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        PRIOR PRINTER'S NOS. 1693, 1740               PRINTER'S NO. 1781

THE GENERAL ASSEMBLY OF PENNSYLVANIA


SENATE BILL

No. 1158 Session of 2004


        INTRODUCED BY CONTI, LOGAN, RAFFERTY, ERICKSON, EARLL, SCHWARTZ,
           TARTAGLIONE, M. WHITE, COSTA, LEMMOND AND FERLO,
           JUNE 14, 2004

        AS AMENDED ON THIRD CONSIDERATION, JUNE 30, 2004

                                     AN ACT

     1  Amending the act of April 12, 1951 (P.L.90, No.21), entitled, as
     2     reenacted, "An act relating to alcoholic liquors, alcohol and
     3     malt and brewed beverages; amending, revising, consolidating
     4     and changing the laws relating thereto; regulating and
     5     restricting the manufacture, purchase, sale, possession,
     6     consumption, importation, transportation, furnishing, holding
     7     in bond, holding in storage, traffic in and use of alcoholic
     8     liquors, alcohol and malt and brewed beverages and the
     9     persons engaged or employed therein; defining the powers and
    10     duties of the Pennsylvania Liquor Control Board; providing
    11     for the establishment and operation of State liquor stores,
    12     for the payment of certain license fees to the respective
    13     municipalities and townships, for the abatement of certain
    14     nuisances and, in certain cases, for search and seizure
    15     without warrant; prescribing penalties and forfeitures;
    16     providing for local option, and repealing existing laws,"
    17     further providing for definitions, for general powers of the
    18     Pennsylvania Liquor Control Board, for when sales may be made
    19     at Pennsylvania Liquor Stores, for sales by Pennsylvania
    20     Liquor Stores, for malt and brewed beverages manufacturers',
    21     distributors' and importing distributors' licenses, for
    22     renewal of licenses, for temporary provisions for licensees
    23     in armed service and for limited wineries.

    24     The General Assembly of the Commonwealth of Pennsylvania
    25  hereby enacts as follows:
    26     Section 1.  Section 102 of the act of April 12, 1951 (P.L.90,
    27  No.21), known as the Liquor Code, reenacted and amended June 29,


     1  1987 (P.L.32, No.14), is amended by adding a definition to read:
     2     Section 102.  Definitions.--The following words or phrases,
     3  unless the context clearly indicates otherwise, shall have the
     4  meanings ascribed to them in this section:
     5     * * *
     6     "Holiday" shall mean the first day of January, commonly known
     7  as New Year's Day; the third Monday of January, known as Dr.
     8  Martin Luther King, Jr., Day; the third Monday in February,
     9  known as Presidents Day; the last Monday in May, known as
    10  Memorial Day; the fourth day of July, known as Independence Day;
    11  the first Monday of September, known as Labor Day; the fourth
    12  Thursday in November, known as Thanksgiving Day; and the twenty-
    13  fifth day of December, known as Christmas Day.
    14     * * *
    15     Section 2.  Section 207(a) of the act, amended December 30,
    16  2003 (P.L.423, No.59), is amended to read:
    17     Section 207.  General Powers of Board.--Under this act, the
    18  board shall have the power and its duty shall be:
    19     (a)  To buy, import or have in its possession for sale and
    20  sell liquor, alcohol, corkscrews, wine and liquor accessories,
    21  trade publications, gift cards, gift certificates and wine
    22  glasses in the manner set forth in this act: Provided, however,
    23  That all purchases shall be made subject to the approval of the
    24  State Treasurer, or his designated deputy. The board shall buy
    25  liquor and alcohol at the lowest price and in the greatest
    26  variety reasonably obtainable.
    27     * * *
    28     Section 3.  Section 304 of the act, amended December 9, 2002
    29  (P.L.1653, No.212), is amended to read:
    30     Section 304.  When Sales May Be Made at Pennsylvania Liquor
    20040S1158B1781                  - 2 -     

     1  Stores.--(a)  Except as provided for in subsection (b), every
     2  Pennsylvania Liquor Store shall be open for business week days,
     3  except [legal holidays or any day on which a general, municipal,
     4  special or primary election is being held, during such hours as
     5  the board, in its discretion, shall determine: Provided, That
     6  the Pennsylvania Liquor Stores in the case of a special election
     7  for members of the General Assembly or members of the Congress
     8  of the United States, when such special election is held on
     9  other than a primary, municipal or general election day, shall
    10  be open in those Legislative or Congressional Districts as
    11  though the day were not a special election day.] holidays as
    12  that term is defined in section 102. The board may, with the
    13  approval of the Governor, temporarily close any store in any
    14  municipality.
    15     (b)  Certain Pennsylvania Liquor Stores operated by the board
    16  [shall] may be open for Sunday retail sales [between the hours
    17  of noon and five o'clock postmeridian] during such hours as the
    18  board, in its discretion, shall determine, except that no Sunday
    19  sales shall occur on Easter Sunday or Christmas [day. For a two-
    20  year time period following the effective date of this
    21  subsection, the] Day. The board shall open up to [ten] fifty per
    22  centum of the total number of Pennsylvania Liquor Stores at its
    23  discretion for Sunday sales as provided for in this subsection.
    24  [At the expiration of the two-year time period, the board shall
    25  conduct a review and determine whether the stores shall be
    26  closed or whether additional stores shall be opened for these
    27  Sunday sales.] The board shall submit yearly reports to the
    28  Appropriations and the Law and Justice Committees of the Senate
    29  and the Appropriations and the Liquor Control Committees of the
    30  House of Representatives summarizing the total dollar value of
    20040S1158B1781                  - 3 -     

     1  sales under this section.
     2     Section 4.  Section 305(h) of the act, amended July 17, 2003
     3  (P.L.63, No.15), is amended and the section is amended by adding
     4  a subsection to read:
     5     Section 305.  Sales by Pennsylvania Liquor Stores.--* * *
     6     * * *
     7     (h)  Every Pennsylvania Liquor Store shall sell gift
     8  certificates and gift cards which may be redeemed for [liquor]
     9  any product sold by the board. In addition, the board may sell
    10  corkscrews, wine and liquor accessories, trade publications and
    11  wine sleeves at Pennsylvania Liquor Stores.
    12     (i)  Notwithstanding any other provision of law to the
    13  contrary, the board may sell wine in containers having a
    14  capacity of six liters or less.
    15     Section 5.  Section 431(a.1), (a.2), (b) and (d)(2) of the
    16  act, amended or added December 20, 1996 (P.L.1513, No.196), June
    17  18, 1998 (P.L.664, No.86) and December 9, 2002 (P.L.1653,
    18  No.212), are amended to read:
    19     Section 431.  Malt and Brewed Beverages Manufacturers',
    20  Distributors' and Importing Distributors' Licenses.--* * *
    21     (a.1)  Any out of State manufacturer whose products are sold
    22  and delivered within this Commonwealth and whose production
    23  exceeds 15,000 barrels per year shall be authorized: to rent,
    24  lease or otherwise acquire space from an importing distributor
    25  or bailee for hire authorized by this act at no more than two
    26  locations per manufacturer for use of a segregated portion of a
    27  warehouse or other storage facility owned or operated by the
    28  importing distributor or bailee for hire at which the out of
    29  State manufacturer may store, repackage and sell malt or brewed
    30  beverages to any importing distributor to whom the out of State
    20040S1158B1781                  - 4 -     

     1  manufacturer has granted distribution rights pursuant to
     2  subsection (b) or to any purchaser outside this Commonwealth for
     3  delivery outside this Commonwealth; or to ship to its storage
     4  facility outside this Commonwealth. Such manufacturer may
     5  compensate the importing distributor or bailee for hire for any
     6  related storage, repackaging or delivery services. The out of
     7  State manufacturer must file with the Liquor Control Board the
     8  rate of compensation to be paid. A separate written application
     9  must be filed to acquire storage licenses, and the board may
    10  establish the information that must be provided on the
    11  application. The initial filing must be made prior to any
    12  payments being made, and any subsequent changes in the rate of
    13  compensation must be filed within thirty days of any such
    14  change. Nothing in this act authorizing storage facilities for
    15  out of State manufacturers is intended to make any change in the
    16  manner malt or brewed beverages are distributed through the
    17  three-tier system.
    18     (a.2)  The board shall issue to a holder of a manufacturer's
    19  license whose production exceeds 15,000 barrels per year no more
    20  than two storage licenses per manufacturer to cover storage
    21  facilities separate from the location of the manufacturing
    22  facility. A manufacturer may use its storage facilities to
    23  receive, store, repackage, sell and distribute malt or brewed
    24  beverages in the same manner as it can at its place of
    25  manufacture or it may rent, lease or otherwise acquire space
    26  from an importing distributor or bailee for hire authorized by
    27  this act in the same manner as an out of State manufacturer as
    28  set forth in subsection (a.1). A separate written application
    29  must be filed to acquire storage licenses, and the board is
    30  empowered to establish what information must be provided on that
    20040S1158B1781                  - 5 -     

     1  application. Nothing in this act authorizing off-site storage
     2  facilities for manufacturers is intended to make any change in
     3  the manner malt or brewed beverages are distributed through the
     4  three-tier system.
     5     (b)  The board shall issue to any reputable person who
     6  applies therefor, and pays the license fee hereinafter
     7  prescribed, a distributor's or importing distributor's license
     8  for the place which such person desires to maintain for the sale
     9  of malt or brewed beverages, not for consumption on the premises
    10  where sold, and in quantities of not less than a case or
    11  original containers containing one hundred twenty-eight ounces
    12  or more which may be sold separately as prepared for the market
    13  by the manufacturer at the place of manufacture. The board shall
    14  have the discretion to refuse a license to any person or to any
    15  corporation, partnership or association if such person, or any
    16  officer or director of such corporation, or any member or
    17  partner of such partnership or association shall have been
    18  convicted or found guilty of a felony within a period of five
    19  years immediately preceding the date of application for the said
    20  license: And provided further, That, in the case of any new
    21  license or the transfer of any license to a new location, the
    22  board may, in its discretion, grant or refuse such new license
    23  or transfer if such place proposed to be licensed is within
    24  three hundred feet of any church, hospital, charitable
    25  institution, school or public playground, or if such new license
    26  or transfer is applied for a place which is within two hundred
    27  feet of any other premises which is licensed by the board: And
    28  provided further, That the board shall refuse any application
    29  for a new license or the transfer of any license to a new
    30  location if, in the board's opinion, such new license or
    20040S1158B1781                  - 6 -     

     1  transfer would be detrimental to the welfare, health, peace and
     2  morals of the inhabitants of the neighborhood within a radius of
     3  five hundred feet of the place proposed to be licensed. The
     4  board shall refuse any application for a new license or the
     5  transfer of any license to a location where the sale of liquid
     6  fuels or oil is conducted. The board may enter into an agreement
     7  with the applicant concerning additional restrictions on the
     8  license in question. If the board and the applicant enter into
     9  such an agreement, such agreement shall be binding on the
    10  applicant. Failure by the applicant to adhere to the agreement
    11  will be sufficient cause to form the basis for a citation under
    12  section 471 and for the nonrenewal of the license under section
    13  470. If the board enters into an agreement with an applicant
    14  concerning additional restrictions, those restrictions shall be
    15  binding on subsequent holders of the license until the license
    16  is transferred to a new location or until the board enters into
    17  a subsequent agreement removing those restrictions. If the
    18  application in question involves a location previously licensed
    19  by the board, then any restrictions imposed by the board on the
    20  previous license at that location shall be binding on the
    21  applicant unless the board enters into a new agreement
    22  rescinding those restrictions. The board shall require notice to
    23  be posted on the property or premises upon which the licensee or
    24  proposed licensee will engage in sales of malt or brewed
    25  beverages. This notice shall be similar to the notice required
    26  of hotel, restaurant and club liquor licensees.
    27     Except as hereinafter provided, such license shall authorize
    28  the holder thereof to sell or deliver malt or brewed beverages
    29  in quantities above specified anywhere within the Commonwealth
    30  of Pennsylvania, which, in the case of distributors, have been
    20040S1158B1781                  - 7 -     

     1  purchased only from persons licensed under this act as
     2  manufacturers or importing distributors, and in the case of
     3  importing distributors, have been purchased from manufacturers
     4  or persons outside this Commonwealth engaged in the legal sale
     5  of malt or brewed beverages or from manufacturers or importing
     6  distributors licensed under this article. In the case of an
     7  importing distributor, the holder of such a license shall be
     8  authorized to store and repackage malt or brewed beverages owned
     9  by [an out of State] a manufacturer at a segregated portion of a
    10  warehouse or other storage facility authorized by section 441(d)
    11  and operated by the importing distributor within its appointed
    12  territory and deliver such beverages to another importing
    13  distributor who has been granted distribution rights by the [out
    14  of State] manufacturer as provided herein. The importing
    15  distributor shall be permitted to receive a fee from the [out of
    16  State] manufacturer for any related storage, repackaging or
    17  delivery services. In the case of a bailee for hire hired by [an
    18  out of State] a manufacturer, the holder of such a permit shall
    19  be authorized: to receive [or], store and repackage malt or
    20  brewed beverages [under the same conditions as permitted for a
    21  distributor or importing distributor under section 441(f)]
    22  produced by that [out of State] manufacturer for sale by that
    23  manufacturer to importing distributors to whom that [out of
    24  State] manufacturer has given distribution rights pursuant to
    25  this subsection or to purchasers outside this Commonwealth for
    26  delivery outside this Commonwealth; or to ship to that [out of
    27  State] manufacturer's storage facilities outside this
    28  Commonwealth. The bailee for hire shall be permitted to receive
    29  a fee from the [out of State] manufacturer for any related
    30  storage, repackaging or delivery services. The bailee for hire
    20040S1158B1781                  - 8 -     

     1  shall, as required in Article V of this act, keep complete and
     2  accurate records of all transactions, inventory, receipts and
     3  shipments and make all records and the licensed areas available
     4  for inspection by the board and for the Pennsylvania State
     5  Police, Bureau of Liquor Control Enforcement, during normal
     6  business hours.
     7     Each out of State manufacturer of malt or brewed beverages
     8  whose products are sold and delivered in this Commonwealth shall
     9  give distributing rights for such products in designated
    10  geographical areas to specific importing distributors, and such
    11  importing distributor shall not sell or deliver malt or brewed
    12  beverages manufactured by the out of State manufacturer to any
    13  person issued a license under the provisions of this act whose
    14  licensed premises are not located within the geographical area
    15  for which he has been given distributing rights by such
    16  manufacturer. Should a licensee accept the delivery of such malt
    17  or brewed beverages in violation of this section, said licensee
    18  shall be subject to a suspension of his license for at least
    19  thirty days: Provided, That the importing distributor holding
    20  such distributing rights for such product shall not sell or
    21  deliver the same to another importing distributor without first
    22  having entered into a written agreement with the said secondary
    23  importing distributor setting forth the terms and conditions
    24  under which such products are to be resold within the territory
    25  granted to the primary importing distributor by the
    26  manufacturer.
    27     When a Pennsylvania manufacturer of malt or brewed beverages
    28  licensed under this article names or constitutes a distributor
    29  or importing distributor as the primary or original supplier of
    30  his product, he shall also designate the specific geographical
    20040S1158B1781                  - 9 -     

     1  area for which the said distributor or importing distributor is
     2  given distributing rights, and such distributor or importing
     3  distributor shall not sell or deliver the products of such
     4  manufacturer to any person issued a license under the provisions
     5  of this act whose licensed premises are not located within the
     6  geographical area for which distributing rights have been given
     7  to the distributor and importing distributor by the said
     8  manufacturer: Provided, That the importing distributor holding
     9  such distributing rights for such product shall not sell or
    10  deliver the same to another importing distributor without first
    11  having entered into a written agreement with the said secondary
    12  importing distributor setting forth the terms and conditions
    13  under which such products are to be resold within the territory
    14  granted to the primary importing distributor by the
    15  manufacturer. Nothing herein contained shall be construed to
    16  prevent any manufacturer from authorizing the importing
    17  distributor holding the distributing rights for a designated
    18  geographical area from selling the products of such manufacturer
    19  to another importing distributor also holding distributing
    20  rights from the same manufacturer for another geographical area,
    21  providing such authority be contained in writing and a copy
    22  thereof be given to each of the importing distributors so
    23  affected.
    24     * * *
    25     (d)  * * *
    26     (2)  After January 1, 1980, no manufacturer shall enter into
    27  any agreement with more than one distributor or importing
    28  distributor for the purpose of establishing more than one
    29  agreement for designated brand or brands of malt or brewed
    30  beverages in any one territory. Each franchise territory which
    20040S1158B1781                 - 10 -     

     1  is granted by a manufacturer shall not be required to be
     2  geographically contiguous.  All importing distributors shall
     3  maintain sufficient records to evidence compliance of this
     4  section. With regard to any territorial distribution authority
     5  granted to an importing distributor by a manufacturer of malt or
     6  brewed beverages after January 1, 1996, the records shall
     7  establish that each and every case of a brand of malt or brewed
     8  beverages for which the importing distributor is assigned was
     9  sold, resold, stored, delivered or transported by the importing
    10  distributor, either from a point or to a point with the assigned
    11  [geographically contiguous] geographical territory, to any
    12  person or persons, whether such person or persons are licensed
    13  by this act or not licensed by this act.
    14     * * *
    15     Section 6.  Section 470(a.1) and (b) of the act, amended
    16  December 21, 1998 (P.L.1202, No.155), are amended and the
    17  section is amended by adding a subsection to read:
    18     Section 470.  Renewal of Licenses; Temporary Provisions for
    19  Licensees in Armed Service.--* * *
    20     (a.1)  The Director of the Bureau of Licensing may object to
    21  and the board may refuse a properly filed license application:
    22     (1)  if the licensee, its shareholders, directors, officers,
    23  association members, servants, agents or employes have violated
    24  any of the laws of this Commonwealth or any of the regulations
    25  of the board;
    26     [(2)  if the licensee has one or more adjudicated citations;]
    27     (2)  if the licensee, its shareholders, directors, officers,
    28  association members, servants, agents or employes have one or
    29  more adjudicated citations under this or any other license
    30  issued by the board or were involved in a license whose renewal
    20040S1158B1781                 - 11 -     

     1  was objected to by the Bureau of Licensing under this section;
     2     (3)  if the licensed premises no longer meets the
     3  requirements of this act or the board's regulations; or
     4     [(4)  due to the manner in which the licensed premises is
     5  being operated, the board can consider activity occurring on or
     6  about the licensed premises or in areas under licensee's control
     7  if the activity occurs when the premises is open for operation
     8  and if there is a relationship between the activity outside the
     9  premises and the manner in which the licensed premises is
    10  operated. The board may take into consideration whether the
    11  licensee has taken any substantial steps to address the activity
    12  occurring on or about the premises when the premises is open for
    13  operation.]
    14     (4)  due to the manner in which this or another licensed
    15  premises was operated while the licensee, its shareholders,
    16  directors, officers, association members, servants, agents or
    17  employes were involved with that license. When considering the
    18  manner in which this or another licensed premises was being
    19  operated, the board may consider activity that occurred on or
    20  about the licensed premises or in areas under licensee's control
    21  if the activity occurred when the premises was open for
    22  operation and if there was a relationship between the activity
    23  outside the premises and the manner in which the licensed
    24  premises was operated. The board may take into consideration
    25  whether any substantial steps were taken to address the activity
    26  occurring on or about the premises.
    27     * * *
    28     (a.3)  If the objection to the application is based on the
    29  reputation, criminal history, citation history or activity of
    30  one or more of the applicant's shareholders, directors,
    20040S1158B1781                 - 12 -     

     1  officers, association members, servants, agents or employes, and
     2  not on the reputation, criminal history, citation history or
     3  activity attributable to the applicant, the board shall order
     4  the divestiture of the shareholders, directors, officers,
     5  association members, servants, agents or employes in question,
     6  in lieu of refusing the application. If such divestiture does
     7  not occur within thirty (30) days of the board's order, then the
     8  board may refuse the application.
     9     (b)  [In cases where a licensee or his servants, agents or
    10  employes are arrested, charged with violating any of the laws of
    11  this Commonwealth relating to liquor, alcohol or malt or brewed
    12  beverages, and where the board has on file in such cases reports
    13  of enforcement officers or investigators of the enforcement
    14  bureau or from other sources that a licensee or his servants,
    15  agents or employes have violated any of the aforementioned laws
    16  and a proceeding to revoke such licensee's license is or is
    17  about to be instituted, and such arrest occurs or report of
    18  violations is received or revocation proceeding instituted or
    19  about to be instituted during the time a renewal application of
    20  such license is pending before the board, the board may, in its
    21  discretion, renew the license, notwithstanding such alleged
    22  violations, but such renewal license may be revoked if and when
    23  the licensee or any of his servants, agents or employes are
    24  convicted of or plead guilty to violations under the previous
    25  license, as aforesaid, or if and when such previous license is
    26  for any reason revoked.] In cases where a licensee or its
    27  servants, agents or employes are arrested or charged with
    28  violating any of the laws of this Commonwealth or if a licensee
    29  has one or more unadjudicated citations pending against the
    30  licensee at the time a renewal application for the license is
    20040S1158B1781                 - 13 -     

     1  pending before the board, the board may, in its discretion,
     2  renew the license; however, the renewed license may be
     3  subsequently revoked by the board if and when the licensee or
     4  its servants, agents or employes are convicted of the pending
     5  criminal charges or when the citation issued against the license
     6  is adjudicated by the Office of Administrative Law Judge.
     7     In the event [such] the renewal license is revoked by the
     8  board, neither the license fee paid for [such] the license nor
     9  any part thereof shall be returned to the licensee.
    10     * * *
    11     Section 7.  Section 505.2 of the act, amended November 10,
    12  1999 (P.L.514, No.47), December 9, 2002 (P.L.1653, No.212),
    13  December 16, 2002 (P.L.1806, No.221) and July 17, 2003 (P.L.63,
    14  No.15), is amended to read:
    15     Section 505.2.  Limited Wineries.--(a)  In the interest of
    16  promoting tourism and recreational development in Pennsylvania,
    17  holders of a limited winery license may:
    18     (1)  Produce alcoholic ciders, wines and wine coolers,
    19  subject to the exceptions provided under this section, only from
    20  fruits grown in Pennsylvania.
    21     (2)  Sell alcoholic cider, wine and wine coolers produced by
    22  the limited winery or purchased in bulk in bond from another
    23  Pennsylvania limited winery on the licensed premises, under such
    24  conditions and regulations as the board may enforce, to the
    25  board, to individuals and to brewery, hotel, restaurant, club
    26  and public service liquor licensees, and to Pennsylvania winery
    27  licensees: Provided, That a limited winery shall not, in any
    28  calendar year, purchase alcoholic cider or wine produced by
    29  other limited wineries in an amount in excess of fifty per
    30  centum of the alcoholic cider or wine produced by the purchasing
    20040S1158B1781                 - 14 -     

     1  limited winery in the preceding calendar year. In addition, the
     2  holder of a limited winery license may purchase wine in bottles
     3  from another Pennsylvania limited winery if these wines undergo
     4  a second fermentation process. Such wine may be sold in bottles
     5  bearing the purchasing limited winery's label or the producing
     6  limited winery's label. Such wines, if sold by the board, may be
     7  sold by the producing limited winery to the purchasing limited
     8  winery at a price lower than the price charged by the board.
     9     (3)  Separately or in conjunction with other limited
    10  wineries, sell alcoholic cider, wine and wine coolers produced
    11  by the limited winery on no more than five (5) board-approved
    12  locations other than the licensed premises, with no bottling or
    13  production requirement at those additional board-approved
    14  locations and under such conditions and regulations as the board
    15  may enforce, to the board, to individuals and to brewery, hotel,
    16  restaurant, club and public service liquor licensees. If two or
    17  more limited wineries apply to operate an additional board-
    18  approved location in conjunction with each other, the wineries
    19  need only have one board-approved manager for the location, need
    20  only pay one application fee and need not designate specific or
    21  distinct areas for each winery's licensed area. Each limited
    22  winery must file an application for such an additional board-
    23  approved location, and such location shall count as one of the
    24  five permitted for each limited winery. Each limited winery is
    25  responsible for keeping only its own complete records. A limited
    26  winery may be cited for a violation of the recordkeeping
    27  requirements of sections 512 and 513 pertaining to its own
    28  records only.
    29     (4)  At the discretion of the board, obtain a special permit
    30  to participate in alcoholic cider, wine and food expositions off
    20040S1158B1781                 - 15 -     

     1  the licensed premises. A special permit shall be issued upon
     2  proper application and payment of a fee of thirty dollars ($30)
     3  per day for each day of permitted use, not to exceed five (5)
     4  consecutive days. The total number of days for all the special
     5  permits may not exceed forty (40) days in any calendar year. A
     6  special permit shall entitle the holder to engage in the sale by
     7  the glass, by the bottle or in case lots of alcoholic cider or
     8  wine produced [by the bottle or in case lots] by the permittee
     9  under the authority of a limited winery license. Holders of
    10  special permits may provide tasting samples of wines in
    11  individual portions not to exceed one fluid ounce. Samples at
    12  alcoholic cider, wine and food expositions may be sold or
    13  offered free of charge. Except as provided herein, limited
    14  wineries utilizing special permits shall be governed by all
    15  applicable provisions of this act as well as by all applicable
    16  regulations or conditions adopted by the board.
    17     For the purposes of this clause, "alcoholic cider, wine and
    18  food expositions" are defined as affairs held indoors or
    19  outdoors with the primary intent of educating those in
    20  attendance of the availability, nature and quality of
    21  Pennsylvania-produced alcoholic ciders and wines in conjunction
    22  with suitable food displays, demonstrations and sales. Alcoholic
    23  cider, wine and food expositions may also include activities
    24  other than alcoholic cider, wine and food displays, including
    25  arts and crafts, musical activities, cultural exhibits,
    26  agricultural exhibits and similar activities.
    27     (5)  Apply for and hold a hotel liquor license, a restaurant
    28  liquor license or a malt and brewed beverages retail license to
    29  sell for consumption at the restaurant or limited winery on the
    30  licensed winery premises, liquor, wine and malt or brewed
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     1  beverages regardless of the place of manufacture under the same
     2  conditions and regulations as any other hotel liquor license,
     3  restaurant liquor license or malt and brewed beverages retail
     4  license.
     5     (6)  (i)  Secure a permit from the board to allow the holder
     6  of a limited winery license to use up to twenty-five per centum
     7  permitted fruit, not wine, in the current year's production.
     8  Each permit is valid only for the calendar year in which it is
     9  issued.
    10     (ii)  The fee for a permit to import and use permitted fruit
    11  shall be in an amount to be determined by the board.
    12     (iii)  The purpose of this section is to increase the
    13  productivity of limited wineries while at the same time
    14  protecting the integrity and unique characteristics of wine
    15  produced from fruit primarily grown in this Commonwealth.
    16  Prevailing climatic conditions have a significant impact on the
    17  character of the fruit. Accordingly, "permitted fruit" shall
    18  mean fruit grown or juice derived from fruit grown within three
    19  hundred fifty (350) miles of the winery.
    20     (iv)  The department is authorized to promulgate regulations
    21  requiring the filing of periodic reports by limited wineries to
    22  ensure compliance with the provisions of this section.
    23     (v)  This clause shall expire on December 31, 2004.
    24     (6.1)  Sell food for consumption on or off the licensed
    25  premises and sell by the glass only wine and alcoholic ciders
    26  that may otherwise be sold by the bottle.
    27     (6.2)  Sell candles acquired or produced by the limited        <--
    28  winery.
    29     [(7)] (b)  The total production of alcoholic ciders, wine and
    30  wine coolers by a limited winery may not exceed two hundred
    20040S1158B1781                 - 17 -     

     1  thousand (200,000) gallons per year.
     2     Section 8.  This act shall take effect in 60 days.



















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