SB224: Bill Text

4. The applicant holds a Class "B" license for the restaurant and offers for sale in the restaurant, in addition to its own beer, beer manufactured by other brewers.

5. The applicant holds a business tax registration certificate issued by DOR.

6. The applicant does not hold or have an interest in a Class "A" license, a beer wholesaler's license, a brewer's permit, or an alcohol beverage, warehouse permit, and does not hold or have an interest in a Class "B," "Class B," or "Class C" license other than one for brewpub premises.

If an applicant for a brewpub permit has no current operations, the applicant can certify that the applicant will comply with these requirements prior to or upon commencing operations under the brewpub permit. If an applicant for a brewpub permit holds a brewer's permit, wholesale license, or any other prohibited license or permit at the time of the application, the applicant can certify that the applicant will surrender any such license or permit upon issuance of the brewpub permit.

A brewpub permit authorizes a brewpub to do all of the following:

1. Manufacture beer on the brewpub premises, up to 10,000 barrels each year for all brewpub premises, if the entire manufacturing process occurs on these premises.

2. Bottle on the brewpub premises beer that has been manufactured on these premises.

3. Package in refillable containers exceeding 24 ounces in volume, on brewpub premises, beer that has been manufactured on these premises, and possess and store on brewpub premises any beer.

4. Transport beer that has been manufactured on the brewpub premises between these premises and any other brewpub premises or brewpub Class "B" premises.

5. Sell at wholesale, ship, transport, and deliver to wholesalers, from the brewpub premises, beer manufactured on these premises or on other brewpub premises.

6. Sell at wholesale, ship, transport, and deliver to retailers, from the brewpub premises, beer manufactured on these premises or on other brewpub premises, but only up to 1,000 barrels of beer each year, not including beer provided to the brewpub's own retail premises.

7. Sell alcohol beverages at retail on the brewpub premises in accordance with the terms of any Class "B," "Class B," or "Class C" license held by the brewpub.

A brewpub may not hold more than six permits for brewpub locations. A brewpub may hold only Class "B," "Class B," and "Class C" licenses for restaurants on brewpub premises.

Like the holder of a brewer's permit, a brewpub, in providing beer to its own retail premises, is not subject to restrictions on the sale, transportation, and delivery of beer generally applicable to wholesalers and retailers. However, a brewpub does not hold a wholesaler's license and may maintain wholesale operations, including the sale, transportation, and delivery to retailers if otherwise authorized, from its brewpub premises. To distribute its beer through licensed beer wholesalers, a brewpub must enter into written agreements with the wholesalers for each brewpub brand distributed providing exclusive designated sales territories to the wholesalers for these brands. A brewpub is also subject to certain requirements generally applicable to wholesalers when selling its own beer to unaffiliated retailers.

Current law prohibits a person from operating a restaurant unless the person has been issued a restaurant permit. This bill prohibits a person issued a brewer's permit after the bill's effective date from holding a restaurant permit, thereby requiring a person who intends to begin manufacturing beer and operating a restaurant after this date to obtain a brewpub permit if the person is otherwise eligible for a brewpub permit.

The bill also repeals the authorization for a small brewer to possess a Class "B" license for not more than four restaurants in which the sale of alcohol beverages accounts for less than 50 percent of the restaurant's gross receipts.

Current law includes a global severability provision applicable to all statutes, which states that the provisions of the statutes and of any session law are severable. If any provision of the statutes or of a session law is invalid, or if the application of either to any person or circumstance is invalid, the invalidity does not affect other provisions or applications that can be given effect without the invalid provision or application.

This bill includes another severability provision specifically applicable to chapter 125 of the statutes relating to alcohol beverages. The bill states that if any provision or clause of chapter 125 or its application to any person or circumstance is held invalid, the invalidity does not affect other provisions or applications of the chapter that can be given effect without the invalid provision or application, and to this end the provisions of the chapter are severable.

For further information see the state and local fiscal estimate, which will be printed as an appendix to this bill.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

SB224, s. 1 Section 1. 125.015 of the statutes is created to read:

SB224,5,6 125.015 Severability. If any provision or clause of this chapter or its application to any person or circumstance is held invalid, the invalidity shall not affect other provisions or applications of this chapter that can be given effect without the invalid provision or application, and to this end the provisions of this chapter are severable.

SB224, s. 2 Section 2. 125.02 (2) of the statutes is amended to read:

SB224,5,10 125.02 (2) "Brewer" means any person who manufactures fermented malt beverages for sale or transportation, except that "brewer" does not include a permittee under s. 125.295.

SB224, s. 3 Section 3. 125.02 (2d) (intro.), (2h), (2p) and (2t) of the statutes are created to read:

SB224,5,15 125.02 (2d) (intro.) "Brewer group" means a brewer, including all premises for which the brewer holds a permit issued under s. 125.29, together with all of the following:

SB224,5,16 (2h) "Brewpub" means a permittee under s. 125.295.

SB224,5,18 (2p) "Brewpub group" means a brewpub, including all premises for which the brewpub holds a permit issued under s. 125.295, together with all of the following:

SB224,6,2 (a) All brewpubs that share membership with the brewpub in a controlled group of brewpubs, as determined under 26 USC 5051 (a) (2) (B).

SB224,6,4 (b) All brewpubs considered with the brewpub as one taxpayer under 27 CFR 25.111b (b).

SB224,6,5 (c) All franchisees, as defined in s. 553.03 (5), of the brewpub.

SB224,6,7 (d) All franchisees, as defined in s. 553.03 (5), of the brewpub's franchisor, as defined in s. 553.03 (6).

SB224,6,8 (e) The franchisor, as defined in s. 553.03 (6), of the brewpub.

SB224,6,10 (2t) "Brewpub premises" means any premises covered by a permit issued under s. 125.295.

SB224, s. 4 Section 4. 125.02 (21) of the statutes is amended to read:

SB224,6,14 125.02 (21) "Wholesaler" means a person, other than a brewer, brewpub, manufacturer, or rectifier, who sells alcohol beverages to a licensed retailer or to another person who holds a permit or license to sell alcohol beverages at wholesale.

SB224, s. 5 Section 5. 125.04 (9) of the statutes is amended to read:

SB224,6,20 125.04 (9) Separate license or permit required. Except as provided under ss. 125.27 (2) (a) and 125.51 (5) (c) 1., wholesalers, manufacturers, rectifiers, brewers, brewpubs, and retailers shall have a separate permit or license covering each location or premises, except a licensed public warehouse, from which deliveries and sales of alcohol beverages are made or at which alcohol beverages are stored.

SB224, s. 6 Section 6. 125.07 (4) (bm) 1. of the statutes is amended to read:

SB224,6,22 125.07 (4) (bm) 1. A brewer or brewpub.

SB224, s. 7 Section 7. 125.10 (4) of the statutes is amended to read:

SB224,7,5 125.10 (4) Regulation of closed retail premises. A municipality may not prohibit the permittee, licensee, employees, salespersons, employees of wholesalers licensed under s. 125.28 (1) or 125.54 (1); employees of permittees under s. 125.295 with respect to the permittee's own retail premises; or service personnel from being present on premises operated under a Class "A", "Class A" or "Class C" license or under a Class "B" or "Class B" license or permit during hours when the premises are not open for business if those persons are performing job-related activities.

SB224, s. 8 Section 8. 125.25 (2) (b) 5. of the statutes is created to read:

SB224,7,10 125.25 (2) (b) 5. A Class "A" license may not be issued to a person holding a brewpub permit issued under s. 125.295 or to a person who has a direct or indirect ownership interest in a premises operating under a brewpub permit issued under s. 125.295.

SB224, s. 9 Section 9. 125.26 (2) (b) 1. of the statutes is amended to read:

SB224,7,13 125.26 (2) (b) 1. Except as provided in s. ss. 125.295 and 125.31, Class "B" licenses may not be issued to brewers or brewpubs.

SB224, s. 10 Section 10. 125.28 (2) (b) 1. e. of the statutes is created to read:

SB224,7,15 125.28 (2) (b) 1. e. A brewpub permit issued under s. 125.295.

SB224, s. 11 Section 11. 125.28 (2) (b) 2. of the statutes is amended to read:

SB224,7,19 125.28 (2) (b) 2. A person who has a direct or indirect ownership interest in a premises operating under one or more of the licenses or permits listed in subd. 1. a. to d. e.

SB224, s. 12 Section 12. 125.29 (5) and (6) of the statutes are created to read:

SB224,7,22 125.29 (5) Brewpubs. No person holding a brewpub permit under s. 125.295 may register as a brewer under this section.

SB224,7,25 (6) Restaurants. No person issued a permit under this section after the effective date of this subsection .... [revisor inserts date], may hold a restaurant permit issued under s. 254.64.

SB224, s. 13 Section 13. 125.295 of the statutes is created to read:

SB224,8,3 125.295 Brewpub permits. (1) The department shall issue brewpub permits to eligible applicants authorizing all of the following:

SB224,8,7 (a) The manufacture of fermented malt beverages on the brewpub premises if the entire manufacturing process occurs on these premises and not more than 10,000 barrels of fermented malt beverages are manufactured in a calendar year by the permittee's brewpub group.

SB224,8,9 (b) The bottling on brewpub premises of fermented malt beverages that have been manufactured on these premises.

SB224,8,12 (c) The packaging in refillable containers exceeding 24 ounces in volume, at the request of a customer and on brewpub premises, of fermented malt beverages that have been manufactured on these premises.

SB224,8,14 (d) The possession and storage of any fermented malt beverages on brewpub premises.

SB224,8,17 (e) The transportation of fermented malt beverages that have been manufactured on the brewpub premises between these premises and any other brewpub premises or Class "B" premises of the brewpub group.

SB224,8,21 (f) Subject to s. 125.34 (3) and (4), the sale at wholesale, shipment, transportation, and delivery, in original unopened packages or containers, to wholesalers, from the brewpub premises, of fermented malt beverages that have been manufactured on these premises or on other brewpub premises of the brewpub.

SB224,9,9 (g) The sale at wholesale, shipment, transportation, and delivery, in original unopened packages or containers, to retailers, from the brewpub premises, of fermented malt beverages that have been manufactured on these premises or on other brewpub premises of the brewpub. A brewpub's brewpub group may not sell, ship, transport, or deliver more than a total of 1,000 barrels of fermented malt beverages in any calendar year to retailers under this paragraph. Fermented malt beverages provided by a brewpub to any retail premises for which the brewpub group holds a retail license shall not be included in any calculation of the 1,000 barrel limitation under this paragraph. Deliveries and shipments of fermented malt beverages by a brewpub under this paragraph shall be made to retailers only at their retail premises. Any retailer receiving such a delivery or shipment is subject to the prohibition under s. 125.34 (5) against further transporting the delivery or shipment to any other retail premises.

SB224,9,12 (h) The sale of alcohol beverages at retail on the brewpub premises in accordance with the terms of any retail license specified in subs. (2) (a) 4. and (3) (b) and (c).

SB224,9,16 (i) Notwithstanding s. 125.33 (1), the ownership, maintenance, and operation of places for the sale of fermented malt beverages at the state fair park or on any county fairgrounds located in this state if the fermented malt beverages have been manufactured by the brewpub.

SB224,9,18 (2) (a) An applicant is eligible for a brewpub permit only if all of the following apply:

SB224,9,20 1. The applicant's brewpub group manufactures a total of not more than 10,000 barrels of fermented malt beverages in a calendar year.

SB224,9,22 2. The applicant's entire process for manufacturing fermented malt beverages under the permit occurs on the premises for which the permit is issued.

SB224,9,24 3. The applicant operates a restaurant on the premises for which the permit is issued, for which a restaurant permit is issued under s. 254.64 and in which the sale of alcohol beverages accounts for less than 60 percent of the gross receipts of all of the food and beverages served in the restaurant on a calendar year basis.

SB224,10,6 4. The applicant holds a Class "B" license for the restaurant identified in subd. 3. and, on these Class "B" premises, offers for sale, in addition to fermented malt beverages manufactured by the applicant, fermented malt beverages manufactured by a brewer other than the applicant and its brewpub group.

SB224,10,7 5. The applicant holds a valid certificate issued under s. 73.03 (50).

SB224,10,10 6. Neither the applicant nor the applicant's brewpub group holds, or has a direct or indirect ownership interest in a premises operating under, any of the following:

SB224,10,11 a. A Class "A" license issued under s. 125.25.

SB224,10,13 b. Except as provided in subd. 4. and subs. (1) (h) and (3) (b), a Class "B" license issued under s. 125.26.

SB224,10,14 c. A wholesaler's license issued under s. 125.28.

SB224,10,15 d. A brewer's permit issued under s. 125.29.

SB224,10,17 e. Except as provided in subs. (1) (h) and (3) (c), a "Class B" license or permit or "Class C" license issued under s. 125.51.

SB224,10,18 f. An alcohol beverage warehouse permit issued under s. 125.19.

SB224,10,25 (b) If an applicant under par. (a) has no current operations, the applicant may certify that the applicant has applied for or will apply for a Class "B" license or restaurant permit or will comply with any other requirement under par. (a), prior to or upon commencing operations authorized under this section. If a Class "B" license or restaurant permit is not subsequently issued to the applicant, or if the applicant otherwise fails to comply with any requirement for eligibility under par. (a), the department may revoke under s. 125.12 (5) the permit issued under this section.

SB224,11,9 (c) If an applicant under par. (a) holds any license or permit prohibited under par. (a) 6. at the time of its application, the applicant may certify that the applicant will surrender any such license or permit upon issuance of a permit under this section. If the department issues a permit under this section and the applicant fails to surrender any license or permit prohibited under par. (a) 6., the department may revoke under s. 125.12 (5) the permit issued under this section. An applicant is not required to surrender any Class "B" license issued under s. 125.31 (1) (a) 2. or under s. 125.31 (1) (a) 3., 2005 stats., if the applicant's continued possession of the license is consistent with subs. (1) (h), (2) (a) 4., and (3) (b) and (c).

SB224,11,11 (3) (a) No brewpub group may hold more than 6 brewpub permits issued under this section.

SB224,11,18 (b) A brewpub may not hold any Class "B" license other than one issued for a restaurant on the brewpub premises. Notwithstanding s. 125.26 (2) (a), each Class "B" license shall be issued for the brewpub's restaurant in the same name as the permittee under this section. Notwithstanding s. 125.33 (1), a brewpub may own the furniture, fixtures, fittings, furnishings, and equipment on the Class "B" premises and shall pay any license fee or tax required for the operation of the premises.

SB224,11,21 (c) Subject to the requirements specified in s. 125.51 (3) and (3m), a brewpub may also hold "Class B" licenses and "Class C" licenses, but only for restaurants on brewpub premises.

SB224,11,23 (4) The fee established by the department for a brewpub permit shall not exceed the fee established by the department for a permit under s. 125.29.

SB224, s. 14 Section 14. 125.31 (1) (a) 1. (intro.) of the statutes is repealed.

SB224, s. 15 Section 15. 125.31 (1) (a) 1. a. to e. of the statutes are renumbered 125.02 (2d) (a) to (e).

SB224, s. 16 Section 16. 125.31 (1) (a) 2. of the statutes is amended to read:

SB224,12,9 125.31 (1) (a) 2. Notwithstanding ss. 125.29 (2) and 125.33 (1), a brewer may maintain and operate one place on brewery premises and one place on real estate owned by the brewer or a subsidiary or affiliate corporation or limited liability company for the sale of fermented malt beverages for which a Class "B" license is required for each place, but, except as provided in subds. 3. and subd. 4., not more than 2 such Class "B" licenses shall be issued to any brewer.

SB224, s. 17 Section 17. 125.31 (1) (a) 3. of the statutes is repealed.