HOUSE OF REPRESENTATIVES	H.B. NO.	546
THIRTIETH LEGISLATURE, 2019		H.D. 1
STATE OF HAWAII

A BILL FOR AN ACT

RELATING TO INTOXICATING LIQUOR.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. The legislature finds that Hawaii's liquor laws contain inconsistencies regarding liquor manufacturing and sales. Furthermore, it is necessary to allow brewpubs and small craft producer pubs that manufacture beer solely in the State to obtain a direct shipper permit because such businesses usually do not have access to distributors that can export their beer out of state.

Accordingly, the purpose of this Act is to:

(1) Permit small craft producer pub licensees to manufacture not more than 125,000 barrels of malt beverages on the licensee's premises per year;

(2) Allow brewpub licensees and small craft producer pub licensees to conduct certain activities at satellite locations;

(3) Clarify the definition of "growler"; and

(4) Allow brewpub licensees and small craft producer pub licensees that manufacture beer solely in the State to obtain a direct shipper permit.

SECTION 2. Section 281-31, Hawaii Revised Statutes, is amended as follows:

1. By amending subsection (n) to read:

"(n) Class 14. Brewpub license. A brewpub licensee:

(1) May sell malt beverages manufactured on the licensee's premises for consumption on the premises;

(2) May sell malt beverages manufactured by the licensee in brewery-sealed packages to class 3 wholesale dealer licensees pursuant to conditions imposed by the county by ordinance or rule;

(3) May sell intoxicating liquor purchased from a class 3 wholesale dealer licensee to consumers for consumption on the licensee's premises. The categories of establishments shall be as follows:

(A) A standard bar; or

(B) Premises in which live entertainment or recorded music is provided. Facilities for dancing by the patrons may be permitted as provided by commission rules;

(4) May, subject to federal labeling and bottling requirements, sell malt beverages manufactured on the licensee's premises to consumers in brewery-sealed kegs and recyclable or reusable containers and sell malt beverages manufactured on the licensee's premises or purchased from a class 1 manufacturer licensee, a class 3 wholesale dealer licensee, a class 14 brewpub licensee, or a class 18 small craft producer pub licensee to consumers in growlers for off-premises consumption; provided that for purposes of this paragraph, "growler" means a [glass, ceramic, or metal] recyclable or reusable container[,] that does not [to] exceed one [half-gallon, which shall be securely sealed;

(5) May, subject to federal labeling and bottling requirements, sell malt beverages manufactured on the licensee's premises in recyclable containers provided by the licensee or by the consumer which do not exceed one] gallon [per container] and [are] is securely sealed on the licensee's premises [to consumers for off-premises consumption];

[(6)] (5) Shall comply with all [regulations] requirements pertaining to class 4 retail dealer licensees when engaging in the retail sale of malt beverages;

[(7)] (6) May, subject to federal labeling and bottling requirements, sell malt beverages manufactured on the licensee's premises in brewery-sealed containers directly to class 2 restaurant licensees, class 3 wholesale dealer licensees, class 4 retail dealer licensees, class 5 dispenser licensees, class 6 club licensees, class 8 transient vessel licensees, class 9 tour or cruise vessel licensees, class 10 special licensees, class 11 cabaret licensees, class 12 hotel licensees, class 13 caterer licensees, class 14 brewpub licensees, class 15 condominium hotel licensees, class 18 small craft producer pub licensees, and consumers pursuant to conditions imposed by county [regulations] ordinances or rules governing class 1 manufacturer licensees and class 3 wholesale dealer licensees;

[(8)] (7) May conduct the activities under paragraphs (1) to [(7)] (6) at [one location] locations other than the licensee's primary manufacturing premises; provided that:

(A) The manufacturing takes place in Hawaii; [and]

(B) [The] Each of the other [location is] locations:

(i) Operates within the State under the same trade name for the premises; and

(ii) Is properly licensed [under the same ownership;] within the county of its operation as a class 1 manufacturer licensee, class 2 restaurant licensee, class 4 retail dealer licensee, class 5 dispenser licensee, class 12 hotel licensee, class 14 brewpub licensee, or class 18 small craft producer pub licensee;

(C) The county liquor department of the county in which the licensee satellite is located shall have jurisdiction of the satellite; and

(D) All requirements of the license class of the location shall be in effect as required by the county liquor commission for the satellite licensed premises; and

[(9)] (8) May allow minors, who are accompanied by a parent or legal guardian of legal drinking age, on the licensee's premises."

2. By amending subsection (r) to read:

"(r) Class 18. Small craft producer pub license. A small craft producer pub licensee:

(1) Shall manufacture not more than:

(A) [Sixty] One hundred twenty-five thousand barrels of malt beverages;

(B) Twenty thousand barrels of wine; or

(C) Seven thousand five hundred barrels of alcohol on the licensee's premises during the license year;

provided that for purposes of this paragraph, "barrel" means a container not exceeding thirty-one gallons or wine gallons of liquor;

(2) May sell malt beverages, wine, or alcohol manufactured on the licensee's premises for consumption on the premises;

(3) May sell malt beverages, wine, or alcohol manufactured by the licensee in producer-sealed packages to class 3 wholesale dealer licensees pursuant to conditions imposed by the county by ordinance or rule;

(4) May sell intoxicating liquor purchased from a class 3 wholesale dealer licensee to consumers for consumption on the licensee's premises. The categories of establishments shall be as follows:

(A) A standard bar; or

(B) Premises in which live entertainment or recorded music is provided. Facilities for dancing by the patrons may be permitted as provided by commission rules;

(5) May, subject to federal labeling and bottling requirements, sell malt beverages manufactured on the licensee's premises to consumers in producer-sealed kegs and recyclable or reusable containers and sell malt beverages manufactured on the licensee's premises or purchased from a class 1 manufacturer licensee, a class 3 wholesale dealer licensee, a class 14 brewpub licensee, or a class 18 small craft producer pub licensee to consumers in growlers for off-premises consumption; provided that for purposes of this paragraph, "growler" means a [glass, ceramic, or metal] recyclable or reusable container[,] that does not [to] exceed one [half-gallon,] gallon, which shall be securely sealed;

(6) May, subject to federal labeling and bottling requirements, sell [malt beverages,] wine[,] or alcohol manufactured on the licensee's premises in recyclable containers provided by the licensee or by the consumer which do not exceed:

(A) One gallon per container for [malt beverages and] wine; and

(B) One liter for alcohol; and

are securely sealed on the licensee's premises to consumers for off-premises consumption;

(7) Shall comply with all [regulations] requirements pertaining to class 4 retail dealer licensees when engaging in the retail sale of malt beverages, wine, and alcohol;

(8) May, subject to federal labeling and bottling requirements, sell malt beverages, wine, and alcohol manufactured on the licensee's premises in producer-sealed containers directly to class 2 restaurant licensees, class 3 wholesale dealer licensees, class 4 retail dealer licensees, class 5 dispenser licensees, class 6 club licensees, class 8 transient vessel licensees, class 9 tour or cruise vessel licensees, class 10 special licensees, class 11 cabaret licensees, class 12 hotel licensees, class 13 caterer licensees, class 14 brewpub licensees, class 15 condominium hotel licensees, class 18 small craft producer pub licensees, and consumers pursuant to conditions imposed by county [regulations] ordinances or rules governing class 1 manufacturer licensees and class 3 wholesale dealer licensees;

(9) May conduct the activities under paragraphs (1) to (8) at [one location] locations other than the licensee's premises; provided that:

(A) The manufacturing takes place in Hawaii; [and]

(B) [The] Each of the other [location is] locations:

(i) Operates within the State under the same trade name for the premises; and

(ii) Is properly licensed [under the same ownership;] within the county of its operation as a class 1 manufacturer licensee, class 2 restaurant licensee, class 4 retail dealer licensee, class 5 dispenser licensee, class 12 hotel licensee, class 14 brewpub licensee, or class 18 small craft producer pub licensee;

(C) The county liquor department of the county in which the licensee satellite is located shall have jurisdiction of the satellite; and

(D) All requirements of the license class of the location shall be in effect as required by the county liquor commission for the satellite licensed premises; and

(10) May allow minors, who are accompanied by a parent or legal guardian of legal drinking age, on the licensee's premises."

SECTION 3. Section 281-33.6, Hawaii Revised Statutes, is amended to read as follows:

"§281-33.6 Direct shipment of beer manufactured solely in the State and wine by wineries. (a) Any person holding:

(1) A general excise tax license from the department of taxation; and

(2) Either:

(A) A class 1, class 16, or class 18 license to manufacture wine under section 281-31; [or]

(B) A license to manufacture wine issued by another state, or

(C) A class 14 or class 18 license to manufacture beer; provided that the licensee manufactures beer solely in the State,

may pay any applicable fees and obtain a direct wine shipper or beer shipper permit from the liquor commission of the county to which the wine or beer will be shipped authorizing the holder to directly ship wine or beer to persons in the county pursuant to this section.

(b) The holder of a direct wine or beer shipper permit may sell and annually ship to any person twenty-one years of age or older in the county that issued the permit, no more than six nine-liter cases of wine, and no more than forty-two gallons of beer if the beer was manufactured solely in the State per household for personal use only and not for resale, and shall:

(1) Ship wine or beer directly to the person only in containers that are conspicuously labeled with the words:

"CONTAINS ALCOHOL: SIGNATURE OF PERSON AGE 21 YEARS OR OLDER REQUIRED FOR DELIVERY.";

(2) Require that the carrier of the shipment obtain the signature of any person twenty-one years of age or older before delivering the shipment;

(3) Report no later than January 31 of each year to the liquor commission in each county where a direct wine or beer shipper permit is held, the total amount of wine or beer shipped to persons in the county during the preceding calendar year;

(4) Pay all applicable general excise and gallonage taxes. For gallonage tax purposes, all wine or beer sold under a direct wine or beer shipper permit shall be deemed to be wine or beer sold in the State; and

(5) Be subject to audit by the liquor commission of each county in which a permit is held.

(c) The holder of a license to manufacture wine or beer issued by another state may annually renew a direct wine or beer shipper permit by providing the liquor commission that issued the permit with a copy of the license and paying all required fees. The holder of a class 1, class 14, class 16, or class 18 license to manufacture wine or beer under section 281-31 may renew a direct wine or beer shipper permit concurrently with the [class 1] applicable license by complying with all applicable laws and paying all required fees.

(d) The sale and shipment of wine or beer directly to a person in this State by a person that does not possess a valid direct wine or beer shipper permit is prohibited. Knowingly violating this law is a misdemeanor.

(e) The liquor [[]commission[]] in each county may adopt rules and regulations necessary to carry out the intent and purpose of this section."

SECTION 4. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 5. This Act shall take effect on July 1, 2112.

Report Title:

Liquor Licenses; Brewpubs; Small Craft Producer Pubs

Description:

Permits a small craft producer pub licensee to manufacture not more than 125,000 barrels of malt beverages on the licensee's premises per year. Allows brewpub licensees and small craft producer pub licensees to conduct certain activities at satellite locations. Clarifies the definition of "growler". Allows brewpub licensees and small craft producer pub licensees who manufacture beer solely in the State to obtain a direct shipper permit. (HB546 HD1)

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.