LRB-3533/1
ARG:emw&wlj
2023 - 2024 LEGISLATURE
June 8, 2023 - Introduced by Representatives Vos,
August, Swearingen and
Zimmerman, cosponsored by Senators LeMahieu, Feyen and Testin. Referred
to Committee on State Affairs.
AB304,4,8
1An Act to repeal 125.06 (13), 125.28 (2) (e), 125.29 (2) (b) 1. and 2., 125.29 (3)
2(g), 125.51 (3) (am), 125.51 (3m) (a), 125.52 (7) and 125.68 (4) (c) 3m.;
to
3renumber 125.02 (16), 125.04 (8), 125.29 (2) (b) 3. and 125.58 (2);
to renumber
4and amend 125.02 (6), 125.045 (2), 125.045 (3), 125.09 (1), 125.29 (3) (h),
5125.30 (3), 125.33 (9), 125.52 (1) (b) 1., 125.52 (1) (b) 2. and 125.53 (1);
to amend
6125.02 (12), 125.02 (13), 125.02 (14m), 125.02 (23), 125.03 (title), 125.03 (1) (a),
7125.03 (1) (b), 125.03 (2), 125.04 (3) (a) (intro.), 125.04 (3) (a) 1., 125.04 (3) (b),
8125.04 (3) (bm) (intro.), 125.04 (3) (c), 125.04 (3) (d) 1., 125.04 (3) (d) 2., 125.04
9(3) (e) 2., 125.04 (3) (h), 125.04 (3) (j), 125.04 (4), 125.04 (5) (a) 5., 125.04 (5) (d)
101., 125.04 (5) (d) 2., 125.04 (5) (d) 3. a., 125.04 (6) (g), 125.04 (8) (title), 125.04
11(8) (b), 125.04 (12) (a), 125.045 (title), 125.045 (1), 125.06 (1), 125.06 (3g), 125.06
12(11m), 125.07 (1) (b) 4., 125.07 (3) (a) 3., 125.07 (3) (a) 10., 125.07 (3) (a) 16.,
13125.07 (4) (f) 3., 125.105 (1), 125.12 (1) (a), 125.12 (1) (c), 125.12 (4) (title), 125.12
14(4) (ag) (intro.), 125.12 (5) (title), 125.12 (5) (a), 125.12 (5) (b), 125.12 (5) (c),
1125.12 (6) (a), 125.12 (6) (b), 125.12 (6) (c), 125.12 (6) (cm), 125.12 (6) (d), 125.12
2(6) (dm), 125.12 (6) (e), 125.13, 125.14 (2) (c), 125.14 (2) (d), 125.14 (2) (e), 125.14
3(2) (f), 125.14 (3) (b), 125.145, 125.15 (1), 125.17 (6) (a) (intro.), 125.19 (1), 125.20
4(5) (c) and (d), 125.26 (2m), 125.26 (2s) (b), 125.27 (1) (a), 125.27 (2) (a) 1. (intro.),
5125.27 (2) (a) 2., 125.27 (3) (b), 125.27 (5) (b) and (f), 125.275 (1), 125.275 (2) (b),
6125.275 (3), 125.28 (1) (a), 125.28 (1) (b), 125.28 (2) (b) (intro.), 125.28 (2) (b) 1.
7a., 125.28 (2) (b) 1. b., 125.28 (2) (b) 1. c., 125.28 (2) (b) 2., 125.28 (4), 125.28 (5)
8(b), 125.28 (5) (d) 3., 125.28 (5) (e), 125.29 (1), 125.29 (3) (intro.), 125.29 (3) (c),
9125.29 (3) (e), 125.29 (3) (f), 125.29 (3) (i), 125.29 (6), 125.295 (1) (intro.), 125.295
10(1) (a), 125.295 (1) (g), 125.295 (2) (a) 1., 125.295 (2) (a) 2., 125.295 (2) (a) 4.,
11125.295 (2) (a) 6. (intro.), 125.295 (2) (a) 6. a., 125.295 (2) (a) 6. b., 125.295 (2)
12(a) 6. c., 125.295 (2) (b), 125.295 (2) (c), 125.295 (4), 125.295 (5), 125.30 (1),
13125.30 (2), 125.30 (4), 125.30 (5), 125.32 (2), 125.32 (6) (a), 125.33 (2) (a), 125.33
14(2) (d), 125.33 (12), 125.34 (6), 125.51 (1) (a), 125.51 (2) (am), 125.51 (2) (e) 3.,
15125.51 (3) (a), 125.51 (3) (b), 125.51 (3) (bm), 125.51 (3) (bs) 2., 125.51 (3) (f),
16125.51 (3m) (c), 125.51 (3r) (a) 3., 125.51 (3r) (b), 125.51 (4) (a) 1., 125.51 (4) (e)
171., 125.51 (5) (a) 1., 125.51 (5) (a) 4., 125.51 (5) (b) 2., 125.51 (5) (b) 4., 125.51
18(5) (c) 1., 125.51 (5) (d) 2., 125.51 (5) (f) 2. and 5., 125.52 (1) (a), 125.52 (2),
19125.535 (1), 125.535 (2), 125.535 (3) (b) 2., 125.535 (3) (c), 125.54 (1), 125.54 (3),
20125.54 (5), 125.54 (6), 125.54 (7) (a) 2., 125.54 (7) (c) 3., 125.54 (7) (d), 125.545
21(title), 125.545 (1) (a), 125.545 (1) (d), 125.545 (1) (e), 125.545 (2) (a) 1., 125.545
22(2) (a) 3. b., 125.545 (2) (b), 125.545 (2) (c), 125.545 (3) (a) 1., 125.545 (3) (a) 2.,
23125.545 (3) (b), 125.545 (3) (c), 125.545 (4), 125.545 (5), 125.545 (6) (title) and
24(a) 1. and 2., 125.545 (6) (a) 3., 125.545 (6) (a) 4., 125.545 (6) (b), 125.545 (7),
25125.55 (1), 125.56 (2) (a), 125.56 (2) (c), 125.56 (2) (d), 125.58 (1), 125.60 (1),
1125.61 (1), 125.61 (3), 125.61 (4), 125.62 (1), 125.62 (3), 125.63 (1), 125.63 (3),
2125.65 (1), 125.65 (4) (intro.), 125.65 (4) (e), 125.65 (6), 125.65 (10), 125.68 (2),
3125.68 (4) (c) 1., 125.68 (4) (c) 3., 125.68 (9) (f), 125.68 (10) (a) and (b), 125.69
4(4) (e), 125.69 (7), 139.01 (4), 139.01 (6), 139.03 (5) (a), 139.04 (4), 139.06 (3),
5139.08 (3), 139.08 (4), 139.11 (1), 139.11 (4) (a) 2., 139.11 (4) (b) 2., 139.22, 139.25
6(9), 185.043 (2), 227.52 (1), 230.08 (2) (e) 11. and 346.657 (1);
to repeal and
7recreate 125.25 (2) (b), 125.26 (2) (b), 125.29 (2) (a) and 125.69 (1); and
to
8create 15.433 (2), 19.42 (13) (q), 20.923 (4) (c) 7., 125.02 (1g), 125.02 (5g), 125.02
9(6) (b), 125.02 (6d), 125.02 (6g), 125.02 (16) (bm), 125.025, 125.04 (3) (k), 125.04
10(8) (b), 125.045 (2) (b), 125.045 (3) (b), 125.09 (1) (b) and (c), 125.11 (3), 125.12
11(4) (ag) 9., 125.12 (5) (bm), 125.175, 125.20, 125.21, 125.22, 125.23, 125.24,
12125.27 (7), 125.28 (2) (b) 1. g., h. and i., 125.28 (2) (b) 1. j., 125.29 (2) (a) 6., 125.29
13(3) (dm), 125.29 (3) (h) 3., 125.29 (7) and (8), 125.295 (1) (fm), 125.295 (2) (a) 6.
14g., 125.30 (2) (d), 125.30 (3) (b), 125.30 (3) (c), 125.30 (3) (c) 5., 125.32 (3m) (L),
15125.33 (2) (hr), 125.33 (9) (c), 125.51 (3) (bg), 125.51 (4) (v) 5., 125.52 (1) (b) 3.,
164. and 5., 125.52 (4) and (5), 125.53 (1) (a) 3., 4., 5. and 6., 125.53 (3) and (4),
17125.535 (3) (b) 3., 125.535 (3) (d) and (e), 125.535 (7), 125.545 (1) (ar), 125.545
18(1) (cm), 125.545 (1) (em), 125.545 (2) (a) 4., 125.545 (3) (a) 2m., 125.545 (6) (a)
192m., 125.545 (6) (a) 3m., 125.58 (2) (b) and (c), 125.58 (5), 125.69 (1) (a) 5., (b)
205., (c) 9. and (d) 5., 125.69 (9), 139.01 (2p) and 139.08 (5) of the statutes;
21relating to: creating the Division of Alcohol Beverages attached to the
22Department of Revenue; the regulation of alcohol beverages and enforcement
23of alcohol beverage laws; interest restrictions relating to, and authorized
24activities of, brewers, brewpubs, wineries, manufacturers, rectifiers,
25wholesalers, and retailers; shipping alcohol beverages by means of fulfillment
1houses and common carriers; the consumption of alcohol beverages in a public
2place; creating a no-sale event venue permit; creating an operator's permit;
3liquor licenses transferred from one municipality to another; retailers'
4authorized activities; liquor license quotas; the safe ride program; the presence
5of underage persons and conduct of other business on licensed premises; the
6occupational tax on alcohol beverages; repealing a rule promulgated by the
7Department of Revenue; granting rule-making authority; and providing a
8penalty.
Analysis by the Legislative Reference Bureau
This bill does all of the following:
1. Creates the Division of Alcohol Beverages (division) attached to the
Department of Revenue and transfers DOR's alcohol beverage regulation and
enforcement functions to the division.
2. Makes changes relating to the retail sales authority of brewers, wineries,
manufacturers, and rectifiers, as well as changes relating to other authorized
activities of brewers, wineries, manufacturers, and rectifiers.
3. Expands or modifies the authority of brewers, wineries, manufacturers, and
rectifiers to provide free taste samples on retail premises.
4. Increases the limits on the amount of fermented malt beverages (beer) a
brewpub may manufacture and self-distribute.
5. Makes changes relating to restrictions on holding certain common interests
applicable to manufacturers, rectifiers, wineries, brewers, brewpubs, wholesalers,
and retailers.
6. Specifies requirements for certain production arrangements between alcohol
beverage producers.
7. Creates permits issued to, and imposes requirements and restrictions on,
fulfillment houses and common carriers.
8. Makes changes relating to the state's jurisdiction over out-of-state persons
holding Wisconsin alcohol beverage permits and persons who unlawfully ship
alcohol beverages into another state.
9. Modifies provisions relating to the consumption of alcohol beverages in a
public place and creates a no-sale event venue permit issued by the division to
property owners authorizing the permittee to rent real property for use as an event
venue at which beer and wine are consumed, on no more than six days per year, if
certain requirements are met. The bill also creates a liquor license quota exception
for qualifying persons who opt to obtain a retail license instead of a no-sale event
venue permit.
10. Allows “Class C” retail licenses to be issued to establishments other than
restaurants.
11. Modifies the applicable penalty when a beer retailer purchases beer from
a source other than a wholesaler.
12. Broadens membership eligibility and operational authority of cooperative
wholesalers and allows new cooperative wholesalers to be formed for a limited
period.
13. Eliminates the limit on the number of manufacturers', rectifiers', or liquor
wholesalers' permits one person may hold and allows a beer wholesaler to transfer
its wholesaler's permit to a different location within the state.
14. Increases the amount of the safe ride program surcharge and requires
municipalities to provide information to retailers about the safe ride program.
15. Makes changes relating to the occupational tax liability of producers of
alcohol beverages.
16. Changes the definition of “fermented malt beverages.”
17. Establishes a $500 fee for permits issued by the division if no fee is currently
charged for the permit.
18. Creates an operator's permit issued by the division that is similar to an
operator's license (commonly referred to as a bartender's license) issued by a
municipality.
19. Allows a municipality to transfer a retail liquor license that is subject to the
quota system to another municipality in the same county.
20. Creates a closing hour exception for certain retailers in southeast
Wisconsin during a 2024 national political convention.
21. Modifies a licensing exception applicable to beer provided on brewery
premises.
22. Allows a retail license to be issued for an axe throwing facility and allows
an underage person, without a parent or guardian, to be on these licensed premises.
23. Specifies that, subject to certain conditions, a “Class B” retailer may
prepare and store mixed drinks up to 48 hours prior to sale to consumers.
Background
Under current law, alcohol beverages are generally distributed to consumers
under a three-tier distribution system: the producer sells to a wholesaler, the
wholesaler sells to a retailer, and the retailer sells to a consumer. With specific
exceptions, no person may sell outside the three-tier system and no person may sell
alcohol beverages to a consumer unless the seller possesses a license or permit
authorizing the sale. Also under current law, DOR issues permits to alcohol beverage
producers that authorize specified activities, while municipalities issue retail
licenses to alcohol beverage retailers. With limited exceptions, a retail licensee may
not purchase alcohol beverages from, or possess alcohol beverages purchased from,
any person other than a wholesaler.
Under current law, Class “A” and “Class A” licenses authorize the retail sale of,
respectively, beer and intoxicating liquor in original packages for consumption off the
licensed premises. Intoxicating liquor includes wine and distilled spirits. Class “A”
and “Class A” licenses are often issued together for grocery stores or liquor stores.
A Class “B" license authorizes the retail sale of beer for consumption on or off the
premises. Except when issued to a winery, a “Class B" license authorizes the retail
sale of intoxicating liquor for consumption on the licensed premises and, subject to
restrictions, the retail sale of intoxicating liquor for consumption off the licensed
premises. Class “B” and “Class B” licenses are often issued together for restaurants
or taverns. A “Class C" license, which may be issued only for a restaurant, authorizes
the retail sale of wine for consumption on the premises.
Under current law, DOR issues permits to manufacturers (commonly referred
to as distillers), rectifiers, wineries, brewers, and brewpubs. DOR also issues
permits to beer wholesalers, intoxicating liquor wholesalers, out-of-state beer
shippers, and out-of-state intoxicating liquor shippers. Out-of-state shippers are
suppliers located outside this state that ship alcohol into this state. DOR also issues
direct wine shippers' permits to in-state and out-of-state wineries that authorize
the permittee to ship wine directly to individuals in this state. In addition, DOR
issues Class “B” and “Class B” retail permits under limited circumstances.
Division of Alcohol Beverages
The bill creates the division, attached to DOR, and transfers DOR's alcohol
beverage regulation and enforcement functions, including issuance of alcohol
beverage permits, to the division. The bill also creates within the division separate
bureaus dedicated to enforcement, legal services, and education and community
outreach. The administrator of the division may appoint special agents and other
employees necessary to carry out the permitting, audit, education, legal, and
enforcement functions of the division. The administrator and employees of the
division may not be employed by or have a financial interest in the alcohol beverage
industry and are subject to the standards of conduct and conflict of interest
prohibitions for state public officials.
Retail sales by brewers, wineries, manufacturers, and rectifiers
Under current law, a brewer's permit issued by DOR authorizes the brewer to,
among other activities, manufacture beer and, if the brewer manufactures 300,000
or fewer barrels of beer per year, self-distribute its beer directly to retailers. A
brewer's permit also authorizes the brewer to sell at retail, without a retail license,
at the brewery premises and at one off-site retail outlet 1) the brewer's own beer, for
consumption on or off the premises; 2) certain other Wisconsin-made beer, for
consumption on or off the premises, if the brewer purchases the beer from a
wholesaler or another brewer; and 3) intoxicating liquor, for consumption on the
premises, if the brewer held a retail intoxicating liquor license on June 1, 2011, and
if the brewer purchases the intoxicating liquor from a wholesaler. The brewer may
also provide free taste samples at the brewery premises and the brewer's off-site
retail outlet. A brewer may not hold a retail beer license. A brewer may not operate
a restaurant except at the brewery premises and the brewer's off-site retail outlet.
Under current law, a winery permit issued by DOR authorizes the winery to,
among other activities, manufacture wine and provide taste samples of its wine on
the winery premises. A winery may also hold one retail license—either a “Class A”
or “Class B” license—which may be issued for the winery premises or another
location, but the winery may not hold other specified retail interests. A “Class B”
license issued to a winery is limited compared to other “Class B” licenses because it
authorizes the retail sale of wine for consumption on or off the premises but does not
authorize the retail sale of distilled spirits. A “Class B” license may be issued to a
winery only if the winery is capable of producing at least 5,000 gallons of wine per
year in no more than two locations. If a retail license is issued to a winery, the winery
may provide wine made by the winery directly to its own retail premises, without the
wine first passing through a wholesaler.
Under current law, a manufacturer's permit or rectifier's permit issued by DOR
authorizes the permittee to, respectively, manufacture or rectify intoxicating liquor.
Current law prohibits a manufacturer or rectifier from holding an interest in a retail
liquor license, but a manufacturer's permit or rectifier's permit authorizes the
manufacturer or rectifier to make retail sales, without a retail license, of intoxicating
liquor manufactured or rectified on the manufacturer's or rectifier's premises, for
consumption on or off the premises. Subject to limitations, a manufacturer or
rectifier may also provide free taste samples of intoxicating liquor manufactured or
rectified on the premises, for consumption on the premises.
The bill eliminates most current law provisions relating to retail sales authority
for brewers, wineries, manufacturers, and rectifiers and replaces them with
provisions creating a more uniform standard of retail sales authority for these
producers. Under the bill, a brewer, winery, manufacturer, or rectifier (producer)
may, under its division-issued permit, make retail sales on the production premises
and establish full-service retail outlets depending on the producer's production
volume. The bill authorizes a producer to make retail sales of its own products on
the production premises, for on-premises or off-premises consumption. If the
producer meets specified production thresholds, the bill also allows the producer to
engage in full-service retail sales on the production premises and to establish from
one to three full-service retail outlets away from the production premises at which
full-service retail sales may be made. “Full-service retail sales" are sales of beer and
intoxicating liquor, for on-premises or off-premises consumption, and the provision
of taste samples. Alcohol beverages not produced by the producer must be purchased
from a wholesaler or other person authorized to distribute the alcohol beverages
under current law. To operate a full-service retail outlet, a producer must obtain
approval from the division, which the division must grant unless the producer has
violated a provision of law related to full-service retail outlets. In addition, a
producer may not commence sales of alcohol beverages at a full-service retail outlet
unless, prior to commencing such sales, the producer receives approval from the
municipality in which the retail outlet is located. Applications for a municipality's
approval must be made on a form prescribed by the division. A municipality's
approval must be based on the same standards and criteria that the municipality has
established by ordinance for the evaluation and approval of retail license
applications. A municipality may limit the scope of alcohol beverages offered for sale
at a full-service retail outlet only with respect to alcohol beverages that are not of
the same type as those produced by the producer. Retail sales on the production
premises and at full-service retail outlets must be supervised by the permit holder
or a person holding an operator's license or operator's permit (discussed further
below). A producer may operate a restaurant at any full-service retail outlet and on
the production premises.
Under the bill, if a brewer is not eligible to establish a full-service retail outlet,
the brewer maintains the current-law authorization to establish an off-site retail
outlet at which it may sell its own beer for on-premises or off-premises consumption.
In addition, if the brewer held a retail intoxicating liquor license on June 1, 2011, for
its brewery premises or an off-site retail outlet, the brewer may make retail sales of
intoxicating liquor for on-premises consumption at this formerly licensed location.
The bill eliminates the authorization for a winery to hold a retail license, which
authorization is replaced with the retail sales authority described above. The bill
also eliminates the prohibition against a brewer operating a restaurant in a location
other than the brewery premises and the brewer's off-site retail outlet.
Closing hours for retail sales by brewers, wineries, manufacturers, and
rectifiers
Under current law, with limited exceptions, a retailer operating under a Class
“B" or “Class B” license may not remain open between the hours of 2 a.m. and 6 a.m.
on weekdays or between 2:30 a.m. and 6 a.m. on Saturday and Sunday, and a
municipality may not impose different closing hours by ordinance. The hours during
which a Class “B” licensed retailer may make sales for off-premises consumption are
more limited, with these sales prohibited from midnight to 6 a.m., although a
municipality may, by ordinance, impose more restrictive hours for these sales.
Current law does not specify closing hours or permissible hours of sale for retail sales
by brewers, manufacturers, or rectifiers.
Under the bill, a full-service retail outlet of a producer is subject to the same
closing hours, and restrictions on the hours in which sales for off-premises
consumption may be made, that are applicable to a Class “B" licensee in the same
municipality with respect to all alcohol beverages sold at the retail outlet. These
limitations also apply to the producer's production premises, except that the
production premises are not required to be closed for nonretail activities. The bill
also specifies that no member of the public or invited guests may be present on the
production premises during the closing hours applicable to a Class “B" licensee.
Under current law, a winery operating under a “Class B" license may not
remain open for retail sales of wine between the hours of 9 p.m. and 8 a.m.
The bill eliminates this earlier closing hour for a winery.
Other authorized activities of brewers, wineries, manufacturers, and
rectifiers
