EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
Underlining indicates amendments to bill.
Strike out indicates matter stricken from the bill by amendment or deleted from the law by
amendment.
*hb0854*
HOUSE BILL 854
A1, C8 2lr2416
CF SB 698
By: Delegate Wilkins
Introduced and read first time: February 7, 2022
Assigned to: Ways and Means and Economic Matters
Reassigned: Economic Matters and Ways and Means, February 11, 2022
Committee Report: Favorable with amendments
House action: Adopted
Read second time: March 12, 2022
CHAPTER ______
AN ACT concerning 1
Alcoholic Beverages – Maryland Alcohol Manufacturing and Promotion 2
FOR the purpose of repealing the Maryland Wine and Grape Promotion Fund and the 3
Advisory Commission on Maryland Wine and Grape Growing; establishing the 4
Advisory Commission on Maryland Alcohol Manufacturing in the Department of 5
Commerce as the successor to the Advisory Commission on Maryland Wine and 6
Grape Growing; establishing the Maryland Alcohol Manufacturing Promotion Fund 7
for certain purposes; requiring the Secretary of Commerce to award certain grants 8
from the Fund for certain purposes; directing the distribution of certain alcoholic 9
beverage tax revenues to the Fund; providing for the transfer of certain funds as of 10
a certain date; and generally relating to Maryland alcohol manufacturing and 11
promotion. 12
BY repealing 13
Article – Agriculture 14
Section 2–1101 and 2–1102 and the subtitle “Subtitle 11. Maryland Wine and Grape 15
Promotion Fund”; and 10–1201 through 10–1206 and the subtitle “Subtitle 12. 16
Advisory Commission on Maryland Wine and Grape Growing” 17
Annotated Code of Maryland 18
(2016 Replacement Volume and 2021 Supplement) 19
BY adding to 20
Article – Economic Development 21 2 HOUSE BILL 854
Section 5–1901 through 5–1912 to be under the new subtitle “Subtitle 19. Maryland 1
Alcohol Manufacturing and Promotion” 2
Annotated Code of Maryland 3
(2018 Replacement Volume and 2021 Supplement) 4
BY repealing and reenacting, with amendments, 5
Article – Tax – General 6
Section 2–301 and 5–105 7
Annotated Code of Maryland 8
(2016 Replacement Volume and 2021 Supplement) 9
SECTION 1. BE IT ENACTED BY THE GENERAL ASS EMBLY OF MARYLAND, 10
That Section(s) 2–1101 and 2–1102 and the subtitle “Subtitle 11. Maryland Wine and Grape 11
Promotion Fund”; and 10–1201 through 10–1206 and the subtitle “Subtitle 12. Advisory 12
Commission on Maryland Wine and Grape Growing” of Article – Agriculture of the 13
Annotated Code of Maryland be repealed. 14
SECTION 2. AND BE IT FURTHER ENACTED, That the Laws of Maryland read 15
as follows: 16
Article – Economic Development 17
SUBTITLE 19. MARYLAND ALCOHOL MANUFACTURING AND PROMOTION. 18
5–1901. 19
(A) IN THIS SU BTITLE THE FOLLOWING WORDS HAVE THE MEANI NGS 20
INDICATED. 21
(B) “ADVISORY COMMISSION” MEANS THE ADVISORY COMMISSION ON 22
MARYLAND ALCOHOL MANUFACTURING . 23
(C) “BEER” HAS THE MEANING STAT ED IN § 1–101 OF THE ALCOHOLIC 24
BEVERAGES ARTICLE. 25
(D) “BREWERY” MEANS AN ESTABLISHMENT OPERAT ED UNDER A CLASS 5 26
BREWERY LICENSE , CLASS 6 PUB–BREWERY LICENSE , CLASS 7 MICRO–BREWERY 27
LICENSE, OR CLASS 8 FARM BREWERY LICENSE . 28
(E) “DISTILLED SPIRITS” HAS THE MEANING STAT ED IN § 5–101 OF THE 29
TAX – GENERAL ARTICLE. 30
(F) “DISTILLERY” MEANS AN ESTABLISHME NT OPERATED UNDER A 31
CLASS 1 DISTILLERY LICENSE O R CLASS 9 LIMITED DISTILLERY L ICENSE. 32
HOUSE BILL 854 3
(G) “FUND” MEANS THE MARYLAND ALCOHOL MANUFACTURING 1
PROMOTION FUND. 2
(H) “GROWER” MEANS A PERSON WHO : 3
(1) GROWS GRAPES , HOPS, FRUIT, HONEY, OR GRAIN TO BE INCLU DED 4
IN MANUFACTURED ALCO HOL IN THE STATE; AND 5
(2) PRODUCES AT LEAST $10,000 WORTH OF THESE PRODU CTS EACH 6
YEAR. 7
(I) “VITICULTURE” MEANS THE CULTIVATIO N AND STUDY OF GRAPE S AND 8
GRAPE VINES. 9
(J) “WINE” HAS THE MEANING STAT ED IN § 1–101 OF THE ALCOHOLIC 10
BEVERAGES ARTICLE. 11
(K) “WINERY” MEANS AN ESTABLISHME NT OPERATED UNDER A CLASS 3 12
WINERY LICENSE OR CLASS 4 LIMITED WINERY LICEN SE. 13
5–1902. 14
THERE IS AN ADVISORY COMMISSION ON MARYLAND ALCOHOL 15
MANUFACTURING IN THE DEPARTMENT . 16
5–1903. 17
(A) THE ADVISORY COMMISSION CONSISTS O F THE FOLLOWING MEMB ERS: 18
(1) THE SECRETARY OR THE SECRETARY’S DESIGNEE; 19
(2) THE SECRETARY OF AGRICULTURE , OR THE SECRETARY’S 20
DESIGNEE; 21
(3) ONE MEMBER OF THE ALCOHOL AND TOBACCO COMMISSION, 22
DESIGNATED BY THE CHAIR OF THE ALCOHOL AND TOBACCO COMMISSION; 23
(4) ONE MEMBER OF THE SENATE OF MARYLAND, APPOINTED BY THE 24
PRESIDENT OF THE SENATE; 25
(4) (5) ONE MEMBER OF THE HOUSE OF DELEGATES, APPOINTED 26
BY THE SPEAKER OF THE HOUSE; AND 27
(5) (6) THE FOLLOWING MEMBERS APPOINTED BY THE GOVERNOR: 28
4 HOUSE BILL 854
(I) ONE MEMBER REPRESENT ING THE UNIVERSITY OF 1
MARYLAND COLLEGE OF AGRICULTURE AND NATURAL RESOURCES; 2
(II) TWO MEMBERS REPRESEN TING BREWERIES IN TH E STATE; 3
(III) TWO MEMBERS REPRESEN TING DISTILLERIES IN THE 4
STATE; 5
(IV) TWO MEMBERS REPRESEN TING WINERIES IN THE STATE; 6
AND 7
(V) TWO MEMBERS REPRESEN TING GROWERS IN THE STATE. 8
(B) BEFORE TAKING OFFICE , EACH MEMBER OF THE ADVISORY 9
COMMISSION SHALL TAKE THE OATH REQUIRED BY ARTICLE I, § 9 OF THE 10
MARYLAND CONSTITUTION. 11
(C) (1) THE TERM OF A MEMBER IS 3 YEARS. 12
(2) THE TERMS OF MEMBERS ARE STAGGERED AS REQ UIRED BY THE 13
TERMS PROVIDED FOR M EMBERS OF THE ADVISORY COMMISSION ON JULY 1, 2022. 14
(3) AT THE END OF A TERM , A MEMBER CONTINUES T O SERVE UNTIL 15
A SUCCESSOR IS APPOINT ED AND QUALIFIES . 16
(4) A MEMBER WHO IS APPOIN TED AFTER A TERM HAS BEGUN SERVES 17
ONLY FOR THE REST OF THE TERM AND UNTIL A SUCCESSOR IS APPOINT ED AND 18
QUALIFIES. 19
(5) A MEMBER MAY NOT BE AP POINTED FOR MORE THA N TWO 20
CONSECUTIVE FULL TER MS. 21
(D) THE GOVERNOR MAY REMOVE A MEMBER FOR INCOMPETE NCE OR 22
MISCONDUCT . 23
5–1904. 24
(A) THE GOVERNOR SHALL DESIGN ATE THE CHAIR OF THE ADVISORY 25
COMMISSION. 26
(B) FROM AMONG ITS MEMBER S, THE ADVISORY COMMISSION EACH YEAR 27
SHALL ELECT A VICE C HAIR. 28
HOUSE BILL 854 5
(C) THE ADVISORY COMMISSION SHALL DETE RMINE THE MANNER OF 1
ELECTION OF THE VICE CHAIR AND ANY OTHER OFFICERS. 2
5–1905. 3
(A) THE ADVISORY COMMISSION SHALL DETE RMINE THE TIMES AND 4
PLACES OF ITS REGULA R AND SPECIAL MEETIN GS. 5
(B) THE CHAIR OF THE ADVISORY COMMISSION: 6
(1) MAY CALL A SPECIAL M EETING AT ANY TIME ; AND 7
(2) SHALL CALL A SPECIAL MEETING WHEN REQUEST ED BY TWO OR 8
MORE MEMBERS OF THE ADVISORY COMMISSION. 9
(C) A MAJORITY OF THE MEMB ERS THEN SERVING ON THE ADVISORY 10
COMMISSION IS A QUORU M. 11
5–1906. 12
A MEMBER OF THE ADVISORY COMMISSION: 13
(1) MAY NOT RECEIVE COMP ENSATION AS A MEMBER OF THE 14
ADVISORY COMMISSION; BUT 15
(2) IS ENTITLED TO REIMB URSEMENT FOR EXPENSE S UNDER THE 16
STANDARD STATE TRAVEL REGULATIONS, AS PROVIDED IN THE STATE BUDGET . 17
5–1907. 18
THE DEPARTMENT SHALL PROV IDE STAFF FOR THE ADVISORY COMMISSION. 19
5–1908. 20
THE ADVISORY COMMISSION SHALL : 21
(1) ADVISE AND RECOMMEND TO THE SECRETARY FOR APPROVA L 22
THE ALLOCATION OF MO NEY FROM THE MARYLAND ALCOHOL MANUFACTURING 23
PROMOTION FUND TO ELIGIBLE A PPLICANTS FOR PROGRA MS CONSIDERED 24
NECESSARY OR ADVISAB LE TO ACCOMPLISH THE PURPOSES OF THIS SUB TITLE; 25
(2) PROVIDE A FORUM TO A DDRESS THE ISSUES TH AT ARE RELEVANT 26
TO THE GROWTH OF THE MARYLAND ALCOHOL MANU FACTURING INDUSTRY ; AND 27
6 HOUSE BILL 854
(3) IDENTIFY STRATEGIE S TO FACILITATE GROW TH OF VITICULTURE 1
AND OTHER PRODUCTS U SED IN MANUFACTURED ALCOHOL SUCH AS HOPS , FRUIT, 2
HONEY, AND GRAIN. 3
5–1909. 4
(A) THERE IS A MARYLAND ALCOHOL MANUFACTURING PROMOTION 5
FUND. 6
(B) THE PURPOSE OF THE FUND IS TO PROVIDE GR ANTS THAT PROMOTE 7
THE ADVANTAGES AND A TTRIBUTES OF STATE BREWERIES , DISTILLERIES, AND 8
WINERIES AND THEIR P RODUCTS MANUFACTURED IN THE STATE. 9
(C) THE SECRETARY SHALL ADMIN ISTER THE FUND. 10
(D) (1) THE FUND IS A SPECIAL , NONLAPSING FUND THAT IS NOT 11
SUBJECT TO REVERS ION UNDER § 7–302 OF THE STATE FINANCE AND 12
PROCUREMENT ARTICLE. 13
(2) THE STATE TREASURER SHALL HOLD THE FUND SEPARATELY , 14
AND THE COMPTROLLER SHALL ACC OUNT FOR THE FUND. 15
(E) THE FUND CONSISTS OF : 16
(1) REVENUE DISTRIBUTED TO THE FUND UNDER § 2–301(B) OF THE 17
TAX – GENERAL ARTICLE; 18
(2) MONEY APPROPRIATED I N THE STATE BUDGET TO THE FUND; AND 19
(3) ANY OTHER MONEY FROM ANY OTHER SOURCE ACC EPTED FOR 20
THE BENEFIT OF THE FUND. 21
(F) THE FUND MAY BE USED ONLY FOR: 22
(1) GRANTS TO ELIGIBLE A PPLICANTS UNDER § 5–1910 OF THIS 23
SUBTITLE; AND 24
(2) ADMINISTRATIVE EXPEN SES OF THE FUND. 25
(G) (1) THE STATE TREASURER SHALL INVES T THE MONEY OF THE FUND 26
IN THE SAME MANNER A S OTHER STATE MONEY MAY BE IN VESTED. 27
(2) ANY INTEREST EARNINGS OF THE FUND SHALL BE CREDITE D TO 28
THE GENERAL FUND OF THE STATE. 29
HOUSE BILL 854 7
(H) EXPENDITURES FROM THE FUND MAY BE MADE ONLY IN ACCORDANCE 1
WITH THE STATE BUDGET . 2
5–1910. 3
(A) AN APPLICANT FOR A GR ANT FROM THE FUND SHALL SUBMIT AN 4
APPLICATION TO THE ADVISORY COMMISSION ON THE FOR M THAT THE SECRETARY 5
REQUIRES. 6
(B) TO BE ELIGIBLE TO REC EIVE A GRANT FROM TH E FUND, AN APPLICANT 7
MUST BE: 8
(1) A NONPROFIT ORGANIZA TION UNDER § 501(C)(3) § 501(C) OF THE 9
INTERNAL REVENUE CODE; OR 10
(2) A STATE OR LOCAL GOVERN MENTAL UNIT. 11
(C) THE SECRETARY SHAL L AWARD GRANTS TO EL IGIBLE APPLICANTS 12
FROM THE FUND BASED ON THE ADV ICE OF THE ADVISORY COMMISSION. 13
(D) SUBJECT TO THE AVAILA BILITY OF MONEY IN T HE FUND, THE 14
SECRETARY MAY AWARD G RANTS TO ELIGIBLE AP PLICANTS TO: 15
(1) FOSTER THE CREATION AND EXPANSION O F STATE BREWERIES , 16
DISTILLERIES, AND WINERIES; 17
(2) ATTRACT NEW VISITORS TO STATE BREWERIES , DISTILLERIES, 18
AND WINERIES; 19
(3) ENCOURAGE AND CREATE INCENTIVES FOR SPECI AL EVENTS TO 20
PROMOTE STATE BREWERIES , DISTILLERIES, AND WINERIES; 21
(4) EDUCATE THE PUBLIC ABOUT ALCOHOL MANUFACTURING IN THE 22
STATE, ESPECIALLY THE HISTO RY OF THE INDUSTRY ; 23
(5) CONDUCT RESEARCH ON , DEVELOP INCENTIVES F OR, AND 24
PROMOTE THE GROWTH O F STATE AGRICULTURAL PR ODUCTS USED IN STATE 25
MANUFACTURED BEER , WINE, AND SPIRITS; OR 26
(6) SUPPORT THE EXPANSIO N OF MINORITY OWNERS HIP AND 27
PARTICIPATION IN THE OPERATION OF STATE BREWERIES , DISTILLERIES, AND 28
WINERIES. 29
8 HOUSE BILL 854
(E) AN ELIGIBLE APPLICANT MAY NOT USE A GRANT PROVIDED UNDER THIS 1
SUBTITLE TO: 2
(1) SATISFY ANY PART OF A MATCHING FUND REQUIREMENT OF 3
ANOTHER STATE GRANT PROVIDED TO THE ELIGIBLE APPL ICANT; OR 4
(2) PAY FOR ACTIVITIES R ELATED TO LOBBYING , AS DEFINED IN 5
TITLE 5 OF THE GENERAL PROVISIONS ARTICLE. 6
5–1911. 7
THE ADVISORY COMMISSION SHALL ISSU E A REPORT EACH YEAR TO THE 8
GOVERNOR AND, IN ACCORDANCE WITH § 2–1257 OF THE STATE GOVERNMENT 9
ARTICLE, THE SENATE EDUCATION, HEALTH, AND ENVIRONMENTAL AFFAIRS 10
COMMITTEE AND THE HOUSE ECONOMIC MATTERS COMMITTEE ON THE ADVISORY 11
COMMISSION’S FINDINGS AND RECOM MENDATIONS . 12
5–1912. 13
THE SECRETARY MAY ADOPT REGUL ATIONS TO CARRY OUT THIS SUBTITLE. 14
Article – Tax – General 15
2–301. 16
(a) From the alcoholic beverage tax revenue, the Comptroller shall distribute the 17
amount necessary to administer the alcoholic beverage tax laws to an administrative cost 18
account. 19
(b) AFTER MAKING THE DIST RIBUTION REQUIRED UN DER SUBSECTION (A) 20
OF THIS SECTION , THE COMPTROLLER SHALL DIS TRIBUTE TO THE MARYLAND 21
ALCOHOL MANUFACTURING PROMOTION FUND UNDER § 5–1909 OF THE 22
ECONOMIC DEVELOPMENT ARTICLE THE ALCOHOLIC BEVERAGE TAX REVENUE 23
COLLECTED UNDER § 5–105 OF THIS ARTICLE ON : 24
(1) BEER PRODUCED BY HOL DERS OF A CLASS 5 BREWERY LICENSE , 25
CLASS 6 PUB–BREWERY LICENSE , CLASS 7 MICRO–BREWERY LICENSE , OR CLASS 8 26
FARM BREWERY LICENSE ; 27
(2) WINE PRODUCED BY HOL DERS OF A CLASS 3 WINERY LICENSE OR 28
CLASS 4 LIMITED WINERY LICEN SE; AND 29
(3) DISTILLED SPIRITS PR ODUCED BY HOLDERS OF A CLASS 1 30
DISTILLERY LICENSE O R CLASS 9 LIMITED DISTILLERY L ICENSE. 31
HOUSE BILL 854 9
(C) After making the [distribution] DISTRIBUTIONS required under [subsection 1
(a)] SUBSECTIONS (A) AND (B) of this section, the Comptroller shall distribute the 2
remaining alcoholic beverage tax revenue to the General Fund of the State. 3
5–105. 4
(a) Except as provided in subsection (d) of this section, the alcoholic beverage tax 5
rate for distilled spirits is: 6
(1) $1.50 for each gallon or 39.63 cents for each liter; and 7
(2) if distilled spirits contain a percentage of alcohol greater than 100 proof, 8
an additional tax, for each 1 proof over 100 proof, of 1.5 cents for each gallon or 0.3963 cents 9
for each liter. 10
(b) Except as provided in subsection (d) of this section, the alcoholic beverage tax 11
rate for wine is 40 cents for each gallon or 10.57 cents for each liter. 12
(c) Except as provided in subsection (d) of this section, the alcoholic beverage tax 13
rate on beer and mead is 9 cents for each gallon or 2.3778 cents for each liter. 14
(d) The tax imposed under § 5–102(b) of this subtitle shall equal the amount that 15
the discriminating jurisdiction charges a Maryland licensee or permit holder. 16
[(e) The revenue generated from the tax imposed under subsection (b) of this 17
section on wine produced at wineries licensed under the Alcoholic Beverages Article shall 18
be distributed to the Maryland Wine and Grape Promotion Fund under § 2–1102 of the 19
Agriculture Article.] 20
SECTION 3. AND BE IT FURTHER ENACTED, That all funds in the Maryland 21
Wine and Grape Promotion Fund at the end of June 30, 2022, shall be transferred to the 22
Maryland Alcohol Manufacturing Promotion Fund established under Section 2 of this Act. 23
SECTION 4. AND BE IT FURTHER ENACTED, That: 24
(a) The Advisory Commission on Maryland Alcohol Manufacturing established 25
under Section 2 of this Act is the successor of the Advisory Commission on Maryland Wine 26
and Grape Growing. 27
(b) In every law, executive order, rule, regulation, policy, or document created by 28
an official, an employee, or a unit of this State, the names and titles of those agencies and 29
officials mean the names and titles of the successor agency or official. 30
SECTION 5. AND BE IT FURTHER ENACTED, That any transaction or 31
employment status affected by or flowing from any change of nomenclature or any statute 32
amended by this Act and validly entered into or existing before the effective date of this Act 33
and every right, duty, or interest flowing from a statute amended by this Act remains valid 34 10 HOUSE BILL 854
after the effective date of this Act and may be terminated, completed, consummated, or 1
enforced as required or allowed by any statute amended by this Act as though the 2
amendment had not occurred. If a change in nomenclature involves a change in name or 3
designation of any State unit, the successor unit shall be considered in all respects as 4
having the powers and obligations granted the former unit. 5
SECTION 6. AND BE IT FURTHER ENACTED, That: 6
(1) the continuity of every board, commission, office, department, agency, 7
or other unit is retained; and 8
(2) the personnel, records, files, furniture, fixtures, and other properties 9
and all appropriations, credits, assets, liabilities, and obligations of each retained unit are 10
continued as the personnel, records, files, furniture, fixtures, properties, appropriations, 11
credits, assets, liabilities, and obligations of the unit under the laws enacted by this Act. 12
SECTION 7. AND BE IT FURTHER ENACTED, That the initial terms of the 13
members appointed to the Advisory Commission on Maryland Alcohol Manufacturing 14
under § 5–1903(a)(5) § 5–1903(a)(6) of the Economic Development Article, as enacted by 15
Section 2 of this Act, shall terminate as follows: 16
(1) three members on June 30, 2024; 17
(2) three members on June 30, 2025; and 18
(3) three members on June 30, 2026. 19
SECTION 8. AND BE IT FURTHER ENACTED, That this Act shall take effect July 20
1, 2022. 21
Approved:
________________________________________________________________________________
Governor.
________________________________________________________________________________
Speaker of the House of Delegates.
________________________________________________________________________________
President of the Senate.