SENATE BILL 546

50th legislature - STATE OF NEW MEXICO - first session, 2011

INTRODUCED BY

Phil A. Griego

AN ACT

RELATING TO ALCOHOLIC BEVERAGES; PROVIDING FOR A MICRODISTILLER'S LICENSE; AMENDING THE DOMESTIC WINERY AND SMALL BREWERY ACT; RECONCILING MULTIPLE AMENDMENTS TO THE SAME SECTION OF LAW IN LAWS 1998.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

     SECTION 1. Section 60-6A-21 NMSA 1978 (being Laws 1983, Chapter 280, Section 2, as amended) is amended to read:

     "60-6A-21. SHORT TITLE.--Sections 60-6A-21 through

60-6A-28 NMSA 1978 may be cited as the "Domestic Winery, [and] Small Brewery and Microdistillery Act"."

     SECTION 2. Section 60-6A-22 NMSA 1978 (being Laws 1983, Chapter 280, Section 3, as amended) is amended to read:

     "60-6A-22. DEFINITIONS.--As used in the Domestic Winery, [and] Small Brewery and Microdistillery Act:

          A. "brandy" means an alcoholic liquor distilled from wine or from fermented fruit juice;

          B. "beer" means any fermented beverage containing more than one-half percent alcohol obtained by the fermentation of any infusion or decoction of barley, malt and hops or other cereal in water, and includes porter, beer, ale and stout;

          C. "small brewer" means any person who owns or operates a business for the manufacture of beer but does not manufacture more than two hundred thousand barrels of beer per year;

          D. "proof gallon" means a gallon of liquid at sixty degrees Fahrenheit that contains fifty percent ethyl alcohol by volume or its equivalent;

          [D.] E. "public celebration" means any state fair, county fair, community fiesta or cultural or artistic performance;

          F. "microdistiller" means a person licensed as a microdistiller who owns or operates a business for the manufacture of spirituous liquors but does not manufacture more than one hundred fifty thousand proof gallons per year;

          [E.] G. "wine" means the product obtained from normal alcoholic fermentation of the juice of sound ripe grapes or other agricultural products containing natural or added sugar, or any such alcoholic beverage to which is added grape brandy, fruit brandy or spirits of wine [which] that is distilled from the particular agricultural products of which the wine is made, and other rectified wine products by whatever name [which] that do not contain more than fifteen percent added flavoring, coloring and blending material and [which] that contain not more than twenty-four percent [of] alcohol by volume, and includes vermouth;

          [F.] H. "wine blender" means a person authorized to operate a bonded wine cellar pursuant to a permit issued for that purpose under the internal revenue laws of the United States but who does not have facilities or equipment for the conversion of grapes, berries or other fruit into wine and does not engage in the production of wine in commercial quantities; provided that any person who produces or blends not to exceed three hundred gallons of wine per year shall not, because of such production or blending, be considered a wine blender; and

          [G.] I. "winer" means a person licensed as a winegrower."

     SECTION 3. A new section of the Domestic Winery, Small Brewery and Microdistillery Act is enacted to read:

     "[NEW MATERIAL] MICRODISTILLER'S LICENSE.--

          A. In any local option district, a person qualified under the provisions of the Liquor Control Act, except as otherwise provided in the Domestic Winery, Small Brewery and Microdistillery Act, may apply for and be issued a microdistiller's license subject to the following conditions:

                (1) the applicant submits evidence to the department that the applicant has a valid and appropriate permit issued by the federal government to be a microdistiller;

                (2) renewal of the license shall be conditioned upon no less than sixty percent of the gross receipts from the preceding twelve months of the licensee's operation being derived from the sale of distilled spirits produced by the licensee. Upon application for renewal, a licensee shall submit a report to the director indicating the annual gross receipts from the sale of distilled spirits produced by the licensee and from the licensee's sale of distilled spirits produced by another New Mexico licensed microdistiller;

                (3) a microdistiller's license shall not be transferred from person to person or from one location to another;

                (4) the provisions of Section 60-6A-18 NMSA 1978 shall not apply to a microdistiller's license; and

                (5) nothing in this section shall prevent a microdistiller from receiving other licenses pursuant to the Liquor Control Act.

          B. A person to whom a microdistiller's license is issued pursuant to this section may do any of the following:

                (1) manufacture or produce spirituous liquors, including aging, filtering, blending, mixing, flavoring, coloring, bottling and labeling;

                (2) store, transport, import or export spirituous liquors;

                (3) sell only spirituous liquors that are packaged by or for the microdistiller to a person holding a wholesaler's license, a microdistiller's license or a manufacturer's license;

                (4) deal in warehouse receipts for spirituous liquors;

                (5) buy spirituous liquors from other persons,

including licensees and permittees under the Liquor Control Act, for use in blending, flavoring, mixing or bottling of spirituous liquors;

                (6) be deemed a manufacturer for purposes of the Gross Receipts and Compensating Tax Act;

                (7) conduct spirituous liquor tastings and sell, by the glass or by the bottle, or in unbroken packages for consumption off the premises but not for resale, spirituous liquors of the microdistiller's own production or spirituous liquors produced by another New Mexico microdistiller or New Mexico manufacturer on the microdistiller's premises; and

                (8) at no more than two other locations off the microdistiller's premises, after the microdistiller has paid the applicable fee for a microdistiller's off-premises permit, after the director has determined that the off-premises locations meet the requirements of the Liquor Control Act and department rules for new liquor license locations and after the director has issued a microdistiller's off-premises permit for each off-premises location, conduct spirituous liquor tastings and sell by the glass, or in unbroken packages for consumption and not for resale, spirituous liquors produced and bottled by or for the microdistiller or spirituous liquors produced and bottled by or for another New Mexico microdistiller or manufacturer.

          C. For a public celebration off the microdistiller's premises in any local option district permitting the sale of alcoholic beverages, a microdistiller shall pay ten dollars ($10.00) to the alcohol and gaming division of the regulation and licensing department for a "microdistiller's public celebration permit" to be issued under rules adopted by the director. Upon request, the alcohol and gaming division of the regulation and licensing department may issue to a microdistiller a public celebration permit for a location at the public celebration that is to be shared with other microdistillers, small brewers and winegrowers. As used in this subsection, "public celebration" includes any state or county fair, community fiesta, cultural or artistic event, sporting competition of a seasonal nature or other activity held on an intermittent basis.

          D. Sales and tastings of spirituous liquors authorized in this section shall be permitted during the hours set forth in Subsection A of Section 60-7A-1 NMSA 1978 and between the hours of noon and midnight on Sunday and shall conform to the limitations regarding Christmas day sales and the expansion of Sunday sales hours to 2:00 a.m. on January 1, when December 31 falls on a Sunday as set forth in Section 60-7A-1 NMSA 1978."

     SECTION 4. Section 60-6A-27 NMSA 1978 (being Laws 1983, Chapter 280, Section 8, as amended by Laws 1998, Chapter 109, Section 5 and also by Laws 1998, Chapter 111, Section 2) is amended to read:

     "60-6A-27. LICENSE FEES.--Every application for the issuance or annual renewal of the following licenses and permits shall be accompanied by a license fee or permit fee in the following specified amounts:

          A. brandy manufacturer's license, seven hundred fifty dollars ($750);

          B. small brewer's license, seven hundred fifty dollars ($750);

          C. wine blender's license, seven hundred fifty dollars ($750);

          D. wine exporter's license, five hundred dollars ($500);

          E. small brewer's public celebrations permit, ten dollars ($10.00) for each public celebration; [and

          I.] F. small brewer's off-premises permit, two hundred dollars ($200) for each off-premises location;

          G. microdistiller's license, seven hundred fifty dollars ($750); and

          H. microdistiller's off-premises permit, two hundred dollars ($200) for each off-premises location."

     SECTION 5. TEMPORARY PROVISION--APPLICATIONS FOR LICENSE.--

          A. If a person has submitted an application for a manufacturer's license as a distiller to the director of the alcohol and gaming division of the regulation and licensing department and, on July 1, 2011, the application has not yet been approved, the person may submit a request in writing to the director no later than July 31, 2011 to convert the application from a manufacturer's license as a distiller to an application for a microdistiller's license in accordance with procedures adopted by the director.

          B. If, within one hundred twenty days prior to or subsequent to July 1, 2011, a person obtains approval for a manufacturer's license as a distiller, the person may submit a request in writing to the director of the alcohol and gaming division of the regulation and licensing department to convert the manufacturer's license as a distiller to a microdistiller's license pursuant to procedures adopted by the director and upon payment of licensing fees as provided in Section 60-6A-27 NMSA 1978. There shall be no refunds of application or licensing fees unless otherwise provided by law.

     SECTION 6. EFFECTIVE DATE.--The effective date of the

provisions of this act is July 1, 2011.

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