A BILL TO BE ENTITLED
AN ACT to modernize the north carolina ALCOHOLIC beverage control system based on the program evaluation division report issued december 10, 2008.
The General Assembly of North Carolina enacts:
SECTION 1.  G.S. 18B‑203(a) is amended by adding a new subdivision to read:
"§ 18B‑203.  Powers and duties of the Commission.
(a)	Powers. – The Commission shall have authority to:
…
(20)	Establish performance standards for local ABC boards. Performance standards established pursuant to this subdivision shall include, but not be limited to, standards that address store appearance, operating efficiency, profitability, and customer service."
SECTION 2.  G.S. 18B‑208 is amended by adding a new subsection to read:
"(c)	Technical Assistance and Financial Incentive Loans. – A special fund in the Department of the State Treasurer, the Technical Assistance and Financial Assistance Fund, is created. Funds may be transferred from the ABC Commission Fund to the Technical Assistance and Financial Assistance Fund to provide needed revenue to carry out the provisions of this subsection. If additional revenue is needed for the Technical Assistance and Financial Assistance Fund, the ABC Commission is authorized to levy an additional bailment surcharge amount not to exceed ten cents (10¢) per case, which shall be deposited in the Technical Assistance and Financial Assistance Fund for the purpose of carrying out the provisions of this subsection.
The ABC Commission Fund shall be subject to the provisions of the State Budget Act except that no unexpended surplus of this fund shall revert to the General Fund. The Commission shall fix the level of the bailment surcharges at an amount calculated to generate a maximum of two million dollars ($2,000,000) for the Technical Assistance and Financial Assistance Fund. Once the Fund has reached the two million dollar ($2,000,000) maximum, the Commission shall reduce the bailment surcharge to an amount no greater than necessary to maintain the balance in the Technical Assistance and Financial Assistance Fund as authorized by the General Assembly.
All moneys credited to the Technical Assistance and Financial Assistance Fund shall be used by the North Carolina ABC Commission to issue no‑interest loans to local ABC boards, upon application and approval of the full Commission, for technical assistance and financial incentives that will result in increased efficiencies in store operation and improved customer service."
SECTION 3.  G.S. 18B‑301(b) reads as rewritten:
"(b)	Possession on Other Property. – It shall be lawful, without an ABC permit, for a person to possess for his personal use and the use of his guests not more than 40 liters of fortified wine or spirituous liquor, or 40 liters of the two combined, at the following places:
(1)	The residence of any other person with that person's consent;
(2)	Any other property not primarily used for commercial purposes and not open to the public at the time the alcoholic beverage is possessed, if the owner or other person in charge of the property consents to that possession and consumption;
(3)	An establishment with a brown‑bagging permit as defined in G.S. 18B‑1001(7)."
SECTION 4.  G.S. 18B‑303(a) reads as rewritten:
"(a)	Purchases Allowed. – Without a permit, a person may purchase at one time:
(1)	Not more than 80 liters of malt beverages, except draft malt beverages in kegs for off‑premises consumption. For purchase of a keg or kegs of malt beverages for off‑premises consumption, the permit required by G.S. 18B‑403.1(a) must first be obtained;
(2)	Any amount of draft malt beverages by a permittee in kegs for on‑premise consumption;
(3)	Not more than 100 liters of unfortified wine;
(4)	Not more than 40 liters of either fortified wine or spirituous liquor, or 40 liters of the two combined."
SECTION 5.  G.S. 18B‑304 reads as rewritten:
"§ 18B‑304.  Sale and possession for sale.
(a)	Offense. – It shall be unlawful for any person to sell any alcoholic beverage, or possess any alcoholic beverage for sale, without first obtaining the applicable ABC permit and revenue licenses.
(b)	Prima Facie Evidence. – Possession of the following amounts of alcoholic beverages, without a permit authorizing that possession, shall be prima facie evidence that the possessor is possessing those alcoholic beverages for sale:
(1)	More than 80 liters of malt beverages, other than draft malt beverages in kegs;
(2)	More than 40 liters of spirituous liquor; or
(3)	Any amount of nontaxpaid alcoholic beverages." 
SECTION 6.  G.S. 18B‑403 is repealed.
SECTION 7.  G.S. 18B‑600(d) reads as rewritten:
"(d)	City ABC Store Elections. – A city may hold an ABC store election only if:
(1)	The city has at least 5,000 registered voters; and
(2)	The county in which the city is located does not operate ABC stores."
SECTION 8.  G.S. 18B‑600(e) reads as rewritten:
"(e)	City Mixed Beverage Elections. – A city may hold a mixed beverage election if the city has at least 500 registered voters.
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SECTION 9.  G.S. 18B‑700 is amended by adding a new subsection to read:
"(a1)	Mission. – The  mission of ABC boards and their employees shall be to responsibly serve their localities by controlling the sale of spirituous liquor in customer‑friendly, modern, and efficient stores in order to optimize revenue distributions."
SECTION 10.  G.S. 18B‑700(g) reads as rewritten:
"(g)	Salary. – A local board member may be compensated as determined by the appointing authority. No local board member may be compensated for service if the profit margin for the local board falls below five percent (5%) based on information in the annual audit."
SECTION 11.  G.S. 18B‑701 reads as rewritten:
"§ 18B‑701.  Powers and duties  of local ABC boards.
(a)	Powers. – A local board shall have authority to:
(1)	Buy, sell, transport, and possess alcoholic beverages as necessary for the operation of its ABC stores;
(2)	Adopt rules for its ABC system, subject to the approval of the Commission;
(3)	Hire and fire employees for the ABC system;
(4)	Designate one employee as manager of the ABC system and determine his responsibilities;
(5)	Require bonds of employees as provided in the rules of the Commission;
(6)	Operate ABC stores as provided in Article 8;
	(8)	Employ local ABC officers or make other provision for enforcement of ABC laws as provided in Article 5;
(9)	Borrow money as provided in G.S. 18B‑702;
(10)	Buy and lease real and personal property, and receive property bequeathed or given, as necessary for the operation of the ABC system;
(11)	Invest surplus funds as provided in G.S. 18B‑702;
(12)	Dispose of property in the same manner as a city council may under Article 12 of Chapter 160A of the General Statutes; and
(13)	Perform any other activity authorized or required by the ABC law.
(b)	Duties. – A local board shall have the duty to comply with all directives of the Commission and meet all standards for performance established by the Commission pursuant to G.S. 18B‑203(a)(20)."
SECTION 12.  Chapter 18B of the General Statutes is amended by adding a new section to read:
"§ 18B‑705. Compliance with performance standards; remedies.
(a)	Local Board Compliance. – The Commission shall ensure that all local boards comply with performance standards established pursuant to G.S. 18B‑203(a)(20) by conducting regular or special audits, conducting performance evaluations, or taking other measures which may include inspections by Commission auditors and alcohol law enforcement agents.
(b)	Performance Improvement Plans. – The Commission, upon determining that a local board is failing to meet performance standards established pursuant to G.S. 18B‑203(a)(20), shall meet with the chair of the local board, issue a statement of findings, and deliver a performance improvement plan. The performance improvement plan shall include, but not be limited to, recommendations for improved performance based on the performance standards established by the Commission. The plan shall also state a period of time in which the performance improvements are to occur and what action will be taken by the Commission if performance standards are not met within the given time limits. The Commission shall allow up to, but no more than, six months' time to the local board to implement and show improvement under the performance improvement plan. The Commission, upon good cause shown, may allow up to an additional six‑month period of time for the local board to meet all requirements in the performance improvement plan and to establish that the performance standards established by the Commission are met.
(c)	Remedies. – If the Commission determines that the established performance standards cannot be met after a performance improvement plan has been implemented and adequate time has been given, but in no case more than 12 months, the Commission may seize all assets of the local board and take appropriate action to ensure profitability. This action may include closing the board, a store, multiple stores, merging the local board with another local board, or merging the local board with another local board to create a regional board."
SECTION 13. G.S. 18B‑801(b) is amended by adding a new subdivision to read:
"(b)	Location of Stores. – A local board may choose the location of the ABC stores within its jurisdiction, subject to the approval of the Commission. In making its decision on a location, the Commission may consider:
(1)	Whether the health, safety, or general welfare of the community will be adversely affected.
(2)	Whether the citizens of the community or city in which the proposed store is to be located voted for or against ABC stores in the last election on the question.
(3)	The proximity of the new location to existing ABC stores operated by the local board or any other boards."
SECTION 14.  This act becomes effective October 1, 2009.