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AB 605 Portantino Off-sale Instructional Tasting Event, Instructional Tasting License, Original Fee and Renewal Fee Analysis by Ed Kikumoto 06.09.10 updated 06.10.10 OVERVIEW This bill was originally a horse racing bill. It was gutted and amended on June 7, 2010 to become an off-sale tasting bill. Off-Sale Instructional Tasting Event “This bill would authorize the department to issue to the holder of any off-sale retail license an instructional tasting license that would allow the licenseholder to allow an authorized licensee, as defined, or designated representative of that licensee, to conduct, on a designated portion of, or contiguous to, an existing licensed premises, an instructional event at which tastes of alcoholic beverages may be served to consumers, as provided. The bill would impose an original fee of $300 and an annual renewal fee of $261 for the license, which would be deposited in the Alcoholic Beverage Control Fund…” CONTENT OF THE BILL Definitions (Section 25503.56(b))  licenseholder [of premises] (licenseholder)  authorized licensee: entity conducting the event (licensee)  designated representative of an authorized licensee (licensee) SECTION 1: Section 23396.6 NEW SECTION 2: Section 25503.56 NEW SECTION 3: No reimbursement required to local agency or school district.    

exempt from limitation on number of licenses per city or county requirements exempt from undue concentration requirement no publication and noticing requirement for license application no “change of mode or character” reporting requirement

where tasting can occur: “…in the portion of the licenses premises where alcoholic beverages are exposed and offered for sale, and any contiguous areas reasonably related to the merchandising or sale of alcoholic beverages.” separated by barrier from rest of premises…[barrier can be] permananent or temporary sign prohibiting minors required no minors allowed in instructional area event attendee cannot leave instructional area with alcoholic beverage no on-sale retail sale to consumers attending the event

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application fee $300 renewal fee $261 fees to ABC Fund

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not more than 3-tastings in one-day distilled spirits – ¼ oz wine – 1 oz beer – 3 oz only products authorized to be sold by the authorized licensee and licenseholder

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no charge for tastings authorized licensee must be independent of the licenseholder minors cannot serve service by employee of authorized licensee only (not licenseholder) “…a licenseholder may conduct an instructional event that includes the serving of tastings only when an authorized licensee or its designated representative are unable to conduct a scheduled instructional event, provided the licenseholder supplies the wine, beer, or distilled spirits used in the instructional event and provides or pays for a person to serve the wine, beer, or distilled spirits.” (25503.56(c)) distilled spirits and wine either supplied by the authorized licensee or purchase from licenseholder at original invoice cost beer purchased from licenseholder at original invoice cost unused alcoholic beverage removed limited to single type of alcoholic beverage

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only one event per day for dual licenseholder (off-sale and on-sale) no on-sale and off-sale event on same day

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share of cost of advertising by licensee NOT authorized cost of advertising paid by licenseholder no giveaways by licensee setup, breakdown, and supplies by licensee permitted no quid pro quo collusion or coercion no exclusive right agreement to hold events

RECOMMENDATION: Strongly Oppose TALKING POINTS  “Temporary” designated areas for the instructional event, rather than a “permanently” designated area further blurs the line between off-sales and onsales activities.  There is no accountability to local governing bodies, which are ultimately responsible for any negative affect this activity will have on communities’ health and safety. 2


For example, who is suppose to monitor and corroborate BPC Section 25503.56(c), which states, “…a licenseholder may conduct an instructional event that includes the serving of tastings only when an authorized licensee or its designated representative are unable to conduct a scheduled instructional event, provided the licenseholder supplies the wine, beer, or distilled spirits used in the instructional event and provides or pays for a person to serve the wine, beer, or distilled spirits.” Cost of enforcement prohibitive to ABC and local enforcement agencies. a) Local enforcement agencies are facing severe cutbacks in personnel due to revenue shortfalls and, therefore, will not be able to monitor this activity. b) ABC is already reduced and does not have the personnel to enforce this new regulation. This bill allows premises in areas of over concentration and high-crime to acquire an instructional tasting license without any consideration for the harmful affects this activity will have on public health and safety.

COMMENTS  This is a well written bill and very thorough.  The only thing missing is a noticing requirement to the local governing body.  Section 25503.56(c) is ripe for abuse. Edward Kikumoto Executive Director Alcohol Policy Network 2201 Broadway Suite 208 Oakland CA 94612-3028 (510) 251-2492 Office (510) 251-2613 FAX ekiku@pacbell.net

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AB605-APN_Analysis061010  

SECTION 1: Section 23396.6 NEW SECTION 2: Section 25503.56 NEW SECTION 3: No reimbursement required to local agency or school district. CONT...

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