HOUSE BILL NO. 399
INTRODUCED BY J. MCKENNEY
AN ACT GENERALLY REVISING LIQUOR LICENSING LAWS; PROVIDING FOR THE DEPOSIT OF LIQUOR LICENSE FEES AND PERMIT FEES INTO THE DEPARTMENT OF REVENUE'S LIQUOR ENTERPRISE FUND; CHANGING THE METHOD FOR DETERMINING WHEN THE DEPARTMENT OF REVENUE SHALL PUBLISH NOTICE OF APPLICATION FOR LIQUOR LICENSE TO WHEN THE APPLICATION IS COMPLETE RATHER THAN 30 DAYS AFTER AN INVESTIGATION IS REQUESTED; AMENDING SECTIONS 15-1-501, 16-2-108, 16-4-207, AND 16-4-401, MCA; PROVIDING AN IMMEDIATE EFFECTIVE DATE AND AN APPLICABILITY DATE.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:
Section 1. Section 15-1-501, MCA, is amended to read:
"15-1-501. Disposition of money from certain designated license and other taxes. (1) The state treasurer shall deposit to the credit of the state general fund in accordance with the provisions of subsection (3) all money received from the collection of:
(a) income taxes, interest, and penalties collected under chapter 30;
(b) except as provided in 15-31-702, all taxes, interest, and penalties collected under chapter 31;
(c) oil and natural gas production taxes allocated under 15-36-324(8)(a) and (10)(a);
(d) electrical energy producer's license taxes under chapter 51;
(e) [an amount equal to 25% of] the retail telecommunications excise tax collected under Title 15, chapter 53, part 1;
(f) liquor license taxes under Title 16;
(g) fees from driver's licenses, motorcycle endorsements, and duplicate driver's licenses as provided in 61-5-121;
(h) estate taxes under Title 72, chapter 16; and
(i) fees based on the value of currency on deposit and tangible personal property held for safekeeping by a foreign capital depository as provided in 15-31-803.
(2) The department shall also deposit to the credit of the state general fund all money received from the collection of
license taxes and fees and all net revenue and receipts from all other sources, other than certain fees, under the operation of
the Montana Alcoholic Beverage Code.
(3) Notwithstanding any other provision of law, the distribution of tax revenue must be made according to the provisions of the law governing allocation of the tax that were in effect for the period in which the tax revenue was recorded for accounting purposes. Tax revenue must be recorded as prescribed by the department of administration, pursuant to 17-1-102(2) and (4), in accordance with generally accepted accounting principles.
(4) All refunds of taxes must be attributed to the funds in which the taxes are currently being recorded. All refunds of interest and penalties must be attributed to the funds in which the interest and penalties are currently being recorded."
Section 2. Section 16-2-108, MCA, is amended to read:
"16-2-108. Disposition of money received. (1) The department may purchase liquor from money deposited to its
account in the enterprise fund. The department shall pay from its account in the enterprise fund its administrative expenses
associated with the sale of liquor, subject to the limits imposed by legislative appropriation. An obligation created or
incurred by the department may not be a debt or claim against the state of Montana but must be payable by the department
solely from funds derived from the operation of state liquor sales. The department shall pay into the state treasury to the
credit of the enterprise fund the receipts from the sale of liquor and all taxes and license and permit fees collected by it.
Taxes, license and permit fees, and the net proceeds from the operation of state liquor sales must be transferred to the
general fund.
(2) All liquor license fees and permit fees collected by the department must be deposited into the department's liquor enterprise fund.
(3) The department shall pay from its account in the liquor enterprise fund:
(a) expenses associated with administering liquor licensing and fee collection; and
(b) expenses associated with investigations pursuant to its agreement with the department of justice.
(4) The net proceeds of the liquor enterprise fund must be transferred to the general fund."
Section 3. Section 16-4-207, MCA, is amended to read:
"16-4-207. Notice of application -- investigation -- publication -- protest. (1) When an application has been filed
with the department for a license to sell alcoholic beverages at retail or to transfer the location of a retail license, the
department shall review the application for completeness and, based upon review of the application and any other
information supplied to the department, determine whether the applicant or the premises to be licensed meets criteria
provided by law. The department may make one request for additional information necessary to complete the application.
The application is considered complete when the applicant furnishes the application information requested by the
department. If the applicant does not provide the additional application information within 60 30 days of the department's
request, the department shall terminate the application and return it to the applicant with an explanation of why the
application was terminated. The terminated application is not a denial, and the premises identified in the application are not
subject to the provisions of 16-4-413. An applicant whose application is terminated may subsequently submit a new
application. When the application is complete, the department shall request that the department of justice investigate the
application as provided in 16-4-402. If the department does not discover a basis to deny the application within 30 days after
the department requests the investigation by the department of justice, When the department determines that an application
for a license under this code is complete, the department shall publish in a newspaper of general circulation in the city,
town, or county from which the application comes a notice that the applicant has made application for a retail on-premises
license or a transfer of location and that protests may be made against the approval of the application by a person who has
extended credit to the transferor or by residents of the county from which the application comes or adjoining Montana
counties. Protests may be mailed to a named administrator in the department of revenue within 10 days after the final notice
is published. Notice of application for a new license must be published once a week for 4 consecutive weeks. Notice of
application for transfer of ownership or location of a license must be published once a week for 2 consecutive weeks.
Notice may be substantially in the following form:
NOTICE OF APPLICATION FOR RETAILALL-BEVERAGES LICENSE Notice is given that on the .... day of ...., 20..., one (name of applicant) filed an application for a retail all-beverages license with the Montana department of revenue to be used at (describe location of premises where beverages are to be sold). A person who has extended credit to the transferor and residents of ...... counties may protest against the approval of the application. Each protestor is required to mail a letter that contains in legible print the protestor's full name, mailing address, and street address. Each letter must be signed by the protestor. A protest petition bearing the names and signatures of persons opposing the approval of an application may not be considered as a protest. Protests may be mailed to ...., department of revenue, Helena, Montana, on or before the .... day of ...., 20...
Dated ..................
Signed
................................
ADMINISTRATOR
(2) Each applicant shall, at the time of filing an application, pay to the department an amount sufficient to cover the costs of publishing the notice.
(3) (a) If the administrator receives no written protests, the department may approve the application without holding a public hearing.
(b) A response to a notice of opportunity to protest an application may not be considered unless the response is a letter satisfying all the requirements contained in the notice in subsection (1).
(c) If the department receives sufficient written protests that satisfy the requirements in subsection (1) against the approval of the application, the department shall hold a public hearing as provided in subsection (4).
(4) (a) If the department receives at least one protest but less than the number of protests required for a public convenience and necessity determination as specified in subsection (4)(c), the department shall schedule a public hearing to be held in Helena, Montana, to determine whether the protest presents sufficient cause to deny the application based on the qualifications of the applicant as provided in 16-4-401 or on the grounds for denial of an application provided for in 16-4-405, exclusive of public convenience and necessity. The hearing must be governed by the provisions of Title 2, chapter 4, part 6.
(b) If the department receives the number of protests required for a public convenience and necessity determination as specified in subsection (4)(c) and the application is for an original license or for a transfer of location, the department shall schedule a public hearing to be held in the county of the proposed location of the license to determine whether the protest presents sufficient cause to deny the application based on the qualifications of the applicant as provided in 16-4-401 or on the grounds for denial of an application provided for in 16-4-405 including public convenience and necessity. The hearing must be governed by the provisions of Title 2, chapter 4, part 6.
(c) The minimum number of protests necessary to initiate a public hearing to determine whether an application satisfies the requirements for public convenience and necessity, as specified in 16-4-203, for the proposed premises located within a quota area described in 16-4-201 must be 25% of the quota for all-beverages licenses determined for that quota area according to 16-4-201(1), (2), and (5) but in no case less than two. The minimum number of protests determined in this manner will apply only to applications for either on-premises consumption beer or all-beverages licenses."
Section 4. Section 16-4-401, MCA, is amended to read:
"16-4-401. License as privilege -- criteria for decision on application. (1) A license under this code is a privilege that the state may grant to an applicant and is not a right to which any applicant is entitled.
(2) Except as provided in subsection (6), in the case of a license that permits on-premises consumption, the department shall find in every case in which it makes an order for the issuance of a new license or for the approval of the transfer of a license that:
(a) in the case of an individual applicant:
(i) the applicant will not possess an ownership interest in more than one establishment licensed under this chapter for all-beverages sales;
(ii) the applicant does not possess an ownership interest in an agency liquor store as defined in 16-1-106;
(iii) the applicant or any member of the applicant's immediate family is without financing from or any affiliation to a manufacturer, importer, bottler, or distributor of alcoholic beverages;
(iv) the applicant is a resident of the state and is qualified to vote in a state election;
(v) the applicant's past record and present status as a purveyor of alcoholic beverages and as a business person and citizen demonstrate that the applicant is likely to operate the establishment in compliance with all applicable laws of the state and local governments; and
(vi) the applicant is not under 19 years of age; and
(b) in the case of a corporate applicant:
(i) the owners of at least 51% of the outstanding stock meet the requirements of subsection (2)(a)(iv);
(ii) each owner of 10% or more of the outstanding stock meets the requirements for an individual applicant listed in subsection (2)(a);
(iii) each individual who has control over the operation of the license or shares in the profits or liabilities of the license
meets the requirements for an individual applicant listed in subsection (2)(a);
(iv) each person who shares in the profits or liabilities of a license meets the requirements for an individual applicant listed in subsection (2)(a). This subsection (2)(b)(iv) does not apply to a shareholder of a corporation who owns less than 10% of the outstanding stock in that corporation.
(iv)(v) the corporation is authorized to do business in Montana; and
(v)(vi) in the case of a corporation not listed on a national stock exchange, each owner of stock meets the requirements
of subsections (2)(a)(i) and (2)(a)(ii); and
(c) in the case of any other business entity as applicant:
(i) if the applicant consists of more than one individual, all must meet the requirements of subsection (2)(a); and
(ii) if the applicant consists of more than one corporation, all must meet the requirements of subsection (2)(b).
(3) In the case of a license that permits only off-premises consumption, the department shall find in every case in which it makes an order for the issuance of a new license or for the approval of the transfer of a license that:
(a) in the case of an individual applicant:
(i) the applicant will not possess an ownership interest in more than one establishment licensed under this chapter for all-beverages sales;
(ii) the applicant does not possess an ownership interest in an agency liquor store as defined in 16-1-106;
(iii) the applicant or any member of the applicant's immediate family is without financing from or any affiliation to a manufacturer, importer, bottler, or distributor of alcoholic beverages;
(iv) the applicant has not been convicted of a felony or, if the applicant has been convicted of a felony, the applicant's rights have been restored;
(v) the applicant's past record and present status as a purveyor of alcoholic beverages and as a business person and citizen demonstrate that the applicant is likely to operate the establishment in compliance with all applicable laws of the state and local governments; and
(vi) the applicant is not under 19 years of age; and
(b) in the case of a corporate applicant:
(i) the owners of at least 51% of the outstanding stock meet the requirements of subsection (3)(a)(iv);
(ii) each owner of 10% or more of the outstanding stock meets the requirements for an individual listed in subsection (3)(a); and
(iii) the corporation is authorized to do business in Montana; and
(c) in the case of any other business entity as applicant:
(i) if the applicant consists of more than one individual, all must meet the requirements of subsection (3)(a); and
(ii) if the applicant consists of more than one corporation, all must meet the requirements of subsection (3)(b).
(4) In the case of a license that permits the manufacture, importing, or wholesaling of an alcoholic beverage, the department shall find in every case in which it makes an order for the issuance of a new license or for the approval of the transfer of a license that:
(a) in the case of an individual applicant:
(i) the applicant has no ownership interest in any establishment licensed under this chapter for retail alcoholic beverages sales;
(ii) the applicant does not possess an ownership interest in an agency liquor store as defined in 16-1-106;
(iii) the applicant has not been convicted of a felony or, if the applicant has been convicted of a felony, rights have been restored;
(iv) the applicant's past record and present status as a purveyor of alcoholic beverages and as a business person and citizen demonstrate that the applicant is likely to operate the establishment in compliance with all applicable laws of the state and local governments;
(v) the applicant is not under 19 years of age; and
(vi) an applicant for a wholesale license is neither a manufacturer of an alcoholic beverage nor is owned or controlled by a manufacturer of an alcoholic beverage; and
(b) in the case of a corporate applicant:
(i) the owners of at least 51% of the outstanding stock meet the requirements of subsection (4)(a)(iii);
(ii) each owner of 10% or more of the outstanding stock meets the requirements for an individual listed in subsection (4)(a);
(iii) an applicant for a wholesale license is neither a manufacturer of an alcoholic beverage nor is owned or controlled by a manufacturer of an alcoholic beverage; and
(iv) the corporation is authorized to do business in Montana; and
(c) in the case of any other business entity as applicant:
(i) if the applicant consists of more than one individual, all must meet the requirements of subsection (4)(a); and
(ii) if the applicant consists of more than one corporation, all must meet the requirements of subsection (4)(b).
(5) In the case of a corporate applicant, the requirements of subsections (2)(b), (3)(b), and (4)(b) apply separately to each class of stock.
(6) The provisions of subsection (2) do not apply to an applicant for or holder of a license pursuant to 16-4-302."
Section 5. Effective date. [This act] is effective on passage and approval.
Section 6. Applicability. [Sections 1 and 2] apply to fees collected after June 30, 2001.
- END -
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