Bill Text - SB88 (2018)

(New Title) authorizing wine manufacturer retail outlets.


Revision: Jan. 25, 2017, 10:20 a.m.

SB 88-FN - AS INTRODUCED

 

 

2017 SESSION

17-0935

03/08

 

SENATE BILL 88-FN

 

AN ACT authorizing satellite tasting rooms for wine manufacturers.

 

SPONSORS: Sen. Daniels, Dist 11; Sen. Gannon, Dist 23; Sen. Giuda, Dist 2; Sen. Avard, Dist 12; Sen. Birdsell, Dist 19; Sen. Innis, Dist 24; Sen. Kahn, Dist 10; Rep. Hansen, Hills. 22; Rep. M. MacKay, Hills. 30

 

COMMITTEE: Commerce

 

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ANALYSIS

 

This bill authorizes a licensed wine manufacturer to operate up to 5 satellite tasting rooms for the sale, sampling, and promotion of its products.

 

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Explanation: Matter added to current law appears in bold italics.

Matter removed from current law appears [in brackets and struckthrough.]

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

17-0935

03/08

 

STATE OF NEW HAMPSHIRE

 

In the Year of Our Lord Two Thousand Seventeen

 

AN ACT authorizing satellite tasting rooms for wine manufacturers.

 

Be it Enacted by the Senate and House of Representatives in General Court convened:

 

1  New Paragraph; Definitions; Satellite Tasting Room.  Amend RSA 175:1 by inserting after paragraph LX-b the following new paragraph:

LX-c.  "Satellite tasting room" means an outlet for the sale, sampling, and promotion of wine and other products manufactured by a wine manufacturer licensee.

2  Wine Manufacturer Licensee.  Amend RSA 178:8, III to read as follows:

III.  Each wine manufacturer shall have the right to sell at retail or wholesale at its winery, or at up to 5 satellite tasting rooms, for off-premises consumption any of its wines.  The wine manufacturer shall pay an annual fee of $100 to the commission for each satellite tasting room.  The wine manufacturer may transport wines and other product manufactured by it to its satellite tasting rooms for sample or sale.  Visitors of legal drinking age at [said premises] the winery or satellite tasting room may be provided with samples of wine manufactured [on the premises] by the licensee in this state for tasting.  Samples may be provided either free or for a fee and shall be limited to one 2-ounce sample per label per person.  Pursuant to rules adopted by the commission, a wine manufacturer may transport its products to a farmers' market or a wine festival licensed under RSA 178:31, and may sell such products at retail in the original container.

3  Effective Date.  This act shall take effect July 1, 2017.

 

LBAO

17-0935

1/14/17

 

SB 88-FN- FISCAL NOTE

as introduced

 

AN ACT authorizing satellite tasting rooms for wine manufacturers.

 

FISCAL IMPACT:      [ X ] State              [    ] County               [    ] Local              [    ] None

 

 

 

Estimated Increase / (Decrease)

STATE:

FY 2018

FY 2019

FY 2020

FY 2021

   Appropriation

$0

$0

$0

$0

   Revenue

Indeterminable

Indeterminable

Indeterminable

Indeterminable

   Expenditures

Indeterminable

Indeterminable

Indeterminable

Indeterminable

Funding Source:

  [    ] General            [    ] Education            [    ] Highway           [ X ] Liquor

 

 

 

 

 

METHODOLOGY:

This bill allows each of the State's 34 wine manufacturers to operate up to five satellite tasting rooms.  Wine manufacturers would be permitted to provide samples or to sell their products from the satellite locations.  There are no limits on the total quantity of sales that may occur.  Wine manufacturers must pay $100 annual fee to the Liquor Commission for each satellite tasting room.  The Commission states this bill could result in lost revenue if consumers choose to purchase wine from one of the satellite tasting rooms instead of from a State liquor store.  This assumes consumers will not purchase more wine than they currently do.  There is no data available to determine how many satellite locations would be opened or how many bottles of wine would be sold from those new locations.  For context, during FY 2016 the Liquor Commission sold about 70,000 bottles of wine through State liquor stores and on and off-premises licensees.  The average gross profit on each bottle sold is about $4.25.  If the Commission were to lose 1/3rd of these sales, then the commission would lose approximately $99,167 in gross profit which would subsequently reduce state liquor revenue by a similar amount ((70,000/3)*$4.25 = $99,167).  The Commission states it would need an additional position to handle the increased workload from the new satellite tasting rooms.  The Commission indicates it would need to audit all new locations twice a year to verify taxes are paid.  There is no administrative rule or law requiring biannual audits.  However, the Commission has determined that biannual audits are necessary to enforce RSA 178:8, IV, which requires wine manufacturers to maintain records of sales and pay the Commission a monthly fee equal to 5 percent of applicable sales.  The cost of the new position are detailed below:

Liquor Examiner II, Group I (LG 20)

 

FY 2018

FY 2019

FY 2020

FY 2021

Salary & Benefits

 $  78,500

 $82,551

 $85,207

 $87,836

Equipment, Overtime, Training, & Current Expenses

 $  34,000

 $  6,500

 $  6,500

 $  6,500  

Total

 $112,500

 $89,051

 $91,707

 $94,336

 

 

AGENCIES CONTACTED:

Liquor Commission