The Bench & Bar magazine is published to provide members of the KBA with information that will increase their knowledge of the law, improve the practice of law, and assist in improving the quality of legal services for the citizenry.
Issue link: https://kentuckybenchandbar.epubxp.com/i/213936
FEATURE: BRIDLED SPIRITS Historically, the concept was that the "special event" was a county fair, city festival, or similar type of civic or community event. Applicants abused the license, however, and applied for events outside the intended scope of the license. Although the qualifications for non-profit or charitable groups have not changed, to prevent abuses, "for-profit" applicants may now only obtain a temporary license for a bona fide civic event. Forprofit applicants are now required to submit written documentary evidence supporting the civic nature of the event and showing the local government's knowledge and support of the event. The Kentucky ABC requires a resolution from the local government, a letter from a mayor or similar local official with authority, or a newspaper article detailing the civic nature of the event. Marketing materials such as brochures and advertisements will not suffice. A different type of temporary license, the special temporary distilled spirits and wine auction, remains unchanged by and did not merge into this new license. 10 MODIFICATIONS TO STATE LICENSING FEES AND THE ANNUAL RENEWAL SCHEDULE SB 13 further attempted to correct inconsistencies and inequalities in license fees. Prior to SB 13, licensees had as many as four different state licensing fees depending upon the type of license and the class of city or county in which a licensee was located. For example, under the former KRS 243.030, the license fee for the retail liquor drink license was $1,000 for a county containing a city of the first class or consolidated government (e.g., Louisville); $700 for a county containing a city of the second class (e.g., Lexington); $600 for a county containing a city of the third class (e.g., Independence); and $500 for a county containing a city of the fourth class (e.g., Bardstown).33 There is now only one fee for the same license type, regardless of location. Accordingly, a licensee in the aforementioned example B&B; • 11.13 would now only pay $620 to the state for a quota retail drink license regardless of where located.34 SB 13 also modified the licensing fee amounts in an effort to remain revenue neutral. Based on the task force's recommendations, a serious attempt was made to calculate fees equitably across all license types, and changes were not made for the purpose of increasing state licensing fees. Notably, some license fees actually decreased. Consolidated fees remained low in an effort to protect licensees in smaller class cities and counties that may not generate as much revenue as their counterparts located in larger cities and counties. The state licensing renewal schedule was simplified, and state renewals are now scheduled by month for specific counties instead of by zip code. Previously, retailers in the same city with different zip codes, but literally located across the street from one another, had different license renewal dates, and that caused confusion when wholesalers and distributors attempted to fill orders. These changes mainly affect licensees in larger cities, such as Louisville and Lexington. To incorporate the statutory modifications into licensing, the Kentucky ABC recently issued replacement state licenses to all existing license holders. The replacement licenses show the new license types in place of the eliminated ones, but the expiration dates of these licenses remain the same. Licensees are required to replace their old state licenses with the new ones and correct licensing numbers on the exterior windows or doors. You should advise your clients that their failure to do so by Sept. 1, 2013, could result in violations issued by the Kentucky and/or local ABCs. If a licensee's renewal schedule does change, the Kentucky ABC will phase in the new renewal schedule by requiring the licensee to renew twice in the next year. Licensees should receive their state renewal notices as normal even if the expiration month is changing. The renewal form will permit a licensee to renew the licensee's existing licenses and pay a pro-rated fee to keep the licenses active during the transition period this year. The second renewal form will allow the licensee to renew on the full year schedule as anticipated by the statutory modifications. Since local governments are not required to renew local licenses based on the state's licensing renewal schedule, the local renewal date may not mirror the state renewal schedule. Holders of producer, wholesaler and distributor licenses now have the option to renew their respective licenses for a oneyear or a two-year licensing period, instead of just a one-year license as was required prior to SB 13.35 This two-year licensing period and renewal option, however, is not available to retail licensees. MODIFICATIONS TO LOCAL LICENSES AND FEES Courts have held that since the alcoholic beverage laws in KRS Chapters 241-244 are a comprehensive body of law, statutory authority for city and county ordinances must be specific and unequivocal. The legislative body of any wet or moist county or city may impose local license fees for the privilege of manufacturing and trafficking in alcoholic beverages,36 but only those license types listed in KRS 243.060 and KRS 243.070 may be issued at the local level. Local license types were also revised to be consistent with the new state license types.37 Cities and counties were advised to amend their local ordinances to reflect the new license types to avoid court challenges that local ABC approval was no longer required and that the applicable cities and counties could no longer charge an applicant a licensing fee for a license type that no longer exists. Unlike state license fees, local license fees were not standard- ized to one fee for the same license type. SB 13, however, did reduce the number of different fees for the same license type from four to two,38 although not all local licenses have different fees. For those license types with two different fee amounts, the different fees are based upon whether the licensed premises is located in a county containing a consolidated local government or located in some other county.39 In consolidating the four fees, the maximum license fee amounts permitted will increase for some counties and cities. To protect licensees from drastic increases in county and city fees, current fees may not be increased by more than 5 percent during any five-year period.40 NEW STATE LAW ALLOWING RETAIL ALCOHOL SALES ON ELECTION DAYS Prior to the passage of SB 13, Kentucky was one of only four states left in the nation to prohibit the sale of alcohol on primary and general election days while the polls were open.41 To modernize Kentucky's laws, SB 13 amended KRS 244.290 and KRS 244.480 to permit licensees to sell alcoholic beverages on any primary, regular, local option or special election days as the default state law. SB 13 authorized cities of the first four classes, and counties containing cities of the first four classes, to adopt local ordinances to prohibit alcoholic beverages sales, or limit the hours of sales, on any primary, regular, local option or special election day if such locale desires to prohibit such sales.42 Although counties and cities are not required to enact such ordinances, if prohibition is desired on election days by an authorized local government that did not previously have an ordinance to that effect in place, an ordinance must be passed to prohibit such sales. If no local ordinance exists, whether currently in effect or enacted with the passage of SB 13, retail alcohol sales will be permitted, by default, under state law.43