Bill Text: IL HB5369 | 2011-2012 | 97th General Assembly | Introduced

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Bill Title: Amends the Liquor Control Act of 1934. Provides that as a means to reduce the sale of cheap alcoholic liquors that leads to binge drinking, the Illinois Liquor Control Commission shall provide by rule for a standard of minimum prices that shall be charged for alcoholic liquors sold in bars and restaurants.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Failed) 2013-01-08 - Session Sine Die [HB5369 Detail]

Download: Illinois-2011-HB5369-Introduced.html

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97TH GENERAL ASSEMBLY State of Illinois 2011 and 2012 HB5369 Introduced , by Rep. Maria Antonia Berrios SYNOPSIS AS INTRODUCED:
235 ILCS 5/3-12
Amends the Liquor Control Act of 1934. Provides that as a means to reduce the sale of cheap alcoholic liquors that leads to binge drinking, the Illinois Liquor Control Commission shall provide by rule for a standard of minimum prices that shall be charged for alcoholic liquors sold in bars and restaurants.
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FISCAL NOTE ACT MAY APPLY
A BILL FOR
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AN ACT concerning liquor.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Liquor Control Act of 1934 is amended by
changing Section 3-12 as follows:
(235 ILCS 5/3-12)
Sec. 3-12. Powers and duties of State Commission.
(a) The State commission shall have the following powers,
functions and duties:
(1) To receive applications and to issue licenses to
manufacturers, foreign importers, importing distributors,
distributors, non-resident dealers, on premise consumption
retailers, off premise sale retailers, special event
retailer licensees, special use permit licenses, auction
liquor licenses, brew pubs, caterer retailers,
non-beverage users, railroads, including owners and
lessees of sleeping, dining and cafe cars, airplanes,
boats, brokers, and wine maker's premises licensees in
accordance with the provisions of this Act, and to suspend
or revoke such licenses upon the State commission's
determination, upon notice after hearing, that a licensee
has violated any provision of this Act or any rule or
regulation issued pursuant thereto and in effect for 30

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days prior to such violation. Except in the case of an
action taken pursuant to a violation of Section 6-3, 6-5,
or 6-9, any action by the State Commission to suspend or
revoke a licensee's license may be limited to the license
for the specific premises where the violation occurred.
In lieu of suspending or revoking a license, the
commission may impose a fine, upon the State commission's
determination and notice after hearing, that a licensee has
violated any provision of this Act or any rule or
regulation issued pursuant thereto and in effect for 30
days prior to such violation. The fine imposed under this
paragraph may not exceed $500 for each violation. Each day
that the activity, which gave rise to the original fine,
continues is a separate violation. The maximum fine that
may be levied against any licensee, for the period of the
license, shall not exceed $20,000. The maximum penalty that
may be imposed on a licensee for selling a bottle of
alcoholic liquor with a foreign object in it or serving
from a bottle of alcoholic liquor with a foreign object in
it shall be the destruction of that bottle of alcoholic
liquor for the first 10 bottles so sold or served from by
the licensee. For the eleventh bottle of alcoholic liquor
and for each third bottle thereafter sold or served from by
the licensee with a foreign object in it, the maximum
penalty that may be imposed on the licensee is the
destruction of the bottle of alcoholic liquor and a fine of

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up to $50.
(2) To adopt such rules and regulations consistent with
the provisions of this Act which shall be necessary to
carry on its functions and duties to the end that the
health, safety and welfare of the People of the State of
Illinois shall be protected and temperance in the
consumption of alcoholic liquors shall be fostered and
promoted and to distribute copies of such rules and
regulations to all licensees affected thereby.
(3) To call upon other administrative departments of
the State, county and municipal governments, county and
city police departments and upon prosecuting officers for
such information and assistance as it deems necessary in
the performance of its duties.
(4) To recommend to local commissioners rules and
regulations, not inconsistent with the law, for the
distribution and sale of alcoholic liquors throughout the
State.
(5) To inspect, or cause to be inspected, any premises
in this State where alcoholic liquors are manufactured,
distributed, warehoused, or sold.
(5.1) Upon receipt of a complaint or upon having
knowledge that any person is engaged in business as a
manufacturer, importing distributor, distributor, or
retailer without a license or valid license, to notify the
local liquor authority, file a complaint with the State's

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Attorney's Office of the county where the incident
occurred, or initiate an investigation with the
appropriate law enforcement officials.
(5.2) To issue a cease and desist notice to persons
shipping alcoholic liquor into this State from a point
outside of this State if the shipment is in violation of
this Act.
(5.3) To receive complaints from licensees, local
officials, law enforcement agencies, organizations, and
persons stating that any licensee has been or is violating
any provision of this Act or the rules and regulations
issued pursuant to this Act. Such complaints shall be in
writing, signed and sworn to by the person making the
complaint, and shall state with specificity the facts in
relation to the alleged violation. If the Commission has
reasonable grounds to believe that the complaint
substantially alleges a violation of this Act or rules and
regulations adopted pursuant to this Act, it shall conduct
an investigation. If, after conducting an investigation,
the Commission is satisfied that the alleged violation did
occur, it shall proceed with disciplinary action against
the licensee as provided in this Act.
(6) To hear and determine appeals from orders of a
local commission in accordance with the provisions of this
Act, as hereinafter set forth. Hearings under this
subsection shall be held in Springfield or Chicago, at

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whichever location is the more convenient for the majority
of persons who are parties to the hearing.
(7) The commission shall establish uniform systems of
accounts to be kept by all retail licensees having more
than 4 employees, and for this purpose the commission may
classify all retail licensees having more than 4 employees
and establish a uniform system of accounts for each class
and prescribe the manner in which such accounts shall be
kept. The commission may also prescribe the forms of
accounts to be kept by all retail licensees having more
than 4 employees, including but not limited to accounts of
earnings and expenses and any distribution, payment, or
other distribution of earnings or assets, and any other
forms, records and memoranda which in the judgment of the
commission may be necessary or appropriate to carry out any
of the provisions of this Act, including but not limited to
such forms, records and memoranda as will readily and
accurately disclose at all times the beneficial ownership
of such retail licensed business. The accounts, forms,
records and memoranda shall be available at all reasonable
times for inspection by authorized representatives of the
State commission or by any local liquor control
commissioner or his or her authorized representative. The
commission, may, from time to time, alter, amend or repeal,
in whole or in part, any uniform system of accounts, or the
form and manner of keeping accounts.

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(8) In the conduct of any hearing authorized to be held
by the commission, to appoint, at the commission's
discretion, hearing officers to conduct hearings involving
complex issues or issues that will require a protracted
period of time to resolve, to examine, or cause to be
examined, under oath, any licensee, and to examine or cause
to be examined the books and records of such licensee; to
hear testimony and take proof material for its information
in the discharge of its duties hereunder; to administer or
cause to be administered oaths; for any such purpose to
issue subpoena or subpoenas to require the attendance of
witnesses and the production of books, which shall be
effective in any part of this State, and to adopt rules to
implement its powers under this paragraph (8).
Any Circuit Court may by order duly entered, require
the attendance of witnesses and the production of relevant
books subpoenaed by the State commission and the court may
compel obedience to its order by proceedings for contempt.
(9) To investigate the administration of laws in
relation to alcoholic liquors in this and other states and
any foreign countries, and to recommend from time to time
to the Governor and through him or her to the legislature
of this State, such amendments to this Act, if any, as it
may think desirable and as will serve to further the
general broad purposes contained in Section 1-2 hereof.
(10) To adopt such rules and regulations consistent

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with the provisions of this Act which shall be necessary
for the control, sale or disposition of alcoholic liquor
damaged as a result of an accident, wreck, flood, fire or
other similar occurrence.
(11) To develop industry educational programs related
to responsible serving and selling, particularly in the
areas of overserving consumers and illegal underage
purchasing and consumption of alcoholic beverages.
(11.1) To license persons providing education and
training to alcohol beverage sellers and servers under the
Beverage Alcohol Sellers and Servers Education and
Training (BASSET) programs and to develop and administer a
public awareness program in Illinois to reduce or eliminate
the illegal purchase and consumption of alcoholic beverage
products by persons under the age of 21. Application for a
license shall be made on forms provided by the State
Commission.
(12) To develop and maintain a repository of license
and regulatory information.
(13) On or before January 15, 1994, the Commission
shall issue a written report to the Governor and General
Assembly that is to be based on a comprehensive study of
the impact on and implications for the State of Illinois of
Section 1926 of the Federal ADAMHA Reorganization Act of
1992 (Public Law 102-321). This study shall address the
extent to which Illinois currently complies with the

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provisions of P.L. 102-321 and the rules promulgated
pursuant thereto.
As part of its report, the Commission shall provide the
following essential information:
(i) the number of retail distributors of tobacco
products, by type and geographic area, in the State;
(ii) the number of reported citations and
successful convictions, categorized by type and
location of retail distributor, for violation of the
Prevention of Tobacco Use by Minors and Sale and
Distribution of Tobacco Products Act and the Smokeless
Tobacco Limitation Act;
(iii) the extent and nature of organized
educational and governmental activities that are
intended to promote, encourage or otherwise secure
compliance with any Illinois laws that prohibit the
sale or distribution of tobacco products to minors; and
(iv) the level of access and availability of
tobacco products to individuals under the age of 18.
To obtain the data necessary to comply with the
provisions of P.L. 102-321 and the requirements of this
report, the Commission shall conduct random, unannounced
inspections of a geographically and scientifically
representative sample of the State's retail tobacco
distributors.
The Commission shall consult with the Department of

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Public Health, the Department of Human Services, the
Illinois State Police and any other executive branch
agency, and private organizations that may have
information relevant to this report.
The Commission may contract with the Food and Drug
Administration of the U.S. Department of Health and Human
Services to conduct unannounced investigations of Illinois
tobacco vendors to determine compliance with federal laws
relating to the illegal sale of cigarettes and smokeless
tobacco products to persons under the age of 18.
(14) On or before April 30, 2008 and every 2 years
thereafter, the Commission shall present a written report
to the Governor and the General Assembly that shall be
based on a study of the impact of this amendatory Act of
the 95th General Assembly on the business of soliciting,
selling, and shipping wine from inside and outside of this
State directly to residents of this State. As part of its
report, the Commission shall provide all of the following
information:
(A) The amount of State excise and sales tax
revenues generated.
(B) The amount of licensing fees received.
(C) The number of cases of wine shipped from inside
and outside of this State directly to residents of this
State.
(D) The number of alcohol compliance operations

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conducted.
(E) The number of winery shipper's licenses
issued.
(F) The number of each of the following: reported
violations; cease and desist notices issued by the
Commission; notices of violations issued by the
Commission and to the Department of Revenue; and
notices and complaints of violations to law
enforcement officials, including, without limitation,
the Illinois Attorney General and the U.S. Department
of Treasury's Alcohol and Tobacco Tax and Trade Bureau.
(15) As a means to reduce the underage consumption of
alcoholic liquors, the Commission shall conduct alcohol
compliance operations to investigate whether businesses
that are soliciting, selling, and shipping wine from inside
or outside of this State directly to residents of this
State are licensed by this State or are selling or
attempting to sell wine to persons under 21 years of age in
violation of this Act.
(15.5) As a means to reduce the sale of cheap alcoholic
liquors that leads to binge drinking, the Commission shall
provide by rule for a standard of minimum prices that shall
be charged for alcoholic liquors sold in bars and
restaurants.
(16) The Commission shall, in addition to notifying any
appropriate law enforcement agency, submit notices of

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complaints or violations of Sections 6-29 and 6-29.1 by
persons who do not hold a winery shipper's license under
this amendatory Act to the Illinois Attorney General and to
the U.S. Department of Treasury's Alcohol and Tobacco Tax
and Trade Bureau.
(17) (A) A person licensed to make wine under the laws
of another state who has a winery shipper's license under
this amendatory Act and annually produces less than 25,000
gallons of wine or a person who has a first-class or
second-class wine manufacturer's license, a first-class or
second-class wine-maker's license, or a limited wine
manufacturer's license under this Act and annually
produces less than 25,000 gallons of wine may make
application to the Commission for a self-distribution
exemption to allow the sale of not more than 5,000 gallons
of the exemption holder's wine to retail licensees per
year.
(B) In the application, which shall be sworn under
penalty of perjury, such person shall state (1) the
date it was established; (2) its volume of production
and sales for each year since its establishment; (3)
its efforts to establish distributor relationships;
(4) that a self-distribution exemption is necessary to
facilitate the marketing of its wine; and (5) that it
will comply with the liquor and revenue laws of the
United States, this State, and any other state where it

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is licensed.
(C) The Commission shall approve the application
for a self-distribution exemption if such person: (1)
is in compliance with State revenue and liquor laws;
(2) is not a member of any affiliated group that
produces more than 25,000 gallons of wine per annum or
produces any other alcoholic liquor; (3) will not
annually produce for sale more than 25,000 gallons of
wine; and (4) will not annually sell more than 5,000
gallons of its wine to retail licensees.
(D) A self-distribution exemption holder shall
annually certify to the Commission its production of
wine in the previous 12 months and its anticipated
production and sales for the next 12 months. The
Commission may fine, suspend, or revoke a
self-distribution exemption after a hearing if it
finds that the exemption holder has made a material
misrepresentation in its application, violated a
revenue or liquor law of Illinois, exceeded production
of 25,000 gallons of wine in any calendar year, or
become part of an affiliated group producing more than
25,000 gallons of wine or any other alcoholic liquor.
(E) Except in hearings for violations of this Act
or amendatory Act or a bona fide investigation by duly
sworn law enforcement officials, the Commission, or
its agents, the Commission shall maintain the

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production and sales information of a
self-distribution exemption holder as confidential and
shall not release such information to any person.
(F) The Commission shall issue regulations
governing self-distribution exemptions consistent with
this Section and this Act.
(G) Nothing in this subsection (17) shall prohibit
a self-distribution exemption holder from entering
into or simultaneously having a distribution agreement
with a licensed Illinois distributor.
(H) It is the intent of this subsection (17) to
promote and continue orderly markets. The General
Assembly finds that in order to preserve Illinois'
regulatory distribution system it is necessary to
create an exception for smaller makers of wine as their
wines are frequently adjusted in varietals, mixes,
vintages, and taste to find and create market niches
sometimes too small for distributor or importing
distributor business strategies. Limited
self-distribution rights will afford and allow smaller
makers of wine access to the marketplace in order to
develop a customer base without impairing the
integrity of the 3-tier system.
(18) (A) A craft brewer licensee, who must also be
either a licensed brewer or licensed non-resident dealer
and annually manufacture less than 465,000 gallons of beer,

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may make application to the Commission for a
self-distribution exemption to allow the sale of not more
than 232,500 gallons of the exemption holder's beer to
retail licensees per year.
(B) In the application, which shall be sworn under
penalty of perjury, the craft brewer licensee shall
state (1) the date it was established; (2) its volume
of beer manufactured and sold for each year since its
establishment; (3) its efforts to establish
distributor relationships; (4) that a
self-distribution exemption is necessary to facilitate
the marketing of its beer; and (5) that it will comply
with the alcoholic beverage and revenue laws of the
United States, this State, and any other state where it
is licensed.
(C) Any application submitted shall be posted on
the Commission's website at least 45 days prior to
action by the Commission. The Commission shall approve
the application for a self-distribution exemption if
the craft brewer licensee: (1) is in compliance with
the State, revenue, and alcoholic beverage laws; (2) is
not a member of any affiliated group that manufacturers
more than 465,000 gallons of beer per annum or produces
any other alcoholic beverages; (3) shall not annually
manufacture for sale more than 465,000 gallons of beer;
and (4) shall not annually sell more than 232,500

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gallons of its beer to retail licensees.
(D) A self-distribution exemption holder shall
annually certify to the Commission its manufacture of
beer during the previous 12 months and its anticipated
manufacture and sales of beer for the next 12 months.
The Commission may fine, suspend, or revoke a
self-distribution exemption after a hearing if it
finds that the exemption holder has made a material
misrepresentation in its application, violated a
revenue or alcoholic beverage law of Illinois,
exceeded the manufacture of 465,000 gallons of beer in
any calendar year or became part of an affiliated group
manufacturing more than 465,000 gallons of beer or any
other alcoholic beverage.
(E) The Commission shall issue rules and
regulations governing self-distribution exemptions
consistent with this Act.
(F) Nothing in this paragraph (18) shall prohibit a
self-distribution exemption holder from entering into
or simultaneously having a distribution agreement with
a licensed Illinois importing distributor or a
distributor. If a self-distribution exemption holder
enters into a distribution agreement and has assigned
distribution rights to an importing distributor or
distributor, then the self-distribution exemption
holder's distribution rights in the assigned

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territories shall cease in a reasonable time not to
exceed 60 days.
(G) It is the intent of this paragraph (18) to
promote and continue orderly markets. The General
Assembly finds that in order to preserve Illinois'
regulatory distribution system, it is necessary to
create an exception for smaller manufacturers in order
to afford and allow such smaller manufacturers of beer
access to the marketplace in order to develop a
customer base without impairing the integrity of the
3-tier system.
(b) On or before April 30, 1999, the Commission shall
present a written report to the Governor and the General
Assembly that shall be based on a study of the impact of this
amendatory Act of 1998 on the business of soliciting, selling,
and shipping alcoholic liquor from outside of this State
directly to residents of this State.
As part of its report, the Commission shall provide the
following information:
(i) the amount of State excise and sales tax revenues
generated as a result of this amendatory Act of 1998;
(ii) the amount of licensing fees received as a result
of this amendatory Act of 1998;
(iii) the number of reported violations, the number of
cease and desist notices issued by the Commission, the
number of notices of violations issued to the Department of

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Revenue, and the number of notices and complaints of
violations to law enforcement officials.
(Source: P.A. 96-179, eff. 8-10-09; 96-446, eff. 1-1-10;
96-1000, eff. 7-2-10; 97-5, eff. 6-1-11.)