GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1995

H	1 

HOUSE BILL 969

Short Title:  Repeal Liquor by the Drink.	(Public)

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Sponsors: Representative Cunningham.

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Referred to:  Business and Labor.

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April 12, 1995

A BILL TO BE ENTITLED
AN ACT TO PROHIBIT THE ISSUANCE OF MIXED BEVERAGE PERMITS AND TO MAKE THOSE THAT HAVE BEEN ISSUED EXPIRE ON A DATE CERTAIN.
The General Assembly of North Carolina enacts:
Section 1.  G.S. 18B-101(10) is repealed.
Sec. 2.  G.S. 18B-301(f) reads as rewritten:
"(f)	Unlawful Possession or Use. – As illustration, but not limitation, of the general prohibition stated in G.S. 18B-102(a), it shall be unlawful for:
(1)	Any person to consume fortified wine, spirituous liquor or to offer such beverages to another person:
a.	On the premises of an ABC store, or
b.	Upon any property used or occupied by a local board, or
c.	On any public road, street, highway, or sidewalk.
(2)	Any person to display publicly at an athletic contest fortified wine, spirituous liquor;
(3)	Any person to permit any fortified wine or spirituous liquor to be possessed or consumed upon any premises not authorized by this Chapter;
(4)	Any person to possess or consume any fortified wine or spirituous liquor upon any premises where such possession or consumption is not authorized by law, or where the person has been forbidden to possess or consume that beverage by the owner or other person in charge of the premises;
(5)	Any person to possess on any of the premises described in subsections (a) through (c) a greater amount of fortified wine or spirituous liquor than authorized by this Chapter;
(6)	Any permittee to possess spirituous liquor or mixed beverages on his licensed premises.
(7)	Any person to possess on his person or consume malt beverages or unfortified wine upon any property owned or leased by a local board of education and used by the local board of education for school purposes."
Sec. 3.  G.S. 18B-302(a) reads as rewritten:
"(a)	Sale. – It shall be unlawful for any person to:
(1)	Sell or give malt beverages or unfortified wine to anyone less than 21 years old; or
(2)	Sell or give fortified wine or spirituous liquor to anyone less than 21 years old."
Sec. 3.1.  G.S. 18B-302(b) reads as rewritten:
"(b)	Purchase or Possession. – It shall be unlawful for:
(1)	A person less than 21 years old to purchase, to attempt to purchase, or to possess malt beverages or unfortified wine; or
(2)	A person less than 21 years old to purchase, to attempt to purchase, or to possess fortified wine or spirituous liquor."
Sec. 4.  G.S. 18B-404 is repealed.
Sec. 5.  G.S. 18B-600 reads as rewritten:
"§ 18B-600.  Places eligible to hold alcoholic beverage elections.
(a)	Kinds of Elections. – The following kinds of alcoholic beverage elections shall be permitted:
(1)	Malt beverage;
(2)	Unfortified wine;
(3)	ABC 
	store.
(b)	County Elections. – Any county may hold a malt beverage, unfortified wine, or ABC store election. 
(c)	City Malt Beverage and Unfortified Wine Elections. – A city may hold a malt beverage or unfortified wine election only if the county in which the city is located has already held such an election, the vote in the last county election was against the sale of that kind of alcoholic beverage, and:
(1)	The city has a population of 500 or more; or
(2)	The city operates an ABC store.
(d)	City ABC Store Elections. – A city may hold an ABC store election only if:
(1)	The city has at least 500 registered voters; and
(2)	The county in which the city is located does not operate ABC stores.
											(e2)  Ski Resorts ABC Elections. – Notwithstanding any other provisions of this section, any city that provides governmental services to as many as 1,000 snow skiers weekly during the normal ski season from December 1 through March 15, may hold an election authorized by subdivision (a)(1) or (2) of this section. 
		(e4)  Multicounty/City ABC Elections. – If a city is located in two or more counties, the following provisions shall apply:
(1)	The city may hold a malt beverage or unfortified wine election if any county in which a portion of the city is located has already held such an election, the vote in the last election of the particular type was against the sale of that type of alcoholic beverage, and the city has a population of 500 or more.
	(3)	If an election is held by a city under this subsection, all of the city voters may vote in the election.  If the vote is for approval, alcoholic beverages may be sold on the basis of that approval and under the provisions of this Chapter.  The remaining gross receipts shall be distributed in accordance with existing law applicable to those ABC stores.
(f)	Township Elections. – In a county where ABC stores have heretofore been established by petition pursuant to law, an election may be called in any township on any of the propositions listed in G.S. 18B-602. The election shall be held by the county board of elections upon request of the county board of commissioners or upon petition of twenty-five percent (25%) of the registered voters of the township. The election shall be conducted and the results determined in the same manner as county elections held under this Article. For purposes of this Article, townships holding any election under this subsection shall be treated on the same basis as counties, and municipalities located within those townships shall be treated on the same basis as cities.
In order for an establishment to qualify for a permit under this subsection, the establishment's gross receipts from food and nonalcoholic beverages shall be greater than its gross receipts from alcoholic beverages.
(g)	Beautification District Elections. – In a county where ABC stores have been approved by an election and a beautification district has been created after May, 1984, and prior to June 30, 1990, an election authorized by subsection (a) of this section may be called in the beautification district. The election shall be called in accordance with G.S. 18B-601(b), conducted, and the results determined in the same manner as county elections held under this Article. For purposes of this Article, beautification districts holding any election shall be treated on the same basis as counties, and municipalities located within those beautification districts shall be treated on the same basis as cities."
Sec. 6.  G.S. 18B-602(h) is repealed.
Sec. 7.  G.S. 18B-603(d) and (e) are repealed.
Sec. 7.1.  G.S. 118B-603(f2) reads as rewritten:
"(f2)	Permits for Special ABC Areas. – The Commission may issue the permits provided for in G.S. 18B-1001(1), G.S. 18B-1001(2), G.S. 18B-1001(3), G.S. 18B-1001(4), G.S. 18B-1001(5), and G.S. 18B-1001(6) to qualified persons and establishments located within a Special ABC area as defined in G.S. 18B-101, provided that: (i) if such area is a municipal corporation, the area shall conduct an election authorized by subdivision (a)(4) of G.S. 18B-600, which election may be held regardless of the number of registered voters located within the municipal corporation; "
Sec. 7.2.  G.S. 18B-603(h) reads as rewritten:
"(h)	Permits Based on Existing Permits. – In any county in which the sale of malt beverage on and off premises, the sale of unfortified wine on and off premises, the sale of mixed beverages, and the operation of an ABC system has been allowed in at least six cities in the county, or in any county adjacent to that county in which an ABC system has been allowed and which borders on the Atlantic Ocean, the Commission may issue permits to sports clubs as defined in G.S. 18B-1000(8) throughout the county.  The Commission may issue the following permits:
(1)	On and Off Premises Malt Beverage;
(2) 	On and Off Premises Unfortified Wine; or
(3) 	On and Off Premises Fortified Wine.
		The Commission may also issue on-premises malt beverage, unfortified wine and fortified wine permits to a sports club located in a county adjacent to any county that has approved the sale of mixed beverages pursuant to the last paragraph of G.S. 18B-603(d), if the county in which the sports club is located borders another state and has at least one city that has approved the sale of mixed beverages.  
	The Commission may further issue on-premises malt beverage and on-premises unfortified wine permits to a sports club located in a county bordering on another state that is adjacent to any county in which permits were issued pursuant to this subsection prior to August 1, 1993.  The sports clubs must be located in the unincorporated areas of a county, in which the sale of malt beverages and unfortified wine is not permitted, and where there are six or more municipalities in that county where the sale of malt beverages and unfortified wine is permitted."
Sec. 8.  G.S. 18B-604(e) is repealed.
Sec. 9.  G.S. 18B-804(b)(4) is repealed.
Sec. 10.  G.S. 18B-805 reads as rewritten:
"§ 18B-805.  Distribution of revenue.
	(a)	Gross Receipts. – As used in this section, 'gross receipts' means all revenue of a local board, including proceeds from the sale of alcoholic beverages, investments, interest on deposits, and any other source.
(b)	Primary Distribution. – Before making any other distribution, a local board shall first pay the following from its gross receipts:
(1)	The board shall pay the expenses, including salaries, of operating the local ABC system.
(2)	Each month the local board shall pay to the Department of Revenue the taxes due the Department. In addition to the taxes levied under Chapter 105 of the General Statutes.
	(4)	Each month the local board shall pay to the county commissioners of the county where the charge is collected the proceeds from the bottle charge required by G.S. 18B-804(b)(6), to be spent by the county commissioners for the purposes stated in subsection (h) of this section.
(c)	Other Statutory Distributions. – After making the distributions required by subsection (b), a local board shall make the following quarterly distributions from the remaining gross receipts:
(1)	Before making any other distribution under this subsection, the local board shall set aside the clear proceeds of the three and one-half percent (3 1/2%) markup provided for in G.S. 18B-804(b)(5) and the bottle charge provided for in G.S. 18B-804(b)(6b), to be distributed as part of the remaining gross receipts under subsection (e) of this section.
(2)	The local board shall spend for law enforcement an amount set by the board which shall be at least five percent (5%) of the gross receipts remaining after the distribution required by subdivision (1).  The local board may contract with the ALE Division to provide the law enforcement required by this subdivision.  Notwithstanding the provisions of any local act, this provision shall apply to all local boards.
(3)	The local board shall spend, or pay to the county commissioners to spend, for the purposes stated in subsection (h), an amount set by the board which shall be at least seven percent (7%) of the gross receipts remaining after the distribution required by subdivision (1). This provision shall not be applicable to a local board which is subject to a local act setting a different distribution.
(d)	Working Capital. – After making the distributions provided for in subsections (b) and (c), the local board may set aside a portion of the remaining gross receipts, within the limits set by the rules of the Commission, as cash to operate the ABC system. With the approval of the appointing authority for the board, the local board may also set aside a portion of the remaining gross receipts as a fund for specific capital improvements.
(e)	Other Distributions. – After making the distributions provided in subsections (b), (c), and (d), the local board shall pay each quarter the remaining gross receipts to the general fund of the city or county for which the board is established, unless some other distribution or some other schedule is provided for by law. If the governing body of each city and county receiving revenue from an ABC system agrees, those governing bodies may alter at any time the distribution to be made under this subsection or under any local act. Copies of the governing body resolutions agreeing to a new distribution formula and a copy of the approved new distribution formula shall be submitted to the Commission for review and audit purposes. If any one of the governing bodies later withdraws its consent to the change in distribution, profits shall be distributed according to the original formula, beginning with the next quarter.
		(g)  Quarterly Distributions. – When this section requires a distribution to be made quarterly, at least ninety percent (90%) of the estimated distribution shall be paid to the recipient by the local board within 30 days of the end of that quarter. Adjustments in the amount to be distributed resulting from the closing of the books and from audit shall be made with the next quarterly payment.
(h)	Expenditure of Alcoholism Funds. – Funds distributed under subdivisions (b)(4) and (c)(3) of this section shall be spent for the treatment of alcoholism or substance abuse, or for research or education on alcohol or substance abuse. The minutes of the board of county commissioners or local board spending funds allocated under this subsection shall describe the activity for which the funds are to be spent. Any agency or person receiving funds from the county commissioners or local board under this subsection shall submit an annual report to the board of county commissioners or local board from which funds were received, describing how the funds were spent.
(i)	Calculation of Statutory Distributions When Liquor Sold at Less Than Uniform Price. – If a local board sells liquor at less than the uniform State price, distributions required by subsections (b) and (c) shall be calculated as though the liquor was sold at the uniform price."
Sec. 11.  G.S. 18B-902(d) reads as rewritten:
"(d)	Fees. – An application for an ABC permit shall be accompanied by payment of the following application fee:
(1)	On-premises malt beverage permit – $200.00.
(2)	Off-premises malt beverage permit – $200.00.
(3)	On-premises unfortified wine permit – $200.00.
(4)	Off-premises unfortified wine permit – $200.00.
(5)	On-premises fortified wine permit – $200.00.
(6)	Off-premises fortified wine permit – $200.00.
(7)	Brown-bagging permit – $200.00, unless the application is for a restaurant seating less than 50, in which case the fee shall be $100.00.
(8)	Special occasion permit – $200.00.
(9)	Limited special occasion permit – $25.00.
	(11)	Culinary permit – $100.00.
(12)	Unfortified winery permit – $150.00.
(13)	Fortified winery permit – $150.00.
(14)	Limited winery permit – $150.00.
(15)	Brewery permit – $150.00.
(16)	Distillery permit – $150.00.
(17)	Fuel alcohol permit – $50.00.
(18)	Wine importer permit – $150.00.
(19)	Wine wholesaler permit – $150.00.
(20)	Malt beverage importer permit – $150.00.
(21)	Malt beverage wholesaler permit – $150.00.
(22)	Bottler permit – $150.00.
(23)	Salesman permit – $25.00.
(24)	Vendor representative permit – $25.00.
(25)	Nonresident malt beverage vendor permit – $50.00.
(26)	Nonresident wine vendor permit – $50.00.
(27)	Any special one-time permit under G.S. 18B-1002 – $25.00.
(28)	Winery special event permit – $100.00.
	(30)	Guest room cabinet permit – $750.00."
Sec. 12.  G.S. 18B-903(b) reads as rewritten:
"(b)	Renewal. – Application for renewal of an ABC permit shall be on a form provided by the Commission. An application for renewal shall be accompanied by an application fee of twenty-five percent (25%) of the original application fee set in G.S. 18B-902. A renewal fee shall not be refundable."
Sec. 13.  G.S. 18B-1001(10) and (12) are repealed.
Sec. 13.1.  G.S. 18B-1001(13) reads as rewritten:
"(13)	Guest Room Cabinet Permit. – A guest room cabinet permit authorizes a hotel to sell to its room guests, from securely locked cabinets, malt beverages, unfortified wine, fortified wine, and spirituous liquor.  A permittee shall designate and maintain at least ten percent (10%) of the permittee's guest rooms as rooms that do not have a guest room cabinet.  A permittee may dispense alcoholic beverages from a guest room cabinet only in accordance with written policies and procedures filed with and approved by the Commission.  A permittee shall provide a reasonable number of vending machines, coolers, or similar machines on premises for the sale of soft drinks to hotel guests.
A guest room cabinet permit may be issued for any of the following:
a.	A hotel located in a county subject to G.S. 18B-600(f).
b.	A hotel located in a county that has a population in excess of 150,000 by the last federal census."
Sec. 14.  G.S. 18B-1002(a) reads as rewritten:
"(a)	Kinds of Permits. – In addition to the other permits authorized by this Chapter, the Commission may issue permits for the following activities:
(1)	A permit may be issued to a person who acquires ownership or possession of alcoholic beverages through bankruptcy, inheritance, foreclosure, judicial sale, or other special occurrence, and who does not already have a permit authorizing the sale of that kind of alcoholic beverage. The permit may authorize the sale or other disposition of the alcoholic beverages in a manner prescribed by the Commission.
(2)	A permit may be issued to a nonprofit organization to allow the retail sale of malt beverages, unfortified wine, or fortified wine, or to allow brown-bagging, at a single fund-raising event of that organization. A permit for this purpose shall not be issued for the sale of any kind of alcoholic beverage in a jurisdiction where the sale of that alcoholic beverage is not lawful.
(3)	A permit may be issued to a permittee who is going out of business to authorize the sale or other disposition of his alcoholic beverages stock in a manner that would not otherwise be authorized under his permit.
(4)	A permit may be issued to a collector of wine or decorative decanters of spirituous liquor authorizing that person to bring into the State, transport, or possess as a collector, a greater amount of those alcoholic beverages than is otherwise authorized by this Chapter, or to sell those alcoholic beverages in a manner prescribed by the Commission.
(5)	A permit may be issued to a nonprofit organization or a political organization to serve wine, malt beverages, and spirituous liquor at a ticketed event held to allow the organization to raise funds.  For purposes of this subdivision 'nonprofit organization' means an organization that is exempt from taxation under Section 501(c)(3), 501(c)(4), 501(c)(6), 501(c)(8), 501(c)(10), 501(c)(19), or 501(d) of the Internal Revenue Code or is exempt under similar provisions of the General Statutes as a bona fide nonprofit charitable, civic, religious, fraternal, patriotic, or veterans' organization or as a nonprofit volunteer fire department, or as a nonprofit volunteer rescue squad or a bona fide homeowners' or property owners' association.  For purposes of this subdivision 'political organization' means an organization covered by the provisions of G.S. 163-96(a)(1) or (2) or a campaign organization established by or for a person who is a candidate who has filed a notice of candidacy, paid the filing fees or filed the required petition, and been certified as a candidate.  "
Sec. 15.  G.S. 18B-1004 reads as rewritten:
"§ 18B-1004.  Hours for sale and consumption.
(a)	Hours. – Except as otherwise provided in this section, it shall be unlawful to sell malt beverages, unfortified wine, or fortified wine between the hours of 2:00 A.M. and 7:00 A.M., or to consume any of those alcoholic beverages between the hours of 2:30 A.M. and 7:00 A.M., in any place that has been issued a permit under G.S. 18B-1001.
(b)	Repealed by Session Laws 1991, c. 689, s. 310.
(c)	Sunday Hours. – It shall be unlawful to sell or consume alcoholic beverages on any licensed premises from the time at which sale or consumption must cease on Sunday morning until 12:00 Noon on that day.
(d)	Local Option. – A city may adopt an ordinance prohibiting in the city the retail sale of malt beverages, unfortified wine, and fortified wine during any or all of the hours from 12:00 Noon on Sunday until 7:00 A.M. on the following Monday. A county may adopt an ordinance prohibiting, in the parts of the county outside any city, the retail sale of malt beverages, unfortified wine, and fortified wine during any or all of the hours from 12:00 Noon on Sunday until 7:00 A.M. on the following Monday. Neither a city nor a county, however, may prohibit those sales in establishments having brown-bagging permits.
(e)	This section does not prohibit at any time the wholesale delivery and sale of unfortified wine, fortified wine, and malt beverages to retailers issued permits pursuant to G.S. 18B-1001 or G.S. 18B-1002(a)(2) or (5)."
Sec. 16.  G.S. 18B-1006(a) reads as rewritten:
"(a)	School and College Campuses. – No permit for the sale of malt beverages, unfortified wine, or fortified wine shall be issued to a business on the campus or property of a public school or college unless that business is a hotel or a nonprofit alumni organization with a special occasion permit."
Sec. 16.1.  G.S. 18B-1006(i) reads as rewritten:
"(i)	Tour Boats. – The Commission may issue permits to boats that conduct regularly scheduled tours upon the rivers or waterways of this State under the following conditions:
(1)	A boat shall serve meals on each tour and shall have a dining area with seating for at least 36 people;
(2)	A boat's gross receipts from food and non-alcoholic beverages shall be greater than its gross receipts from alcoholic beverages;
(3)	A boat may hold the permits listed in G.S. 18B-1001(1), (3), (5), and (7), but no off-premises sales may be made pursuant to those permits;
(4)	A boat shall have a home port in an area where issuance of the permits listed in subdivision (3) is legal, and all passengers shall enter the boat at the home port or at other ports listed on a preannounced itinerary.  The boat's permits are valid during tours that leave and return to the boat's home port, and apply regardless of whether the boat crosses into an area where sales are not legal, if the boat docks only at a port listed on the preannounced itinerary, except in an emergency; and
(5)	A boat conducting tours along the intracoastal waterway and navigable waterways that enters into the intracoastal waterway, pursuant to a preannounced itinerary that includes visits to two or more cities, may serve alcoholic beverages pursuant to ABC permits issued according to the jurisdiction of its home port in the following manner:
a.	While on tour, alcoholic beverages may be served to passengers;
b.	While docked in any other port alcoholic beverages may be served only to tour passengers;
c.	During special city-sponsored events and festivals, in which case the boat may open its galley and bars at dockside to the general public and sell those alcoholic beverages that are lawful in the jurisdiction in which it is docked.  Any sales in this manner shall be in accordance with the requirements of any ordinances of the jurisdiction in which the boat is docked.
	."
Sec. 17.  G.S. 18B-1007 is repealed.
Sec. 18.  G.S. 95-25.5(i) reads as rewritten:
"(i)	Youths under 18 years of age employed by their parents are exempt from all provisions of this section, except for all of the following:
(1)	The certificate requirements of subsection (a) of this section.
(2)	The prohibition from hazardous or detrimental occupations of subsection (b) of this section. 
	."
Sec. 18.1.  G.S. 95-25.5(j) reads as rewritten:
"(j)	No person who holds any ABC permit issued pursuant to the provisions of Chapter 18B of the General Statutes for the on-premises sale or consumption of alcoholic beverages shall employ a youth:
(1)	Under 16 years of age on the premises for any purpose;
(2)	Under 18 years of age to prepare, serve, dispense or sell any alcoholic beverages."
Sec. 19.  G.S. 105-113.68(a)(4) reads as rewritten:
"(4)	'Alcoholic beverage' means a beverage containing at least one half of one percent (0.5%) alcohol by volume, including malt beverages, unfortified wine, fortified wine, spirituous liquor."
Sec. 20.  G.S. 105-164.13(37) reads as rewritten:
"(37)	Spirituous liquor. As used in this subdivision, the term 'spirituous liquor' "has the same meaning as in G.S. 18B-101(14)."
Sec. 21.  Notwithstanding any other provision of law, the ABC Commission shall not issue any permits allowing the sale of mixed beverages on or after the effective date of this act.
Sec. 22.  All permits repealed by this act that were issued prior to the effective date of this act shall expire and become null and void 60 days after the effective date of this act.
Sec. 23.  This act is effective upon ratification.