Illinois General Assembly - Full Text of SB3428
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Full Text of SB3428  101st General Assembly

SB3428 101ST GENERAL ASSEMBLY

  
  

 


 
101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
SB3428

 

Introduced 2/14/2020, by Sen. Heather A. Steans

 

SYNOPSIS AS INTRODUCED:
 
235 ILCS 5/3-12
235 ILCS 5/5-1  from Ch. 43, par. 115

    Amends the Liquor Control Act of 1934. In provisions concerning self-distribution exemptions for certain wine manufacturers, provides that those wine manufacturers may not be granted a self-distribution exemption if they are part of an affiliated group producing more than 25,000 gallons of wine, 930,000 gallons of beer, or 50,000 gallons of spirits (instead of 25,000 gallons of wine or any other liquor). Provides that a class 1 craft distiller may not be a member of or affiliated with, directly or indirectly, a manufacturer that produces more than 50,000 gallons of spirits per year, 930,000 gallons of beer per year, or 25,000 gallons of wine per year (instead of 50,000 gallons of spirits per year or any other alcoholic liquor). Provides that a class 2 craft distiller may not be a member of or affiliated with, directly or indirectly, a manufacturer that produces more than 50,000 gallons of spirits per year, 3,720,000 gallons of beer per year, or 25,000 gallons of wine per year (instead of 100,000 gallons of spirits per year or any other alcoholic liquor). Provides that a class 1 brewer may not be a member of or affiliated with a manufacturer that produces more than 930,000 gallons of beer per year, 50,000 gallons of spirits per year, or 25,000 gallons of wine per year (instead of 930,000 gallons of beer per year or any other alcoholic liquor). Provides that class 2 brewers may not be a member of or affiliated with a manufacturer that produces more than 3,720,000 gallons of beer per year, 100,000 gallons of spirits per year, or 25,000 gallons of wine per year (instead of 3,720,000 gallons of beer per year or any other alcoholic liquor). Makes related changes in provisions concerning brew pub licensees, distilling pub licensees, and self-distribution exemptions. Effective immediately.


LRB101 20405 RPS 69955 b

 

 

A BILL FOR

 

SB3428LRB101 20405 RPS 69955 b

1    AN ACT concerning liquor.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Liquor Control Act of 1934 is amended by
5changing Sections 3-12 and 5-1 as follows:
 
6    (235 ILCS 5/3-12)
7    Sec. 3-12. Powers and duties of State Commission.
8    (a) The State Commission shall have the following powers,
9functions, and duties:
10        (1) To receive applications and to issue licenses to
11    manufacturers, foreign importers, importing distributors,
12    distributors, non-resident dealers, on premise consumption
13    retailers, off premise sale retailers, special event
14    retailer licensees, special use permit licenses, auction
15    liquor licenses, brew pubs, caterer retailers,
16    non-beverage users, railroads, including owners and
17    lessees of sleeping, dining and cafe cars, airplanes,
18    boats, brokers, and wine maker's premises licensees in
19    accordance with the provisions of this Act, and to suspend
20    or revoke such licenses upon the State Commission's
21    determination, upon notice after hearing, that a licensee
22    has violated any provision of this Act or any rule or
23    regulation issued pursuant thereto and in effect for 30

 

 

SB3428- 2 -LRB101 20405 RPS 69955 b

1    days prior to such violation. Except in the case of an
2    action taken pursuant to a violation of Section 6-3, 6-5,
3    or 6-9, any action by the State Commission to suspend or
4    revoke a licensee's license may be limited to the license
5    for the specific premises where the violation occurred. An
6    action for a violation of this Act shall be commenced by
7    the State Commission within 2 years after the date the
8    State Commission becomes aware of the violation.
9        In lieu of suspending or revoking a license, the
10    commission may impose a fine, upon the State Commission's
11    determination and notice after hearing, that a licensee has
12    violated any provision of this Act or any rule or
13    regulation issued pursuant thereto and in effect for 30
14    days prior to such violation.
15        For the purpose of this paragraph (1), when determining
16    multiple violations for the sale of alcohol to a person
17    under the age of 21, a second or subsequent violation for
18    the sale of alcohol to a person under the age of 21 shall
19    only be considered if it was committed within 5 years after
20    the date when a prior violation for the sale of alcohol to
21    a person under the age of 21 was committed.
22        The fine imposed under this paragraph may not exceed
23    $500 for each violation. Each day that the activity, which
24    gave rise to the original fine, continues is a separate
25    violation. The maximum fine that may be levied against any
26    licensee, for the period of the license, shall not exceed

 

 

SB3428- 3 -LRB101 20405 RPS 69955 b

1    $20,000. The maximum penalty that may be imposed on a
2    licensee for selling a bottle of alcoholic liquor with a
3    foreign object in it or serving from a bottle of alcoholic
4    liquor with a foreign object in it shall be the destruction
5    of that bottle of alcoholic liquor for the first 10 bottles
6    so sold or served from by the licensee. For the eleventh
7    bottle of alcoholic liquor and for each third bottle
8    thereafter sold or served from by the licensee with a
9    foreign object in it, the maximum penalty that may be
10    imposed on the licensee is the destruction of the bottle of
11    alcoholic liquor and a fine of up to $50.
12        Any notice issued by the State Commission to a licensee
13    for a violation of this Act or any notice with respect to
14    settlement or offer in compromise shall include the field
15    report, photographs, and any other supporting
16    documentation necessary to reasonably inform the licensee
17    of the nature and extent of the violation or the conduct
18    alleged to have occurred. The failure to include such
19    required documentation shall result in the dismissal of the
20    action.
21        (2) To adopt such rules and regulations consistent with
22    the provisions of this Act which shall be necessary to
23    carry on its functions and duties to the end that the
24    health, safety and welfare of the People of the State of
25    Illinois shall be protected and temperance in the
26    consumption of alcoholic liquors shall be fostered and

 

 

SB3428- 4 -LRB101 20405 RPS 69955 b

1    promoted and to distribute copies of such rules and
2    regulations to all licensees affected thereby.
3        (3) To call upon other administrative departments of
4    the State, county and municipal governments, county and
5    city police departments and upon prosecuting officers for
6    such information and assistance as it deems necessary in
7    the performance of its duties.
8        (4) To recommend to local commissioners rules and
9    regulations, not inconsistent with the law, for the
10    distribution and sale of alcoholic liquors throughout the
11    State.
12        (5) To inspect, or cause to be inspected, any premises
13    in this State where alcoholic liquors are manufactured,
14    distributed, warehoused, or sold. Nothing in this Act
15    authorizes an agent of the State Commission to inspect
16    private areas within the premises without reasonable
17    suspicion or a warrant during an inspection. "Private
18    areas" include, but are not limited to, safes, personal
19    property, and closed desks.
20        (5.1) Upon receipt of a complaint or upon having
21    knowledge that any person is engaged in business as a
22    manufacturer, importing distributor, distributor, or
23    retailer without a license or valid license, to conduct an
24    investigation. If, after conducting an investigation, the
25    State Commission is satisfied that the alleged conduct
26    occurred or is occurring, it may issue a cease and desist

 

 

SB3428- 5 -LRB101 20405 RPS 69955 b

1    notice as provided in this Act, impose civil penalties as
2    provided in this Act, notify the local liquor authority, or
3    file a complaint with the State's Attorney's Office of the
4    county where the incident occurred or the Attorney General.
5        (5.2) Upon receipt of a complaint or upon having
6    knowledge that any person is shipping alcoholic liquor into
7    this State from a point outside of this State if the
8    shipment is in violation of this Act, to conduct an
9    investigation. If, after conducting an investigation, the
10    State Commission is satisfied that the alleged conduct
11    occurred or is occurring, it may issue a cease and desist
12    notice as provided in this Act, impose civil penalties as
13    provided in this Act, notify the foreign jurisdiction, or
14    file a complaint with the State's Attorney's Office of the
15    county where the incident occurred or the Attorney General.
16        (5.3) To receive complaints from licensees, local
17    officials, law enforcement agencies, organizations, and
18    persons stating that any licensee has been or is violating
19    any provision of this Act or the rules and regulations
20    issued pursuant to this Act. Such complaints shall be in
21    writing, signed and sworn to by the person making the
22    complaint, and shall state with specificity the facts in
23    relation to the alleged violation. If the State Commission
24    has reasonable grounds to believe that the complaint
25    substantially alleges a violation of this Act or rules and
26    regulations adopted pursuant to this Act, it shall conduct

 

 

SB3428- 6 -LRB101 20405 RPS 69955 b

1    an investigation. If, after conducting an investigation,
2    the State Commission is satisfied that the alleged
3    violation did occur, it shall proceed with disciplinary
4    action against the licensee as provided in this Act.
5        (5.4) To make arrests and issue notices of civil
6    violations where necessary for the enforcement of this Act.
7        (5.5) To investigate any and all unlicensed activity.
8        (5.6) To impose civil penalties or fines to any person
9    who, without holding a valid license, engages in conduct
10    that requires a license pursuant to this Act, in an amount
11    not to exceed $20,000 for each offense as determined by the
12    State Commission. A civil penalty shall be assessed by the
13    State Commission after a hearing is held in accordance with
14    the provisions set forth in this Act regarding the
15    provision of a hearing for the revocation or suspension of
16    a license.
17        (6) To hear and determine appeals from orders of a
18    local commission in accordance with the provisions of this
19    Act, as hereinafter set forth. Hearings under this
20    subsection shall be held in Springfield or Chicago, at
21    whichever location is the more convenient for the majority
22    of persons who are parties to the hearing.
23        (7) The State Commission shall establish uniform
24    systems of accounts to be kept by all retail licensees
25    having more than 4 employees, and for this purpose the
26    State Commission may classify all retail licensees having

 

 

SB3428- 7 -LRB101 20405 RPS 69955 b

1    more than 4 employees and establish a uniform system of
2    accounts for each class and prescribe the manner in which
3    such accounts shall be kept. The State Commission may also
4    prescribe the forms of accounts to be kept by all retail
5    licensees having more than 4 employees, including, but not
6    limited to, accounts of earnings and expenses and any
7    distribution, payment, or other distribution of earnings
8    or assets, and any other forms, records, and memoranda
9    which in the judgment of the commission may be necessary or
10    appropriate to carry out any of the provisions of this Act,
11    including, but not limited to, such forms, records, and
12    memoranda as will readily and accurately disclose at all
13    times the beneficial ownership of such retail licensed
14    business. The accounts, forms, records, and memoranda
15    shall be available at all reasonable times for inspection
16    by authorized representatives of the State Commission or by
17    any local liquor control commissioner or his or her
18    authorized representative. The commission, may, from time
19    to time, alter, amend, or repeal, in whole or in part, any
20    uniform system of accounts, or the form and manner of
21    keeping accounts.
22        (8) In the conduct of any hearing authorized to be held
23    by the State Commission, to appoint, at the commission's
24    discretion, hearing officers to conduct hearings involving
25    complex issues or issues that will require a protracted
26    period of time to resolve, to examine, or cause to be

 

 

SB3428- 8 -LRB101 20405 RPS 69955 b

1    examined, under oath, any licensee, and to examine or cause
2    to be examined the books and records of such licensee; to
3    hear testimony and take proof material for its information
4    in the discharge of its duties hereunder; to administer or
5    cause to be administered oaths; for any such purpose to
6    issue subpoena or subpoenas to require the attendance of
7    witnesses and the production of books, which shall be
8    effective in any part of this State, and to adopt rules to
9    implement its powers under this paragraph (8).
10        Any circuit court may, by order duly entered, require
11    the attendance of witnesses and the production of relevant
12    books subpoenaed by the State Commission and the court may
13    compel obedience to its order by proceedings for contempt.
14        (9) To investigate the administration of laws in
15    relation to alcoholic liquors in this and other states and
16    any foreign countries, and to recommend from time to time
17    to the Governor and through him or her to the legislature
18    of this State, such amendments to this Act, if any, as it
19    may think desirable and as will serve to further the
20    general broad purposes contained in Section 1-2 hereof.
21        (10) To adopt such rules and regulations consistent
22    with the provisions of this Act which shall be necessary
23    for the control, sale, or disposition of alcoholic liquor
24    damaged as a result of an accident, wreck, flood, fire, or
25    other similar occurrence.
26        (11) To develop industry educational programs related

 

 

SB3428- 9 -LRB101 20405 RPS 69955 b

1    to responsible serving and selling, particularly in the
2    areas of overserving consumers and illegal underage
3    purchasing and consumption of alcoholic beverages.
4        (11.1) To license persons providing education and
5    training to alcohol beverage sellers and servers for
6    mandatory and non-mandatory training under the Beverage
7    Alcohol Sellers and Servers Education and Training
8    (BASSET) programs and to develop and administer a public
9    awareness program in Illinois to reduce or eliminate the
10    illegal purchase and consumption of alcoholic beverage
11    products by persons under the age of 21. Application for a
12    license shall be made on forms provided by the State
13    Commission.
14        (12) To develop and maintain a repository of license
15    and regulatory information.
16        (13) (Blank).
17        (14) On or before April 30, 2008 and every 2 years
18    thereafter, the State Commission shall present a written
19    report to the Governor and the General Assembly that shall
20    be based on a study of the impact of Public Act 95-634 on
21    the business of soliciting, selling, and shipping wine from
22    inside and outside of this State directly to residents of
23    this State. As part of its report, the State Commission
24    shall provide all of the following information:
25            (A) The amount of State excise and sales tax
26        revenues generated.

 

 

SB3428- 10 -LRB101 20405 RPS 69955 b

1            (B) The amount of licensing fees received.
2            (C) The number of cases of wine shipped from inside
3        and outside of this State directly to residents of this
4        State.
5            (D) The number of alcohol compliance operations
6        conducted.
7            (E) The number of winery shipper's licenses
8        issued.
9            (F) The number of each of the following: reported
10        violations; cease and desist notices issued by the
11        Commission; notices of violations issued by the
12        Commission and to the Department of Revenue; and
13        notices and complaints of violations to law
14        enforcement officials, including, without limitation,
15        the Illinois Attorney General and the U.S. Department
16        of Treasury's Alcohol and Tobacco Tax and Trade Bureau.
17        (15) As a means to reduce the underage consumption of
18    alcoholic liquors, the State Commission shall conduct
19    alcohol compliance operations to investigate whether
20    businesses that are soliciting, selling, and shipping wine
21    from inside or outside of this State directly to residents
22    of this State are licensed by this State or are selling or
23    attempting to sell wine to persons under 21 years of age in
24    violation of this Act.
25        (16) The State Commission shall, in addition to
26    notifying any appropriate law enforcement agency, submit

 

 

SB3428- 11 -LRB101 20405 RPS 69955 b

1    notices of complaints or violations of Sections 6-29 and
2    6-29.1 by persons who do not hold a winery shipper's
3    license under this Act to the Illinois Attorney General and
4    to the U.S. Department of Treasury's Alcohol and Tobacco
5    Tax and Trade Bureau.
6        (17)(A) A person licensed to make wine under the laws
7    of another state who has a winery shipper's license under
8    this Act and annually produces less than 25,000 gallons of
9    wine or a person who has a first-class or second-class wine
10    manufacturer's license, a first-class or second-class
11    wine-maker's license, or a limited wine manufacturer's
12    license under this Act and annually produces less than
13    25,000 gallons of wine may make application to the
14    Commission for a self-distribution exemption to allow the
15    sale of not more than 5,000 gallons of the exemption
16    holder's wine to retail licensees per year.
17        (B) In the application, which shall be sworn under
18    penalty of perjury, such person shall state (1) the date it
19    was established; (2) its volume of production and sales for
20    each year since its establishment; (3) its efforts to
21    establish distributor relationships; (4) that a
22    self-distribution exemption is necessary to facilitate the
23    marketing of its wine; and (5) that it will comply with the
24    liquor and revenue laws of the United States, this State,
25    and any other state where it is licensed.
26        (C) The State Commission shall approve the application

 

 

SB3428- 12 -LRB101 20405 RPS 69955 b

1    for a self-distribution exemption if such person: (1) is in
2    compliance with State revenue and liquor laws; (2) is not a
3    member of any affiliated group that produces more than
4    25,000 gallons of wine per annum or produces any other
5    alcoholic liquor; (3) will not annually produce for sale
6    more than 25,000 gallons of wine; and (4) will not annually
7    sell more than 5,000 gallons of its wine to retail
8    licensees.
9        (D) A self-distribution exemption holder shall
10    annually certify to the State Commission its production of
11    wine in the previous 12 months and its anticipated
12    production and sales for the next 12 months. The State
13    Commission may fine, suspend, or revoke a
14    self-distribution exemption after a hearing if it finds
15    that the exemption holder has made a material
16    misrepresentation in its application, violated a revenue
17    or liquor law of Illinois, exceeded production of 25,000
18    gallons of wine in any calendar year, or become part of an
19    affiliated group producing more than 25,000 gallons of
20    wine, 930,000 gallons of beer, or 50,000 gallons of spirits
21    or any other alcoholic liquor.
22        (E) Except in hearings for violations of this Act or
23    Public Act 95-634 or a bona fide investigation by duly
24    sworn law enforcement officials, the State Commission, or
25    its agents, the State Commission shall maintain the
26    production and sales information of a self-distribution

 

 

SB3428- 13 -LRB101 20405 RPS 69955 b

1    exemption holder as confidential and shall not release such
2    information to any person.
3        (F) The State Commission shall issue regulations
4    governing self-distribution exemptions consistent with
5    this Section and this Act.
6        (G) Nothing in this paragraph (17) shall prohibit a
7    self-distribution exemption holder from entering into or
8    simultaneously having a distribution agreement with a
9    licensed Illinois distributor.
10        (H) It is the intent of this paragraph (17) to promote
11    and continue orderly markets. The General Assembly finds
12    that, in order to preserve Illinois' regulatory
13    distribution system, it is necessary to create an exception
14    for smaller makers of wine as their wines are frequently
15    adjusted in varietals, mixes, vintages, and taste to find
16    and create market niches sometimes too small for
17    distributor or importing distributor business strategies.
18    Limited self-distribution rights will afford and allow
19    smaller makers of wine access to the marketplace in order
20    to develop a customer base without impairing the integrity
21    of the 3-tier system.
22        (18)(A) A class 1 brewer licensee, who must also be
23    either a licensed brewer or licensed non-resident dealer
24    and annually manufacture less than 930,000 gallons of beer,
25    may make application to the State Commission for a
26    self-distribution exemption to allow the sale of not more

 

 

SB3428- 14 -LRB101 20405 RPS 69955 b

1    than 232,500 gallons of the exemption holder's beer per
2    year to retail licensees and to brewers, class 1 brewers,
3    and class 2 brewers that, pursuant to subsection (e) of
4    Section 6-4 of this Act, sell beer, cider, or both beer and
5    cider to non-licensees at their breweries.
6        (B) In the application, which shall be sworn under
7    penalty of perjury, the class 1 brewer licensee shall state
8    (1) the date it was established; (2) its volume of beer
9    manufactured and sold for each year since its
10    establishment; (3) its efforts to establish distributor
11    relationships; (4) that a self-distribution exemption is
12    necessary to facilitate the marketing of its beer; and (5)
13    that it will comply with the alcoholic beverage and revenue
14    laws of the United States, this State, and any other state
15    where it is licensed.
16        (C) Any application submitted shall be posted on the
17    State Commission's website at least 45 days prior to action
18    by the State Commission. The State Commission shall approve
19    the application for a self-distribution exemption if the
20    class 1 brewer licensee: (1) is in compliance with the
21    State, revenue, and alcoholic beverage laws; (2) is not a
22    member of any affiliated group that manufactures more than
23    930,000 gallons of beer per annum, 25,000 gallons of wine
24    per annum, or 50,000 gallons of spirits per annum or
25    produces any other alcoholic beverages; (3) shall not
26    annually manufacture for sale more than 930,000 gallons of

 

 

SB3428- 15 -LRB101 20405 RPS 69955 b

1    beer; (4) shall not annually sell more than 232,500 gallons
2    of its beer to retail licensees or to brewers, class 1
3    brewers, and class 2 brewers that, pursuant to subsection
4    (e) of Section 6-4 of this Act, sell beer, cider, or both
5    beer and cider to non-licensees at their breweries; and (5)
6    has relinquished any brew pub license held by the licensee,
7    including any ownership interest it held in the licensed
8    brew pub.
9        (D) A self-distribution exemption holder shall
10    annually certify to the State Commission its manufacture of
11    beer during the previous 12 months and its anticipated
12    manufacture and sales of beer for the next 12 months. The
13    State Commission may fine, suspend, or revoke a
14    self-distribution exemption after a hearing if it finds
15    that the exemption holder has made a material
16    misrepresentation in its application, violated a revenue
17    or alcoholic beverage law of Illinois, exceeded the
18    manufacture of 930,000 gallons of beer in any calendar year
19    or became part of an affiliated group manufacturing more
20    than 930,000 gallons of beer or any other alcoholic
21    beverage.
22        (E) The State Commission shall issue rules and
23    regulations governing self-distribution exemptions
24    consistent with this Act.
25        (F) Nothing in this paragraph (18) shall prohibit a
26    self-distribution exemption holder from entering into or

 

 

SB3428- 16 -LRB101 20405 RPS 69955 b

1    simultaneously having a distribution agreement with a
2    licensed Illinois importing distributor or a distributor.
3    If a self-distribution exemption holder enters into a
4    distribution agreement and has assigned distribution
5    rights to an importing distributor or distributor, then the
6    self-distribution exemption holder's distribution rights
7    in the assigned territories shall cease in a reasonable
8    time not to exceed 60 days.
9        (G) It is the intent of this paragraph (18) to promote
10    and continue orderly markets. The General Assembly finds
11    that in order to preserve Illinois' regulatory
12    distribution system, it is necessary to create an exception
13    for smaller manufacturers in order to afford and allow such
14    smaller manufacturers of beer access to the marketplace in
15    order to develop a customer base without impairing the
16    integrity of the 3-tier system.
17        (19)(A) A class 1 craft distiller licensee or a
18    non-resident dealer who manufactures less than 50,000
19    gallons of distilled spirits per year may make application
20    to the State Commission for a self-distribution exemption
21    to allow the sale of not more than 5,000 gallons of the
22    exemption holder's spirits to retail licensees per year.
23        (B) In the application, which shall be sworn under
24    penalty of perjury, the class 1 craft distiller licensee or
25    non-resident dealer shall state (1) the date it was
26    established; (2) its volume of spirits manufactured and

 

 

SB3428- 17 -LRB101 20405 RPS 69955 b

1    sold for each year since its establishment; (3) its efforts
2    to establish distributor relationships; (4) that a
3    self-distribution exemption is necessary to facilitate the
4    marketing of its spirits; and (5) that it will comply with
5    the alcoholic beverage and revenue laws of the United
6    States, this State, and any other state where it is
7    licensed.
8        (C) Any application submitted shall be posted on the
9    State Commission's website at least 45 days prior to action
10    by the State Commission. The State Commission shall approve
11    the application for a self-distribution exemption if the
12    applicant: (1) is in compliance with State revenue and
13    alcoholic beverage laws; (2) is not a member of any
14    affiliated group that produces more than 50,000 gallons of
15    spirits per annum, 930,000 gallons of beer per annum, or
16    25,000 gallons of wine per annum or produces any other
17    alcoholic liquor; (3) does not annually manufacture for
18    sale more than 50,000 gallons of spirits; and (4) does not
19    annually sell more than 5,000 gallons of its spirits to
20    retail licensees.
21        (D) A self-distribution exemption holder shall
22    annually certify to the State Commission its manufacture of
23    spirits during the previous 12 months and its anticipated
24    manufacture and sales of spirits for the next 12 months.
25    The State Commission may fine, suspend, or revoke a
26    self-distribution exemption after a hearing if it finds

 

 

SB3428- 18 -LRB101 20405 RPS 69955 b

1    that the exemption holder has made a material
2    misrepresentation in its application, violated a revenue
3    or alcoholic beverage law of Illinois, exceeded the
4    manufacture of 50,000 gallons of spirits in any calendar
5    year, or has become part of an affiliated group
6    manufacturing more than 50,000 gallons of spirits or any
7    other alcoholic beverage.
8        (E) The State Commission shall adopt rules governing
9    self-distribution exemptions consistent with this Act.
10        (F) Nothing in this paragraph (19) shall prohibit a
11    self-distribution exemption holder from entering into or
12    simultaneously having a distribution agreement with a
13    licensed Illinois importing distributor or a distributor.
14        (G) It is the intent of this paragraph (19) to promote
15    and continue orderly markets. The General Assembly finds
16    that in order to preserve Illinois' regulatory
17    distribution system, it is necessary to create an exception
18    for smaller manufacturers in order to afford and allow such
19    smaller manufacturers of spirits access to the marketplace
20    in order to develop a customer base without impairing the
21    integrity of the 3-tier system.
22    (b) On or before April 30, 1999, the Commission shall
23present a written report to the Governor and the General
24Assembly that shall be based on a study of the impact of Public
25Act 90-739 on the business of soliciting, selling, and shipping
26alcoholic liquor from outside of this State directly to

 

 

SB3428- 19 -LRB101 20405 RPS 69955 b

1residents of this State.
2    As part of its report, the Commission shall provide the
3following information:
4        (i) the amount of State excise and sales tax revenues
5    generated as a result of Public Act 90-739;
6        (ii) the amount of licensing fees received as a result
7    of Public Act 90-739;
8        (iii) the number of reported violations, the number of
9    cease and desist notices issued by the Commission, the
10    number of notices of violations issued to the Department of
11    Revenue, and the number of notices and complaints of
12    violations to law enforcement officials.
13(Source: P.A. 100-134, eff. 8-18-17; 100-201, eff. 8-18-17;
14100-816, eff. 8-13-18; 100-1012, eff. 8-21-18; 100-1050, eff.
158-23-18; 101-37, eff. 7-3-19; 101-81, eff. 7-12-19; 101-482,
16eff. 8-23-19; revised 9-20-19.)
 
17    (235 ILCS 5/5-1)  (from Ch. 43, par. 115)
18    Sec. 5-1. Licenses issued by the Illinois Liquor Control
19Commission shall be of the following classes:
20    (a) Manufacturer's license - Class 1. Distiller, Class 2.
21Rectifier, Class 3. Brewer, Class 4. First Class Wine
22Manufacturer, Class 5. Second Class Wine Manufacturer, Class 6.
23First Class Winemaker, Class 7. Second Class Winemaker, Class
248. Limited Wine Manufacturer, Class 9. Craft Distiller, Class
2510. Class 1 Craft Distiller, Class 11. Class 2 Craft Distiller,

 

 

SB3428- 20 -LRB101 20405 RPS 69955 b

1Class 12. Class 1 Brewer, Class 13. Class 2 Brewer,
2    (b) Distributor's license,
3    (c) Importing Distributor's license,
4    (d) Retailer's license,
5    (e) Special Event Retailer's license (not-for-profit),
6    (f) Railroad license,
7    (g) Boat license,
8    (h) Non-Beverage User's license,
9    (i) Wine-maker's premises license,
10    (j) Airplane license,
11    (k) Foreign importer's license,
12    (l) Broker's license,
13    (m) Non-resident dealer's license,
14    (n) Brew Pub license,
15    (o) Auction liquor license,
16    (p) Caterer retailer license,
17    (q) Special use permit license,
18    (r) Winery shipper's license,
19    (s) Craft distiller tasting permit,
20    (t) Brewer warehouse permit,
21    (u) Distilling pub license,
22    (v) Craft distiller warehouse permit.
23    No person, firm, partnership, corporation, or other legal
24business entity that is engaged in the manufacturing of wine
25may concurrently obtain and hold a wine-maker's license and a
26wine manufacturer's license.

 

 

SB3428- 21 -LRB101 20405 RPS 69955 b

1    (a) A manufacturer's license shall allow the manufacture,
2importation in bulk, storage, distribution and sale of
3alcoholic liquor to persons without the State, as may be
4permitted by law and to licensees in this State as follows:
5    Class 1. A Distiller may make sales and deliveries of
6alcoholic liquor to distillers, rectifiers, importing
7distributors, distributors and non-beverage users and to no
8other licensees.
9    Class 2. A Rectifier, who is not a distiller, as defined
10herein, may make sales and deliveries of alcoholic liquor to
11rectifiers, importing distributors, distributors, retailers
12and non-beverage users and to no other licensees.
13    Class 3. A Brewer may make sales and deliveries of beer to
14importing distributors and distributors and may make sales as
15authorized under subsection (e) of Section 6-4 of this Act.
16    Class 4. A first class wine-manufacturer may make sales and
17deliveries of up to 50,000 gallons of wine to manufacturers,
18importing distributors and distributors, and to no other
19licensees.
20    Class 5. A second class Wine manufacturer may make sales
21and deliveries of more than 50,000 gallons of wine to
22manufacturers, importing distributors and distributors and to
23no other licensees.
24    Class 6. A first-class wine-maker's license shall allow the
25manufacture of up to 50,000 gallons of wine per year, and the
26storage and sale of such wine to distributors in the State and

 

 

SB3428- 22 -LRB101 20405 RPS 69955 b

1to persons without the State, as may be permitted by law. A
2person who, prior to June 1, 2008 (the effective date of Public
3Act 95-634), is a holder of a first-class wine-maker's license
4and annually produces more than 25,000 gallons of its own wine
5and who distributes its wine to licensed retailers shall cease
6this practice on or before July 1, 2008 in compliance with
7Public Act 95-634.
8    Class 7. A second-class wine-maker's license shall allow
9the manufacture of between 50,000 and 150,000 gallons of wine
10per year, and the storage and sale of such wine to distributors
11in this State and to persons without the State, as may be
12permitted by law. A person who, prior to June 1, 2008 (the
13effective date of Public Act 95-634), is a holder of a
14second-class wine-maker's license and annually produces more
15than 25,000 gallons of its own wine and who distributes its
16wine to licensed retailers shall cease this practice on or
17before July 1, 2008 in compliance with Public Act 95-634.
18    Class 8. A limited wine-manufacturer may make sales and
19deliveries not to exceed 40,000 gallons of wine per year to
20distributors, and to non-licensees in accordance with the
21provisions of this Act.
22    Class 9. A craft distiller license, which may only be held
23by a class 1 craft distiller licensee or class 2 craft
24distiller licensee but not held by both a class 1 craft
25distiller licensee and a class 2 craft distiller licensee,
26shall grant all rights conveyed by either: (i) a class 1 craft

 

 

SB3428- 23 -LRB101 20405 RPS 69955 b

1distiller license if the craft distiller holds a class 1 craft
2distiller license; or (ii) a class 2 craft distiller licensee
3if the craft distiller holds a class 2 craft distiller license.
4    Class 10. A class 1 craft distiller license, which may only
5be issued to a licensed craft distiller or licensed
6non-resident dealer, shall allow the manufacture of up to
750,000 gallons of spirits per year provided that the class 1
8craft distiller licensee does not manufacture more than a
9combined 50,000 gallons of spirits per year and is not a member
10of or affiliated with, directly or indirectly, a manufacturer
11that produces more than 50,000 gallons of spirits per year,
12930,000 gallons of beer per year, or 25,000 gallons of wine per
13year or any other alcoholic liquor. A class 1 craft distiller
14licensee may make sales and deliveries to importing
15distributors and distributors and to retail licensees in
16accordance with the conditions set forth in paragraph (19) of
17subsection (a) of Section 3-12 of this Act. However, the
18aggregate amount of spirits sold to non-licensees and sold or
19delivered to retail licensees may not exceed 5,000 gallons per
20year.
21    A class 1 craft distiller licensee may sell up to 5,000
22gallons of such spirits to non-licensees to the extent
23permitted by any exemption approved by the State Commission
24pursuant to Section 6-4 of this Act. A class 1 craft distiller
25license holder may store such spirits at a non-contiguous
26licensed location, but at no time shall a class 1 craft

 

 

SB3428- 24 -LRB101 20405 RPS 69955 b

1distiller license holder directly or indirectly produce in the
2aggregate more than 50,000 gallons of spirits per year.
3    A class 1 craft distiller licensee may hold more than one
4class 1 craft distiller's license. However, a class 1 craft
5distiller that holds more than one class 1 craft distiller
6license shall not manufacture, in the aggregate, more than
750,000 gallons of spirits by distillation per year and shall
8not sell, in the aggregate, more than 5,000 gallons of such
9spirits to non-licensees in accordance with an exemption
10approved by the State Commission pursuant to Section 6-4 of
11this Act.
12    Class 11. A class 2 craft distiller license, which may only
13be issued to a licensed craft distiller or licensed
14non-resident dealer, shall allow the manufacture of up to
15100,000 gallons of spirits per year provided that the class 2
16craft distiller licensee does not manufacture more than a
17combined 100,000 gallons of spirits per year and is not a
18member of or affiliated with, directly or indirectly, a
19manufacturer that produces more than 100,000 gallons of spirits
20per year, 3,720,000 gallons of beer per year, or 25,000 gallons
21of wine per year or any other alcoholic liquor. A class 2 craft
22distiller licensee may make sales and deliveries to importing
23distributors and distributors, but shall not make sales or
24deliveries to any other licensee. If the State Commission
25provides prior approval, a class 2 craft distiller licensee may
26annually transfer up to 100,000 gallons of spirits manufactured

 

 

SB3428- 25 -LRB101 20405 RPS 69955 b

1by that class 2 craft distiller licensee to the premises of a
2licensed class 2 craft distiller wholly owned and operated by
3the same licensee. A class 2 craft distiller may transfer
4spirits to a distilling pub wholly owned and operated by the
5class 2 craft distiller subject to the following limitations
6and restrictions: (i) the transfer shall not annually exceed
7more than 5,000 gallons; (ii) the annual amount transferred
8shall reduce the distilling pub's annual permitted production
9limit; (iii) all spirits transferred shall be subject to
10Article VIII of this Act; (iv) a written record shall be
11maintained by the distiller and distilling pub specifying the
12amount, date of delivery, and receipt of the product by the
13distilling pub; and (v) the distilling pub shall be located no
14farther than 80 miles from the class 2 craft distiller's
15licensed location.
16    A class 2 craft distiller shall, prior to transferring
17spirits to a distilling pub wholly owned by the class 2 craft
18distiller, furnish a written notice to the State Commission of
19intent to transfer spirits setting forth the name and address
20of the distilling pub and shall annually submit to the State
21Commission a verified report identifying the total gallons of
22spirits transferred to the distilling pub wholly owned by the
23class 2 craft distiller.
24    A class 2 craft distiller license holder may store such
25spirits at a non-contiguous licensed location, but at no time
26shall a class 2 craft distiller license holder directly or

 

 

SB3428- 26 -LRB101 20405 RPS 69955 b

1indirectly produce in the aggregate more than 100,000 gallons
2of spirits per year.
3    Class 12. A class 1 brewer license, which may only be
4issued to a licensed brewer or licensed non-resident dealer,
5shall allow the manufacture of up to 930,000 gallons of beer
6per year provided that the class 1 brewer licensee does not
7manufacture more than a combined 930,000 gallons of beer per
8year and is not a member of or affiliated with, directly or
9indirectly, a manufacturer that produces more than 930,000
10gallons of beer per year, 50,000 gallons of spirits per year,
11or 25,000 gallons of wine per year or any other alcoholic
12liquor. A class 1 brewer licensee may make sales and deliveries
13to importing distributors and distributors and to retail
14licensees in accordance with the conditions set forth in
15paragraph (18) of subsection (a) of Section 3-12 of this Act.
16If the State Commission provides prior approval, a class 1
17brewer may annually transfer up to 930,000 gallons of beer
18manufactured by that class 1 brewer to the premises of a
19licensed class 1 brewer wholly owned and operated by the same
20licensee.
21    Class 13. A class 2 brewer license, which may only be
22issued to a licensed brewer or licensed non-resident dealer,
23shall allow the manufacture of up to 3,720,000 gallons of beer
24per year provided that the class 2 brewer licensee does not
25manufacture more than a combined 3,720,000 gallons of beer per
26year and is not a member of or affiliated with, directly or

 

 

SB3428- 27 -LRB101 20405 RPS 69955 b

1indirectly, a manufacturer that produces more than 3,720,000
2gallons of beer per year, 100,000 gallons of spirits per year,
3or 25,000 gallons of wine per year or any other alcoholic
4liquor. A class 2 brewer licensee may make sales and deliveries
5to importing distributors and distributors, but shall not make
6sales or deliveries to any other licensee. If the State
7Commission provides prior approval, a class 2 brewer licensee
8may annually transfer up to 3,720,000 gallons of beer
9manufactured by that class 2 brewer licensee to the premises of
10a licensed class 2 brewer wholly owned and operated by the same
11licensee.
12    A class 2 brewer may transfer beer to a brew pub wholly
13owned and operated by the class 2 brewer subject to the
14following limitations and restrictions: (i) the transfer shall
15not annually exceed more than 31,000 gallons; (ii) the annual
16amount transferred shall reduce the brew pub's annual permitted
17production limit; (iii) all beer transferred shall be subject
18to Article VIII of this Act; (iv) a written record shall be
19maintained by the brewer and brew pub specifying the amount,
20date of delivery, and receipt of the product by the brew pub;
21and (v) the brew pub shall be located no farther than 80 miles
22from the class 2 brewer's licensed location.
23    A class 2 brewer shall, prior to transferring beer to a
24brew pub wholly owned by the class 2 brewer, furnish a written
25notice to the State Commission of intent to transfer beer
26setting forth the name and address of the brew pub and shall

 

 

SB3428- 28 -LRB101 20405 RPS 69955 b

1annually submit to the State Commission a verified report
2identifying the total gallons of beer transferred to the brew
3pub wholly owned by the class 2 brewer.
4    (a-1) A manufacturer which is licensed in this State to
5make sales or deliveries of alcoholic liquor to licensed
6distributors or importing distributors and which enlists
7agents, representatives, or individuals acting on its behalf
8who contact licensed retailers on a regular and continual basis
9in this State must register those agents, representatives, or
10persons acting on its behalf with the State Commission.
11    Registration of agents, representatives, or persons acting
12on behalf of a manufacturer is fulfilled by submitting a form
13to the Commission. The form shall be developed by the
14Commission and shall include the name and address of the
15applicant, the name and address of the manufacturer he or she
16represents, the territory or areas assigned to sell to or
17discuss pricing terms of alcoholic liquor, and any other
18questions deemed appropriate and necessary. All statements in
19the forms required to be made by law or by rule shall be deemed
20material, and any person who knowingly misstates any material
21fact under oath in an application is guilty of a Class B
22misdemeanor. Fraud, misrepresentation, false statements,
23misleading statements, evasions, or suppression of material
24facts in the securing of a registration are grounds for
25suspension or revocation of the registration. The State
26Commission shall post a list of registered agents on the

 

 

SB3428- 29 -LRB101 20405 RPS 69955 b

1Commission's website.
2    (b) A distributor's license shall allow (i) the wholesale
3purchase and storage of alcoholic liquors and sale of alcoholic
4liquors to licensees in this State and to persons without the
5State, as may be permitted by law; (ii) the sale of beer,
6cider, or both beer and cider to brewers, class 1 brewers, and
7class 2 brewers that, pursuant to subsection (e) of Section 6-4
8of this Act, sell beer, cider, or both beer and cider to
9non-licensees at their breweries; and (iii) the sale of
10vermouth to class 1 craft distillers and class 2 craft
11distillers that, pursuant to subsection (e) of Section 6-4 of
12this Act, sell spirits, vermouth, or both spirits and vermouth
13to non-licensees at their distilleries. No person licensed as a
14distributor shall be granted a non-resident dealer's license.
15    (c) An importing distributor's license may be issued to and
16held by those only who are duly licensed distributors, upon the
17filing of an application by a duly licensed distributor, with
18the Commission and the Commission shall, without the payment of
19any fee, immediately issue such importing distributor's
20license to the applicant, which shall allow the importation of
21alcoholic liquor by the licensee into this State from any point
22in the United States outside this State, and the purchase of
23alcoholic liquor in barrels, casks or other bulk containers and
24the bottling of such alcoholic liquors before resale thereof,
25but all bottles or containers so filled shall be sealed,
26labeled, stamped and otherwise made to comply with all

 

 

SB3428- 30 -LRB101 20405 RPS 69955 b

1provisions, rules and regulations governing manufacturers in
2the preparation and bottling of alcoholic liquors. The
3importing distributor's license shall permit such licensee to
4purchase alcoholic liquor from Illinois licensed non-resident
5dealers and foreign importers only. No person licensed as an
6importing distributor shall be granted a non-resident dealer's
7license.
8    (d) A retailer's license shall allow the licensee to sell
9and offer for sale at retail, only in the premises specified in
10the license, alcoholic liquor for use or consumption, but not
11for resale in any form. Nothing in Public Act 95-634 shall
12deny, limit, remove, or restrict the ability of a holder of a
13retailer's license to transfer, deliver, or ship alcoholic
14liquor to the purchaser for use or consumption subject to any
15applicable local law or ordinance. Any retail license issued to
16a manufacturer shall only permit the manufacturer to sell beer
17at retail on the premises actually occupied by the
18manufacturer. For the purpose of further describing the type of
19business conducted at a retail licensed premises, a retailer's
20licensee may be designated by the State Commission as (i) an on
21premise consumption retailer, (ii) an off premise sale
22retailer, or (iii) a combined on premise consumption and off
23premise sale retailer.
24    Notwithstanding any other provision of this subsection
25(d), a retail licensee may sell alcoholic liquors to a special
26event retailer licensee for resale to the extent permitted

 

 

SB3428- 31 -LRB101 20405 RPS 69955 b

1under subsection (e).
2    (e) A special event retailer's license (not-for-profit)
3shall permit the licensee to purchase alcoholic liquors from an
4Illinois licensed distributor (unless the licensee purchases
5less than $500 of alcoholic liquors for the special event, in
6which case the licensee may purchase the alcoholic liquors from
7a licensed retailer) and shall allow the licensee to sell and
8offer for sale, at retail, alcoholic liquors for use or
9consumption, but not for resale in any form and only at the
10location and on the specific dates designated for the special
11event in the license. An applicant for a special event retailer
12license must (i) furnish with the application: (A) a resale
13number issued under Section 2c of the Retailers' Occupation Tax
14Act or evidence that the applicant is registered under Section
152a of the Retailers' Occupation Tax Act, (B) a current, valid
16exemption identification number issued under Section 1g of the
17Retailers' Occupation Tax Act, and a certification to the
18Commission that the purchase of alcoholic liquors will be a
19tax-exempt purchase, or (C) a statement that the applicant is
20not registered under Section 2a of the Retailers' Occupation
21Tax Act, does not hold a resale number under Section 2c of the
22Retailers' Occupation Tax Act, and does not hold an exemption
23number under Section 1g of the Retailers' Occupation Tax Act,
24in which event the Commission shall set forth on the special
25event retailer's license a statement to that effect; (ii)
26submit with the application proof satisfactory to the State

 

 

SB3428- 32 -LRB101 20405 RPS 69955 b

1Commission that the applicant will provide dram shop liability
2insurance in the maximum limits; and (iii) show proof
3satisfactory to the State Commission that the applicant has
4obtained local authority approval.
5    Nothing in this Act prohibits an Illinois licensed
6distributor from offering credit or a refund for unused,
7salable alcoholic liquors to a holder of a special event
8retailer's license or the special event retailer's licensee
9from accepting the credit or refund of alcoholic liquors at the
10conclusion of the event specified in the license.
11    (f) A railroad license shall permit the licensee to import
12alcoholic liquors into this State from any point in the United
13States outside this State and to store such alcoholic liquors
14in this State; to make wholesale purchases of alcoholic liquors
15directly from manufacturers, foreign importers, distributors
16and importing distributors from within or outside this State;
17and to store such alcoholic liquors in this State; provided
18that the above powers may be exercised only in connection with
19the importation, purchase or storage of alcoholic liquors to be
20sold or dispensed on a club, buffet, lounge or dining car
21operated on an electric, gas or steam railway in this State;
22and provided further, that railroad licensees exercising the
23above powers shall be subject to all provisions of Article VIII
24of this Act as applied to importing distributors. A railroad
25license shall also permit the licensee to sell or dispense
26alcoholic liquors on any club, buffet, lounge or dining car

 

 

SB3428- 33 -LRB101 20405 RPS 69955 b

1operated on an electric, gas or steam railway regularly
2operated by a common carrier in this State, but shall not
3permit the sale for resale of any alcoholic liquors to any
4licensee within this State. A license shall be obtained for
5each car in which such sales are made.
6    (g) A boat license shall allow the sale of alcoholic liquor
7in individual drinks, on any passenger boat regularly operated
8as a common carrier on navigable waters in this State or on any
9riverboat operated under the Illinois Gambling Act, which boat
10or riverboat maintains a public dining room or restaurant
11thereon.
12    (h) A non-beverage user's license shall allow the licensee
13to purchase alcoholic liquor from a licensed manufacturer or
14importing distributor, without the imposition of any tax upon
15the business of such licensed manufacturer or importing
16distributor as to such alcoholic liquor to be used by such
17licensee solely for the non-beverage purposes set forth in
18subsection (a) of Section 8-1 of this Act, and such licenses
19shall be divided and classified and shall permit the purchase,
20possession and use of limited and stated quantities of
21alcoholic liquor as follows:
22Class 1, not to exceed ......................... 500 gallons
23Class 2, not to exceed ....................... 1,000 gallons
24Class 3, not to exceed ....................... 5,000 gallons
25Class 4, not to exceed ...................... 10,000 gallons
26Class 5, not to exceed ....................... 50,000 gallons

 

 

SB3428- 34 -LRB101 20405 RPS 69955 b

1    (i) A wine-maker's premises license shall allow a licensee
2that concurrently holds a first-class wine-maker's license to
3sell and offer for sale at retail in the premises specified in
4such license not more than 50,000 gallons of the first-class
5wine-maker's wine that is made at the first-class wine-maker's
6licensed premises per year for use or consumption, but not for
7resale in any form. A wine-maker's premises license shall allow
8a licensee who concurrently holds a second-class wine-maker's
9license to sell and offer for sale at retail in the premises
10specified in such license up to 100,000 gallons of the
11second-class wine-maker's wine that is made at the second-class
12wine-maker's licensed premises per year for use or consumption
13but not for resale in any form. A wine-maker's premises license
14shall allow a licensee that concurrently holds a first-class
15wine-maker's license or a second-class wine-maker's license to
16sell and offer for sale at retail at the premises specified in
17the wine-maker's premises license, for use or consumption but
18not for resale in any form, any beer, wine, and spirits
19purchased from a licensed distributor. Upon approval from the
20State Commission, a wine-maker's premises license shall allow
21the licensee to sell and offer for sale at (i) the wine-maker's
22licensed premises and (ii) at up to 2 additional locations for
23use and consumption and not for resale. Each location shall
24require additional licensing per location as specified in
25Section 5-3 of this Act. A wine-maker's premises licensee shall
26secure liquor liability insurance coverage in an amount at

 

 

SB3428- 35 -LRB101 20405 RPS 69955 b

1least equal to the maximum liability amounts set forth in
2subsection (a) of Section 6-21 of this Act.
3    (j) An airplane license shall permit the licensee to import
4alcoholic liquors into this State from any point in the United
5States outside this State and to store such alcoholic liquors
6in this State; to make wholesale purchases of alcoholic liquors
7directly from manufacturers, foreign importers, distributors
8and importing distributors from within or outside this State;
9and to store such alcoholic liquors in this State; provided
10that the above powers may be exercised only in connection with
11the importation, purchase or storage of alcoholic liquors to be
12sold or dispensed on an airplane; and provided further, that
13airplane licensees exercising the above powers shall be subject
14to all provisions of Article VIII of this Act as applied to
15importing distributors. An airplane licensee shall also permit
16the sale or dispensing of alcoholic liquors on any passenger
17airplane regularly operated by a common carrier in this State,
18but shall not permit the sale for resale of any alcoholic
19liquors to any licensee within this State. A single airplane
20license shall be required of an airline company if liquor
21service is provided on board aircraft in this State. The annual
22fee for such license shall be as determined in Section 5-3.
23    (k) A foreign importer's license shall permit such licensee
24to purchase alcoholic liquor from Illinois licensed
25non-resident dealers only, and to import alcoholic liquor other
26than in bulk from any point outside the United States and to

 

 

SB3428- 36 -LRB101 20405 RPS 69955 b

1sell such alcoholic liquor to Illinois licensed importing
2distributors and to no one else in Illinois; provided that (i)
3the foreign importer registers with the State Commission every
4brand of alcoholic liquor that it proposes to sell to Illinois
5licensees during the license period, (ii) the foreign importer
6complies with all of the provisions of Section 6-9 of this Act
7with respect to registration of such Illinois licensees as may
8be granted the right to sell such brands at wholesale, and
9(iii) the foreign importer complies with the provisions of
10Sections 6-5 and 6-6 of this Act to the same extent that these
11provisions apply to manufacturers.
12    (l) (i) A broker's license shall be required of all persons
13who solicit orders for, offer to sell or offer to supply
14alcoholic liquor to retailers in the State of Illinois, or who
15offer to retailers to ship or cause to be shipped or to make
16contact with distillers, craft distillers, rectifiers, brewers
17or manufacturers or any other party within or without the State
18of Illinois in order that alcoholic liquors be shipped to a
19distributor, importing distributor or foreign importer,
20whether such solicitation or offer is consummated within or
21without the State of Illinois.
22    No holder of a retailer's license issued by the Illinois
23Liquor Control Commission shall purchase or receive any
24alcoholic liquor, the order for which was solicited or offered
25for sale to such retailer by a broker unless the broker is the
26holder of a valid broker's license.

 

 

SB3428- 37 -LRB101 20405 RPS 69955 b

1    The broker shall, upon the acceptance by a retailer of the
2broker's solicitation of an order or offer to sell or supply or
3deliver or have delivered alcoholic liquors, promptly forward
4to the Illinois Liquor Control Commission a notification of
5said transaction in such form as the Commission may by
6regulations prescribe.
7    (ii) A broker's license shall be required of a person
8within this State, other than a retail licensee, who, for a fee
9or commission, promotes, solicits, or accepts orders for
10alcoholic liquor, for use or consumption and not for resale, to
11be shipped from this State and delivered to residents outside
12of this State by an express company, common carrier, or
13contract carrier. This Section does not apply to any person who
14promotes, solicits, or accepts orders for wine as specifically
15authorized in Section 6-29 of this Act.
16    A broker's license under this subsection (l) shall not
17entitle the holder to buy or sell any alcoholic liquors for his
18own account or to take or deliver title to such alcoholic
19liquors.
20    This subsection (l) shall not apply to distributors,
21employees of distributors, or employees of a manufacturer who
22has registered the trademark, brand or name of the alcoholic
23liquor pursuant to Section 6-9 of this Act, and who regularly
24sells such alcoholic liquor in the State of Illinois only to
25its registrants thereunder.
26    Any agent, representative, or person subject to

 

 

SB3428- 38 -LRB101 20405 RPS 69955 b

1registration pursuant to subsection (a-1) of this Section shall
2not be eligible to receive a broker's license.
3    (m) A non-resident dealer's license shall permit such
4licensee to ship into and warehouse alcoholic liquor into this
5State from any point outside of this State, and to sell such
6alcoholic liquor to Illinois licensed foreign importers and
7importing distributors and to no one else in this State;
8provided that (i) said non-resident dealer shall register with
9the Illinois Liquor Control Commission each and every brand of
10alcoholic liquor which it proposes to sell to Illinois
11licensees during the license period, (ii) it shall comply with
12all of the provisions of Section 6-9 hereof with respect to
13registration of such Illinois licensees as may be granted the
14right to sell such brands at wholesale by duly filing such
15registration statement, thereby authorizing the non-resident
16dealer to proceed to sell such brands at wholesale, and (iii)
17the non-resident dealer shall comply with the provisions of
18Sections 6-5 and 6-6 of this Act to the same extent that these
19provisions apply to manufacturers. No person licensed as a
20non-resident dealer shall be granted a distributor's or
21importing distributor's license.
22    (n) A brew pub license shall allow the licensee to only (i)
23manufacture up to 155,000 gallons of beer per year only on the
24premises specified in the license, (ii) make sales of the beer
25manufactured on the premises or, with the approval of the
26Commission, beer manufactured on another brew pub licensed

 

 

SB3428- 39 -LRB101 20405 RPS 69955 b

1premises that is wholly owned and operated by the same licensee
2to importing distributors, distributors, and to non-licensees
3for use and consumption, (iii) store the beer upon the
4premises, (iv) sell and offer for sale at retail from the
5licensed premises for off-premises consumption no more than
6155,000 gallons per year so long as such sales are only made
7in-person, (v) sell and offer for sale at retail for use and
8consumption on the premises specified in the license any form
9of alcoholic liquor purchased from a licensed distributor or
10importing distributor, (vi) with the prior approval of the
11Commission, annually transfer no more than 155,000 gallons of
12beer manufactured on the premises to a licensed brew pub wholly
13owned and operated by the same licensee, and (vii)
14notwithstanding item (i) of this subsection, brew pubs wholly
15owned and operated by the same licensee may combine each
16location's production limit of 155,000 gallons of beer per year
17and allocate the aggregate total between the wholly owned,
18operated, and licensed locations.
19    A brew pub licensee shall not under any circumstance sell
20or offer for sale beer manufactured by the brew pub licensee to
21retail licensees.
22    A person who holds a class 2 brewer license may
23simultaneously hold a brew pub license if the class 2 brewer
24(i) does not, under any circumstance, sell or offer for sale
25beer manufactured by the class 2 brewer to retail licensees;
26(ii) does not hold more than 3 brew pub licenses in this State;

 

 

SB3428- 40 -LRB101 20405 RPS 69955 b

1(iii) does not manufacture more than a combined 3,720,000
2gallons of beer per year, including the beer manufactured at
3the brew pub; and (iv) is not a member of or affiliated with,
4directly or indirectly, a manufacturer that produces more than
53,720,000 gallons of beer per year or any other alcoholic
6liquor.
7    Notwithstanding any other provision of this Act, a licensed
8brewer, class 2 brewer, or non-resident dealer who before July
91, 2015 manufactured less than 3,720,000 gallons of beer per
10year and held a brew pub license on or before July 1, 2015 may
11(i) continue to qualify for and hold that brew pub license for
12the licensed premises and (ii) manufacture more than 3,720,000
13gallons of beer per year and continue to qualify for and hold
14that brew pub license if that brewer, class 2 brewer, or
15non-resident dealer does not simultaneously hold a class 1
16brewer license and is not a member of or affiliated with,
17directly or indirectly, a manufacturer that produces more than
183,720,000 gallons of beer per year, 100,000 gallons of spirits
19per year, or 25,000 gallons of wine per year or that produces
20any other alcoholic liquor.
21    (o) A caterer retailer license shall allow the holder to
22serve alcoholic liquors as an incidental part of a food service
23that serves prepared meals which excludes the serving of snacks
24as the primary meal, either on or off-site whether licensed or
25unlicensed. A caterer retailer license shall allow the holder,
26a distributor, or an importing distributor to transfer any

 

 

SB3428- 41 -LRB101 20405 RPS 69955 b

1inventory to and from the holder's retail premises and shall
2allow the holder to purchase alcoholic liquor from a
3distributor or importing distributor to be delivered directly
4to an off-site event.
5    Nothing in this Act prohibits a distributor or importing
6distributor from offering credit or a refund for unused,
7salable beer to a holder of a caterer retailer license or a
8caterer retailer licensee from accepting a credit or refund for
9unused, salable beer, in the event an act of God is the sole
10reason an off-site event is cancelled and if: (i) the holder of
11a caterer retailer license has not transferred alcoholic liquor
12from its caterer retailer premises to an off-site location;
13(ii) the distributor or importing distributor offers the credit
14or refund for the unused, salable beer that it delivered to the
15off-site premises and not for any unused, salable beer that the
16distributor or importing distributor delivered to the caterer
17retailer's premises; and (iii) the unused, salable beer would
18likely spoil if transferred to the caterer retailer's premises.
19A caterer retailer license shall allow the holder to transfer
20any inventory from any off-site location to its caterer
21retailer premises at the conclusion of an off-site event or
22engage a distributor or importing distributor to transfer any
23inventory from any off-site location to its caterer retailer
24premises at the conclusion of an off-site event, provided that
25the distributor or importing distributor issues bona fide
26charges to the caterer retailer licensee for fuel, labor, and

 

 

SB3428- 42 -LRB101 20405 RPS 69955 b

1delivery and the distributor or importing distributor collects
2payment from the caterer retailer licensee prior to the
3distributor or importing distributor transferring inventory to
4the caterer retailer premises.
5    For purposes of this subsection (o), an "act of God" means
6an unforeseeable event, such as a rain or snow storm, hail, a
7flood, or a similar event, that is the sole cause of the
8cancellation of an off-site, outdoor event.
9    (p) An auction liquor license shall allow the licensee to
10sell and offer for sale at auction wine and spirits for use or
11consumption, or for resale by an Illinois liquor licensee in
12accordance with provisions of this Act. An auction liquor
13license will be issued to a person and it will permit the
14auction liquor licensee to hold the auction anywhere in the
15State. An auction liquor license must be obtained for each
16auction at least 14 days in advance of the auction date.
17    (q) A special use permit license shall allow an Illinois
18licensed retailer to transfer a portion of its alcoholic liquor
19inventory from its retail licensed premises to the premises
20specified in the license hereby created; to purchase alcoholic
21liquor from a distributor or importing distributor to be
22delivered directly to the location specified in the license
23hereby created; and to sell or offer for sale at retail, only
24in the premises specified in the license hereby created, the
25transferred or delivered alcoholic liquor for use or
26consumption, but not for resale in any form. A special use

 

 

SB3428- 43 -LRB101 20405 RPS 69955 b

1permit license may be granted for the following time periods:
2one day or less; 2 or more days to a maximum of 15 days per
3location in any 12-month period. An applicant for the special
4use permit license must also submit with the application proof
5satisfactory to the State Commission that the applicant will
6provide dram shop liability insurance to the maximum limits and
7have local authority approval.
8    A special use permit license shall allow the holder to
9transfer any inventory from the holder's special use premises
10to its retail premises at the conclusion of the special use
11event or engage a distributor or importing distributor to
12transfer any inventory from the holder's special use premises
13to its retail premises at the conclusion of an off-site event,
14provided that the distributor or importing distributor issues
15bona fide charges to the special use permit licensee for fuel,
16labor, and delivery and the distributor or importing
17distributor collects payment from the retail licensee prior to
18the distributor or importing distributor transferring
19inventory to the retail premises.
20    Nothing in this Act prohibits a distributor or importing
21distributor from offering credit or a refund for unused,
22salable beer to a special use permit licensee or a special use
23permit licensee from accepting a credit or refund for unused,
24salable beer at the conclusion of the event specified in the
25license if: (i) the holder of the special use permit license
26has not transferred alcoholic liquor from its retail licensed

 

 

SB3428- 44 -LRB101 20405 RPS 69955 b

1premises to the premises specified in the special use permit
2license; (ii) the distributor or importing distributor offers
3the credit or refund for the unused, salable beer that it
4delivered to the premises specified in the special use permit
5license and not for any unused, salable beer that the
6distributor or importing distributor delivered to the
7retailer's premises; and (iii) the unused, salable beer would
8likely spoil if transferred to the retailer premises.
9    (r) A winery shipper's license shall allow a person with a
10first-class or second-class wine manufacturer's license, a
11first-class or second-class wine-maker's license, or a limited
12wine manufacturer's license or who is licensed to make wine
13under the laws of another state to ship wine made by that
14licensee directly to a resident of this State who is 21 years
15of age or older for that resident's personal use and not for
16resale. Prior to receiving a winery shipper's license, an
17applicant for the license must provide the Commission with a
18true copy of its current license in any state in which it is
19licensed as a manufacturer of wine. An applicant for a winery
20shipper's license must also complete an application form that
21provides any other information the Commission deems necessary.
22The application form shall include all addresses from which the
23applicant for a winery shipper's license intends to ship wine,
24including the name and address of any third party, except for a
25common carrier, authorized to ship wine on behalf of the
26manufacturer. The application form shall include an

 

 

SB3428- 45 -LRB101 20405 RPS 69955 b

1acknowledgement consenting to the jurisdiction of the
2Commission, the Illinois Department of Revenue, and the courts
3of this State concerning the enforcement of this Act and any
4related laws, rules, and regulations, including authorizing
5the Department of Revenue and the Commission to conduct audits
6for the purpose of ensuring compliance with Public Act 95-634,
7and an acknowledgement that the wine manufacturer is in
8compliance with Section 6-2 of this Act. Any third party,
9except for a common carrier, authorized to ship wine on behalf
10of a first-class or second-class wine manufacturer's licensee,
11a first-class or second-class wine-maker's licensee, a limited
12wine manufacturer's licensee, or a person who is licensed to
13make wine under the laws of another state shall also be
14disclosed by the winery shipper's licensee, and a copy of the
15written appointment of the third-party wine provider, except
16for a common carrier, to the wine manufacturer shall be filed
17with the State Commission as a supplement to the winery
18shipper's license application or any renewal thereof. The
19winery shipper's license holder shall affirm under penalty of
20perjury, as part of the winery shipper's license application or
21renewal, that he or she only ships wine, either directly or
22indirectly through a third-party provider, from the licensee's
23own production.
24    Except for a common carrier, a third-party provider
25shipping wine on behalf of a winery shipper's license holder is
26the agent of the winery shipper's license holder and, as such,

 

 

SB3428- 46 -LRB101 20405 RPS 69955 b

1a winery shipper's license holder is responsible for the acts
2and omissions of the third-party provider acting on behalf of
3the license holder. A third-party provider, except for a common
4carrier, that engages in shipping wine into Illinois on behalf
5of a winery shipper's license holder shall consent to the
6jurisdiction of the State Commission and the State. Any
7third-party, except for a common carrier, holding such an
8appointment shall, by February 1 of each calendar year and upon
9request by the State Commission or the Department of Revenue,
10file with the State Commission a statement detailing each
11shipment made to an Illinois resident. The statement shall
12include the name and address of the third-party provider filing
13the statement, the time period covered by the statement, and
14the following information:
15        (1) the name, address, and license number of the winery
16    shipper on whose behalf the shipment was made;
17        (2) the quantity of the products delivered; and
18        (3) the date and address of the shipment.
19If the Department of Revenue or the State Commission requests a
20statement under this paragraph, the third-party provider must
21provide that statement no later than 30 days after the request
22is made. Any books, records, supporting papers, and documents
23containing information and data relating to a statement under
24this paragraph shall be kept and preserved for a period of 3
25years, unless their destruction sooner is authorized, in
26writing, by the Director of Revenue, and shall be open and

 

 

SB3428- 47 -LRB101 20405 RPS 69955 b

1available to inspection by the Director of Revenue or the State
2Commission or any duly authorized officer, agent, or employee
3of the State Commission or the Department of Revenue, at all
4times during business hours of the day. Any person who violates
5any provision of this paragraph or any rule of the State
6Commission for the administration and enforcement of the
7provisions of this paragraph is guilty of a Class C
8misdemeanor. In case of a continuing violation, each day's
9continuance thereof shall be a separate and distinct offense.
10    The State Commission shall adopt rules as soon as
11practicable to implement the requirements of Public Act 99-904
12and shall adopt rules prohibiting any such third-party
13appointment of a third-party provider, except for a common
14carrier, that has been deemed by the State Commission to have
15violated the provisions of this Act with regard to any winery
16shipper licensee.
17    A winery shipper licensee must pay to the Department of
18Revenue the State liquor gallonage tax under Section 8-1 for
19all wine that is sold by the licensee and shipped to a person
20in this State. For the purposes of Section 8-1, a winery
21shipper licensee shall be taxed in the same manner as a
22manufacturer of wine. A licensee who is not otherwise required
23to register under the Retailers' Occupation Tax Act must
24register under the Use Tax Act to collect and remit use tax to
25the Department of Revenue for all gallons of wine that are sold
26by the licensee and shipped to persons in this State. If a

 

 

SB3428- 48 -LRB101 20405 RPS 69955 b

1licensee fails to remit the tax imposed under this Act in
2accordance with the provisions of Article VIII of this Act, the
3winery shipper's license shall be revoked in accordance with
4the provisions of Article VII of this Act. If a licensee fails
5to properly register and remit tax under the Use Tax Act or the
6Retailers' Occupation Tax Act for all wine that is sold by the
7winery shipper and shipped to persons in this State, the winery
8shipper's license shall be revoked in accordance with the
9provisions of Article VII of this Act.
10    A winery shipper licensee must collect, maintain, and
11submit to the Commission on a semi-annual basis the total
12number of cases per resident of wine shipped to residents of
13this State. A winery shipper licensed under this subsection (r)
14must comply with the requirements of Section 6-29 of this Act.
15    Pursuant to paragraph (5.1) or (5.3) of subsection (a) of
16Section 3-12, the State Commission may receive, respond to, and
17investigate any complaint and impose any of the remedies
18specified in paragraph (1) of subsection (a) of Section 3-12.
19    As used in this subsection, "third-party provider" means
20any entity that provides fulfillment house services, including
21warehousing, packaging, distribution, order processing, or
22shipment of wine, but not the sale of wine, on behalf of a
23licensed winery shipper.
24    (s) A craft distiller tasting permit license shall allow an
25Illinois licensed class 1 craft distiller or class 2 craft
26distiller to transfer a portion of its alcoholic liquor

 

 

SB3428- 49 -LRB101 20405 RPS 69955 b

1inventory from its class 1 craft distiller or class 2 craft
2distiller licensed premises to the premises specified in the
3license hereby created and to conduct a sampling, only in the
4premises specified in the license hereby created, of the
5transferred alcoholic liquor in accordance with subsection (c)
6of Section 6-31 of this Act. The transferred alcoholic liquor
7may not be sold or resold in any form. An applicant for the
8craft distiller tasting permit license must also submit with
9the application proof satisfactory to the State Commission that
10the applicant will provide dram shop liability insurance to the
11maximum limits and have local authority approval.
12    (t) A brewer warehouse permit may be issued to the holder
13of a class 1 brewer license or a class 2 brewer license. If the
14holder of the permit is a class 1 brewer licensee, the brewer
15warehouse permit shall allow the holder to store or warehouse
16up to 930,000 gallons of tax-determined beer manufactured by
17the holder of the permit at the premises specified on the
18permit. If the holder of the permit is a class 2 brewer
19licensee, the brewer warehouse permit shall allow the holder to
20store or warehouse up to 3,720,000 gallons of tax-determined
21beer manufactured by the holder of the permit at the premises
22specified on the permit. Sales to non-licensees are prohibited
23at the premises specified in the brewer warehouse permit.
24    (u) A distilling pub license shall allow the licensee to
25only (i) manufacture up to 5,000 gallons of spirits per year
26only on the premises specified in the license, (ii) make sales

 

 

SB3428- 50 -LRB101 20405 RPS 69955 b

1of the spirits manufactured on the premises or, with the
2approval of the State Commission, spirits manufactured on
3another distilling pub licensed premises that is wholly owned
4and operated by the same licensee to importing distributors and
5distributors and to non-licensees for use and consumption,
6(iii) store the spirits upon the premises, (iv) sell and offer
7for sale at retail from the licensed premises for off-premises
8consumption no more than 5,000 gallons per year so long as such
9sales are only made in-person, (v) sell and offer for sale at
10retail for use and consumption on the premises specified in the
11license any form of alcoholic liquor purchased from a licensed
12distributor or importing distributor, and (vi) with the prior
13approval of the State Commission, annually transfer no more
14than 5,000 gallons of spirits manufactured on the premises to a
15licensed distilling pub wholly owned and operated by the same
16licensee.
17    A distilling pub licensee shall not under any circumstance
18sell or offer for sale spirits manufactured by the distilling
19pub licensee to retail licensees.
20    A person who holds a class 2 craft distiller license may
21simultaneously hold a distilling pub license if the class 2
22craft distiller (i) does not, under any circumstance, sell or
23offer for sale spirits manufactured by the class 2 craft
24distiller to retail licensees; (ii) does not hold more than 3
25distilling pub licenses in this State; (iii) does not
26manufacture more than a combined 100,000 gallons of spirits per

 

 

SB3428- 51 -LRB101 20405 RPS 69955 b

1year, including the spirits manufactured at the distilling pub;
2and (iv) is not a member of or affiliated with, directly or
3indirectly, a manufacturer that produces more than 100,000
4gallons of spirits per year, 3,720,000 gallons of beer per
5year, or 25,000 gallons of wine per year or any other alcoholic
6liquor.
7    (v) A craft distiller warehouse permit may be issued to the
8holder of a class 1 craft distiller or class 2 craft distiller
9license. The craft distiller warehouse permit shall allow the
10holder to store or warehouse up to 500,000 gallons of spirits
11manufactured by the holder of the permit at the premises
12specified on the permit. Sales to non-licensees are prohibited
13at the premises specified in the craft distiller warehouse
14permit.
15(Source: P.A. 100-17, eff. 6-30-17; 100-201, eff. 8-18-17;
16100-816, eff. 8-13-18; 100-885, eff. 8-14-18; 100-1050, eff.
178-23-18; 101-16, eff. 6-14-19; 101-31, eff. 6-28-19; 101-81,
18eff. 7-12-19; 101-482, eff. 8-23-19; 101-517, eff. 8-23-19;
19101-615, eff. 12-20-19.)
 
20    Section 99. Effective date. This Act takes effect upon
21becoming law.