FISCAL NOTE
FUND(S):
General Revenue
Sources of Revenue:
General Fund
Legislation creates:
A New Program
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
This bill was introduced on March 7, 2013 and the WVABCA received the Fiscal Note request on March 27, 2013. The WVABCA was requested to provide an urgent Fiscal Note. Due to the urgency and short notice, the WVABCA is submitting this Fiscal Note with estimates and would ask that the Fiscal Note be subject to amendment.
The bill attempts to require a permit for all persons who serve or sell nonintoxicating beer and “mixed alcohol liquor” to obtain an alcohol server permit. “Mixed alcohol liquor” is not a defined term and it is unclear what the drafter is intending to encompass with this terminology. The bill attempts to require a permit with no real standards for approval or refusal. The bill does not set forth any requirement that an alcohol server receive any training in association with obtaining a permit.
The bill sets a $25 fee for an alcohol server permit. The bill does not provide a methodology to sanction a permitee or provide any due process rights for a permitee who is refused a license, has his or her license suspended or his or her license revoked.
The real cost associated with this bill is not written or contemplated by the bill. Training and the hearing process would be very expensive, likely far in excess of the $25 permit fee.
Exact Numbers are not possible. A very rough estimate is that a bar may (again this is from practical experience) have 1 to 20 servers working at any one time depending on its size and nature. If we take an average of 10 servers per on-premise licensee multiplied by the 2855 current on-premise WVABCA licensees, then this bill would affect 28,550 alcohol servers.
Using the rough estimate of 28,550 alcohol servers multiplied by $25 (the permit fee would generate $713,750 approximately every 3 years). This assumes the bill passes as drafted and would violate the permittees’ due process rights with no hearings and also no training.
The bill is silent as to whether the applicant or the WVABCA would pay the cost of the background check which is $45.35 per permittee (28,550 * $45.35) or a rough estimate of $1,294,742.50.
However to actually conduct training statewide, likely 5 to 6 employees would need to be hired (estimated at 5 * $30,000 = $150,000, plus benefits), training materials bought or developed (estimated at $15 a workbook * 28,550 = $428,250), expenses for travel and use of state cars, developing a computerized license system, expense for renting training facilities and printing permit photo ID cards/licenses would (estimated) likely be $50,000 to $100,000 (estimated at $75,000 for calculation). The total based on the above assumptions and estimates for this part would likely be $653,250, plus employee benefits.
Further to provide due process rights and conduct hearings across the state. An estimate based on the current buy rate of approximately 15%, would have of the 4283 permittees (28,550 *.15) having a potential violation requiring a sanction and potentially a hearing. Again based on the estimate, you could assume at least 25% would request a hearing or 1071 (.25 *4283) permittees would need a hearing. This additional work would require 3-4 additional attorneys (for the estimate, 3 * $50,000 = $150,000, plus employee benefits), expenses for travel to regional hearings and use of state cars, computerized docket system, renting the facilities for hearings, hearing examiner and transcribing fees, fees for researching and writing briefs and fees for appeals to Circuit Court and the Supreme Court would likely be $125,000 to $175,000 (for the estimate $150,000). The hearing process based on the above assumptions and estimates could likely cost $300,000.
The potential revenue based on the above estimates could be
$ 713,750
The potential costs based on the above estimates could be
$ 1,294,742.50
$ 653,250
$ 300,000
Total potential cost based on the above estimates $ 2,247,992.50
Again these are rough estimates using averages. the numbers could be potentially higher since many chain restaurants use multiple shifts of workers with possibly 20 workers per shift.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2013
Increase/Decrease
(use"-") |
2014
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
2,247,993 |
2,247,993 |
2,247,993 |
| Personal Services |
0 |
0 |
0 |
| Current Expenses |
0 |
0 |
0 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
0 |
0 |
| Other |
0 |
0 |
0 |
| 2. Estimated Total Revenues |
713,750 |
713,750 |
713,750 |
Explanation of above estimates (including long-range effect):
This bill was introduced on March 7, 2013 and the WVABCA received the Fiscal Note request on March 27, 2013. The WVABCA was requested to provide an urgent Fiscal Note. Due to the urgency and short notice, the WVABCA is submitting this Fiscal Note with estimates and would ask that the Fiscal Note be subject to amendment.
The bill attempts to require a permit for all persons who serve or sell nonintoxicating beer and “mixed alcohol liquor” to obtain an alcohol server permit. “Mixed alcohol liquor” is not a defined term and it is unclear what the drafter is intending to encompass with this terminology. The bill attempts to require a permit with no real standards for approval or refusal. The bill does not set forth any requirement that an alcohol server receive any training in association with obtaining a permit.
The bill sets a $25 fee for an alcohol server permit. The bill does not provide a methodology to sanction a permitee or provide any due process rights for a permitee who is refused a license, has his or her license suspended or his or her license revoked.
The real cost associated with this bill is not written or contemplated by the bill. Training and the hearing process would be very expensive, likely far in excess of the $25 permit fee.
Exact Numbers are not possible. A very rough estimate is that a bar may (again this is from practical experience) have 1 to 20 servers working at any one time depending on its size and nature. If we take an average of 10 servers per on-premise licensee multiplied by the 2855 current on-premise WVABCA licensees, then this bill would affect 28,550 alcohol servers.
Using the rough estimate of 28,550 alcohol servers multiplied by $25 (the permit fee would generate $713,750 approximately every 3 years). This assumes the bill passes as drafted and would violate the permittees’ due process rights with no hearings and also no training.
The bill is silent as to whether the applicant or the WVABCA would pay the cost of the background check which is $45.35 per permittee (28,550 * $45.35) or a rough estimate of $1,294,742.50.
However to actually conduct training statewide, likely 5 to 6 employees would need to be hired (estimated at 5 * $30,000 = $150,000, plus benefits), training materials bought or developed (estimated at $15 a workbook * 28,550 = $428,250), expenses for travel and use of state cars, developing a computerized license system, expense for renting training facilities and printing permit photo ID cards/licenses would (estimated) likely be $50,000 to $100,000 (estimated at $75,000 for calculation). The total based on the above assumptions and estimates for this part would likely be $653,250, plus employee benefits.
Further to provide due process rights and conduct hearings across the state. An estimate based on the current buy rate of approximately 15%, would have of the 4283 permittees (28,550 *.15) having a potential violation requiring a sanction and potentially a hearing. Again based on the estimate, you could assume at least 25% would request a hearing or 1071 (.25 *4283) permittees would need a hearing. This additional work would require 3-4 additional attorneys (for the estimate, 3 * $50,000 = $150,000, plus employee benefits), expenses for travel to regional hearings and use of state cars, computerized docket system, renting the facilities for hearings, hearing examiner and transcribing fees, fees for researching and writing briefs and fees for appeals to Circuit Court and the Supreme Court would likely be $125,000 to $175,000 (for the estimate $150,000). The hearing process based on the above assumptions and estimates could likely cost $300,000.
The potential revenue based on the above estimates could be
$ 713,750
The potential costs based on the above estimates could be
$ 1,294,742.50
$ 653,250
$ 300,000
Total potential cost based on the above estimates $ 2,247,992.50
Again these are rough estimates using averages. the numbers could be potentially higher since many chain restaurants use multiple shifts of workers with possibly 20 workers per shift.
Memorandum
This bill was introduced on March 7, 2013 and the WVABCA received the Fiscal Note request on March 27, 2013. The WVABCA was requested to provide an urgent Fiscal Note. Due to the urgency and short notice, the WVABCA is submitting this Fiscal Note with estimates and would ask that the Fiscal Note be subject to amendment.
The bill attempts to require a permit for all persons who serve or sell nonintoxicating beer and “mixed alcohol liquor” to obtain an alcohol server permit. “Mixed alcohol liquor” is not a defined term and it is unclear what the drafter is intending to encompass with this terminology. The bill attempts to require a permit with no real standards for approval or refusal. The bill does not set forth any requirement that an alcohol server receive any training in association with obtaining a permit.
The bill sets a $25 fee for an alcohol server permit. The bill does not provide a methodology to sanction a permitee or provide any due process rights for a permitee who is refused a license, has his or her license suspended or his or her license revoked.
The real cost associated with this bill is not written or contemplated by the bill. Training and the hearing process would be very expensive, likely far in excess of the $25 permit fee.
Exact Numbers are not possible. A very rough estimate is that a bar may (again this is from practical experience) have 1 to 20 servers working at any one time depending on its size and nature. If we take an average of 10 servers per on-premise licensee multiplied by the 2855 current on-premise WVABCA licensees, then this bill would affect 28,550 alcohol servers.
Using the rough estimate of 28,550 alcohol servers multiplied by $25 (the permit fee would generate $713,750 approximately every 3 years). This assumes the bill passes as drafted and would violate the permittees’ due process rights with no hearings and also no training.
The bill is silent as to whether the applicant or the WVABCA would pay the cost of the background check which is $45.35 per permittee (28,550 * $45.35) or a rough estimate of $1,294,742.50.
However to actually conduct training statewide, likely 5 to 6 employees would need to be hired (estimated at 5 * $30,000 = $150,000, plus benefits), training materials bought or developed (estimated at $15 a workbook * 28,550 = $428,250), expenses for travel and use of state cars, developing a computerized license system, expense for renting training facilities and printing permit photo ID cards/licenses would (estimated) likely be $50,000 to $100,000 (estimated at $75,000 for calculation). The total based on the above assumptions and estimates for this part would likely be $653,250, plus employee benefits.
Further to provide due process rights and conduct hearings across the state. An estimate based on the current buy rate of approximately 15%, would have of the 4283 permittees (28,550 *.15) having a potential violation requiring a sanction and potentially a hearing. Again based on the estimate, you could assume at least 25% would request a hearing or 1071 (.25 *4283) permittees would need a hearing. This additional work would require 3-4 additional attorneys (for the estimate, 3 * $50,000 = $150,000, plus employee benefits), expenses for travel to regional hearings and use of state cars, computerized docket system, renting the facilities for hearings, hearing examiner and transcribing fees, fees for researching and writing briefs and fees for appeals to Circuit Court and the Supreme Court would likely be $125,000 to $175,000 (for the estimate $150,000). The hearing process based on the above assumptions and estimates could likely cost $300,000.
The potential revenue based on the above estimates could be
$ 713,750
The potential costs based on the above estimates could be
$ 1,294,742.50
$ 653,250
$ 300,000
Total potential cost based on the above estimates $ 2,247,992.50
Again these are rough estimates using averages. the numbers could be potentially higher since many chain restaurants use multiple shifts of workers with possibly 20 workers per shift.
The bill also contemplates putting the permit system in effect within 60 days from July 1, 2013. This date is not possible to meet based on the number of alcohol servers statewide.
Person submitting Fiscal Note: on behalf of the WVABCA, Anoop Bhasin
Email Address: Anoop.K.Bhasin@wv.gov