House File 83 - Introduced HOUSE FILE 83 BY JONES A BILL FOR An Act providing for the direct shipment of alcoholic liquor 1 and including effective date provisions. 2 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 3 TLSB 1124YH (2) 90 ec/rn
H.F. 83 Section 1. Section 123.28, subsection 5, Code 2023, is 1 amended to read as follows: 2 5. This section does not affect the right of a retail 3 alcohol license holder to purchase, possess, or transport 4 alcoholic liquors subject to this chapter . In addition, this 5 section shall not impact the direct shipment of alcoholic 6 liquor as regulated by section 123.42A. 7 Sec. 2. Section 123.32, subsection 1, paragraph b, Code 8 2023, is amended by adding the following new subparagraph: 9 NEW SUBPARAGRAPH . (4A) An alcoholic liquor direct shipper 10 license as provided in section 123.42A. 11 Sec. 3. Section 123.32, subsection 1, paragraph b, 12 subparagraph (10), Code 2023, is amended to read as follows: 13 (10) A wine An alcoholic beverage carrier permit as provided 14 in section 123.188 . 15 Sec. 4. Section 123.41, subsection 1, Code 2023, is amended 16 to read as follows: 17 1. Each completed application to obtain or renew a 18 manufacturers license shall be submitted to the division 19 electronically, or in a manner prescribed by the administrator, 20 and shall be accompanied by a fee of three hundred dollars 21 payable to the division. The administrator may in accordance 22 with this chapter grant and issue to a manufacturer a 23 manufacturers license, valid for a one-year period after date 24 of issuance, which shall allow the manufacture, storage, and 25 wholesale disposition and sale of alcoholic liquors to the 26 division and to customers outside of the state pursuant to the 27 laws of that jurisdiction . 28 Sec. 5. Section 123.41, Code 2023, is amended by adding the 29 following new subsection: 30 NEW SUBSECTION . 1A. A manufacturer of alcoholic liquor 31 may ship alcoholic liquor in closed containers to individual 32 purchasers inside this state by obtaining an alcoholic liquor 33 direct shipper license pursuant to section 123.42A. 34 Sec. 6. NEW SECTION . 123.42A Direct shipment of alcoholic 35 -1- LSB 1124YH (2) 90 ec/rn 1/ 8
H.F. 83 liquor license and requirements. 1 1. An alcoholic liquor manufacturer licensed or permitted 2 pursuant to laws regulating alcoholic beverages in this state 3 or another state may apply for an alcoholic liquor direct 4 shipper license, as provided in this section. For the purposes 5 of this section, an alcoholic liquor manufacturer means a 6 business with an operating still which distills spirits, barrel 7 matures spirits for a period of two years on the licensed 8 premises of the distillery where matured, or blends or mixes 9 spirits comprised solely of spirits distilled or barrel matured 10 for a period of two years on the licensed premises of the 11 distillery, and which, combining all production facilities 12 of the business, produces and manufactures not more than one 13 hundred thousand proof gallons of native distilled spirits on 14 an annual basis. 15 2. a. Only an alcoholic liquor manufacturer that holds 16 an alcoholic liquor direct shipper license issued pursuant to 17 this section shall sell alcoholic liquor at retail for direct 18 shipment to any person within this state. This section shall 19 not prohibit an authorized retail licensee or permittee from 20 delivering alcoholic liquor pursuant to section 123.46A. 21 b. An alcoholic liquor manufacturer applying for an 22 alcoholic liquor direct shipper license shall submit an 23 application for the license electronically, or in a manner 24 prescribed by the administrator, accompanied by a true copy 25 of the manufacturers current alcoholic beverage license or 26 permit issued by the state where the manufacturer is primarily 27 located, a copy of the manufacturers basic permit issued by 28 the alcohol and tobacco tax and trade bureau of the United 29 States department of the treasury, and documents filed by the 30 manufacturer with the alcohol and tobacco tax and trade bureau 31 of the United States department of the treasury that show the 32 total number of proof gallons of distilled spirits produced and 33 manufactured by the manufacturer for the preceding calendar 34 year. 35 -2- LSB 1124YH (2) 90 ec/rn 2/ 8
H.F. 83 c. An application submitted pursuant to paragraph b shall 1 be accompanied by a license fee in the amount of twenty-five 2 dollars. 3 d. A license issued pursuant to this section may be 4 renewed annually by submitting a renewal application with the 5 administrator in a manner prescribed by the administrator, 6 accompanied by the twenty-five dollar license fee. 7 3. The direct shipment of alcoholic liquor pursuant to this 8 section shall be subject to the following requirements and 9 restrictions: 10 a. Alcoholic liquor shall only be shipped to a resident of 11 this state who is at least twenty-one years of age, for the 12 residents personal use and consumption and not for resale. 13 b. Alcoholic liquor subject to direct shipping shall be 14 properly registered with the federal alcohol and tobacco tax 15 and trade bureau, and manufactured on the licensed premises of 16 the alcoholic liquor direct shipper licensee. 17 c. Alcoholic liquor subject to direct shipping shall 18 be properly registered with the division. Products which 19 are not listed for sale by the division must be registered 20 electronically with the division for direct shipping. This 21 registration will include the name of the manufacturer, the 22 name of the brand, the standard of fill, the wholesale price, 23 and other information as requested by the division. The 24 registration shall be updated as necessary to ensure the 25 division possesses an accurate, current registration. 26 d. All containers of alcoholic liquor shipped directly to a 27 resident of this state shall be conspicuously labeled with the 28 words CONTAINS ALCOHOL: SIGNATURE OF PERSON AGE 21 OR OLDER 29 REQUIRED FOR DELIVERY or shall be conspicuously labeled with 30 alternative wording preapproved by the administrator. 31 e. All containers of alcoholic liquor shipped directly 32 to a resident of this state shall be shipped by a holder of 33 an alcoholic beverage carrier permit as provided in section 34 123.188. 35 -3- LSB 1124YH (2) 90 ec/rn 3/ 8
H.F. 83 f. Shipment of alcoholic liquor pursuant to this subsection 1 does not require a refund value for beverage container control 2 purposes under chapter 455C. 3 4. An alcoholic liquor direct shipper licensee shipping 4 alcoholic liquor to this state shall remit the following amount 5 to the division in a manner as directed by the division: 6 a. For alcoholic liquor that is listed for sale by the 7 division, an amount equivalent to fifty percent of the listed 8 wholesale price. 9 b. For alcoholic liquor that is not listed for sale 10 by the division, an amount equivalent to fifty percent of 11 the wholesale price as registered with the division under 12 subsection 3. 13 5. Each alcoholic liquor direct shipper licensee shall make 14 a report under oath to the division electronically, or in a 15 manner prescribed by the administrator, on or before the tenth 16 day of each month, which includes the following information: 17 a. The products and quantities shipped directly to residents 18 of this state in the preceding month. 19 b. The name and address of the individuals to whom the 20 alcoholic liquor was sold in each sale. 21 c. The wholesale price of the alcoholic liquor sold. 22 d. The purchase price of the alcoholic liquor sold and 23 the amount of taxes charged to the individual purchasing the 24 alcoholic liquor. 25 e. The alcoholic beverage carrier permittee who delivered 26 the shipment. 27 f. All documents filed by the alcoholic liquor direct 28 shipper licensee with the alcohol and tobacco tax and trade 29 bureau of the United States department of treasury for the 30 preceding month, including all production, storage, and 31 processing reports. 32 6. The license holder at the time of filing the report as 33 required by subsection 5 shall pay to the division the amount 34 as required pursuant to subsection 4. A penalty of ten percent 35 -4- LSB 1124YH (2) 90 ec/rn 4/ 8
H.F. 83 of the amount due shall be assessed and collected if the report 1 required to be filed pursuant to this section and the amount 2 required to be paid as provided by subsection 4 is not filed 3 and the amount paid within the time required by this section. 4 7. An alcoholic liquor direct shipper licensee shall be 5 deemed to have consented to the jurisdiction of the division or 6 any other agency or court in this state concerning enforcement 7 of this section and any related laws, rules, or regulations. A 8 license holder shall allow the division to perform an audit of 9 shipping records upon request. 10 8. A violation of this section shall subject the licensee 11 to the general penalties provided in this chapter and shall 12 constitute grounds for imposition of a civil penalty or 13 suspension or revocation of the license pursuant to section 14 123.39. 15 Sec. 7. Section 123.43A, subsection 2, Code 2023, is amended 16 to read as follows: 17 2. A native distillery shall not sell more than nine 18 liters per person per day, of native distilled spirits on 19 the premises of the native distillery. However, a native 20 distillery shall not directly may ship native distilled spirits 21 for sale at retail manufactured by the native distillery in 22 closed containers to individual purchasers inside the state by 23 obtaining an alcoholic liquor direct shipper license pursuant 24 to section 123.42A . The native distillery shall maintain 25 records of individual purchases of native distilled spirits at 26 the native distillery for three years. 27 Sec. 8. Section 123.43A, subsection 7, Code 2023, is amended 28 to read as follows: 29 7. A native distillery may sell the native distilled spirits 30 it manufactures to customers outside the state , pursuant to the 31 laws of that jurisdiction . 32 Sec. 9. Section 123.46A, subsection 5, Code 2023, is amended 33 to read as follows: 34 5. Nothing in this section shall impact the direct shipment 35 -5- LSB 1124YH (2) 90 ec/rn 5/ 8
H.F. 83 of alcoholic liquor as regulated by section 123.42A or the 1 direct shipment of wine as regulated by section 123.187 . 2 Sec. 10. Section 123.187, subsection 3, paragraph d, Code 3 2023, is amended to read as follows: 4 d. All containers of wine shipped directly to a resident of 5 this state shall be shipped by a holder of a wine an alcoholic 6 beverage carrier permit as provided in section 123.188 . 7 Sec. 11. Section 123.188, subsections 1, 2, and 4, Code 8 2023, are amended to read as follows: 9 1. A person desiring to deliver alcoholic liquor subject 10 to direct shipment within this state pursuant to section 11 123.42A and wine subject to direct shipment within this state 12 pursuant to section 123.187 shall submit an application for a 13 wine an alcoholic beverage carrier permit electronically, or 14 in a manner prescribed by the administrator, which shall be 15 accompanied by a fee in the amount of one hundred dollars. 16 2. The administrator may in accordance with this chapter 17 issue a wine an alcoholic beverage carrier permit which shall 18 be valid for one year from the date of issuance unless it is 19 sooner suspended or revoked for a violation of this chapter . 20 4. The delivery of alcoholic liquor and wine pursuant to 21 this section shall be subject to the following requirements and 22 restrictions: 23 a. A wine An alcoholic beverage carrier permittee shall not 24 deliver alcoholic liquor or wine to any person under twenty-one 25 years of age, or to any person who either is or appears to be in 26 an intoxicated state or condition. 27 b. A wine An alcoholic beverage carrier permittee shall 28 obtain valid proof of identity and age prior to delivery, 29 and shall obtain the signature of an adult as a condition of 30 delivery. 31 c. A wine An alcoholic beverage carrier permittee shall 32 maintain records of alcoholic liquor and wine shipped which 33 include the permit number and name of the alcoholic liquor 34 and wine manufacturer, quantity of alcoholic liquor and wine 35 -6- LSB 1124YH (2) 90 ec/rn 6/ 8
H.F. 83 shipped, recipients name and address, and an electronic or 1 paper form of signature from the recipient of the alcoholic 2 liquor and wine. Records shall be submitted to the division 3 on a monthly basis in a form and manner to be determined by the 4 division. 5 Sec. 12. EFFECTIVE DATE. This Act takes effect January 1, 6 2024. 7 EXPLANATION 8 The inclusion of this explanation does not constitute agreement with 9 the explanations substance by the members of the general assembly. 10 This bill allows for the direct shipment of alcoholic liquor 11 within the state. 12 New Code section 123.42A provides for the direct shipment of 13 alcoholic liquor and provides for an alcoholic liquor direct 14 shipper license. The bill provides that only alcoholic liquor 15 manufacturers that produce and manufacture not more than 16 100,000 proof gallons of native distilled spirits on an annual 17 basis are eligible for this license. Provisions governing the 18 direct shipment of wine and the wine direct shipper permit are 19 generally made applicable to the new Code section providing 20 for the direct shipment of alcoholic liquor. In addition to 21 these requirements, the new Code section requires all alcoholic 22 liquor subject to direct shipping to be properly registered 23 with the alcoholic beverages division and that products which 24 are not listed for sale by the division must be registered 25 to include information on the name of the manufacturer, the 26 name of the brand, the standard of fill, the wholesale price, 27 and other information as requested by the division. The 28 new Code section also requires each alcoholic liquor direct 29 shipper licensee to make a monthly report to the alcoholic 30 beverages division that lists the products and quantities 31 shipped directly to residents of this state in the preceding 32 month, the name and address of the individuals to whom the 33 alcoholic liquor was sold in each sale, the wholesale price of 34 the alcoholic liquor sold, the purchase price and taxes charged 35 -7- LSB 1124YH (2) 90 ec/rn 7/ 8
H.F. 83 of the alcoholic liquor sold, the alcoholic beverage carrier 1 permittee who delivered each shipment, and documents filed by 2 the licensee with the alcohol and tobacco tax and trade bureau 3 of the United States department of treasury for the preceding 4 month, including all production, storage, and processing 5 reports. Finally, the new Code section provides that an 6 alcoholic liquor direct shipper licensee shall remit an amount 7 to the alcoholic beverages division depending on whether the 8 alcoholic liquor shipped is listed for sale by the division. 9 If the alcoholic liquor is listed for sale by the division, the 10 permittee shall remit to the division an amount equivalent to 11 50 percent of the wholesale price paid by the division for the 12 alcoholic liquor. If the alcoholic liquor is not listed for 13 sale by the division, the permittee shall remit to the division 14 an amount equivalent to 50 percent of the wholesale price of 15 the alcoholic liquor as registered with the division. The bill 16 provides that a penalty of 10 percent of the amount due shall 17 be assessed and collected if the amount required to be paid to 18 the division as provided by the bill is not paid within the 19 time required. 20 The bill allows a manufacturer of alcoholic liquor and a 21 native distillery to ship alcoholic liquor or native distilled 22 spirits, as applicable, to individual purchasers inside this 23 state by obtaining an alcoholic liquor direct shipper license 24 as established in the bill. 25 Code section 123.188, providing for a wine carrier permit, 26 is amended to provide for the direct shipment of alcoholic 27 liquor as provided by the bill. 28 The bill takes effect January 1, 2024. 29 -8- LSB 1124YH (2) 90 ec/rn 8/ 8