containers for
consumption on the boat, $1,500.
9. For a liquor store license, which is an off-sale
retailer's license to sell all spirituous liquors, $1,500.
10. For a beer and wine store license, which is an
off-sale retailer's license to sell beer and wine, $1,500.
11. For a hotel-motel license issued as such,
to sell and serve spirituous liquors solely for consumption on the licensed
premises of the hotel or motel, $1,500.
12. For a restaurant license issued as such, to sell
and serve spirituous liquors solely for consumption on the licensed premises of
the restaurant, $1,500. For a permit issued under section 4-205.02,
subsection H allowing for the sale of beer for the consumption off the licensed
premises pursuant to section 4-244, paragraph 32, subdivision (c), the
director may charge a fee. For an application for a permit pursuant
to section 4-203.07 and section 4-205.02, subsection K, the
director may charge a fee.� The director may establish and charge fees for
lease applications pursuant to
sections 4-203.06 and
section
4-203.07.
13. For a farm winery license, $100. The
director may charge a licensed farm winery a fee pursuant to section 4-205.04,
subsection K.
14. For a club license issued in the name of a bona
fide club qualified under this title to sell all spirituous liquors on-sale,
$1,000.
15. For an out-of-state winery that
sells not more than two hundred forty gallons of wine in this state in a
calendar year, $25.
16. The department may charge a fee for a craft
distiller license.
17. The department may charge a fee for registering
an alcohol delivery contractor pursuant to section 4-205.13.
C. The department may issue licenses with staggered
renewal dates to distribute the renewal workload as uniformly as practicable
throughout the twelve months of the calendar year.� If a license is issued less
than six months before the scheduled renewal date of the license, as provided
by the department's staggered license renewal system, one-half of the
annual license fee shall be charged.
D. The annual fees for licenses shall be:
1. For an in-state producer's license to
manufacture or
produce spirituous liquors in this state, $350.
2. Except as provided in paragraph 15 of this
subsection, for an out-of-state producer's, exporter's, importer's
or rectifier's license, $50.
3. For a microbrewery license, $300.
4. For a wholesaler's license, to sell spirituous
liquors, $250.
5. For a government license issued to a county, city
or town, community college or state university or the national guard, $100.
6. For a bar license, which is an on-sale
retailer's license to sell all spirituous liquors primarily by individual
portions and in the original containers, $150.
7. For a beer and wine bar license, which is an on-sale
retailer's license to sell beer and wine primarily by individual portions and
in the original containers, $75.
8. For a conveyance license issued to an operating
railroad company, to sell all spirituous liquors in individual portions or in
the original containers on all passenger trains operated by the railroad
company, or to an operating airline company, to sell or serve spirituous
liquors solely in individual portions on all passenger planes operated by the
airline company, or to a boat operating in the waters of this state, to sell
all spirituous liquor in individual portions or in the original containers for
consumption on the boat, $225.
9. For a liquor store license, which is an off-sale
retailer's license to sell all spirituous liquors, $50.
10. For a beer and wine store license, which is an
off-sale retailer's license to sell beer and wine, $50.
11. For a hotel-motel license issued as such,
to sell and serve spirituous liquors solely for consumption on the licensed
premises of the hotel or motel, $500.
12. For a restaurant license issued as such, to sell
and serve spirituous liquors solely for consumption on the licensed premises of
the restaurant, $500, and for a restaurant license that is allowed to continue
operating as a restaurant pursuant to section 4-213, subsection E, an
additional amount established by the director. The department shall
transfer this amount to the state treasurer for deposit in the state general
fund. The director may establish an annual fee for a permit pursuant
to section 4-203.07 and section 4-205.02, subsection
K. The director may charge annual lease amounts pursuant to
sections 4-203.06 and
section
4-203.07.
13. For a farm winery license, $100. The
director may charge a licensed farm winery an annual fee pursuant to section 4-205.04,
subsection K.
14. For a club license issued in the name of a bona
fide club qualified under this title to sell all spirituous liquors on-sale,
$150.
15. For an out-of-state winery that
sells not more than two hundred forty gallons of wine in this state in a
calendar year, $25.
16. The director may charge a fee for the annual
renewal of a craft distiller license.
17. The department may charge a fee for the annual
registration renewal of a registered alcohol delivery contractor pursuant to
section 4-205.13.
E. Where the business of an on-sale retail
licensee is seasonal, not extending over periods of more than six months in any
calendar year, the licensee may designate the periods of operation and a
license may be granted for those periods only, on payment of one-half of
the fee prescribed in subsection D of this section.
F. Transfer fees from person to person for licenses
transferred pursuant to section 4-203, subsection C shall be $300.
G. Transfer fees from location to location, as
provided for in section 4-203, shall be $100.
H. Assignment fees for a change of agent, as
provided for in section 4-202, subsection A, an acquisition of control,
as provided for in section 4-203, subsection F, or a restructuring, as
provided for in section 4-203, subsection H, shall be $100, except that
where a licensee holds multiple licenses and requests multiple, simultaneous
changes, the change of agent, acquisition of control or restructuring fee for
the first license shall be $100 and the fee for all remaining licenses shall be
$50 each, except that the aggregate fees shall not exceed $1,000 for all change
of agents, $1,000 for all acquisitions of control and $1,000 for all
restructurings.
I. No fee shall be charged by the department for an
assignment of a liquor license in probate or an assignment pursuant to the
provisions of a will or pursuant to a judicial decree in a domestic relations
proceeding that assigns ownership of a business that includes a spirituous
liquor license to one of the parties in the proceeding. In the case
of nontransferable licenses, no fee shall be charged by the department for the
issuance of a license for a licensed business pursuant to a transfer of the
business in probate or pursuant to the provisions of a will or pursuant to a
judicial decree in a domestic relations proceeding that assigns ownership of
the business to one of the parties in the proceeding.
J. The director shall assess a surcharge of $30 on
all licenses prescribed in subsection D, paragraphs 6, 7 and 12 of this
section.� Monies from the surcharge shall be used by the department exclusively
for the costs of an auditor and support staff to review compliance by
applicants and licensees with the requirements of section 4-205.02,
subsection E. The department shall assess the surcharge as part of
the annual license renewal fee.
K. The director shall assess a surcharge of $35 on
all licenses prescribed in this section. Monies from the surcharge
shall be used by the department exclusively for the costs of an enforcement
program to investigate licensees who have been the subject of multiple
complaints to the department. The enforcement program shall respond
to complaints against licensees by neighborhood associations, by neighborhood
civic groups and from municipal and county governments. The
department shall assess the surcharge as part of the annual license renewal
fee.
L. The director shall assess a surcharge of $20 on
all licenses prescribed in subsection D, paragraphs 11 and 12 of this section
and $35 on all other licenses prescribed in this section. Monies
from the surcharge and from surcharges imposed pursuant to subsection K of this
section shall be used by the department exclusively for the costs of a
neighborhood association interaction and liquor enforcement management
unit. The unit shall respond to complaints from neighborhood
associations, neighborhood civic groups and local governing authorities
regarding liquor violations. The director shall report the unit's
activities and the use of monies from the surcharge or surcharges imposed
pursuant to subsection K of this section to the board at each board meeting or
as the board may direct.
M. Licenses may be renewed every two years with
payment of license fees that are twice the amount designated in subsection D of
this section and other applicable fees.� Licensees renewing every two years
must comply with annual reporting requirements. The director may
adopt reasonable rules to allow licensees to renew every two years.
N. The department shall use all monies received from
application fees for permits issued pursuant to section 4-205.02,
subsection K, leases pursuant to
sections 4-203.06 and
section
4-203.07 and registrations pursuant to
section 4-205.13 for administrative costs associated with the permit,
registration or lease and enforcement of this chapter.
END_STATUTE
Sec. 10. Section 4-212, Arizona Revised
Statutes, is amended to read:
START_STATUTE
4-212.
Injunctions
If the board or the director has reasonable grounds to believe
that a person is violating section 4-244.05 or 4-250.01 or is
manufacturing
producing
, selling or
dealing in spirituous liquor without a valid license, permit or registration in
violation of this title, the board or the director may apply to the superior
court for a temporary restraining order and other injunctive relief prohibiting
the specific acts complained of by the board or the director.
END_STATUTE
Sec. 11. Section 4-214, Arizona Revised
Statutes, is amended to read:
START_STATUTE
4-214.
Arizona wines; labeling
A.
A person licensed as
A farm
winery
licensed
pursuant to section 4-205.04 or
licensed as
a producer
licensed
pursuant
to section 4-203 may label a wine offered for sale that states that the wine is
any of the following:
1. An Arizona wine or a wine from a particular
county in this state, if at least seventy-five percent of the wine by volume is
produced
or manufactured
from grapes or other fruit grown
in this state and is fermented, processed, bottled and labeled in this state.
2. A wine from a particular federally recognized
viticultural area, if at least eighty-five percent of the wine by volume is
produced
or manufactured
from grapes or other fruit grown
within a federally recognized viticultural area that is located
in
this state and is fermented, processed, bottled and labeled in this state.
3. A wine from a particular vineyard, orchard, farm
or ranch, if at least ninety-five percent of the wine by volume is produced
or manufactured
from grapes or other fruit grown in this state
and is fermented, processed, bottled and labeled in this state.
4. Estate bottled, if one hundred percent of the
wine by volume is produced
or manufactured
from a winery
in a particular federally recognized viticultural area in which all grapes or
other fruit were grown, crushed, fermented, processed, aged and bottled in a
continuous process, the wine at no time having left the premises of the
bottling winery.
B. A licensee that complies with subsection A of
this section is not subject to criminal, civil or administrative action for a
violation of section 4-244, paragraph 39.
END_STATUTE
Sec. 12. Section 4-221, Arizona Revised
Statutes, is amended to read:
START_STATUTE
4-221.
Registration of stills; forfeiture; sale; proceeds
A. Every person having in
his
the person's
possession or custody or under
his
the person's
control a still or distilling apparatus
shall register it with the director under the rules the director may prescribe,
and every still or distilling apparatus not so registered, together with all
mash, wort or wash, for distillation or for the production of spirits or
alcohol, and all finished products, together with all personal property in the
possession or custody of, or under the control of any person,
which
that
may be used in the
manufacture
production
or transportation of spirituous liquors, and
which
that
is found in the building or in
any yard or enclosure connected with the building in which the unregistered
still or distilling apparatus is located, shall be forfeited to
the
this
state.
B. The still, distilling apparatus, mash, wort, wash
or finished products shall forthwith be destroyed by any peace officer, and all
personal property forfeited to the state shall be sold at public auction to the
highest bidder for cash on five days' notice.
C. The notice shall be posted at the courthouse in
the county in which the personal property was seized or at the office of the
director and shall be published in a newspaper of general circulation
that is
published in this state
which
and that
is nearest to the place where the personal property
was seized. After paying the expenses of the publication and the
expenses of sale from the proceeds of the sale, any balance shall be paid into
the
state
general fund
of the state
.
END_STATUTE
Sec. 13. Section 4-222, Arizona Revised
Statutes, is amended to read:
START_STATUTE
4-222.
Registration of retail agents; fees
A. Every person who holds a bar, beer and wine bar,
liquor store, beer and wine store, club, hotel-motel or restaurant
license and who is authorized by other similarly licensed retailers to act as
their retail agent shall register with the director. Such
registration shall be in accordance with the rules adopted by the director
pursuant to section 4-112 and shall also include a listing of the names
and business addresses of those similarly licensed retailers who have
authorized
him
the person
to act as
their retail agent. While possessing a certificate of registration,
a retail agent shall be entitled to purchase and shall accept delivery of
spirituous liquors for which
he
the retail
agent
is licensed for and on behalf of
himself
the retail agent
and those similarly licensed retailers who
have authorized
him
the
retail agent
to act as their retail agent with the delivery to
be made at the retail agent's licensed premises or other location authorized by
the department. On the termination of such authorization by any
retailer, the retail agent shall promptly notify the director.
Nothing in
This section
shall
does not
require a wholesaler to sell malt beverages to a
registered retail agent for distribution to other retailers.
B. A fee of
five dollars
$5
shall be collected for each registered retailer in this
state, and a fee of
fifty dollars
$50
for each registered agent for a distillery, winery, brewery, importer or broker
having its place of
manufacture
production
or
business outside of
the
this
state.
C. The director shall issue a certificate of
registration to each person so registered as provided in this section, and may,
for good cause shown, cancel any certificate of registration so issued.
END_STATUTE
Sec. 14. Section 4-223, Arizona Revised
Statutes, is amended to read:
START_STATUTE
4-223.
Authority of cities and towns to tax transactions involving
spirituous liquors; prohibitions
A. In addition to the taxes provided for in this
chapter, incorporated cities and towns
shall have the power to
may
levy a tax on the privilege of engaging or continuing in
the business of selling spirituous liquor at retail within their corporate
limits and
to
may
impose a permit
tax or fee, but this section
shall
does
not apply to wholesalers licensed under section 4-209.
B. This section
shall
does
not
be construed to
give to
incorporated cities and towns power to prohibit the
manufacture
production
, sale, distribution
,
and disposal of intoxicating liquors.
END_STATUTE
Sec. 15.
Repeal
Section 4-225, Arizona Revised
Statutes, is repealed.
Sec. 16. Section 4-226, Arizona Revised
Statutes, is amended to read:
START_STATUTE
4-226.
Exemptions
This title does not apply to the following:
1. Drugstores selling spirituous liquors only on
prescription.
2. Any confectionery candy containing less than five
percent by weight of alcohol.
3. Ethyl alcohol intended for use or used for the
following purposes:
(a) Scientific, chemical, mechanical, industrial and
medicinal purposes. For the purposes of this
paragraph
subdivision
, medicinal purposes do not include ethyl alcohol
or spirituous liquor that contains marijuana or usable marijuana as defined in
section 36-2801.
(b) By those authorized to procure spirituous liquor
or ethyl alcohol tax-free, as provided by the acts of Congress and
regulations promulgated under the acts of Congress.
(c) In the manufacture of denatured alcohol produced
and used as provided by the acts of Congress and regulations promulgated under
the acts of Congress.
(d) In the manufacture of patented, patent,
proprietary, medicinal, pharmaceutical, antiseptic, toilet, scientific,
chemical, mechanical and industrial preparations or products, unfit and not
used for beverage purposes.
(e) In the manufacture of flavoring extracts and
syrups unfit for beverage purposes.
4. The purchase, storage, distribution, service or
consumption of wine in connection with the bona fide practice of a religious
belief or as an integral part of a religious exercise by a church recognized by
the United States internal revenue service under section 501(c)(3) of the
internal revenue code and in a manner not dangerous to public health or
safety. This exemption does not apply to any alleged violation of
section 4-244, paragraph 9, 34, 35 or 41.
5. Beer or wine produced for personal or family use
that is not for sale.� The beer or wine may be removed from the premises where
it was made and exhibited at organized affairs, exhibitions or competitions
,
such as homebrewers' or home winemakers' contests, tasting or
judging.
6. The manufacture or sale of bitters products that
have been classified and approved as a nonbeverage product or unfit for
beverage purposes by the United States alcohol and tobacco tax and trade
bureau. This paragraph is consistent with the classification guidelines as
established and administered by the United States alcohol and tobacco tax and
trade bureau.
7. nonbeverage products as defined in
27 code of federal regulations part 17 and that are qualified by the United
States alcohol and tobacco tax and trade bureau as nonbeverage products.
END_STATUTE
Sec. 17. Section 4-244, Arizona Revised
Statutes, is amended to read:
START_STATUTE
4-244.
Unlawful acts; definition
It is unlawful:
1. For a person to buy for resale, sell or deal in
spirituous liquors in this state without first having procured a license duly
issued by the board, except that the director may issue a temporary permit of
any series pursuant to section 4-205.05 to a trustee in bankruptcy to
acquire and dispose of the spirituous liquor of a debtor.
2. For a person to sell or deal in alcohol for
beverage purposes without first complying with this title.
3. For a distiller, vintner, brewer or wholesaler
knowingly to sell, dispose of or give spirituous liquor to any person other
than a licensee except in sampling wares as may be necessary in the ordinary
course of business, except in donating spirituous liquor to a nonprofit
organization that has obtained a special event license for the purpose of
charitable fundraising activities or except in donating spirituous liquor with
a cost to the distiller, brewer or wholesaler of up to $500 in a calendar year
to an organization that is exempt from federal income taxes under section
501(c) (3), (4), (6) or (7) of the internal revenue code and not licensed under
this title.
4. For a distiller, vintner or brewer to require a
wholesaler to offer or grant a discount to a retailer, unless the discount has
also been offered and granted to the wholesaler by the distiller, vintner or
brewer.
5. For a distiller, vintner or brewer to use a
vehicle for trucking or transporting spirituous liquors unless there is affixed
to both sides of the vehicle a sign showing the name and address of the
licensee and the type and number of the person's license in letters not less
than three and one-half inches in height.
6. For a person to take or solicit orders for
spirituous liquors unless the person is a salesman or solicitor of a licensed
wholesaler, a salesman or solicitor of a distiller, brewer, vintner, importer
or broker or a registered retail agent.
7. For any retail licensee to purchase spirituous
liquors from any person other than a solicitor or salesman of a wholesaler
licensed in this state.
8. For a retailer to acquire an interest in property
owned, occupied or used by a wholesaler in the wholesaler's business, or in a
license with respect to the premises of the wholesaler.
9. Except as provided in paragraphs 10 and 11 of
this section, for a licensee or other person to sell, furnish, dispose of or
give, or cause to be sold, furnished, disposed of or given, to a person under
the legal drinking age
or for a
person under the legal drinking age to buy, receive, have in the person's
possession or consume spirituous liquor. This paragraph does not
prohibit the employment by an off-sale retailer of persons who are at
least sixteen years of age to check out, if supervised by a person on the
premises who is at least eighteen years of age, package or carry merchandise,
including spirituous liquor, in unbroken packages, for the convenience of the
customer of the employer, if the employer sells primarily merchandise other
than spirituous liquor.
10. For a licensee to employ a person under eighteen
years of age to
manufacture,
sell or dispose of spirituous
liquors. This paragraph does not prohibit the employment by an off-sale
retailer of persons who are at least sixteen years of age to check out, if
supervised by a person on the premises who is at least eighteen years of age,
package or carry merchandise, including spirituous liquor, in unbroken
packages, for the convenience of the customer of the employer, if the employer
sells primarily merchandise other than spirituous liquor.
11. For an on-sale retailer to employ a person
under eighteen years of age in any capacity connected with the handling of
spirituous liquors. This paragraph does not prohibit the employment by an on-sale
retailer of a person under eighteen years of age who cleans up the tables on
the premises for reuse, removes dirty dishes, keeps a ready supply of needed
items and helps clean up the premises.
12. For a licensee, when engaged in waiting on or
serving customers, to consume spirituous liquor or for a licensee or on-duty
employee to be on or about the licensed premises while in an intoxicated or
disorderly condition.
13. For an employee of a retail licensee, during
that employee's working hours or in connection with such employment, to give to
or purchase for any other person, accept a gift of, purchase for the employee
or consume spirituous liquor, except that:
(a) An employee of a licensee, during that
employee's working hours or in connection with the employment, while the
employee is not engaged in waiting on or serving customers, may give spirituous
liquor to or purchase spirituous liquor for any other person.
(b) An employee of an on-sale retail licensee,
during that employee's working hours or in connection with the employment,
while the employee is not engaged in waiting on or serving customers, may taste
samples of beer or wine of not more than four ounces per day or distilled spirits
of not more than two ounces per day provided by an employee of a wholesaler or
distributor who is present at the time of the sampling.
(c) An employee of an on-sale retail licensee,
under the supervision of a manager as part of the employee's training and
education, while not engaged in waiting on or serving customers may taste
samples of distilled spirits of not more than two ounces per educational
session or beer or wine of not more than four ounces per educational session,
and provided that a licensee does not have more than two educational sessions
in any thirty-day period.
(d) An unpaid volunteer who is a bona fide member of
a club and who is not engaged in waiting on or serving spirituous liquor to
customers may purchase for himself and consume spirituous liquor while
participating in a scheduled event at the club. An unpaid
participant in a food competition may purchase for himself and consume
spirituous liquor while participating in the food competition.
(e) An unpaid volunteer of a special event licensee
under section 4-203.02 may purchase and consume spirituous liquor while
not engaged in waiting on or serving spirituous liquor to customers at the
special event. This subdivision does not apply to an unpaid volunteer whose
responsibilities include verification of a person's legal drinking age,
security or the operation of any vehicle or heavy machinery.
(f) A representative of a producer or wholesaler
participating at a special event under section 4-203.02 may consume small
amounts of the products of the producer or wholesaler on the premises of the
special event for the purpose of quality control.
14. For a licensee or other person to serve, sell or
furnish spirituous liquor to a disorderly or obviously intoxicated person, or
for a licensee or employee of the licensee to allow a disorderly or obviously
intoxicated person to come into or remain on or about the premises, except that
a licensee or an employee of the licensee may allow an obviously intoxicated
person to remain on the premises for not more than thirty minutes after the
state of obvious intoxication is known or should be known to the licensee for a
nonintoxicated person to transport the obviously intoxicated person from the
premises. For the purposes of this section, "obviously
intoxicated" means inebriated to the extent that a person's physical
faculties are substantially impaired and the impairment is shown by
significantly uncoordinated physical action or significant physical dysfunction
that would have been obvious to a reasonable person.
15. For an on-sale or off-sale retailer
or an employee of such retailer or an alcohol delivery contractor to sell,
dispose of, deliver or give spirituous liquor to a person between the hours of
2:00 a.m. and 6:00 a.m., except that:
(a) A retailer with off-sale privileges may
receive and process orders, accept payment or package, load or otherwise
prepare spirituous liquor for delivery at any time, if the actual deliveries to
customers are made between the hours of 6:00 a.m. and 2:00 a.m., at which time
section 4-241, subsections A and K apply.
(b) The governor, in consultation with the
governor's office of highway safety and the public safety community in this
state, may issue an executive order that extends the closing time until 3:00
a.m. for spirituous liquor sales in connection with a professional or
collegiate national sporting championship event held in this state.
16. For a licensee or employee to knowingly allow
any person on or about the licensed premises to give or furnish any spirituous
liquor to any person under twenty-one years of age or knowingly allow any
person under twenty-one years of age to have in the person's possession
spirituous liquor on the licensed premises.
17. For an on-sale retailer or an employee of
such retailer to allow a person to consume or possess spirituous liquors on the
premises between the hours of 2:30 a.m. and 6:00 a.m., except that if the
governor extends the closing time for a day for spirituous liquor sales
pursuant to paragraph 15 of this section it is unlawful for an on-sale retailer
or an employee of such retailer on that day to allow a person to consume or
possess spirituous liquor on the premises between the hours of 3:30 a.m. and
6:00 a.m.
18. For an on-sale retailer to allow an
employee or for an employee to solicit or encourage others, directly or
indirectly, to buy the employee drinks or anything of value in the licensed
premises during the employee's working hours. An on-sale
retailer shall not serve employees or allow a patron of the establishment to
give spirituous liquor to, purchase liquor for or drink liquor with any
employee during the employee's working hours.
19. For an off-sale retailer or employee to
sell spirituous liquor except in the original unbroken container, to allow
spirituous liquor to be consumed on the premises or to knowingly allow
spirituous liquor to be consumed on adjacent property under the licensee's
exclusive control.
20. For a person to consume spirituous liquor in a
public place, thoroughfare or gathering. The license of a licensee
allowing a violation of this paragraph on the premises shall be subject to
revocation. This paragraph does not apply to the sale of spirituous
liquors on the premises of and by an on-sale retailer. This
paragraph also does not apply to a person consuming beer or wine from a broken
package in a public recreation area or on private property with permission of
the owner or lessor or on the walkways surrounding such private property or to
a person consuming beer or wine from a broken package in a public recreation
area as part of a special event or festival that is conducted under a license
secured pursuant to section 4-203.02 or 4-203.03.
21. For a person to possess or to transport
spirituous liquor that is
manufactured
produced
in a distillery, winery, brewery or rectifying plant contrary to the
laws of the United States and this state. Any property used in
transporting such spirituous liquor shall be forfeited to the state and shall
be seized and disposed of as provided in section 4-221.
22. For an on-sale retailer or employee to
allow a person under the legal drinking age to remain in an area on the
licensed premises during those hours in which its primary use is the sale,
dispensing or consumption of alcoholic beverages after the licensee, or the licensee's
employees, know or should have known that the person is under the legal
drinking age. An on-sale retailer may designate an area of the
licensed premises as an area in which spirituous liquor will not be sold or
consumed for the purpose of allowing underage persons on the premises if the
designated area is separated by a physical barrier and at no time will underage
persons have access to the area in which spirituous liquor is sold or
consumed. A licensee or an employee of a licensee may require a
person who intends to enter a licensed premises or a portion of a licensed
premises where persons under the legal drinking age are prohibited under this
section to exhibit an instrument of identification that is acceptable under
section 4-241 as a condition of entry or may use a biometric identity
verification device to determine the person's age as a condition of
entry. The director, or a municipality, may adopt rules to regulate
the presence of underage persons on licensed premises provided the rules
adopted by a municipality are more stringent than those adopted by the
director. The rules adopted by the municipality shall be adopted by
local ordinance and shall not interfere with the licensee's ability to comply
with this paragraph. This paragraph does not apply:
(a) If the person under the legal drinking age is
accompanied by a spouse, parent, grandparent or legal guardian of legal
drinking age or is an on-duty employee of the licensee.
(b) If the owner, lessee or occupant of the premises
is a club as defined in section 4-101, paragraph
8
9
, subdivision (a) and the person under the legal
drinking age is any of the following:
(i) An active duty military service member.
(ii) A veteran.
(iii) A member of the United States army national
guard or the United States air national guard.
(iv) A member of the United States military reserve
forces.
(c) To the area of the premises used primarily for
serving food during the hours when food is served.
23. For an on-sale retailer or employee to
conduct drinking contests, to sell or deliver to a person an unlimited number
of spirituous liquor beverages during any set period of time for a fixed price,
to deliver more than fifty ounces of beer, one liter of wine or four ounces of
distilled spirits in any spirituous liquor drink to one person at one time for
that person's consumption or to advertise any practice prohibited by this
paragraph. This paragraph does not prohibit an on-sale
retailer or employee from selling and delivering an opened, original container
of distilled spirits if:
(a) Service or pouring of the spirituous liquor is
provided by an employee of the on-sale retailer. A licensee
shall not be charged for a violation of this paragraph if a customer, without
the knowledge of the retailer, removes or tampers with a locking device on a
bottle delivered to the customer for bottle service and the customer pours the
customer's own drink from the bottle, if when the licensee becomes aware of the
removal or tampering of the locking device the licensee immediately installs a
functioning locking device on the bottle or removes the bottle and lock from
bottle service.
(b) The employee of the on-sale retailer
monitors consumption to ensure compliance with this
paragraph. Locking devices may be used, but are not required.
24. For a licensee or employee to knowingly allow
the unlawful possession, use, sale or offer for sale of narcotics, dangerous
drugs or marijuana on the premises. For the purposes of this
paragraph, "dangerous drug" has the same meaning prescribed in
section 13-3401.
25. For a licensee or employee to knowingly allow
prostitution or the solicitation of prostitution on the premises.
26. For a licensee or employee to knowingly allow
unlawful gambling on the premises.
27. For a licensee or employee to knowingly allow
trafficking or attempted trafficking in stolen property on the premises.
28. For a licensee or employee to fail or refuse to
make the premises or records available for inspection and examination as
provided in this title or to comply with a lawful subpoena issued under this
title.
29. For any person other than a peace officer while
on duty or off duty or a member of a sheriff's volunteer posse while on duty
who has received firearms training that is approved by the Arizona peace
officer standards and training board, a retired peace officer as defined in
section 38-1113 or an honorably retired law enforcement officer who has
been issued a certificate of firearms proficiency pursuant to section 13-3112,
subsection T, the licensee or an employee of the licensee acting with the
permission of the licensee to be in possession of a firearm while on the
licensed premises of an on-sale retailer. This paragraph does
not include a situation in which a person is on licensed premises for a limited
time in order to seek emergency aid and such person does not buy, receive,
consume or possess spirituous liquor. This paragraph does not apply to:
(a) Hotel or motel guest room accommodations.
(b) Exhibiting or displaying a firearm in
conjunction with a meeting, show, class or similar event.
(c) A person with a permit issued pursuant to
section 13-3112 who carries a concealed handgun on the licensed premises
of any on-sale retailer that has not posted a notice pursuant to section
4-229.
30. For a licensee or employee to knowingly allow a
person in possession of a firearm other than a peace officer while on duty or
off duty or a member of a sheriff's volunteer posse while on duty who has
received firearms training that is approved by the Arizona peace officer
standards and training board, a retired peace officer as defined in section 38-1113
or an honorably retired law enforcement officer who has been issued a
certificate of firearms proficiency pursuant to section 13-3112,
subsection T, the licensee or an employee of the licensee acting with the
permission of the licensee to remain on the licensed premises or to serve, sell
or furnish spirituous liquor to a person in possession of a firearm while on
the licensed premises of an on-sale retailer. It is a defense
to action under this paragraph if the licensee or employee requested assistance
of a peace officer to remove such person. This paragraph does not
apply to:
(a) Hotel or motel guest room accommodations.
(b) Exhibiting or displaying a firearm in
conjunction with a meeting, show, class or similar event.
(c) A person with a permit issued pursuant to
section 13-3112 who carries a concealed handgun on the licensed premises
of any on-sale retailer that has not posted a notice pursuant to section
4-229.
31. For any person in possession of a firearm while
on the licensed premises of an on-sale retailer to consume spirituous
liquor. This paragraph does not prohibit the consumption of small
amounts of spirituous liquor by an undercover peace officer on assignment to
investigate the licensed establishment.
32. For a licensee or employee to knowingly allow
spirituous liquor to be removed from the licensed premises, except in the
original unbroken package. This paragraph does not apply to any of
the following:
(a) A person who removes a bottle of wine that has
been partially consumed in conjunction with a purchased meal from licensed premises
if a cork is inserted flush with the top of the bottle or the bottle is
otherwise securely closed.
(b) A person who is in licensed premises that have
noncontiguous portions that are separated by a public or private walkway or
driveway and who takes spirituous liquor from one portion of the licensed
premises across the public or private walkway or driveway directly to the other
portion of the licensed premises.
(c) A licensee of a bar, beer and wine bar, liquor
store, beer and wine store, microbrewery or restaurant that has a permit
pursuant to section 4-205.02, subsection H that dispenses beer only in a
clean container composed of a material approved by a national sanitation
organization with a maximum capacity that does not exceed one gallon and not
for consumption on the premises if:
(i) The licensee or the licensee's employee fills
the container at the tap at the time of sale.
(ii) The container is sealed and displays a
government warning label.
(d) A bar or liquor store licensee that prepares a
mixed cocktail or a restaurant licensee that
leases the privilege
to sell mixed cocktails for consumption off the licensed premises pursuant to
section 4-203.06 or
holds a permit pursuant to section 4-203.07
and section 4-205.02, subsection K and that prepares a mixed cocktail and
transfers it to a clean container composed of a material approved by a national
sanitation organization with a maximum capacity that does not exceed thirty-two
ounces and not for consumption on the premises if all of the following apply:
(i) The licensee or licensee's employee fills the
container with the mixed cocktail on the licensed premises of the bar, liquor
store or restaurant.
(ii) The container is tamperproof sealed by the
licensee or the licensee's employee and displays a government warning label.
(iii) The container clearly displays the bar's,
liquor store's or restaurant's logo or name.
(iv) For a restaurant licensee licensed pursuant to
section 4-205.02, the sale of mixed cocktails for consumption off the
licensed premises is accompanied by the sale of menu food items for consumption
on or off the licensed premises.
33. For a person who is obviously intoxicated to buy
or attempt to buy spirituous liquor from a licensee or employee of a licensee
or to consume spirituous liquor on licensed premises.
34. For a person who is under twenty-one years
of age to drive or be in physical control of a motor vehicle while there is any
spirituous liquor in the person's body.
35. For a person who is under twenty-one years of
age to operate or be in physical control of a motorized watercraft that is
underway while there is any spirituous liquor in the person's
body. For the purposes of this paragraph, "underway" has
the same meaning prescribed in section 5-301.
36. For a licensee, manager, employee or controlling
person to purposely induce a voter, by means of alcohol, to vote or abstain
from voting for or against a particular candidate or issue on an election day.
37. For a licensee to fail to report an occurrence
of an act of violence to either the department or a law enforcement agency.
38. For a licensee to use a vending machine for the
purpose of dispensing spirituous liquor.
39. For a licensee to offer for sale a wine carrying
a label including a reference to Arizona or any Arizona city, town or
geographic location unless at least seventy-five percent by volume of the
grapes used in making the wine were grown in Arizona.
40. For a retailer to knowingly allow a customer to
bring spirituous liquor onto the licensed premises, except that an on-sale
retailer may allow a wine and food club to bring wine onto the premises for
consumption by the club's members and guests of the club's members in
conjunction with meals purchased at a meeting of the club that is conducted on
the premises and that at least seven members attend. An on-sale
retailer that allows wine and food clubs to bring wine onto its premises under
this paragraph shall comply with all applicable provisions of this title and
any rules adopted pursuant to this title to the same extent as if the on-sale
retailer had sold the wine to the members of the club and their
guests. For the purposes of this paragraph, "wine and food
club" means an association that has more than twenty bona fide members
paying at least $6 per year in dues and that has been in existence for at least
one year.
41. For a person who is under twenty-one years
of age to have in the person's body any spirituous liquor. In a
prosecution for a violation of this paragraph:
(a) Pursuant to section 4-249, it is a defense
that the spirituous liquor was consumed in connection with the bona fide
practice of a religious belief or as an integral part of a religious exercise
and in a manner not dangerous to public health or safety.
(b) Pursuant to section 4-226, it is a defense
that the spirituous liquor was consumed for a bona fide medicinal purpose and
in a manner not dangerous to public health or safety.
42. For an employee
of a licensee to accept any gratuity, compensation, remuneration or
consideration of any kind to either:
(a) Allow a person
who is under twenty-one years of age to enter any portion of the premises
where that person is prohibited from entering pursuant to paragraph 22 of this
section.
(b) Sell, furnish, dispose of or give spirituous
liquor to a person who is under twenty-one years of age.
43. For a person to purchase, offer for sale or use
any device, machine or process that mixes spirituous liquor with pure oxygen or
another gas to produce a vaporized product for the purpose of consumption by
inhalation or to allow patrons to use any item for the consumption of vaporized
spirituous liquor.
44. For a retail licensee or an employee of a retail
licensee to sell spirituous liquor to a person if the retail licensee or
employee knows the person intends to resell the spirituous liquor.
45. Except as authorized by paragraph 32,
subdivision (c) of this section, for a person to reuse a bottle or other
container authorized for use by the laws of the United States or any agency of
the United States for the packaging of distilled spirits or for a person to
increase the original contents or a portion of the original contents remaining
in a liquor bottle or other authorized container by adding any substance.
46. For a direct shipment licensee, a farm winery
licensee or an employee of those licensees to sell, dispose of, deliver or give
spirituous liquor to an individual purchaser between the hours of
2:00 a.m. and 6:00 a.m., except that a direct shipment licensee or a
farm winery licensee may receive and process orders, accept payment, package,
load or otherwise prepare wine for delivery at any time without complying with
section 4-241, subsections A and K, if the actual deliveries to
individual purchasers are made between the hours of 6:00 a.m. and
2:00 a.m. and in accordance with section 4-203.04 for direct
shipment licensees and section 4-205.04 for farm winery licensees.
47. For a supplier to coerce or attempt to coerce a
wholesaler to accept delivery of beer or any other commodity that has not been
ordered by the wholesaler or for which the order was canceled. A
supplier may impose reasonable inventory requirements on a wholesaler if the
requirements are made in good faith and are generally applied to other
similarly situated wholesalers that have an agreement with the supplier.
END_STATUTE
Sec. 18. Section 42-3001, Arizona Revised
Statutes, is amended to read:
START_STATUTE
42-3001.
Definitions
In this chapter, unless the context otherwise requires:
1. "Affix" and "affixed" include
imprinting tax meter stamps on packages and individual containers as authorized
by the department.
2. "Beer" has the same
meaning prescribed in section 4-101.
2.
3.
"Brand
family" has the same meaning prescribed in section 44-7111.
3.
4.
"Cavendish"
means a tobacco product that is smoked from a pipe and that meets one of the
following criteria:
(a) Is described as cavendish, as containing
cavendish or as a cavendish blend on its packaging, labeling or promotional
materials.
(b) Appears to have been processed or manufactured
with an amount of flavorings and humectants that exceeds twenty percent of the
weight of the tobacco contained in the product.
(c) Appears to be blended with or contain a tobacco
product described in subdivision (b) of this paragraph.
4.
5.
"Cider"
means vinous liquor that is made from the normal alcoholic
fermentation of the juice of sound, ripe apples, pears or other pome fruit,
including flavored, sparkling and carbonated cider and cider made from
condensed apple, pear or other pome fruit must, and that contains more than
one-half of one percent of alcohol by volume but not more than seven percent of
alcohol by volume.
has the same meaning prescribed in
section 4-101.
5.
6.
"Cigar"
means any roll of tobacco wrapped in leaf tobacco or in any substance
containing tobacco other than any roll of tobacco that is a cigarette, as
defined in paragraph
6
7
,
subdivision (b) of this section.
6.
7.
"Cigarette" means either of the
following:
(a) Any roll of
tobacco wrapped in paper or any substance not containing tobacco.
(b) Any roll of tobacco wrapped in any substance
containing tobacco that, because of its appearance, the type of tobacco used in
the filler or its packaging and labeling, is likely to be offered to or
purchased by a consumer as a cigarette described in subdivision (a) of this
paragraph. This subdivision shall be interpreted consistently with the
classification guidelines established by the federal alcohol and tobacco tax
and trade bureau.
7.
8.
"Consumer"
means a person in this state that comes into possession of any luxury subject
to the tax imposed by this chapter and that, on coming into possession of the
luxury, is not a distributor intending to sell or distribute the luxury, a
retailer or a wholesaler.
8.
9.
"Craft
distiller"
means a distiller in the United States or in a
territory or possession of the United States that holds a license pursuant to
section 4-205.10.
has the same meaning prescribed
in section 4-101.
9.
10.
"Distributor"
means any person that manufactures, produces, ships, transports or imports into
this state or in any manner acquires or possesses for the purpose of making the
first sale of the following:
(a) Cigarettes without Arizona tax stamps affixed as
required by this article.
(b) Roll-your-own tobacco or other
tobacco products on which the taxes have not been paid as required by this
chapter.
10.
11.
"Farm
winery" has the same meaning prescribed in section 4-101.
11.
12.
"First
sale" means the initial sale or distribution in intrastate commerce or the
initial use or consumption of cigarettes, roll-your-own tobacco or other
tobacco products.
12.
13.
"Luxury"
means any article, object or device on which a tax is imposed under this
chapter.
13.
14.
"Malt
liquor"
:
means any liquid that
contains more than one-half of one percent alcohol by volume and that is
made by the process of fermentation and not distillation of hops or grains, but
not including:
(a) Liquids made by the process of
distillation of such substances.
(b) Medicines that are unsuitable for
beverage purposes.
(
a
) Means any
beverage that is obtained by the alcoholic fermentation, infusion or decoction
of barley malt, hops, rice, bran or other grain, glucose, sugar or molasses, or
any combination of them, and may include, as adjuncts in fermentation, honey,
fruit, fruit juice, fruit concentrate, herbs, spices and other food materials.
(
b
) Includes
beer that is aged in an empty wooden barrel previously used to contain wine or
distilled spirits and as such is not considered a dilution or mixture of any
other spirituous liquor.
14.
15.
"Master
settlement agreement" has the same meaning prescribed in section 44-7101.
15.
16.
"Microbrewery"
has the same meaning prescribed in section 4-101.
16.
17.
"Nonparticipating
manufacturer" has the same meaning prescribed in section 44-7111.
17.
18.
"Other
tobacco products" means tobacco products other than cigarettes and
roll-your-own tobacco.
18.
19.
"Participating
manufacturer" has the same meaning prescribed in section 44-7111.
19.
20.
"Person"
means any individual, firm, partnership, joint venture, association,
corporation, municipal corporation, estate, trust, club, society or other group
or combination acting as a unit, and the plural as well as the singular number.
20.
21.
"Place of business"
:
(
a
)
Means a building, facility site or location where
an order is received or where tobacco products are sold, distributed or
transferred.
Place of business
(
b
)
Does
not include a vehicle.
21.
22.
"Retailer"
means any person that comes into possession of any luxury subject to the taxes
imposed by this chapter for the purpose of selling it for consumption and not
for resale.
22.
23.
"Roll-your-own
tobacco" means any tobacco that, because of its appearance, type,
packaging or labeling, is suitable for use and likely to be offered to or
purchased by consumers as tobacco for making cigarettes. This
paragraph shall be interpreted consistently with the term as used in section 44-7101. This
paragraph shall be interpreted consistently with the classification guidelines
established by the federal alcohol and tobacco tax and trade bureau.
23.
24.
"Smoking
tobacco"
:
(
a
)
Means
any tobacco that, because of its appearance, type, packaging, labeling or
promotion, is suitable for use and likely to be offered to or purchased by
consumers as tobacco for making cigarettes or otherwise consumed by
burning.
Smoking tobacco
(
b
)
Includes
pipe tobacco and roll-your-own tobacco.
24.
25.
"Spirituous
liquor"
means any liquid that contains more than one-half
of one percent alcohol by volume, that is produced by distillation of any
fermented substance and that is used or prepared for use as a
beverage. Spirituous liquor does not include medicines that are
unsuitable for beverage purposes.
has the same meaning
prescribed in section 4-101.
25.
26.
"Tobacco
product manufacturer" has the same meaning prescribed in section 44-7101.
26.
27.
"Tobacco
products" means all luxuries included in section 42-3052, paragraphs
5 through 9.
27.
28.
"Vehicle"
means a device in, on or by which a person or property is or may be transported
or drawn on the roads of this state regardless of the means by which it is
propelled or whether it runs on a track.
28.
29.
"Vinous
liquor"
:
means any liquid that
contains more than one-half of one percent alcohol by volume and that is
made by the process of fermentation of grapes, berries, fruits, vegetables or
other substances.
(
a
) means the
product obtained by the fermentation of grapes, other agricultural products
that
CONTAIN natural or added sugar or cider or any such
alcoholic beverage fortified with grape brandy and that contains not more than
twenty-four percent of alcohol by volume.
(
b
) Does not
include:
(a)
(
i
)
Liquids in which hops or grains are used in the
process of fermentation.
(b)
(
ii
)
Liquids made by the process of distillation of
hops or grains.
(c)
(
iii
)
Medicines that are unsuitable for beverage
purposes.
(
iv
) cider as
defined in section 4-101.
29.
30.
"Wholesaler"
means a person that sells any spirituous, vinous or malt liquor taxed under
this chapter to retail dealers or for the purposes of resale only.
END_STATUTE
Sec. 19. Section 42-3352, Arizona Revised
Statutes, is amended to read:
START_STATUTE
42-3352.
Reports of distillers and producers
A. Every distiller or
manufacturer
producer
of distilled spirits and vinous and malt liquors
that sells any of those products to wholesalers within this state shall
maintain in its records a copy of the invoice of the sale, showing in detail:
1. The kind of liquor or beverage sold.
2. The quantities of each.
3. The size of the container and the weight of the
contents.
4. The alcoholic content if required by section 42-3052.
5. The name of the person, firm or corporation to
whom sold.
B. A distiller or
manufacturer
producer
shall make the invoices required to be kept pursuant
to subsection A of this section available to the department on request.
END_STATUTE
Sec. 20. Section 42-3355, Arizona Revised
Statutes, is amended to read:
START_STATUTE
42-3355.
Return and payment by farm wineries, producers, direct shipment
licensees, microbreweries and craft distillers
A. A farm winery selling vinous liquor at retail or
to a retail licensee pursuant to title 4, chapter 2 that is
manufactured
or
produced on the premises, a producer of vinous liquor that sells at
retail pursuant to section 4-243.02 or a direct shipment licensee that
sells pursuant to section 4-203.04 shall pay the tax under this chapter
on all such liquor sold at retail or to a retail licensee within this state and
add the amount of the tax to the sales price.
B. A microbrewery selling malt liquor at retail or
to a retail licensee pursuant to title 4, chapter 2 that is
manufactured
or
produced on the premises or a
manufacturer
producer
of beer that sells at retail pursuant to section 4-243.02
shall pay the tax under this chapter on all malt liquor sold at retail or to a
retail licensee within this state and add the amount of the tax to the sales
price.
C. A craft distiller selling spirituous liquor at
retail or to a retail licensee pursuant to title 4, chapter 2 that is
manufactured or
produced on the premises or a distiller of
spirituous liquor that sells at retail pursuant to section 4-243.02 shall
pay the tax under this chapter on all spirituous liquor sold at retail or to a
retail licensee within this state and add the amount of the tax to the sales
price.
D. The farm winery,
manufacturer
producer
, microbrewery, craft distiller or direct
shipment licensee shall pay the tax to the department annually on or before the
twentieth day of the first month of the year succeeding the year in which the
tax accrues.
E. On or before that
date, the farm winery,
manufacturer
producer
,
microbrewery, craft distiller or direct shipment licensee shall prepare a sworn
return for the year in which the tax accrues in the form prescribed by the
department, showing:
1. The amount of liquors or beer sold in this state
during the year in which the tax accrues.
2. The amount of tax for the period covered by the
return.
3. Any other information that the department deems
necessary for the proper administration of this chapter.
F. The farm winery,
manufacturer
producer
, microbrewery, craft distiller or direct
shipment licensee shall deliver the return, together with a remittance of the
amount of the tax due, to the department.
G. Any taxpayer that fails to pay the tax within ten
days after the date on which the payment becomes due is subject to and shall
pay a penalty determined under section 42-1125, plus interest at the rate
determined pursuant to section 42-1123 from the time the tax was due and
payable until paid.
H. For reporting periods beginning from and after
December 31, 2019, or when the department has established an electronic filing
program, whichever is later, each taxpayer shall file electronically any report
or return required under this chapter. The report or return is considered to be
filed and received by the department on the date of the electronic postmark
pursuant to section 42-1105.02.
END_STATUTE
Sec. 21.
Effective date
Sections 4-101, 4-201, 4-203,
4-205.02, 4-205.04, 4-205.08, 4-205.10, 4-209, 4-212,
4-214, 4-221, 4-222, 4-223, 4-226, 4-244,
42-3001, 42-3352 and 42-3355, Arizona Revised Statutes, as amended
by this act, are effective from and after December 31, 2026.