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SB3655 - 104th General Assembly

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104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
SB3655

Introduced 2/5/2026, by Sen. Kimberly A. Lightford

SYNOPSIS AS INTRODUCED:

235 ILCS 5/3-12

Amends the Liquor Control Act of 1934. Provides that the maximum fine
that may be levied against any licensee shall not exceed $20,000 per
violation (instead of the maximum fine that may be levied against any
licensee, for the period of the license, shall not exceed $20,000). Makes a
conforming change. Effective immediately.
LRB104 19974 RPS 33425 b

A BILL FOR

SB3655
LRB104 19974 RPS 33425 b
1

AN ACT concerning liquor.

2

Be it enacted by the People of the State of Illinois,
3
represented in the General Assembly:

4

Section 5.
The Liquor Control Act of 1934 is amended by
5
changing Section 3-12 as follows:

6

(235 ILCS 5/3-12)
7

(Text of Section before amendment by P.A. 104-451
)
8

Sec. 3-12.
Powers and duties of State Commission.
9

(a) The State Commission shall have the following powers,
10
functions, and duties:
11

(1) To receive applications and to issue licenses to
12

manufacturers, foreign importers, importing distributors,
13

distributors, non-resident dealers, on premise consumption
14

retailers, off premise sale retailers, special event
15

retailer licensees, special use permit licenses, auction
16

liquor licenses, brew pubs, caterer retailers,
17

non-beverage users, railroads, including owners and
18

lessees of sleeping, dining and cafe cars, airplanes,
19

boats, brokers, and wine maker's premises licensees in
20

accordance with the provisions of this Act, and to suspend
21

or revoke such licenses upon the State Commission's
22

determination, upon notice after hearing, that a licensee
23

has violated any provision of this Act or any rule or

SB3655
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LRB104 19974 RPS 33425 b
1

regulation issued pursuant thereto and in effect for 30
2

days prior to such violation. Except in the case of an
3

action taken pursuant to a violation of Section 6-3, 6-5,
4

or 6-9, any action by the State Commission to suspend or
5

revoke a licensee's license may be limited to the license
6

for the specific premises where the violation occurred. An
7

action for a violation of this Act shall be commenced by
8

the State Commission within 2 years after the date the
9

State Commission becomes aware of the violation.
10

In lieu of suspending or revoking a license, the
11

commission may impose a fine, upon the State Commission's
12

determination and notice after hearing, that a licensee
13

has violated any provision of this Act or any rule or
14

regulation issued pursuant thereto and in effect for 30
15

days prior to such violation.
16

For the purpose of this paragraph (1), when
17

determining multiple violations for the sale of alcohol to
18

a person under the age of 21, a second or subsequent
19

violation for the sale of alcohol to a person under the age
20

of 21 shall only be considered if it was committed within 5
21

years after the date when a prior violation for the sale of
22

alcohol to a person under the age of 21 was committed.
23

The fine imposed under this paragraph may not exceed
24

$500 for each violation.
Each day that the activity, which
25

gave rise to the original fine, continues is a separate
26

violation. The maximum fine that may be levied against any

SB3655
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LRB104 19974 RPS 33425 b
1

licensee
, for the period of the license,
shall not exceed
2

$20,000
per violation
. The maximum penalty that may be
3

imposed on a licensee for selling a bottle of alcoholic
4

liquor with a foreign object in it or serving from a bottle
5

of alcoholic liquor with a foreign object in it shall be
6

the destruction of that bottle of alcoholic liquor for the
7

first 10 bottles so sold or served from by the licensee.
8

For the eleventh bottle of alcoholic liquor and for each
9

third bottle thereafter sold or served from by the
10

licensee with a foreign object in it, the maximum penalty
11

that may be imposed on the licensee is the destruction of
12

the bottle of alcoholic liquor and a fine of up to $50.
13

Any notice issued by the State Commission to a
14

licensee for a violation of this Act or any notice with
15

respect to settlement or offer in compromise shall include
16

the field report, photographs, and any other supporting
17

documentation necessary to reasonably inform the licensee
18

of the nature and extent of the violation or the conduct
19

alleged to have occurred. The failure to include such
20

required documentation shall result in the dismissal of
21

the action.
22

(2) To adopt such rules and regulations consistent
23

with the provisions of this Act which shall be necessary
24

to carry on its functions and duties to the end that the
25

health, safety and welfare of the People of the State of
26

Illinois shall be protected and temperance in the

SB3655
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LRB104 19974 RPS 33425 b
1

consumption of alcoholic liquors shall be fostered and
2

promoted and to distribute copies of such rules and
3

regulations to all licensees affected thereby.
4

(3) To call upon other administrative departments of
5

the State, county and municipal governments, county and
6

city police departments and upon prosecuting officers for
7

such information and assistance as it deems necessary in
8

the performance of its duties.
9

(4) To recommend to local commissioners rules and
10

regulations, not inconsistent with the law, for the
11

distribution and sale of alcoholic liquors throughout the
12

State.
13

(5) To inspect, or cause to be inspected, any premises
14

in this State where alcoholic liquors are manufactured,
15

distributed, warehoused, or sold. Nothing in this Act
16

authorizes an agent of the State Commission to inspect
17

private areas within the premises without reasonable
18

suspicion or a warrant during an inspection. "Private
19

areas" include, but are not limited to, safes, personal
20

property, and closed desks.
21

(5.1) Upon receipt of a complaint or upon having
22

knowledge that any person is engaged in business as a
23

manufacturer, importing distributor, distributor, or
24

retailer without a license or valid license, to conduct an
25

investigation. If, after conducting an investigation, the
26

State Commission is satisfied that the alleged conduct

SB3655
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LRB104 19974 RPS 33425 b
1

occurred or is occurring, it may issue a cease and desist
2

notice as provided in this Act, impose civil penalties as
3

provided in this Act, notify the local liquor authority,
4

or file a complaint with the State's Attorney's Office of
5

the county where the incident occurred or the Attorney
6

General.
7

(5.2) Upon receipt of a complaint or upon having
8

knowledge that any person is shipping alcoholic liquor
9

into this State from a point outside of this State if the
10

shipment is in violation of this Act, to conduct an
11

investigation. If, after conducting an investigation, the
12

State Commission is satisfied that the alleged conduct
13

occurred or is occurring, it may issue a cease and desist
14

notice as provided in this Act, impose civil penalties as
15

provided in this Act, notify the foreign jurisdiction, or
16

file a complaint with the State's Attorney's Office of the
17

county where the incident occurred or the Attorney
18

General.
19

(5.3) To receive complaints from licensees, local
20

officials, law enforcement agencies, organizations, and
21

persons stating that any licensee has been or is violating
22

any provision of this Act or the rules and regulations
23

issued pursuant to this Act. Such complaints shall be in
24

writing, signed and sworn to by the person making the
25

complaint, and shall state with specificity the facts in
26

relation to the alleged violation. If the State Commission

SB3655
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LRB104 19974 RPS 33425 b
1

has reasonable grounds to believe that the complaint
2

substantially alleges a violation of this Act or rules and
3

regulations adopted pursuant to this Act, it shall conduct
4

an investigation. If, after conducting an investigation,
5

the State Commission is satisfied that the alleged
6

violation did occur, it shall proceed with disciplinary
7

action against the licensee as provided in this Act.
8

(5.4) To make arrests and issue notices of civil
9

violations where necessary for the enforcement of this
10

Act.
11

(5.5) To investigate any and all unlicensed activity.
12

(5.6) To impose civil penalties or fines to any person
13

who, without holding a valid license, engages in conduct
14

that requires a license pursuant to this Act, in an amount
15

not to exceed $20,000 for each offense as determined by
16

the State Commission. A civil penalty shall be assessed by
17

the State Commission after a hearing is held in accordance
18

with the provisions set forth in this Act regarding the
19

provision of a hearing for the revocation or suspension of
20

a license.
21

(6) To hear and determine appeals from orders of a
22

local commission in accordance with the provisions of this
23

Act, as hereinafter set forth. Hearings under this
24

subsection shall be held in Springfield or Chicago, at
25

whichever location is the more convenient for the majority
26

of persons who are parties to the hearing.

SB3655
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LRB104 19974 RPS 33425 b
1

(7) The State Commission shall establish uniform
2

systems of accounts to be kept by all retail licensees
3

having more than 4 employees, and for this purpose the
4

State Commission may classify all retail licensees having
5

more than 4 employees and establish a uniform system of
6

accounts for each class and prescribe the manner in which
7

such accounts shall be kept. The State Commission may also
8

prescribe the forms of accounts to be kept by all retail
9

licensees having more than 4 employees, including, but not
10

limited to, accounts of earnings and expenses and any
11

distribution, payment, or other distribution of earnings
12

or assets, and any other forms, records, and memoranda
13

which in the judgment of the commission may be necessary
14

or appropriate to carry out any of the provisions of this
15

Act, including, but not limited to, such forms, records,
16

and memoranda as will readily and accurately disclose at
17

all times the beneficial ownership of such retail licensed
18

business. The accounts, forms, records, and memoranda
19

shall be available at all reasonable times for inspection
20

by authorized representatives of the State Commission or
21

by any local liquor control commissioner or his or her
22

authorized representative. The commission may, from time
23

to time, alter, amend, or repeal, in whole or in part, any
24

uniform system of accounts, or the form and manner of
25

keeping accounts.
26

(8) In the conduct of any hearing authorized to be

SB3655
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LRB104 19974 RPS 33425 b
1

held by the State Commission, to appoint, at the
2

commission's discretion, hearing officers to conduct
3

hearings involving complex issues or issues that will
4

require a protracted period of time to resolve, to
5

examine, or cause to be examined, under oath, any
6

licensee, and to examine or cause to be examined the books
7

and records of such licensee; to hear testimony and take
8

proof material for its information in the discharge of its
9

duties hereunder; to administer or cause to be
10

administered oaths; for any such purpose to issue subpoena
11

or subpoenas to require the attendance of witnesses and
12

the production of books, which shall be effective in any
13

part of this State, and to adopt rules to implement its
14

powers under this paragraph (8).
15

Any circuit court may, by order duly entered, require
16

the attendance of witnesses and the production of relevant
17

books subpoenaed by the State Commission and the court may
18

compel obedience to its order by proceedings for contempt.
19

(9) To investigate the administration of laws in
20

relation to alcoholic liquors in this and other states and
21

any foreign countries, and to recommend from time to time
22

to the Governor and through him or her to the legislature
23

of this State, such amendments to this Act, if any, as it
24

may think desirable and as will serve to further the
25

general broad purposes contained in Section 1-2 hereof.
26

(10) To adopt such rules and regulations consistent

SB3655
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LRB104 19974 RPS 33425 b
1

with the provisions of this Act which shall be necessary
2

for the control, sale, or disposition of alcoholic liquor
3

damaged as a result of an accident, wreck, flood, fire, or
4

other similar occurrence.
5

(11) To develop industry educational programs related
6

to responsible serving and selling, particularly in the
7

areas of overserving consumers and illegal underage
8

purchasing and consumption of alcoholic beverages.
9

(11.1) To license persons providing education and
10

training to alcohol beverage sellers and servers for
11

mandatory and non-mandatory training under the Beverage
12

Alcohol Sellers and Servers Education and Training
13

(BASSET) programs and to develop and administer a public
14

awareness program in Illinois to reduce or eliminate the
15

illegal purchase and consumption of alcoholic beverage
16

products by persons under the age of 21. Application for a
17

license shall be made on forms provided by the State
18

Commission.
19

(12) To develop and maintain a repository of license
20

and regulatory information.
21

(13) (Blank).
22

(14) On or before April 30, 2008 and every 2 years
23

thereafter, the State Commission shall present a written
24

report to the Governor and the General Assembly that shall
25

be based on a study of the impact of Public Act 95-634 on
26

the business of soliciting, selling, and shipping wine

SB3655
- 10 -
LRB104 19974 RPS 33425 b
1

from inside and outside of this State directly to
2

residents of this State. As part of its report, the State
3

Commission shall provide all of the following information:
4

(A) The amount of State excise and sales tax
5

revenues generated.
6

(B) The amount of licensing fees received.
7

(C) The number of cases of wine shipped from
8

inside and outside of this State directly to residents
9

of this State.
10

(D) The number of alcohol compliance operations
11

conducted.
12

(E) The number of winery shipper's licenses
13

issued.
14

(F) The number of each of the following: reported
15

violations; cease and desist notices issued by the
16

Commission; notices of violations issued by the
17

Commission and to the Department of Revenue; and
18

notices and complaints of violations to law
19

enforcement officials, including, without limitation,
20

the Illinois Attorney General and the U.S. Department
21

of Treasury's Alcohol and Tobacco Tax and Trade
22

Bureau.
23

(15) As a means to reduce the underage consumption of
24

alcoholic liquors, the State Commission shall conduct
25

alcohol compliance operations to investigate whether
26

businesses that are soliciting, selling, and shipping wine

SB3655
- 11 -
LRB104 19974 RPS 33425 b
1

from inside or outside of this State directly to residents
2

of this State are licensed by this State or are selling or
3

attempting to sell wine to persons under 21 years of age in
4

violation of this Act.
5

(16) The State Commission shall, in addition to
6

notifying any appropriate law enforcement agency, submit
7

notices of complaints or violations of Sections 6-29 and
8

6-29.1 by persons who do not hold a winery shipper's
9

license under this Act to the Illinois Attorney General
10

and to the U.S. Department of Treasury's Alcohol and
11

Tobacco Tax and Trade Bureau.
12

(17)(A) A person licensed to make wine under the laws
13

of another state who has a winery shipper's license under
14

this Act and annually produces less than 25,000 gallons of
15

wine or a person who has a first-class or second-class
16

wine manufacturer's license, a first-class or second-class
17

wine-maker's license, or a limited wine manufacturer's
18

license under this Act and annually produces less than
19

25,000 gallons of wine may make application to the
20

Commission for a self-distribution exemption to allow the
21

sale of not more than 5,000 gallons of the exemption
22

holder's wine to retail licensees per year and to sell
23

cider, mead, or both cider and mead to brewers, class 1
24

brewers, class 2 brewers, and class 3 brewers that,
25

pursuant to subsection (e) of Section 6-4 of this Act,
26

sell beer, cider, mead, or any combination thereof to

SB3655
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LRB104 19974 RPS 33425 b
1

non-licensees at their breweries.
2

(B) In the application, which shall be sworn under
3

penalty of perjury, such person shall state (1) the date
4

it was established; (2) its volume of production and sales
5

for each year since its establishment; (3) its efforts to
6

establish distributor relationships; (4) that a
7

self-distribution exemption is necessary to facilitate the
8

marketing of its wine; and (5) that it will comply with the
9

liquor and revenue laws of the United States, this State,
10

and any other state where it is licensed.
11

(C) The State Commission shall approve the application
12

for a self-distribution exemption if such person: (1) is
13

in compliance with State revenue and liquor laws; (2) is
14

not a member of any affiliated group that produces
15

directly or indirectly more than 25,000 gallons of wine
16

per annum, 930,000 gallons of beer per annum, or 50,000
17

gallons of spirits per annum; (3) will not annually
18

produce for sale more than 25,000 gallons of wine, 930,000
19

gallons of beer, or 50,000 gallons of spirits; and (4)
20

will not annually sell more than 5,000 gallons of its wine
21

to retail licensees.
22

(D) A self-distribution exemption holder shall
23

annually certify to the State Commission its production of
24

wine in the previous 12 months and its anticipated
25

production and sales for the next 12 months. The State
26

Commission may fine, suspend, or revoke a

SB3655
- 13 -
LRB104 19974 RPS 33425 b
1

self-distribution exemption after a hearing if it finds
2

that the exemption holder has made a material
3

misrepresentation in its application, violated a revenue
4

or liquor law of Illinois, exceeded production of 25,000
5

gallons of wine, 930,000 gallons of beer, or 50,000
6

gallons of spirits in any calendar year, or become part of
7

an affiliated group producing more than 25,000 gallons of
8

wine, 930,000 gallons of beer, or 50,000 gallons of
9

spirits.
10

(E) Except in hearings for violations of this Act or
11

Public Act 95-634 or a bona fide investigation by duly
12

sworn law enforcement officials, the State Commission, or
13

its agents, the State Commission shall maintain the
14

production and sales information of a self-distribution
15

exemption holder as confidential and shall not release
16

such information to any person.
17

(F) The State Commission shall issue regulations
18

governing self-distribution exemptions consistent with
19

this Section and this Act.
20

(G) Nothing in this paragraph (17) shall prohibit a
21

self-distribution exemption holder from entering into or
22

simultaneously having a distribution agreement with a
23

licensed Illinois distributor.
24

(H) It is the intent of this paragraph (17) to promote
25

and continue orderly markets. The General Assembly finds
26

that, in order to preserve Illinois' regulatory

SB3655
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LRB104 19974 RPS 33425 b
1

distribution system, it is necessary to create an
2

exception for smaller makers of wine as their wines are
3

frequently adjusted in varietals, mixes, vintages, and
4

taste to find and create market niches sometimes too small
5

for distributor or importing distributor business
6

strategies. Limited self-distribution rights will afford
7

and allow smaller makers of wine access to the marketplace
8

in order to develop a customer base without impairing the
9

integrity of the 3-tier system.
10

(18)(A) A class 1 brewer licensee, who must also be
11

either a licensed brewer or licensed non-resident dealer
12

and annually manufacture less than 930,000 gallons of
13

beer, may make application to the State Commission for a
14

self-distribution exemption to allow the sale of not more
15

than 232,500 gallons per year of the exemption holder's
16

beer to retail licensees and to brewers, class 1 brewers,
17

and class 2 brewers that, pursuant to subsection (e) of
18

Section 6-4 of this Act, sell beer, cider, mead, or any
19

combination thereof to non-licensees at their breweries.
20

(B) In the application, which shall be sworn under
21

penalty of perjury, the class 1 brewer licensee shall
22

state (1) the date it was established; (2) its volume of
23

beer manufactured and sold for each year since its
24

establishment; (3) its efforts to establish distributor
25

relationships; (4) that a self-distribution exemption is
26

necessary to facilitate the marketing of its beer; and (5)

SB3655
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LRB104 19974 RPS 33425 b
1

that it will comply with the alcoholic beverage and
2

revenue laws of the United States, this State, and any
3

other state where it is licensed.
4

(C) Any application submitted shall be posted on the
5

State Commission's website at least 45 days prior to
6

action by the State Commission. The State Commission shall
7

approve the application for a self-distribution exemption
8

if the class 1 brewer licensee: (1) is in compliance with
9

the State, revenue, and alcoholic beverage laws; (2) is
10

not a member of any affiliated group that manufactures,
11

directly or indirectly, more than 930,000 gallons of beer
12

per annum, 25,000 gallons of wine per annum, or 50,000
13

gallons of spirits per annum; (3) shall not annually
14

manufacture for sale more than 930,000 gallons of beer,
15

25,000 gallons of wine, or 50,000 gallons of spirits; (4)
16

shall not annually sell more than 232,500 gallons of its
17

beer to retail licensees and class 3 brewers and to
18

brewers, class 1 brewers, and class 2 brewers that,
19

pursuant to subsection (e) of Section 6-4 of this Act,
20

sell beer, cider, mead, or any combination thereof to
21

non-licensees at their breweries; and (5) has relinquished
22

any brew pub license held by the licensee, including any
23

ownership interest it held in the licensed brew pub.
24

(D) A self-distribution exemption holder shall
25

annually certify to the State Commission its manufacture
26

of beer during the previous 12 months and its anticipated

SB3655
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LRB104 19974 RPS 33425 b
1

manufacture and sales of beer for the next 12 months. The
2

State Commission may fine, suspend, or revoke a
3

self-distribution exemption after a hearing if it finds
4

that the exemption holder has made a material
5

misrepresentation in its application, violated a revenue
6

or alcoholic beverage law of Illinois, exceeded the
7

manufacture of 930,000 gallons of beer, 25,000 gallons of
8

wine, or 50,000 gallons of spirits in any calendar year or
9

became part of an affiliated group manufacturing more than
10

930,000 gallons of beer, 25,000 gallons of wine, or 50,000
11

gallons of spirits.
12

(E) The State Commission shall issue rules and
13

regulations governing self-distribution exemptions
14

consistent with this Act.
15

(F) Nothing in this paragraph (18) shall prohibit a
16

self-distribution exemption holder from entering into or
17

simultaneously having a distribution agreement with a
18

licensed Illinois importing distributor or a distributor.
19

If a self-distribution exemption holder enters into a
20

distribution agreement and has assigned distribution
21

rights to an importing distributor or distributor, then
22

the self-distribution exemption holder's distribution
23

rights in the assigned territories shall cease in a
24

reasonable time not to exceed 60 days.
25

(G) It is the intent of this paragraph (18) to promote
26

and continue orderly markets. The General Assembly finds

SB3655
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LRB104 19974 RPS 33425 b
1

that in order to preserve Illinois' regulatory
2

distribution system, it is necessary to create an
3

exception for smaller manufacturers in order to afford and
4

allow such smaller manufacturers of beer access to the
5

marketplace in order to develop a customer base without
6

impairing the integrity of the 3-tier system.
7

(19)(A) A class 1 craft distiller licensee or a
8

non-resident dealer who manufactures less than 50,000
9

gallons of distilled spirits per year may make application
10

to the State Commission for a self-distribution exemption
11

to allow the sale of not more than 5,000 gallons of the
12

exemption holder's spirits to retail licensees per year.
13

(B) In the application, which shall be sworn under
14

penalty of perjury, the class 1 craft distiller licensee
15

or non-resident dealer shall state (1) the date it was
16

established; (2) its volume of spirits manufactured and
17

sold for each year since its establishment; (3) its
18

efforts to establish distributor relationships; (4) that a
19

self-distribution exemption is necessary to facilitate the
20

marketing of its spirits; and (5) that it will comply with
21

the alcoholic beverage and revenue laws of the United
22

States, this State, and any other state where it is
23

licensed.
24

(C) Any application submitted shall be posted on the
25

State Commission's website at least 45 days prior to
26

action by the State Commission. The State Commission shall

SB3655
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1

approve the application for a self-distribution exemption
2

if the applicant: (1) is in compliance with State revenue
3

and alcoholic beverage laws; (2) is not a member of any
4

affiliated group that produces more than 50,000 gallons of
5

spirits per annum, 930,000 gallons of beer per annum, or
6

25,000 gallons of wine per annum; (3) does not annually
7

manufacture for sale more than 50,000 gallons of spirits,
8

930,000 gallons of beer, or 25,000 gallons of wine; and
9

(4) does not annually sell more than 5,000 gallons of its
10

spirits to retail licensees.
11

(D) A self-distribution exemption holder shall
12

annually certify to the State Commission its manufacture
13

of spirits during the previous 12 months and its
14

anticipated manufacture and sales of spirits for the next
15

12 months. The State Commission may fine, suspend, or
16

revoke a self-distribution exemption after a hearing if it
17

finds that the exemption holder has made a material
18

misrepresentation in its application, violated a revenue
19

or alcoholic beverage law of Illinois, exceeded the
20

manufacture of 50,000 gallons of spirits, 930,000 gallons
21

of beer, or 25,000 gallons of wine in any calendar year, or
22

has become part of an affiliated group manufacturing more
23

than 50,000 gallons of spirits, 930,000 gallons of beer,
24

or 25,000 gallons of wine.
25

(E) The State Commission shall adopt rules governing
26

self-distribution exemptions consistent with this Act.

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LRB104 19974 RPS 33425 b
1

(F) Nothing in this paragraph (19) shall prohibit a
2

self-distribution exemption holder from entering into or
3

simultaneously having a distribution agreement with a
4

licensed Illinois importing distributor or a distributor.
5

(G) It is the intent of this paragraph (19) to promote
6

and continue orderly markets. The General Assembly finds
7

that in order to preserve Illinois' regulatory
8

distribution system, it is necessary to create an
9

exception for smaller manufacturers in order to afford and
10

allow such smaller manufacturers of spirits access to the
11

marketplace in order to develop a customer base without
12

impairing the integrity of the 3-tier system.
13

(20)(A) A class 3 brewer licensee who must manufacture
14

less than 465,000 gallons of beer in the aggregate and not
15

more than 155,000 gallons at any single brewery premises
16

may make application to the State Commission for a
17

self-distribution exemption to allow the sale of not more
18

than 6,200 gallons of beer from each in-state or
19

out-of-state class 3 brewery premises, which shall not
20

exceed 18,600 gallons annually in the aggregate, that is
21

manufactured at a wholly owned class 3 brewer's in-state
22

or out-of-state licensed premises to retail licensees and
23

class 3 brewers and to brewers, class 1 brewers, class 2
24

brewers that, pursuant to subsection (e) of Section 6-4,
25

sell beer, cider, or both beer and cider to non-licensees
26

at their licensed breweries.

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LRB104 19974 RPS 33425 b
1

(B) In the application, which shall be sworn under
2

penalty of perjury, the class 3 brewer licensee shall
3

state:
4

(1) the date it was established;
5

(2) its volume of beer manufactured and sold for
6

each year since its establishment;
7

(3) its efforts to establish distributor
8

relationships;
9

(4) that a self-distribution exemption is
10

necessary to facilitate the marketing of its beer; and
11

(5) that it will comply with the alcoholic
12

beverage and revenue laws of the United States, this
13

State, and any other state where it is licensed.
14

(C) Any application submitted shall be posted on the
15

State Commission's website at least 45 days before action
16

by the State Commission. The State Commission shall
17

approve the application for a self-distribution exemption
18

if the class 3 brewer licensee: (1) is in compliance with
19

the State, revenue, and alcoholic beverage laws; (2) is
20

not a member of any affiliated group that manufacturers,
21

directly or indirectly, more than 465,000 gallons of beer
22

per annum; (3) shall not annually manufacture for sale
23

more than 465,000 gallons of beer or more than 155,000
24

gallons at any single brewery premises; and (4) shall not
25

annually sell more than 6,200 gallons of beer from each
26

in-state or out-of-state class 3 brewery premises, and

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1

shall not exceed 18,600 gallons annually in the aggregate,
2

to retail licensees and class 3 brewers and to brewers,
3

class 1 brewers, and class 2 brewers that, pursuant to
4

subsection (e) of Section 6-4 of this Act, sell beer,
5

cider, or both beer and cider to non-licensees at their
6

breweries.
7

(D) A self-distribution exemption holder shall
8

annually certify to the State Commission its manufacture
9

of beer during the previous 12 months and its anticipated
10

manufacture and sales of beer for the next 12 months. The
11

State Commission may fine, suspend, or revoke a
12

self-distribution exemption after a hearing if it finds
13

that the exemption holder has made a material
14

misrepresentation in its application, violated a revenue
15

or alcoholic beverage law of Illinois, exceeded the
16

manufacture of 465,000 gallons of beer in any calendar
17

year or became part of an affiliated group manufacturing
18

more than 465,000 gallons of beer, or exceeded the sale to
19

retail licensees, brewers, class 1 brewers, class 2
20

brewers, and class 3 brewers of 6,200 gallons per brewery
21

location or 18,600 gallons in the aggregate.
22

(E) The State Commission may adopt rules governing
23

self-distribution exemptions consistent with this Act.
24

(F) Nothing in this paragraph shall prohibit a
25

self-distribution exemption holder from entering into or
26

simultaneously having a distribution agreement with a

SB3655
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LRB104 19974 RPS 33425 b
1

licensed Illinois importing distributor or a distributor.
2

If a self-distribution exemption holder enters into a
3

distribution agreement and has assigned distribution
4

rights to an importing distributor or distributor, then
5

the self-distribution exemption holder's distribution
6

rights in the assigned territories shall cease in a
7

reasonable time not to exceed 60 days.
8

(G) It is the intent of this paragraph to promote and
9

continue orderly markets. The General Assembly finds that
10

in order to preserve Illinois' regulatory distribution
11

system, it is necessary to create an exception for smaller
12

manufacturers in order to afford and allow such smaller
13

manufacturers of beer access to the marketplace in order
14

to develop a customer base without impairing the integrity
15

of the 3-tier system.
16

(b) On or before April 30, 1999, the Commission shall
17
present a written report to the Governor and the General
18
Assembly that shall be based on a study of the impact of Public
19
Act 90-739 on the business of soliciting, selling, and
20
shipping alcoholic liquor from outside of this State directly
21
to residents of this State.
22

As part of its report, the Commission shall provide the
23
following information:
24

(i) the amount of State excise and sales tax revenues
25

generated as a result of Public Act 90-739;
26

(ii) the amount of licensing fees received as a result

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LRB104 19974 RPS 33425 b
1

of Public Act 90-739;
2

(iii) the number of reported violations, the number of
3

cease and desist notices issued by the Commission, the
4

number of notices of violations issued to the Department
5

of Revenue, and the number of notices and complaints of
6

violations to law enforcement officials.
7
(Source: P.A. 101-37, eff. 7-3-19; 101-81, eff. 7-12-19;
8
101-482, eff. 8-23-19; 102-442, eff. 8-20-21; 102-558, eff.
9
8-20-21; 102-813, eff. 5-13-22.)

10

(Text of Section after amendment by P.A. 104-451
)
11

Sec. 3-12.
Powers and duties of State Commission.
12

(a) The State Commission shall have the following powers,
13
functions, and duties:
14

(1) To receive applications and to issue licenses to
15

manufacturers, foreign importers, importing distributors,
16

distributors, non-resident dealers, on premise consumption
17

retailers, off premise sale retailers, special event
18

retailer licensees, special use permit licenses, auction
19

liquor licenses, brew pubs, caterer retailers,
20

non-beverage users, railroads, including owners and
21

lessees of sleeping, dining, and cafe cars, airplanes,
22

boats, brokers, and wine maker's premises licensees in
23

accordance with the provisions of this Act, and to suspend
24

or revoke such licenses upon the State Commission's
25

determination, upon notice after hearing, that a licensee

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1

has violated any provision of this Act or any rule or
2

regulation issued pursuant thereto and in effect for 30
3

days prior to such violation. Except in the case of an
4

action taken pursuant to a violation of Section 6-3, 6-5,
5

or 6-9, any action by the State Commission to suspend or
6

revoke a licensee's license may be limited to the license
7

for the specific premises where the violation occurred. An
8

action for a violation of this Act shall be commenced by
9

the State Commission within 2 years after the date the
10

State Commission becomes aware of the violation.
11

In lieu of suspending or revoking a license, the State
12

Commission may impose a fine, upon the State Commission's
13

determination and notice after hearing, that a licensee
14

has violated any provision of this Act or any rule or
15

regulation issued pursuant thereto and in effect for 30
16

days prior to such violation.
17

For the purpose of this paragraph (1), when
18

determining multiple violations for the sale of alcohol to
19

a person under the age of 21, a second or subsequent
20

violation for the sale of alcohol to a person under the age
21

of 21 shall only be considered if it was committed within 5
22

years after the date when a prior violation for the sale of
23

alcohol to a person under the age of 21 was committed.
24

The fine imposed under this paragraph may not exceed
25

$500 for each violation.
Each day that the activity, which
26

gave rise to the original fine, continues is a separate

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LRB104 19974 RPS 33425 b
1

violation. The maximum fine that may be levied against any
2

licensee
, for the period of the license,
shall not exceed
3

$20,000
per violation
. The maximum penalty that may be
4

imposed on a licensee for selling a bottle of alcoholic
5

liquor with a foreign object in it or serving from a bottle
6

of alcoholic liquor with a foreign object in it shall be
7

the destruction of that bottle of alcoholic liquor for the
8

first 10 bottles so sold or served from by the licensee.
9

For the eleventh bottle of alcoholic liquor and for each
10

third bottle thereafter sold or served from by the
11

licensee with a foreign object in it, the maximum penalty
12

that may be imposed on the licensee is the destruction of
13

the bottle of alcoholic liquor and a fine of up to $50.
14

Any notice issued by the State Commission to a
15

licensee for a violation of this Act or any notice with
16

respect to settlement or offer in compromise shall include
17

the field report, photographs, and any other supporting
18

documentation necessary to reasonably inform the licensee
19

of the nature and extent of the violation or the conduct
20

alleged to have occurred. The failure to include such
21

required documentation shall result in the dismissal of
22

the action.
23

(2) To adopt such rules and regulations consistent
24

with the provisions of this Act which shall be necessary
25

to carry on its functions and duties to the end that the
26

health, safety, and welfare of the People of the State of

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LRB104 19974 RPS 33425 b
1

Illinois shall be protected and temperance in the
2

consumption of alcoholic liquors shall be fostered and
3

promoted and to distribute copies of such rules and
4

regulations to all licensees affected thereby.
5

(3) To call upon other administrative departments of
6

the State, county and municipal governments, county and
7

city police departments, and prosecuting officers for such
8

information and assistance as it deems necessary in the
9

performance of its duties.
10

(4) To recommend to local commissioners rules and
11

regulations, not inconsistent with the law, for the
12

distribution and sale of alcoholic liquors throughout the
13

State.
14

(5) To inspect, or cause to be inspected, any premises
15

in this State where alcoholic liquors are manufactured,
16

distributed, warehoused, or sold. Nothing in this Act
17

authorizes an agent of the State Commission to inspect
18

private areas within the premises without reasonable
19

suspicion or a warrant during an inspection. "Private
20

areas" includes, but is not limited to, safes, personal
21

property, and closed desks.
22

(5.1) Upon receipt of a complaint or upon having
23

knowledge that any person is engaged in business as a
24

manufacturer, importing distributor, distributor, or
25

retailer without a license or valid license, to conduct an
26

investigation. If, after conducting an investigation, the

SB3655
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LRB104 19974 RPS 33425 b
1

State Commission is satisfied that the alleged conduct
2

occurred or is occurring, it may issue a cease and desist
3

notice as provided in this Act, impose civil penalties as
4

provided in this Act, notify the local liquor authority,
5

or file a complaint with the State's Attorney's Office of
6

the county where the incident occurred or the Attorney
7

General.
8

(5.2) Upon receipt of a complaint or upon having
9

knowledge that any person is shipping alcoholic liquor
10

into this State from a point outside of this State if the
11

shipment is in violation of this Act, to conduct an
12

investigation. If, after conducting an investigation, the
13

State Commission is satisfied that the alleged conduct
14

occurred or is occurring, it may issue a cease and desist
15

notice as provided in this Act, impose civil penalties as
16

provided in this Act, notify the foreign jurisdiction, or
17

file a complaint with the State's Attorney's Office of the
18

county where the incident occurred or the Attorney
19

General.
20

(5.3) To receive complaints from licensees, local
21

officials, law enforcement agencies, organizations, and
22

persons stating that any licensee has been or is violating
23

any provision of this Act or the rules and regulations
24

issued pursuant to this Act. Such complaints shall be in
25

writing, signed and sworn to by the person making the
26

complaint, and shall state with specificity the facts in

SB3655
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LRB104 19974 RPS 33425 b
1

relation to the alleged violation. If the State Commission
2

has reasonable grounds to believe that the complaint
3

substantially alleges a violation of this Act or rules and
4

regulations adopted pursuant to this Act, it shall conduct
5

an investigation. If, after conducting an investigation,
6

the State Commission is satisfied that the alleged
7

violation did occur, it shall proceed with disciplinary
8

action against the licensee as provided in this Act.
9

(5.4) To make arrests and issue notices of civil
10

violations where necessary for the enforcement of this
11

Act.
12

(5.5) To investigate any and all unlicensed activity.
13

(5.6) To impose civil penalties or fines to any person
14

who, without holding a valid license, engages in conduct
15

that requires a license pursuant to this Act, in an amount
16

not to exceed $20,000 for each offense as determined by
17

the State Commission. A civil penalty shall be assessed by
18

the State Commission after a hearing is held in accordance
19

with the provisions set forth in this Act regarding the
20

provision of a hearing for the revocation or suspension of
21

a license.
22

(6) To hear and determine appeals from orders of a
23

local commission in accordance with the provisions of this
24

Act, as hereinafter set forth. Hearings under this
25

subsection shall be held in Springfield or Chicago, at
26

whichever location is the more convenient for the majority

SB3655
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LRB104 19974 RPS 33425 b
1

of persons who are parties to the hearing.
2

(7) The State Commission shall establish uniform
3

systems of accounts to be kept by all retail licensees
4

having more than 4 employees, and, for this purpose, the
5

State Commission may classify all retail licensees having
6

more than 4 employees and establish a uniform system of
7

accounts for each class and prescribe the manner in which
8

such accounts shall be kept. The State Commission may also
9

prescribe the forms of accounts to be kept by all retail
10

licensees having more than 4 employees, including, but not
11

limited to, accounts of earnings and expenses and any
12

distribution, payment, or other distribution of earnings
13

or assets, and any other forms, records, and memoranda
14

which in the judgment of the State Commission may be
15

necessary or appropriate to carry out any of the
16

provisions of this Act, including, but not limited to,
17

such forms, records, and memoranda as will readily and
18

accurately disclose at all times the beneficial ownership
19

of such retail licensed business. The accounts, forms,
20

records, and memoranda shall be available at all
21

reasonable times for inspection by authorized
22

representatives of the State Commission or by any local
23

liquor control commissioner or his or her authorized
24

representative. The State Commission may, from time to
25

time, alter, amend, or repeal, in whole or in part, any
26

uniform system of accounts, or the form and manner of

SB3655
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LRB104 19974 RPS 33425 b
1

keeping accounts.
2

(8) In the conduct of any hearing authorized to be
3

held by the State Commission, to appoint, at the State
4

Commission's discretion, hearing officers to conduct
5

hearings involving complex issues or issues that will
6

require a protracted period of time to resolve, to
7

examine, or cause to be examined, under oath, any
8

licensee, and to examine or cause to be examined the books
9

and records of such licensee; to hear testimony and take
10

proof material for its information in the discharge of its
11

duties hereunder; to administer or cause to be
12

administered oaths; for any such purpose to issue subpoena
13

or subpoenas to require the attendance of witnesses and
14

the production of books, which shall be effective in any
15

part of this State, and to adopt rules to implement its
16

powers under this paragraph (8).
17

Any circuit court may, by order duly entered, require
18

the attendance of witnesses and the production of relevant
19

books subpoenaed by the State Commission and the court may
20

compel obedience to its order by proceedings for contempt.
21

(9) To investigate the administration of laws in
22

relation to alcoholic liquors in this and other states and
23

any foreign countries, and to recommend from time to time
24

to the Governor and through him or her to the legislature
25

of this State, such amendments to this Act, if any, as it
26

may think desirable and as will serve to further the

SB3655
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1

general broad purposes contained in Section 1-2 hereof.
2

(10) To adopt such rules and regulations consistent
3

with the provisions of this Act which shall be necessary
4

for the control, sale, or disposition of alcoholic liquor
5

damaged as a result of an accident, wreck, flood, fire, or
6

other similar occurrence.
7

(11) To develop industry educational programs related
8

to responsible serving and selling, particularly in the
9

areas of overserving consumers and illegal underage
10

purchasing and consumption of alcoholic beverages.
11

(11.1) To license persons providing education and
12

training to alcohol beverage sellers and servers for
13

mandatory and non-mandatory training under the Beverage
14

Alcohol Sellers and Servers Education and Training
15

(BASSET) programs and to develop and administer a public
16

awareness program in Illinois to reduce or eliminate the
17

illegal purchase and consumption of alcoholic beverage
18

products by persons under the age of 21. Application for a
19

license shall be made on forms provided by the State
20

Commission.
21

(12) To develop and maintain a repository of license
22

and regulatory information.
23

(13) (Blank).
24

(14) On or before April 30, 2008 and every 2 years
25

thereafter, the State Commission shall present a written
26

report to the Governor and the General Assembly that shall

SB3655
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LRB104 19974 RPS 33425 b
1

be based on a study of the impact of Public Act 95-634 on
2

the business of soliciting, selling, and shipping wine
3

from inside and outside of this State directly to
4

residents of this State. As part of its report, the State
5

Commission shall provide all of the following information:
6

(A) The amount of State excise and sales tax
7

revenues generated.
8

(B) The amount of licensing fees received.
9

(C) The number of cases of wine shipped from
10

inside and outside of this State directly to residents
11

of this State.
12

(D) The number of alcohol compliance operations
13

conducted.
14

(E) The number of winery shipper's licenses
15

issued.
16

(F) The number of each of the following: reported
17

violations; cease and desist notices issued by the
18

State Commission; notices of violations issued by the
19

State Commission and to the Department of Revenue; and
20

notices and complaints of violations to law
21

enforcement officials, including, without limitation,
22

the Illinois Attorney General and the U.S. Department
23

of Treasury's Alcohol and Tobacco Tax and Trade
24

Bureau.
25

(15) As a means to reduce the underage consumption of
26

alcoholic liquors, the State Commission shall conduct

SB3655
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LRB104 19974 RPS 33425 b
1

alcohol compliance operations to investigate whether
2

businesses that are soliciting, selling, and shipping wine
3

from inside or outside of this State directly to residents
4

of this State are licensed by this State or are selling or
5

attempting to sell wine to persons under 21 years of age in
6

violation of this Act.
7

(16) The State Commission shall, in addition to
8

notifying any appropriate law enforcement agency, submit
9

notices of complaints or violations of Sections 6-29 and
10

6-29.1 by persons who do not hold a winery shipper's
11

license under this Act to the Illinois Attorney General
12

and to the U.S. Department of Treasury's Alcohol and
13

Tobacco Tax and Trade Bureau.
14

(17)(A) A person licensed to make wine under the laws
15

of another state who has a winery shipper's license under
16

this Act and annually produces less than 25,000 gallons of
17

wine or a person who has a first-class or second-class
18

wine manufacturer's license, a first-class or second-class
19

wine-maker's license, or a limited wine manufacturer's
20

license under this Act and annually produces less than
21

25,000 gallons of wine may make application to the State
22

Commission for a self-distribution exemption to allow the
23

sale of not more than 5,000 gallons of the exemption
24

holder's wine to retail licensees per year and to sell
25

cider, mead, or both cider and mead to brewers, class 1
26

brewers, class 2 brewers, class 3 brewers, and class 3

SB3655
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LRB104 19974 RPS 33425 b
1

craft distillers that, pursuant to subsection (e) of
2

Section 6-4 of this Act, sell beer, cider, spirits, mead,
3

or any combination thereof to non-licensees at their
4

breweries or distilleries.
5

(B) In the application, which shall be sworn under
6

penalty of perjury, such person shall state (1) the date
7

it was established; (2) its volume of production and sales
8

for each year since its establishment; (3) its efforts to
9

establish distributor relationships; (4) that a
10

self-distribution exemption is necessary to facilitate the
11

marketing of its wine; and (5) that it will comply with the
12

liquor and revenue laws of the United States, this State,
13

and any other state where it is licensed.
14

(C) The State Commission shall approve the application
15

for a self-distribution exemption if such person: (1) is
16

in compliance with State revenue and liquor laws; (2) is
17

not a member of any affiliated group that produces
18

directly or indirectly more than 25,000 gallons of wine
19

per annum, 930,000 gallons of beer per annum, or 50,000
20

gallons of spirits per annum; (3) will not annually
21

produce for sale more than 25,000 gallons of wine, 930,000
22

gallons of beer, or 50,000 gallons of spirits; and (4)
23

will not annually sell more than 5,000 gallons of its wine
24

to retail licensees.
25

(D) A self-distribution exemption holder shall
26

annually certify to the State Commission its production of

SB3655
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LRB104 19974 RPS 33425 b
1

wine in the previous 12 months and its anticipated
2

production and sales for the next 12 months. The State
3

Commission may fine, suspend, or revoke a
4

self-distribution exemption after a hearing if it finds
5

that the exemption holder has made a material
6

misrepresentation in its application, violated a revenue
7

or liquor law of Illinois, exceeded production of 25,000
8

gallons of wine, 930,000 gallons of beer, or 50,000
9

gallons of spirits in any calendar year, or become part of
10

an affiliated group producing more than 25,000 gallons of
11

wine, 930,000 gallons of beer, or 50,000 gallons of
12

spirits.
13

(E) Except in hearings for violations of this Act or
14

Public Act 95-634 or a bona fide investigation by duly
15

sworn law enforcement officials, the State Commission, or
16

its agents, the State Commission shall maintain the
17

production and sales information of a self-distribution
18

exemption holder as confidential and shall not release
19

such information to any person.
20

(F) The State Commission shall issue regulations
21

governing self-distribution exemptions consistent with
22

this Section and this Act.
23

(G) Nothing in this paragraph (17) shall prohibit a
24

self-distribution exemption holder from entering into or
25

simultaneously having a distribution agreement with a
26

licensed Illinois distributor.

SB3655
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LRB104 19974 RPS 33425 b
1

(H) It is the intent of this paragraph (17) to promote
2

and continue orderly markets. The General Assembly finds
3

that, in order to preserve Illinois' regulatory
4

distribution system, it is necessary to create an
5

exception for smaller makers of wine as their wines are
6

frequently adjusted in varietals, mixes, vintages, and
7

taste to find and create market niches sometimes too small
8

for distributor or importing distributor business
9

strategies. Limited self-distribution rights will afford
10

and allow smaller makers of wine access to the marketplace
11

in order to develop a customer base without impairing the
12

integrity of the 3-tier system.
13

(18)(A) A class 1 brewer licensee, who must also be
14

either a licensed brewer or licensed non-resident dealer
15

and annually manufacture less than 930,000 gallons of
16

beer, may make application to the State Commission for a
17

self-distribution exemption to allow the sale of not more
18

than 232,500 gallons per year of the exemption holder's
19

beer to retail licensees and to brewers, class 1 brewers,
20

and class 2 brewers that, pursuant to subsection (e) of
21

Section 6-4 of this Act, sell beer, cider, mead, or any
22

combination thereof to non-licensees at their breweries.
23

(B) In the application, which shall be sworn under
24

penalty of perjury, the class 1 brewer licensee shall
25

state (1) the date it was established; (2) its volume of
26

beer manufactured and sold for each year since its

SB3655
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LRB104 19974 RPS 33425 b
1

establishment; (3) its efforts to establish distributor
2

relationships; (4) that a self-distribution exemption is
3

necessary to facilitate the marketing of its beer; and (5)
4

that it will comply with the alcoholic beverage and
5

revenue laws of the United States, this State, and any
6

other state where it is licensed.
7

(C) Any application submitted shall be posted on the
8

State Commission's website at least 45 days prior to
9

action by the State Commission. The State Commission shall
10

approve the application for a self-distribution exemption
11

if the class 1 brewer licensee: (1) is in compliance with
12

the State, revenue, and alcoholic beverage laws; (2) is
13

not a member of any affiliated group that manufactures,
14

directly or indirectly, more than 930,000 gallons of beer
15

per annum, 25,000 gallons of wine per annum, or 50,000
16

gallons of spirits per annum; (3) shall not annually
17

manufacture for sale more than 930,000 gallons of beer,
18

25,000 gallons of wine, or 50,000 gallons of spirits; (4)
19

shall not annually sell more than 232,500 gallons of its
20

beer to retail licensees and class 3 brewers and to
21

brewers, class 1 brewers, and class 2 brewers that,
22

pursuant to subsection (e) of Section 6-4 of this Act,
23

sell beer, cider, mead, or any combination thereof to
24

non-licensees at their breweries; and (5) has relinquished
25

any brew pub license held by the licensee, including any
26

ownership interest it held in the licensed brew pub.

SB3655
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LRB104 19974 RPS 33425 b
1

(D) A self-distribution exemption holder shall
2

annually certify to the State Commission its manufacture
3

of beer during the previous 12 months and its anticipated
4

manufacture and sales of beer for the next 12 months. The
5

State Commission may fine, suspend, or revoke a
6

self-distribution exemption after a hearing if it finds
7

that the exemption holder has made a material
8

misrepresentation in its application, violated a revenue
9

or alcoholic beverage law of Illinois, exceeded the
10

manufacture of 930,000 gallons of beer, 25,000 gallons of
11

wine, or 50,000 gallons of spirits in any calendar year or
12

became part of an affiliated group manufacturing more than
13

930,000 gallons of beer, 25,000 gallons of wine, or 50,000
14

gallons of spirits.
15

(E) The State Commission shall issue rules and
16

regulations governing self-distribution exemptions
17

consistent with this Act.
18

(F) Nothing in this paragraph (18) shall prohibit a
19

self-distribution exemption holder from entering into or
20

simultaneously having a distribution agreement with a
21

licensed Illinois importing distributor or a distributor.
22

If a self-distribution exemption holder enters into a
23

distribution agreement and has assigned distribution
24

rights to an importing distributor or distributor, then
25

the self-distribution exemption holder's distribution
26

rights in the assigned territories shall cease in a

SB3655
- 39 -
LRB104 19974 RPS 33425 b
1

reasonable time not to exceed 60 days.
2

(G) It is the intent of this paragraph (18) to promote
3

and continue orderly markets. The General Assembly finds
4

that in order to preserve Illinois' regulatory
5

distribution system, it is necessary to create an
6

exception for smaller manufacturers in order to afford and
7

allow such smaller manufacturers of beer access to the
8

marketplace in order to develop a customer base without
9

impairing the integrity of the 3-tier system.
10

(19)(A) A class 1 craft distiller licensee or a
11

non-resident dealer who manufactures less than 50,000
12

gallons of distilled spirits per year may make application
13

to the State Commission for a self-distribution exemption
14

to allow the sale of not more than 5,000 gallons of the
15

exemption holder's spirits to retail licensees per year.
16

(B) In the application, which shall be sworn under
17

penalty of perjury, the class 1 craft distiller licensee
18

or non-resident dealer shall state (1) the date it was
19

established; (2) its volume of spirits manufactured and
20

sold for each year since its establishment; (3) its
21

efforts to establish distributor relationships; (4) that a
22

self-distribution exemption is necessary to facilitate the
23

marketing of its spirits; and (5) that it will comply with
24

the alcoholic beverage and revenue laws of the United
25

States, this State, and any other state where it is
26

licensed.

SB3655
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LRB104 19974 RPS 33425 b
1

(C) Any application submitted shall be posted on the
2

State Commission's website at least 45 days prior to
3

action by the State Commission. The State Commission shall
4

approve the application for a self-distribution exemption
5

if the applicant: (1) is in compliance with State revenue
6

and alcoholic beverage laws; (2) is not a member of any
7

affiliated group that produces more than 50,000 gallons of
8

spirits per annum, 930,000 gallons of beer per annum, or
9

25,000 gallons of wine per annum; (3) does not annually
10

manufacture for sale more than 50,000 gallons of spirits,
11

930,000 gallons of beer, or 25,000 gallons of wine; and
12

(4) does not annually sell more than 5,000 gallons of its
13

spirits to retail licensees.
14

(D) A self-distribution exemption holder shall
15

annually certify to the State Commission its manufacture
16

of spirits during the previous 12 months and its
17

anticipated manufacture and sales of spirits for the next
18

12 months. The State Commission may fine, suspend, or
19

revoke a self-distribution exemption after a hearing if it
20

finds that the exemption holder has made a material
21

misrepresentation in its application, violated a revenue
22

or alcoholic beverage law of Illinois, exceeded the
23

manufacture of 50,000 gallons of spirits, 930,000 gallons
24

of beer, or 25,000 gallons of wine in any calendar year, or
25

has become part of an affiliated group manufacturing more
26

than 50,000 gallons of spirits, 930,000 gallons of beer,

SB3655
- 41 -
LRB104 19974 RPS 33425 b
1

or 25,000 gallons of wine.
2

(E) The State Commission shall adopt rules governing
3

self-distribution exemptions consistent with this Act.
4

(F) Nothing in this paragraph (19) shall prohibit a
5

self-distribution exemption holder from entering into or
6

simultaneously having a distribution agreement with a
7

licensed Illinois importing distributor or a distributor.
8

(G) It is the intent of this paragraph (19) to promote
9

and continue orderly markets. The General Assembly finds
10

that in order to preserve Illinois' regulatory
11

distribution system, it is necessary to create an
12

exception for smaller manufacturers in order to afford and
13

allow such smaller manufacturers of spirits access to the
14

marketplace in order to develop a customer base without
15

impairing the integrity of the 3-tier system.
16

(20)(A) A class 3 brewer licensee who must manufacture
17

less than 465,000 gallons of beer in the aggregate and not
18

more than 155,000 gallons at any single brewery premises
19

may make application to the State Commission for a
20

self-distribution exemption to allow the sale of not more
21

than 6,200 gallons of beer from each in-state or
22

out-of-state class 3 brewery premises, which shall not
23

exceed 18,600 gallons annually in the aggregate, that is
24

manufactured at a wholly owned class 3 brewer's in-state
25

or out-of-state licensed premises to retail licensees and
26

class 3 brewers and to brewers, class 1 brewers, class 2

SB3655
- 42 -
LRB104 19974 RPS 33425 b
1

brewers that, pursuant to subsection (e) of Section 6-4,
2

sell beer, cider, or both beer and cider to non-licensees
3

at their licensed breweries.
4

(B) In the application, which shall be sworn under
5

penalty of perjury, the class 3 brewer licensee shall
6

state:
7

(1) the date it was established;
8

(2) its volume of beer manufactured and sold for
9

each year since its establishment;
10

(3) its efforts to establish distributor
11

relationships;
12

(4) that a self-distribution exemption is
13

necessary to facilitate the marketing of its beer; and
14

(5) that it will comply with the alcoholic
15

beverage and revenue laws of the United States, this
16

State, and any other state where it is licensed.
17

(C) Any application submitted shall be posted on the
18

State Commission's website at least 45 days before action
19

by the State Commission. The State Commission shall
20

approve the application for a self-distribution exemption
21

if the class 3 brewer licensee: (1) is in compliance with
22

the State, revenue, and alcoholic beverage laws; (2) is
23

not a member of any affiliated group that manufacturers,
24

directly or indirectly, more than 465,000 gallons of beer
25

per annum; (3) shall not annually manufacture for sale
26

more than 465,000 gallons of beer or more than 155,000

SB3655
- 43 -
LRB104 19974 RPS 33425 b
1

gallons at any single brewery premises; and (4) shall not
2

annually sell more than 6,200 gallons of beer from each
3

in-state or out-of-state class 3 brewery premises, and
4

shall not exceed 18,600 gallons annually in the aggregate,
5

to retail licensees and class 3 brewers and to brewers,
6

class 1 brewers, and class 2 brewers that, pursuant to
7

subsection (e) of Section 6-4 of this Act, sell beer,
8

cider, or both beer and cider to non-licensees at their
9

breweries.
10

(D) A self-distribution exemption holder shall
11

annually certify to the State Commission its manufacture
12

of beer during the previous 12 months and its anticipated
13

manufacture and sales of beer for the next 12 months. The
14

State Commission may fine, suspend, or revoke a
15

self-distribution exemption after a hearing if it finds
16

that the exemption holder has made a material
17

misrepresentation in its application, violated a revenue
18

or alcoholic beverage law of Illinois, exceeded the
19

manufacture of 465,000 gallons of beer in any calendar
20

year or became part of an affiliated group manufacturing
21

more than 465,000 gallons of beer, or exceeded the sale to
22

retail licensees, brewers, class 1 brewers, class 2
23

brewers, and class 3 brewers of 6,200 gallons per brewery
24

location or 18,600 gallons in the aggregate.
25

(E) The State Commission may adopt rules governing
26

self-distribution exemptions consistent with this Act.

SB3655
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LRB104 19974 RPS 33425 b
1

(F) Nothing in this paragraph shall prohibit a
2

self-distribution exemption holder from entering into or
3

simultaneously having a distribution agreement with a
4

licensed Illinois importing distributor or a distributor.
5

If a self-distribution exemption holder enters into a
6

distribution agreement and has assigned distribution
7

rights to an importing distributor or distributor, then
8

the self-distribution exemption holder's distribution
9

rights in the assigned territories shall cease in a
10

reasonable time not to exceed 60 days.
11

(G) It is the intent of this paragraph to promote and
12

continue orderly markets. The General Assembly finds that
13

in order to preserve Illinois' regulatory distribution
14

system, it is necessary to create an exception for smaller
15

manufacturers in order to afford and allow such smaller
16

manufacturers of beer access to the marketplace in order
17

to develop a customer base without impairing the integrity
18

of the 3-tier system.
19

(21)(A) A class 3 craft distiller licensee who
20

manufactures less than 100,000 gallons of spirits in the
21

aggregate may make application to the State Commission for
22

a self-distribution exemption to allow the sale of not
23

more than 5,000 gallons of the exemption holder's spirits
24

per year that are manufactured at a wholly owned class 3
25

craft distiller's in-state or out-of-state licensed
26

premises to retail licensees and class 3 brewers and to

SB3655
- 45 -
LRB104 19974 RPS 33425 b
1

class 3 craft distillers that, pursuant to subsection (e)
2

of Section 6-4, sell beer, cider, spirits, or any
3

combination thereof to non-licensees at their licensed
4

distilleries.
5

(B) In the application, which shall be sworn under
6

penalty of perjury, the class 3 craft distiller licensee
7

shall state:
8

(1) the date it was established;
9

(2) its volume of spirits manufactured and sold
10

for each year since its establishment;
11

(3) its efforts to establish distributor
12

relationships;
13

(4) that a self-distribution exemption is
14

necessary to facilitate the marketing of its spirits;
15

and
16

(5) that it will comply with the alcoholic
17

beverage and revenue laws of the United States, this
18

State, and any other state where it is licensed.
19

(C) Any application submitted shall be posted on the
20

State Commission's website at least 45 days before action
21

by the State Commission. The State Commission shall
22

approve the application for a self-distribution exemption
23

if the class 3 craft distiller licensee:
24

(1) is in compliance with the State, revenue, and
25

alcoholic beverage laws;
26

(2) is not a member of any affiliated group that

SB3655
- 46 -
LRB104 19974 RPS 33425 b
1

manufacturers, directly or indirectly, more than
2

100,000 gallons of spirits per annum;
3

(3) shall not annually manufacture for sale more
4

than 100,000 gallons of spirits; and
5

(4) does not sell more than 5,000 gallons of its
6

spirits per year to retail licensees and class 3
7

brewers and to class 3 craft distillers that, pursuant
8

to subsection (e) of Section 6-4, sell beer, cider,
9

spirits, or any combination thereof to non-licensees
10

at their licensed distilleries.
11

(D) A self-distribution exemption holder shall
12

annually certify to the State Commission its manufacture
13

of spirits during the previous 12 months and its
14

anticipated manufacture and sales of spirits for the next
15

12 months. The State Commission may fine, suspend, or
16

revoke a self-distribution exemption after a hearing if it
17

finds that the exemption holder has made a material
18

misrepresentation in its application, violated a revenue
19

or alcoholic beverage law of Illinois, exceeded the
20

manufacture of 100,000 gallons of spirits in any calendar
21

year, or became part of an affiliated group manufacturing
22

more than 100,000 gallons of spirits.
23

(E) The State Commission may adopt rules governing
24

self-distribution exemptions consistent with this Act.
25

(F) Nothing in this paragraph shall prohibit a
26

self-distribution exemption holder from entering into or

SB3655
- 47 -
LRB104 19974 RPS 33425 b
1

simultaneously having a distribution agreement with a
2

licensed Illinois importing distributor or a distributor.
3

(G) It is the intent of this paragraph to promote and
4

continue orderly markets. The General Assembly finds that,
5

in order to preserve Illinois' regulatory distribution
6

system, it is necessary to create an exception for smaller
7

manufacturers in order to afford and allow such smaller
8

manufacturers of spirits access to the marketplace in
9

order to develop a customer base without impairing the
10

integrity of the 3-tier system.
11

(b) On or before April 30, 1999, the Commission shall
12
present a written report to the Governor and the General
13
Assembly that shall be based on a study of the impact of Public
14
Act 90-739 on the business of soliciting, selling, and
15
shipping alcoholic liquor from outside of this State directly
16
to residents of this State.
17

As part of its report, the Commission shall provide the
18
following information:
19

(i) the amount of State excise and sales tax revenues
20

generated as a result of Public Act 90-739;
21

(ii) the amount of licensing fees received as a result
22

of Public Act 90-739;
23

(iii) the number of reported violations, the number of
24

cease and desist notices issued by the Commission, the
25

number of notices of violations issued to the Department
26

of Revenue, and the number of notices and complaints of

SB3655
- 48 -
LRB104 19974 RPS 33425 b
1

violations to law enforcement officials.
2
(Source: P.A. 104-451, eff. 7-1-26.)

3

Section 95.
No acceleration or delay.
Where this Act makes
4
changes in a statute that is represented in this Act by text
5
that is not yet or no longer in effect (for example, a Section
6
represented by multiple versions), the use of that text does
7
not accelerate or delay the taking effect of (i) the changes
8
made by this Act or (ii) provisions derived from any other
9
Public Act.

10

Section 99.
Effective date.
This Act takes effect upon
11
becoming law.

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