Bill Text: MI HB4815 | 2019-2020 | 100th Legislature | Introduced


Bill Title: Liquor: spirits; cap or additional amount the liquor control commission may pay a vendor of spirits; eliminate. Amends sec. 205 of 1998 PA 58 (MCL 436.1205).

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced - Dead) 2019-06-20 - Introduced By Representative Brandt Iden [HB4815 Detail]

Download: Michigan-2019-HB4815-Introduced.html

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

HOUSE BILL No. 4815

 

 

July 18, 2019, Introduced by Rep. Iden and referred to the Committee on Regulatory Reform.

 

     A bill to amend 1998 PA 58, entitled

 

"Michigan liquor control code of 1998,"

 

by amending section 205 (MCL 436.1205), as amended by 2015 PA 246.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 205. (1) The commission shall, as provided in section

 

203(1), by order appoint authorized distribution agents to

 

warehouse and deliver spirits in this state to ensure that all

 

retail licensees are properly serviced with spirits. An authorized

 

distribution agent is subject to uniform requirements, including

 

business operating procedures, that the commission may prescribe by

 

rule, subject to this section.

 

     (2) A person is eligible for appointment by the commission as

 

an authorized distribution agent if all of the following


circumstances exist:

 

     (a) The person satisfies all applicable commission rules

 

prescribing qualifications for licensure promulgated under section

 

215.

 

     (b) The person has entered into a written agreement or

 

contract with a supplier of spirits to warehouse and deliver a

 

brand or brands of spirits of that supplier of spirits.

 

     (c) The person has an adequate warehousing facility located in

 

this state to store spirits from which all delivery of spirits to

 

retail licensees must be made.

 

     (3) An authorized distribution agent shall not have a direct

 

or indirect interest in a supplier of spirits or in a retailer. A

 

supplier of spirits or a retailer shall not have a direct or

 

indirect interest in an authorized distribution agent. An

 

authorized distribution agent shall not hold title to spirits.

 

     (4) An authorized distribution agent shall deliver to each

 

retailer located in its assigned distribution area on at least a

 

weekly basis if the order meets the minimum requirements. Except

 

that in a week that accompanies a state holiday, the commission may

 

order a modified delivery schedule if a retailer will not wait

 

longer than 9 days between deliveries because of the modified

 

delivery schedule. The commission shall provide for an integrated

 

on-line online ordering system for spirits and shall require the

 

continuance of any ordering system in existence on the activation

 

date of the system established under section 206. The commission

 

shall set minimum requirements that must be a sufficient number of

 

bottles to comprise not more than 2 cases. A retailer may pick up


the product at the authorized distribution agent's warehouse. To

 

avoid occasional emergency outages of spirits, a retail licensee

 

may make up to 12 special emergency orders to an authorized

 

distribution agent in each calendar year. An authorized

 

distribution agent shall make a special emergency order available

 

to the retail licensee within 18 hours of the placing of the order.

 

An authorized distribution agent shall make a special emergency

 

order placed on Saturday or Sunday available to the retail licensee

 

before noon on the following Monday. An authorized distribution

 

agent may impose a fee of up to $20.00 to deliver a special

 

emergency order to a retail licensee.

 

     (5) In locations inaccessible to a motor vehicle as that term

 

is defined by the Michigan vehicle code, 1949 PA 300, MCL 257.1 to

 

257.923, an authorized distribution agent shall arrange that a

 

delivery of spirits to a retailer be in compliance with the

 

following procedures:

 

     (a) After processing an order from a retailer, an authorized

 

distribution agent shall contact a retailer to confirm the quantity

 

of cases or bottles, or both, and the exact dollar total of the

 

order.

 

     (b) The authorized distribution agent shall coordinate with

 

the retailer the date and time a driver is scheduled to deliver the

 

order to a ferry transport dock, shall arrange any ferry, drayage,

 

or other appropriate service, and shall pick up the retailer's

 

payment at that time.

 

     (c) The ferry transport company or company representing any

 

other form of conveyance shall take the retailer's payment to the


mainland dock and give that payment to the authorized distribution

 

agent's driver.

 

     (d) The ferry transport company or company representing any

 

other form of conveyance shall transport the order to the drayage

 

or other appropriate company at the island dock for immediate

 

delivery to the retailer.

 

     (e) The drayage or other appropriate company shall deliver the

 

order to the retailer.

 

     (6) An authorized distribution agent is responsible for the

 

payment of all transportation and delivery charges imposed by the

 

ferry, drayage, or other conveyance company and is responsible for

 

all breakage and any shortages, whether attributable to the ferry,

 

drayage, or other conveyance company or any combination of those

 

companies, until the order is delivered to the retailer's

 

establishment. This subsection does not prevent the authorized

 

distribution agent from seeking reimbursement or damages from any

 

company conveying the authorized distribution agent's product.

 

     (7) Except as otherwise provided in subsection (4), an

 

authorized distribution agent shall not charge a delivery fee or a

 

split-case fee for delivery of spirits sold by the commission to a

 

retailer.

 

     (8) An authorized distribution agent or prospective authorized

 

distribution agent shall maintain and make available to the

 

commission or its representatives, on notice, any contract or

 

written agreement it has with a supplier of spirits or other

 

authorized distribution agent for the warehousing and delivering of

 

spirits in this state.


     (9) For a violation of this act, a rule promulgated under this

 

act, or the terms of an order appointing an authorized distribution

 

agent, an authorized distribution agent is subject to the

 

suspension, revocation, forfeiture, and penalty provisions of

 

sections 903(1) and 907 in the same manner in which a licensee

 

would be subject to those provisions. An authorized distribution

 

agent aggrieved by a penalty imposed by the commission may invoke

 

the hearing and appeal procedures of section 903(2) and rules

 

promulgated under that section 903.

 

     (10) A specially designated distributor may sell to an on-

 

premises licensee up to 9 liters of spirits during any 1 month and

 

an on-premises licensee may purchase, collectively from specially

 

designated distributors, up to 9 liters of spirits during any 1

 

month. Notwithstanding any other provision of this act or rule

 

promulgated under this act, a specially designated distributor is

 

only liable for knowingly violating this section. An on-premises

 

licensee shall maintain and make available to the commission upon

 

on request records verifying the purchases described in this

 

subsection.

 

     (11) In addition to paying a vendor of spirits the acquisition

 

price for purchasing spirits, the commission may pay a vendor of

 

spirits an additional amount of not less than $4.50 and not more

 

than $8.25 for each case of spirits purchased as an offset to the

 

costs being incurred by that vendor of spirits in contracting with

 

an authorized distribution agent for warehousing and delivering

 

spirits to retailers. The payment described in this subsection may

 

not be included in the cost of purchasing spirits by the commission


and is not subject to the commission's markup, special taxes, or

 

state sales tax. The per-case offset established by this subsection

 

may be increased by the state administrative board each January to

 

reflect reasonable increases in the authorized distribution agent's

 

cost of warehousing and delivering. As used in this subsection,

 

"case" means a container holding twelve 750 ml bottles of spirits

 

or other containers containing spirits that are standard to the

 

industry.

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