Bill Text: MI SB0349 | 2019-2020 | 100th Legislature | Introduced
Bill Title: Liquor: spirits; markup on spirits; revise based on distiller's use of Michigan distillate. Amends sec. 233 of 1998 PA 58 (MCL 436.1233).
Spectrum: Moderate Partisan Bill (Republican 8-2)
Status: (Engrossed - Dead) 2020-12-01 - Referred To Committee On Ways And Means, With Substitute (h-1) [SB0349 Detail]
Download: Michigan-2019-SB0349-Introduced.html
SENATE BILL No. 349
May 24, 2019, Introduced by Senators VANDERWALL, VICTORY, HERTEL, STAMAS, WOJNO, MACDONALD, BUMSTEAD, BIZON, HORN and ZORN 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 233 (MCL 436.1233).
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 233. (1) The commission shall establish uniform prices
for
the sale of alcoholic liquor in state liquor stores and by
specially
designated distributors. The Except
as otherwise provided
in
this section, the prices shall must return
a gross profit to the
commission of not less than 51% and not greater than 65%. If
alcoholic liquor purchased by the commission has not met sales
standards established by the commission for a period of 6 months,
the commission may sell the alcoholic liquor at a price to be
approved by the state administrative board.
(2) Notwithstanding subsection (1), the commission may
establish by rule prices for the sale of alcoholic liquor to
hospitals, charitable institutions, and military establishments
located in this state.
(3)
There shall be allowed a discount of 17% deducted from the
sale
price established by the commission on the sale of Specially
designated distributors and on-premises licensees are entitled to a
17% discount from the uniform price described under subsection (1)
on
alcoholic liquor made by the purchased from this state. liquor
stores
to specially designated distributors and establishments
licensed
to sell for consumption on the premises.
(4) Not later than February 1, 2020 and each February 1
thereafter, a small distiller or an out-of-state entity that is the
substantial equivalent of a small distiller may file an application
with the department of agriculture and rural development to be
certified as a qualified small distiller. An application under this
subsection must be on a form prescribed and furnished by the
department of agriculture and rural development. The department of
agriculture and rural development may charge a reasonable
certification fee.
(5) Beginning January 1, 2021, for each bottle of spirits
produced by a qualified small distiller of which at least 40% of
the base distillate is distilled from grain grown and harvested in
this state as determined by the department of agriculture and rural
development, the price for each bottle must return a gross profit
to the commission of 32.5%.
(6) The department of agriculture and rural development shall
certify that an applicant under subsection (4) is a qualified small
distiller if the department of agriculture and rural development
determines that the base distillate of the small distiller or the
out-of-state entity that is the substantial equivalent of a small
distiller is at least 40% distilled from distilled grain grown and
harvested in this state.
(7) Not later than October 1, 2020 and each October 1
thereafter, the department of agriculture and rural development
shall submit a report to the commission. A report under this
subsection must include the name of each qualified small distiller
certified under subsection (6).
(8) A qualified small distiller certificate expires on
February 1 following the date of issuance.
(9) A small distiller or an out-of-state entity that is the
substantial equivalent of a small distiller that supplies false
information to the department of agriculture and rural development
or the commission under this section is guilty of a misdemeanor
punishable by imprisonment for not more than 1 year or a fine of
not more than $3,000.00, or both. A small distiller or an out-of-
state entity that is the substantial equivalent of a small
distiller that supplies false information as described in this
subsection shall pay the commission the difference between the
gross profit the commission would have received under subsection
(1) if the small distiller or the out-of-state entity that is the
substantial equivalent of a small distiller was not a qualified
small distiller, as determined by the commission.
(10) A qualified small distiller shall keep a complete and
accurate set of records and accounts of all transactions pertaining
to the operation of its distillery, including, but not limited to,
records and accounts of all distilled grain received in or
withdrawn from the distillery, all acknowledgment forms and
Michigan certification of origination statements in the qualified
small distiller's possession, copies of all contracts, and
acknowledgment forms returned to and settled by the qualified small
distiller. The department of agriculture and rural development and
the commission may examine the records and accounts pertaining to
the qualified small distiller's distilled grain handling business
at any time during normal business hours.
(11) As used in this section:
(a) "Acknowledgment form" means a scale weight ticket, a load
slip, or any other evidence of deposit issued by a small distiller,
an out-of-state entity that is the substantial equivalent of a
small distiller, or the authorized representative of a small
distiller or out-of-state entity that is the substantial equivalent
of a small distiller to a depositor that identifies the distilled
grain being transferred from possession of the depositor to the
possession of the small distiller or the out-of-state entity that
is the substantial equivalent of a small distiller.
(b) "Depositor" means either of the following:
(i) A person that delivers distilled grain to a small
distiller or an out-of-state entity that is the substantial
equivalent of a small distiller for storage, processing, shipment,
or sale and that has title to distilled grain at the time of
delivery.
(ii) A person that owns or that is the legal holder of an
acknowledgment form issued by a depositor for distilled grain.
(c) "Distilled grain" means any of the following:
(i) Dry barley.
(ii) Malted barley.
(iii) Oats.
(iv) A small grain.
(v) A cereal grain.
(vi) Potato.
(vii) Corn.
(viii) Fruit.
(ix) Sugar beets.
(x) Honey.
(d) "Michigan certification of origination statement" means a
signed statement from a depositor or producer on an acknowledgement
form that deposited distilled grain was grown and harvested in this
state.
(e) "Qualified small distiller" means a small distiller or an
out-of-state entity that is the substantial equivalent of a small
distiller certified by the department of agriculture and rural
development under this section as having at least 40% of the base
distillate of the small distiller or the out-of-state entity that
is the substantial equivalent of a small distiller distilled from
distilled grain grown and harvested in this state.
