Senate Bill No. 569

(By Senator Mitchell)

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[Introduced February 21, 2000; referred to the Committee on the Judiciary; and then to the Committee on Finance.]
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A BILL to amend and reenact section fifteen, article two, chapter sixty of the code of West Virginia, one thousand nine hundred thirty-one, as amended; to amend and reenact section twelve, article six of said chapter; and to amend and reenact sections three and six, article eight of said chapter, all relating to allowing wine specialty shops to deliver wine locally and to ship wine in and out of the state effective upon passage of the provision; and to allow wine specialty shops to advertise wine and beer as part of a gift basket or beer kit in catalogues and on the internet.

Be it enacted by the Legislature of West Virginia:
That section fifteen, article two, chapter sixty of the code of West Virginia, one thousand nine hundred thirty-one, as amended, be amended and reenacted; that section twelve, article six of said chapter be amended and reenacted; and that sections three and six, article eight of said chapter be amended and reenacted, all to read as follows:
ARTICLE 2. ALCOHOL BEVERAGE CONTROL COMMISSIONER.
§60-2-15. Regulation of advertising.

The commission commissioner shall prescribe regulations governing the advertising of alcoholic liquors in this state. The regulations shall prohibit advertising that encourages intemperance, induces minors to purchase, or tends to deceive or misrepresent. The commissioner shall not, however, prohibit the advertising by wine specialty shops, as defined by section two, article eight of this chapter, of wine or beer that is advertised in conjunction with or as a component of, a gift basket or beer kit.
 ARTICLE 6. MISCELLANEOUS PROVISIONS.
§60-6-12. Transportation of alcoholic liquors into or through state; permits; bond of permittee.

The commission may adopt regulations governing the transportation of alcoholic liquors, lawfully acquired, within, into or through the state in quantities in excess of one gallon as it may deem considers necessary to confine such transportation to legitimate purposes and may issue transportation permits in accordance with such regulations, collect a fee therefor, and shall require each person to whom such a permit is issued to furnish a bond in such form and amount and with such surety as the commission shall direct, conditioned that he or she will exercise the privileges granted by such permit in conformity with the provisions of this chapter and the regulations of the commission, or in default thereof forfeit to the state school fund the sum of one hundred dollars for each breach recoverable by motion upon ten days' notice in any court having jurisdiction of the parties: Provided, That effective upon the date of passage of this provision, the commissioner shall allow wine specialty shops, as defined by section three, article eight of this chapter, to deliver and transport or cause to be delivered or transported, wine and beer in and through the state that is sold in conjunction with or as a component of, a gift basket or beer kit.
A person who, without authorization under this chapter, transports alcoholic liquors in quantities in excess of one gallon or in any amount for the purpose of sale or in any amount manufactured or acquired contrary to the provisions of this chapter, shall be guilty of a misdemeanor and, upon conviction shall be fined not less than one hundred nor more than five hundred dollars, or confined in jail not to exceed one year, or both such fine and imprisonment for the an first offense. Upon conviction of a second or subsequent offense, he or she shall be guilty of a felony and, confined in the penitentiary a correctional facility of this state for a period of not less than one nor more than three years.
ARTICLE 8. SALE OF WINES.
§60-8-3. Licenses; fees; general restrictions.

(a) Except as to farm wineries as defined by section five-a, article one of this chapter, no person may engage in business in the capacity of a distributor, retailer or private wine restaurant without first obtaining a license from the commissioner, nor shall a person continue to engage in any such activity after his or her license has expired, been suspended or revoked. No person may be licensed simultaneously as a distributor and a retailer, as a distributor and a private wine restaurant, or as a retailer and a private wine restaurant.
(b) The commissioner shall collect an annual fee for licenses issued under this article, as follows:
(1) Twenty-five hundred dollars per year for a distributor's license and each separate warehouse or other facility from which a distributor sells, transfers or delivers wine shall be separately licensed and there shall be collected with respect to each such location the annual license fee of twenty-five hundred dollars as herein provided.
(2) One hundred fifty dollars per year for a retailer's license.
(3) Fifty dollars per year for a wine tasting license.
(4) Fifty dollars for each sales representative of or employed by a licensed distributor.
(5) Two hundred fifty dollars per year for a private wine restaurant license, and each separate restaurant from which a licensee sells wine shall be separately licensed and there shall be collected with respect to each such location the annual license fee of two hundred fifty dollars as herein provided.
(6) Twenty-five dollars per year for a West Virginia wine retailer's license, and each separate retail outlet from which a West Virginia wine retailer sells West Virginia wine shall be separately licensed and there shall be collected with respect to each such location the annual license fee of twenty-five dollars as herein provided. The holder of such a license may sell no wines except those produced by West Virginia farm wineries as defined by section five-a, article one of this chapter. Except for the amount of the license fee and the restriction to sales of West Virginia wines, a West Virginia wine retailer is subject to all other provisions of this article which are applicable to a retailer as defined in section two of this article.
(c) The license period shall begin on the first day of July of each year and end on the thirtieth day of June of the following year, and if granted for a less period, the same shall be computed semiannually in proportion to the remainder of the fiscal year.
(d) No retailer may be licensed as a private club as provided by article seven of this chapter.
(e) No retailer may be licensed as a Class A retail dealer in nonintoxicating beer as provided by article sixteen, chapter eleven of this code: Provided, That a delicatessen, a caterer or party supply store which is a grocery store as defined in section two of this article and which is licensed as a Class A retail dealer in nonintoxicating beer may be a retailer under this article: Provided, however, That any delicatessen, caterer or party supply store licensed in both such capacities must maintain average monthly sales exclusive of sales of wine and nonintoxicating beer which exceed the average monthly sales of nonintoxicating beer.
(f) A retailer under this article may also hold a wine tasting license authorizing such retailer to serve complimentary samples of wine in moderate quantities for tasting. Such retailer shall organize a winetaster's club, which has at least fifty duly elected or approved dues paying members in good standing. Such club shall meet on the retailer's premises not more than one time per week and shall either meet at a time when the premises are closed to the general public, or shall meet in a separate segregated facility on the premises to which the general public is not admitted. Attendance at tastings shall be limited to duly elected or approved dues paying members and their guests.
(g) A retailer who has more than one place of retail business shall obtain a license for each separate retail establishment. A retailer's license may be issued only to the proprietor or owner of a bona fide grocery store or wine specialty shop.
(h) The commissioner may issue a special license for the retail sale of wine at any festival or fair which is endorsed or sponsored by the governing body of a municipality or a county commission. Such special license shall be issued for a term of no longer than ten consecutive days and the fee therefor shall be two hundred fifty dollars regardless of the term of the license unless the applicant is the manufacturer of said wine on a farm winery as defined in section five-a, article one of this chapter, in which event the fee shall be twenty-five dollars. The application for such license shall contain such information as the commissioner may reasonably require and shall be submitted to the commissioner at least thirty days prior to the first day when wine is to be sold at such festival or fair. A farm winery licensed under this subsection may exhibit, conduct tastings, not to exceed a reasonable serving, and may sell wine only for consumption off the premises of such festival or fair. A special license issued other than to a farm winery may be issued to a "wine club" as defined hereinbelow. The festival or fair committee or the governing body shall designate a person to organize a club under a name which includes the name of the festival or fair and the words "wine club". The license shall be issued in the name of the wine club. A licensee may not commence the sale of wine as provided for in this subsection until the wine club has at least fifty dues paying members who have been enrolled and to whom membership cards have been issued. Thereafter, new members may be enrolled and issued membership cards at any time during the period for which the license is issued. A wine club licensed under the provisions of this subsection may sell wine only to its members, and in portions not to exceed eight ounces per serving. Such sales shall take place on premises or in an area cordoned or segregated so as to be closed to the general public, and the general public shall not be admitted to such premises or area. A wine club licensee under the provisions of this subsection shall be authorized to serve complimentary samples of wine in moderate quantities for tasting.
A license issued under the provisions of this subsection and the licensee holding such license shall be subject to all other provisions of this article and the rules, regulations and orders of the commissioner relating to such special license: Provided, That the commissioner may by rule, regulation, or order provide for certain waivers or exceptions with respect to such provisions, rules, regulations, or orders as the circumstances of each such festival or fair may require, including, without limitation, the right to revoke or suspend any license issued pursuant to this section prior to any notice or hearing notwithstanding the provisions of section twelve of this article: Provided, however, That under no circumstances shall the provisions of subsection (c) or (d), section twenty of this article be waived nor shall any exception be granted with respect thereto.
A license issued under the provisions of this subsection and the licensee holding such license shall not be subject to the provisions of subsection (g) of this section.
(i) A license to sell wine granted to a private wine restaurant under the provisions of this article entitles the operator to sell and serve wine, for consumption on the premises of the licensee, when such sale accompanies the serving of food or a meal to its members and their guests in accordance with the provisions of this article. Such licensees are authorized to keep and maintain on their premises a supply of wine in such quantities as may be appropriate for the conduct of operations thereof. Any sale of wine so made shall be subject to all restrictions set forth in section twenty of this article. A private wine restaurant may also be licensed as a Class A retail dealer in nonintoxicating beer as provided by article sixteen, chapter eleven of this code.
(j) With respect to subsections (h) and (i) of this section, the commissioner shall promulgate legislative rules in accordance with the provisions of chapter twenty-nine-a of this code with regard to the form of the applications, the suitability of both the applicant and location of the licensed premises and such other legislative rules deemed considered necessary to carry the provisions of such subsections into effect.
(k) The commissioner shall promulgate legislative rules in accordance with the provisions of chapter twenty-nine-a of this code to allow restaurants to serve West Virginia wine with meals, but not to sell the wine by the bottle. Each restaurant so licensed shall be charged a fee less than that charged for a wine license to a retail outlet, such fees to be set forth in the aforementioned rules promulgated pursuant to this subsection.
(l) The commissioner shall establish guidelines to permit West Virginia wines to be sold in state stores.
(m) Farm wineries as defined in section one-a of this article and wine specialty shops as defined in section two of this article may advertise off premises as provided in section seven, article twenty-two, chapter seventeen and in any other media, including, but not limited to, newspaper, radio, television, magazines, catalogues, the internet and direct mail solicitation.
§60-8-6. License or registration required for sale or shipment of wine; shipment of limited quantities of wine to adult residents permitted.

(a) Except as to the commissioner and except as provided in subsection (b) of this section and section twelve, article six of this chapter, no person may offer for sale or sell wine in this state, or offer wine for shipment into this state, except to a distributor who is duly licensed under this article. Every person, whether resident or nonresident in this state, who is engaged in or desires to engage in the sale or shipment of wine to a distributor for resale under this article shall, prior to engaging in such activities, register with the commissioner. If any such person violates the provisions of this article, he or she shall not be permitted to sell, ship or deliver any wine to a distributor or to the commissioner, or otherwise engage in the wine business in this state for a period of one year from the date a notice is mailed to such person by the commissioner of the fact that such person has violated the provisions of this article. During such one-year period, it shall be unlawful for any distributor within this state to buy or receive wine from such person or to have any dealings with such person with respect thereto. Hearings and appeals on such notices may be had in the same manner as in the case of revocations of licenses under this article.
(b) Notwithstanding the provisions of this chapter or any other law to the contrary, an adult resident or a duly licensed retailer or distributor of alcoholic beverages in a state or nation which affords adults and duly licensed retailers and distributors of this state an equal reciprocal shipping privilege may ship, for personal use and not for resale, not more than two cases of wine per month, not to exceed eighteen liters of wine in any month to any adult resident in this state. Delivery of a shipment pursuant to this section shall not be deemed considered to constitute a sale in this state. The shipping container of any wine sent into or out of this state under this subsection shall be clearly labeled to indicate that the package cannot be delivered to any person under the age of twenty-one or to an intoxicated person. No adult resident or duly licensed retailer or distributor may advertise the availability of wines by shipment to residents of this state.



NOTE: The purpose of this bill is to allow wine specialty shops to deliver wine locally and to ship wine in and out of the state. The bill also would allow wine specialty shops to advertise wine and beer as part of a gift basket or beer kit in catalogues and on the internet.

Strike-throughs indicate language that would be stricken from the present law, and underscoring indicates new language that would be added.