2021 Montana Legislature
_____________ bill NO. _____________
INTRODUCED
BY _________________________________________________
By Request of the ****
A BILL FOR AN ACT ENTITLED: "AN ACT GENERALLY REVISING ALCOHOL REGULATORY LAWS RELATING TO WINERIES; requiring wineries located in Montana to import a certain amount of juice for wine production; allowing certain wineries located in the state that meet production REQUIREMENTS to operate SATELLITE tasting rooms; Allowing the department to waive agricultural importation limits in the event of catastrophic agricultural events; revising shipment limits; allowing certain wineries to obtain special event permits; expanding rulemaking authority; AMENDING SECTIONS 16-3-411 AND 16-4-301, MCA; and PROVIDING AN IMMEDIATE EFFECTIVE DATE and AN APPLICABILITY DATE."
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:
Section 1. Section 16-3-411, MCA, is amended to read:
"16-3-411. Winery. (1) A winery located in Montana and licensed pursuant to 16-4-107 may:
(a) import in bulk, bottle, produce, blend, store, transport, or export wine it produces;
(b) sell wine it produces at wholesale to wine distributors;
(c) sell wine it produces at retail at the winery directly to the consumer for consumption on or off the premises;
(d) provide, without charge, wine it produces for consumption at the winery;
(e) purchase from the department or its licensees brandy or other distilled spirits for fortifying wine it produces;
(f) obtain a special event permit under 16-4-301;
(g) perform those operations and cellar treatments that are permitted for bonded winery premises under applicable regulations of the United States department of the treasury;
(h) sell wine at the winery to a licensed retailer who presents the retailer's license or a photocopy of the license; or
(i) obtain a direct shipment endorsement to ship table wine as provided in Title 16, chapter 4, part 11, directly to an individual in Montana who is at least 21 years of age.
(2) A winery located in Montana and licensed pursuant to 16-4-107 after [the effective date of this act] may import no more than 49% juice or wine for wine production in a calendar year.
(3) A winery located in Montana and licensed pursuant to 16-4-107 that imports no more than 49% juice, wine, fruit, or any other fermentable agricultural products for wine production in a calendar year:
(a) may establish seven satellite tasting rooms in which:
(i) a person may not taste more than 2 ounces of each wine variety in the same day;
(ii) wine may be sold only for off-premises consumption and must be in its original packaging; and
(iii) samples may be provided only between 8 a.m. to 8 p.m.; and
(b) may apply for special permits as provided in 16-4-301(1)(e).
(4) The limit on importation of agricultural products in subsection (3) may be waived by the department by rule if weather or other catastrophic agricultural events affecting agricultural production in the state prevent the winery from meeting the requirements of subsection (3).
(2)(5) (a) A winery licensed pursuant to 16-4-107 may sell and deliver wine produced by the winery directly to licensed retailers if the winery:
(i) uses the winery's own equipment, trucks, and employees to deliver the wine and the wine delivered pursuant to this subsection (2)(a)(i) (5)(a)(i) does not exceed 4,500 6,000 cases a year;
(ii) contracts with a licensed table wine distributor to ship and deliver the winery's wine to the retailer; or
(iii) contracts with a common carrier to ship and deliver the winery's wine to the retailer and:
(A) the wine shipped and delivered by common carrier is shipped directly from the producer's winery or bonded warehouse;
(B) individual shipments delivered by common carrier are limited to three cases a day for each licensed retailer; and
(C) the shipments delivered by common carrier do not exceed 4,500 6,000 cases a year.
(b) If a winery uses a common carrier for delivery of the wine to licensed table wine distributors and retailers, the shipment must be:
(i) in boxes that are marked with the words: "Wine Shipment From Montana-Licensed Winery to Montana Licensee";
(ii) delivered to the premises of a licensed table wine distributor or licensed retailer who is in good standing; and
(iii) signed for by the wine distributor or retailer or its employee or agent.
(c) In addition to any records required to be maintained under 16-4-107, a winery that distributes wine within the state under this subsection (2) (5) shall maintain records of all sales and shipments. The winery shall, pursuant to 16-1-411, electronically file a report in the manner and form prescribed by the department, reporting the amount of wine or hard cider, or both, that it shipped in the state during the preceding period, including the names and addresses of consignees or retailers, and other information that the department may determine to be necessary to ensure that distribution of wine or hard cider, or both, within this state conforms to the requirements of this code."
Section 2. Section 16-4-301, MCA, is amended to read:
"16-4-301. Special permits to sell all alcoholic beverages, beer, and table wine -- application and issuance. (1) (a) An organization or institution that has a tax-exempt designation under the provisions of section 501(c)(3) of the Internal Revenue Code, 26 U.S.C. 501(c)(3), as amended, that is organized and operated to raise funds for a needy person or that is an accredited Montana postsecondary school and that conducts a special event may receive a special permit to sell beer and table wine to the patrons of that special event. An organization may receive up to three special permits a year.
(b) A civic league or organization that has a tax-exempt designation under section 501(c)(4) of the Internal Revenue Code, 26 U.S.C. 501(c)(4), as amended, or an organization authorized by an accredited Montana postsecondary school to engage in fundraising activities for intercollegiate athletics that has a tax-exempt designation under the provisions of section 501(c)(3) of the Internal Revenue Code, 26 U.S.C. 501(c)(3), as amended, may receive up to 12 special permits a year to sell beer and table wine. For purposes of fundraising activities for intercollegiate athletics, only one organization for each Montana postsecondary school may be authorized to apply for and receive special permits under this section. All net earnings from the sale of beer and table wine must be contributed to the state of Montana or a political subdivision of the state or must be devoted to purposes required of entities under section 501(c)(3) of the Internal Revenue Code, 26 U.S.C. 501(c)(3), as amended.
(c) An association or corporation engaged in professional sporting contests or junior hockey contests may receive one special permit to sell beer and table wine covering the entire season of play if:
(i) the association or corporation is sanctioned by a sports organization that regulates the specific sport;
(ii) the season of play of the sport is specified in advance;
(iii) an admission fee to the contests is charged; and
(iv) the contest events are held in facilities that provide seating for at least 1,000 patrons.
(d) A chamber of commerce or business league that has a tax-exempt designation under section 501(c)(6) of the Internal Revenue Code, 26 U.S.C. 501(c)(6), as amended, may receive up to 12 special permits a year to sell beer and table wine. A chamber of commerce may not use one of its special permits for an event conducted by a business league, and a business league may not use one of its permits for an event conducted by a chamber of commerce. The chamber of commerce or business league receiving a special permit shall obtain liquor liability insurance for any event it conducts.
(e) A winery licensed pursuant to 16-4-107 may receive up to 10 special permits a year to sell table wine to patrons at a special event. A winery that also meets the requirements of 16-3-411(3) may receive 24 special permits a year. The wine sold under this subsection (1)(e) may be consumed at the time of the special event within the enclosed area where the special event is held or may be sold in original packaging for later consumption off-site. The special permits include but are not limited to permission to sell at special events, including but not limited to farmer's markets and county fairs, if:
(i) permitted by local ordinance;
(ii) the winery holding the special permit has obtained liquor liability insurance;
(iii) the winery holding the special permit uses the winery's own equipment, trucks, and employees to deliver the wine to the special event; and
(iv) the winery holding the special permit has trained servers at the special event as provided in 16-4-1006.
(f) The Except as provided in subsection (1)(e), beer and wine sold under this subsection (1) must be consumed at the time when and within the enclosure where the special event, activity, or sporting contest is held.
(f)(g) An application for a special permit must be presented 3 days in advance, but the department may, for good cause, waive the 3-day requirement. The application must describe the location of the enclosure where the special event, activity, or sporting contest is to be held, the nature of the special event, activity, or sporting contest, and the period during which it is contemplated that the special event, activity, or sporting contest will be held. An application for a permit for professional sporting contests or junior hockey contests under subsection (1)(c) must provide the inclusive dates of the season of play for the sporting contest. The application must be accompanied by the amount of the permit fee and a written statement of approval of the premises where the special event, activity, or sporting contest is to be held issued by the local law enforcement agency that has jurisdiction over the premises.
(g)(h) A special permit issued under this subsection (1) for the purpose of selling and serving beer or wine at a special event, activity, or sporting contest conducted on the premises of a county fairground or public sports arena authorizes the permitholder to sell and serve beer or wine in the grandstand and bleacher area of the premises, as well as from a booth, stand, or other fixed place on the premises.
(h)(i) For the purposes of this subsection (1), a post of a nationally chartered veterans' organization or a lodge of a recognized national fraternal organization otherwise licensed under this code is an organization that may receive special permits for three special events a year, as described in subsection (1)(a), to sell beer and table wine. All net proceeds must go to the post or lodge acquiring the special permit.
(2) (a) A post of a nationally chartered veterans' organization or a lodge of a recognized national fraternal organization not otherwise licensed under this code may receive, without notice or hearing as provided in 16-4-207, a special permit to sell beer and table wine or a special permit to sell all alcoholic beverages at the post or lodge to members and their guests only, to be consumed within the hall or building of the post or lodge.
(b) The application of a nationally chartered veterans' organization or lodge of a recognized national fraternal organization must describe the location of the hall or building where the special permit will be used and the date it will be used.
(c) The special permit may be issued for a 24-hour period only, ending at 2 a.m., and the department may not issue more than 12 special permits to any post or lodge during a calendar year."
NEW SECTION. Section 3. Effective date. [This act] is effective on passage and approval.
NEW SECTION. Section 4. Applicability. [This act] applies to wineries licensed and winery license applications submitted on or after [the effective date of this act].