LEGISLATIVE SERVICES AGENCY
OFFICE OF FISCAL AND MANAGEMENT ANALYSIS
200 W. Washington St., Suite 301
Indianapolis, IN 46204
(317) 233-0696
iga.in.gov
FISCAL IMPACT STATEMENT
LS 7163 NOTE PREPARED: Jan 26, 2022
BILL NUMBER: HB 1298 BILL AMENDED: Jan 26, 2022
SUBJECT: Alcoholic Beverages.
FIRST AUTHOR: Rep. Smaltz BILL STATUS: 2nd Reading - 1st House
FIRST SPONSOR:
FUNDS AFFECTED:XGENERAL IMPACT: State & Local
XDEDICATED
FEDERAL
Summary of Legislation: (Amended) This bill allows a county, city, or town to adopt an ordinance to allow
the following at a farmers' market, subject to the consent of the operator of the farmers' market:
(1) A small brewery, farm winery, or artisan distillery (craft manufacturer) to serve complimentary samples
of the alcoholic beverages (product) that they manufacture.
(2) A small brewery or artisan distillery to sell their product in original containers.
It provides that the Alcohol and Tobacco Commission (ATC) may not require physical separation between
a bar area and a dining area in a food hall.
It reduces the length of time that an applicant for an artisan distiller's permit must hold another permit prior
to the date of the application.
The bill creates a temporary craft manufacturer hospitality permit (hospitality permit) that allows a craft
manufacturer to participate in a convention, a trade show, an exposition, or a similar event on the licensed
premises of a particular host permittee. It specifies certain requirements and restrictions concerning a
hospitality permit.
It makes conforming amendments.
Effective Date: July 1, 2022.
Explanation of State Expenditures: (Revised) The bill would increase the workload of the Alcohol and
Tobacco Commission (ATC). The ATC would be responsible for enforcing and implementing the bill’s
HB 1298 1 provisions, including enforcing alcoholic beverage laws at farmer’s markets where alcoholic beverages are
sold. The ATC would also be required to amend and adopt rules, as well as process applications and issue
temporary craft manufacturer hospitality permits. [The ATC’s enforcement and administrative costs are
funded primarily by appropriations from a dedicated agency fund.]
Explanation of State Revenues: (Revised) Permit Fees: The bill establishes a $50 permit fee for a
temporary craft manufacturer hospitality permit. Permits may be issued for a period of up to 15 days. The
potential amount of revenue collected from this fee is indeterminable and will depend on the number of
applicants. Revenue will be deposited in the Enforcement and Administration Fund.
(Revised) Alcoholic Beverage Sales: To the extent that alcoholic beverage sales increase as a result of
increased availability at farmers’ markets and events held under temporary craft manufacturer hospitality
permits, Alcoholic Beverage Tax and Sales Tax revenue could potentially increase. However, any increase
would be minimal, as an increase in sales at farmers’ markets and other events would likely be offset by
reduced sales at other locations. [Alcoholic Beverage Tax revenue is distributed in varying amounts to the
following funds: General Fund, State Construction Fund, Enforcement and Administration Fund, Pension
Relief Fund, and Addiction Services Fund. Sales Tax revenue is primarily deposited in the General Fund.]
(Revised) Penalty Provisions: Under current law, it is a Class B misdemeanor for the owner or operator of
a restaurant or place of entertainment to permit another person to come into the establishment with an
alcoholic beverage for sale, gift, or consumption. It is also a Class C misdemeanor to (1) carry on, convey
to, or consume on a licensed premises an alcoholic beverage that was not then and there purchased from the
permittee or (2) carry liquor into a restaurant or place of public entertainment. The bill exempts events held
under temporary craft manufacturer hospitality permits from these provisions. If fewer court cases occur and
fines are collected, revenue to both the Common School Fund (from fines) and the state General Fund (from
court fees) would decrease. The maximum fine for a Class B misdemeanor is $1,000, and the maximum fine
for a Class C misdemeanor is $500. However, any decrease in revenue would likely be small.
Explanation of Local Expenditures: Local Ordinances: If a county, city, or town holds additional meetings
to adopt an ordinance described in the bill, workload and costs could increase. However, the bill’s
requirements should be able to be implemented within existing resources.
Penalty Provisions: A Class B misdemeanor is punishable by up to 180 days in jail, and a Class C
misdemeanor is punishable by up to 60 days in jail.
Explanation of Local Revenues: Penalty Provisions: If fewer court actions occur and guilty verdicts are
entered, local governments would receive less revenue from court fees. However, any change in revenue
would likely be small.
State Agencies Affected: Alcohol and Tobacco Commission.
Local Agencies Affected: Counties, cities, and towns; trial courts, local law enforcement agencies.
Information Sources:
Fiscal Analyst: Lauren Tanselle, 317-232-9586.
HB 1298 2