Liquor: other; discount for specially designated distributors and on-premises licensees; increase. Amends sec. 233 of 1998 PA 58 (MCL 436.1233).
Furthermore, the bill includes provisions for adjusting prices for certain entities, such as hospitals, charitable institutions, and military establishments. It permits specially designated distributors and on-premises licensees to receive a discount, increasing the previously established discount from 17% to 23%. This aspect is intended to alleviate some financial burdens on establishments that have consistent operational costs associated with liquor sales.
House Bill 4113 introduces amendments to the Michigan Liquor Control Code of 1998, specifically focusing on the pricing and distribution of alcoholic liquor by specially designated distributors. The bill mandates that the Michigan liquor control commission establishes uniform selling prices for this liquor, ensuring that these prices result in a gross profit margin for the commission between 51% and 65%. This change aims to standardize the profit structure across distributors and enhance compliance with state guidelines regarding liquor sales.
A notable point of contention surrounds the provisions for small distillers under this bill. It creates a pathway for small distillers, including out-of-state entities that meet certain criteria, to be recognized as 'qualified small distillers,' enabling them to benefit from specific pricing schemes. For these entities, the bill requires that at least 40% of the base distillate must be sourced from qualified grain grown in Michigan, fostering local agricultural ties while promoting the craft beverage industry.
Violations regarding the certification process or misrepresentation can lead to severe penalties, including misdemeanor charges. Additionally, these small distillers are required to maintain rigorous record-keeping of their transactions, with oversight by the Department of Agriculture and Rural Development, ensuring transparency and adherence to the new regulatory framework. This multifaceted approach aims to bolster both the local economy and the state's crafting spirit market.