Bill Text: IL SB3136 | 2009-2010 | 96th General Assembly | Engrossed

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Bill Title: Amends the Liquor Control Act of 1934. Beginning on July 1, 2010, provides that of the funds received for a retailer's license, $270 shall be paid into the Dram Shop Fund and $230 shall be paid into the General Revenue Fund. Provides that the increase in amount of funds that is deposited into the Dram Shop Fund as a result of the amendatory Act shall only be used for the continuing education and professional training of examination employees of the State Commission and shall be in addition to the regular expenditures being made from the Dram Shop Fund for such purposes. Also makes technical changes. Effective July 1, 2010.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Engrossed - Dead) 2010-11-23 - Placed on Calendar 2nd Reading - Short Debate [SB3136 Detail]

Download: Illinois-2009-SB3136-Engrossed.html

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

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effect for 30 days prior to such violation. Except in the
case of an action taken pursuant to a violation of Section
6-3, 6-5, or 6-9, any action by the State Commission to
suspend or revoke a licensee's license may be limited to
the license for the specific premises where the violation
occurred.
In lieu of suspending or revoking a license, the State
Commission commission may impose a fine, upon the State
Commission's commission's determination and notice after
hearing, that a licensee has violated any provision of this
Act or any rule or regulation issued pursuant thereto and
in effect for 30 days prior to such violation. The fine
imposed under this paragraph may not exceed $500 for each
violation. Each day that the activity, which gave rise to
the original fine, continues is a separate violation. The
maximum fine that may be levied against any licensee, for
the period of the license, shall not exceed $20,000. The
maximum penalty that may be imposed on a licensee for
selling a bottle of alcoholic liquor with a foreign object
in it or serving from a bottle of alcoholic liquor with a
foreign object in it shall be the destruction of that
bottle of alcoholic liquor for the first 10 bottles so sold
or served from by the licensee. For the eleventh bottle of
alcoholic liquor and for each third bottle thereafter sold
or served from by the licensee with a foreign object in it,
the maximum penalty that may be imposed on the licensee is

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the destruction of the bottle of alcoholic liquor and a
fine of up to $50.
(2) To adopt such rules and regulations consistent with
the provisions of this Act which shall be necessary to
carry on its functions and duties to the end that the
health, safety and welfare of the People of the State of
Illinois shall be protected and temperance in the
consumption of alcoholic liquors shall be fostered and
promoted and to distribute copies of such rules and
regulations to all licensees affected thereby.
(3) To call upon other administrative departments of
the State, county and municipal governments, county and
city police departments and upon prosecuting officers for
such information and assistance as it deems necessary in
the performance of its duties.
(4) To recommend to local commissioners rules and
regulations, not inconsistent with the law, for the
distribution and sale of alcoholic liquors throughout the
State.
(5) To inspect, or cause to be inspected, any premises
in this State where alcoholic liquors are manufactured,
distributed, warehoused, or sold.
(5.1) Upon receipt of a complaint or upon having
knowledge that any person is engaged in business as a
manufacturer, importing distributor, distributor, or
retailer without a license or valid license, to notify the

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local liquor authority, file a complaint with the State's
Attorney's Office of the county where the incident
occurred, or initiate an investigation with the
appropriate law enforcement officials.
(5.2) To issue a cease and desist notice to persons
shipping alcoholic liquor into this State from a point
outside of this State if the shipment is in violation of
this Act.
(5.3) To receive complaints from licensees, local
officials, law enforcement agencies, organizations, and
persons stating that any licensee has been or is violating
any provision of this Act or the rules and regulations
issued pursuant to this Act. Such complaints shall be in
writing, signed and sworn to by the person making the
complaint, and shall state with specificity the facts in
relation to the alleged violation. If the State Commission
has reasonable grounds to believe that the complaint
substantially alleges a violation of this Act or rules and
regulations adopted pursuant to this Act, it shall conduct
an investigation. If, after conducting an investigation,
the State Commission is satisfied that the alleged
violation did occur, it shall proceed with disciplinary
action against the licensee as provided in this Act.
(6) To hear and determine appeals from orders of a
local commission in accordance with the provisions of this
Act, as hereinafter set forth. Hearings under this

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subsection shall be held in Springfield or Chicago, at
whichever location is the more convenient for the majority
of persons who are parties to the hearing.
(7) The State Commission commission shall establish
uniform systems of accounts to be kept by all retail
licensees having more than 4 employees, and for this
purpose the State Commission commission may classify all
retail licensees having more than 4 employees and establish
a uniform system of accounts for each class and prescribe
the manner in which such accounts shall be kept. The State
Commission commission may also prescribe the forms of
accounts to be kept by all retail licensees having more
than 4 employees, including, but not limited to, accounts
of earnings and expenses and any distribution, payment, or
other distribution of earnings or assets, and any other
forms, records and memoranda which in the judgment of the
State Commission commission may be necessary or
appropriate to carry out any of the provisions of this Act,
including, but not limited to, such forms, records, and
memoranda as will readily and accurately disclose at all
times the beneficial ownership of such retail licensed
business. The accounts, forms, records, and memoranda
shall be available at all reasonable times for inspection
by authorized representatives of the State Commission
commission or by any local liquor control commissioner or
his or her authorized representative. The State Commission

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commission, may, from time to time, alter, amend or repeal,
in whole or in part, any uniform system of accounts, or the
form and manner of keeping accounts.
(8) In the conduct of any hearing authorized to be held
by the State Commission commission, to appoint, at the
State Commission's commission's discretion, hearing
officers to conduct hearings involving complex issues or
issues that will require a protracted period of time to
resolve, to examine, or cause to be examined, under oath,
any licensee, and to examine or cause to be examined the
books and records of such licensee; to hear testimony and
take proof material for its information in the discharge of
its duties hereunder; to administer or cause to be
administered oaths; for any such purpose to issue subpoena
or subpoenas to require the attendance of witnesses and the
production of books, which shall be effective in any part
of this State, and to adopt rules to implement its powers
under this paragraph (8).
Any Circuit Court may by order duly entered, require
the attendance of witnesses and the production of relevant
books subpoenaed by the State Commission commission and the
court may compel obedience to its order by proceedings for
contempt.
(9) To investigate the administration of laws in
relation to alcoholic liquors in this and other states and
any foreign countries, and to recommend from time to time

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to the Governor and through him or her to the legislature
of this State, such amendments to this Act, if any, as it
may think desirable and as will serve to further the
general broad purposes contained in Section 1-2 hereof.
(10) To adopt such rules and regulations consistent
with the provisions of this Act which shall be necessary
for the control, sale or disposition of alcoholic liquor
damaged as a result of an accident, wreck, flood, fire, or
other similar occurrence.
(11) To develop industry educational programs related
to responsible serving and selling, particularly in the
areas of overserving consumers and illegal underage
purchasing and consumption of alcoholic beverages.
(11.1) To license persons providing education and
training to alcohol beverage sellers and servers under the
Beverage Alcohol Sellers and Servers Education and
Training (BASSET) programs and to develop and administer a
public awareness program in Illinois to reduce or eliminate
the illegal purchase and consumption of alcoholic beverage
products by persons under the age of 21. Application for a
license shall be made on forms provided by the State
Commission.
(12) To develop and maintain a repository of license
and regulatory information.
(13) On or before January 15, 1994, the State
Commission shall issue a written report to the Governor and

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General Assembly that is to be based on a comprehensive
study of the impact on and implications for the State of
Illinois of Section 1926 of the Federal ADAMHA
Reorganization Act of 1992 (Public Law 102-321). This study
shall address the extent to which Illinois currently
complies with the provisions of P.L. 102-321 and the rules
promulgated pursuant thereto.
As part of its report, the State Commission shall
provide the following essential information:
(i) the number of retail distributors of tobacco
products, by type and geographic area, in the State;
(ii) the number of reported citations and
successful convictions, categorized by type and
location of retail distributor, for violation of the
Prevention of Tobacco Use by Minors and Sale and
Distribution of Tobacco Products Act and the Smokeless
Tobacco Limitation Act;
(iii) the extent and nature of organized
educational and governmental activities that are
intended to promote, encourage or otherwise secure
compliance with any Illinois laws that prohibit the
sale or distribution of tobacco products to minors; and
(iv) the level of access and availability of
tobacco products to individuals under the age of 18.
To obtain the data necessary to comply with the
provisions of P.L. 102-321 and the requirements of this

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report, the State Commission shall conduct random,
unannounced inspections of a geographically and
scientifically representative sample of the State's retail
tobacco distributors.
The State Commission shall consult with the Department
of Public Health, the Department of Human Services, the
Illinois State Police and any other executive branch
agency, and private organizations that may have
information relevant to this report.
The State Commission may contract with the Food and
Drug Administration of the U.S. Department of Health and
Human Services to conduct unannounced investigations of
Illinois tobacco vendors to determine compliance with
federal laws relating to the illegal sale of cigarettes and
smokeless tobacco products to persons under the age of 18.
(14) On or before April 30, 2008 and every 2 years
thereafter, the State Commission shall present a written
report to the Governor and the General Assembly that shall
be based on a study of the impact of this amendatory Act of
the 95th General Assembly on the business of soliciting,
selling, and shipping wine from inside and outside of this
State directly to residents of this State. As part of its
report, the State Commission shall provide all of the
following information:
(A) The amount of State excise and sales tax
revenues generated.

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

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

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is licensed.
(C) The State Commission shall approve the
application for a self-distribution exemption if such
person: (1) is in compliance with State revenue and
liquor laws; (2) is not a member of any affiliated
group that produces more than 25,000 gallons of wine
per annum or produces any other alcoholic liquor; (3)
will not annually produce for sale more than 25,000
gallons of wine; and (4) will not annually sell more
than 5,000 gallons of its wine to retail licensees.
(D) A self-distribution exemption holder shall
annually certify to the State Commission its
production of wine in the previous 12 months and its
anticipated production and sales for the next 12
months. The State Commission may fine, suspend, or
revoke a self-distribution exemption after a hearing
if it finds that the exemption holder has made a
material misrepresentation in its application,
violated a revenue or liquor law of Illinois, exceeded
production of 25,000 gallons of wine in any calendar
year, or become part of an affiliated group producing
more than 25,000 gallons of wine or any other alcoholic
liquor.
(E) Except in hearings for violations of this Act
or amendatory Act or a bona fide investigation by duly
sworn law enforcement officials, the State Commission,

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or its agents, the State Commission shall maintain the
production and sales information of a
self-distribution exemption holder as confidential and
shall not release such information to any person.
(F) The State Commission shall issue regulations
governing self-distribution exemptions consistent with
this Section and this Act.
(G) Nothing in this subsection (17) shall prohibit
a self-distribution exemption holder from entering
into or simultaneously having a distribution agreement
with a licensed Illinois distributor.
(H) It is the intent of this subsection (17) to
promote and continue orderly markets. The General
Assembly finds that in order to preserve Illinois'
regulatory distribution system it is necessary to
create an exception for smaller makers of wine as their
wines are frequently adjusted in varietals, mixes,
vintages, and taste to find and create market niches
sometimes too small for distributor or importing
distributor business strategies. Limited
self-distribution rights will afford and allow smaller
makers of wine access to the marketplace in order to
develop a customer base without impairing the
integrity of the 3-tier system.
(18) The State Commission shall train and educate its
examination employees on an annual basis. The increase in the

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amount of funds deposited into the Dram Shop Fund as a result
of this amendatory Act of the 96th General Assembly shall only
be used for this purpose and shall be in addition to the
regular expenditures being made from the Dram Shop Fund for
this purpose.
(b) On or before April 30, 1999, the State Commission shall
present a written report to the Governor and the General
Assembly that shall be based on a study of the impact of this
amendatory Act of 1998 on the business of soliciting, selling,
and shipping alcoholic liquor from outside of this State
directly to residents of this State.
As part of its report, the State Commission shall provide
the following information:
(i) the amount of State excise and sales tax revenues
generated as a result of this amendatory Act of 1998;
(ii) the amount of licensing fees received as a result
of this amendatory Act of 1998;
(iii) the number of reported violations, the number of
cease and desist notices issued by the State Commission,
the number of notices of violations issued to the
Department of Revenue, and the number of notices and
complaints of violations to law enforcement officials.
(Source: P.A. 95-634, eff. 6-1-08; 96-179, eff. 8-10-09;
96-446, eff. 1-1-10; revised 10-19-09.)
(235 ILCS 5/5-3) (from Ch. 43, par. 118)

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Sec. 5-3. License fees. Except as otherwise provided
herein, at the time application is made to the State Commission
for a license of any class, the applicant shall pay to the
State Commission the fee hereinafter provided for the kind of
license applied for.
The fee for licenses issued by the State Commission shall
be as follows:
For a manufacturer's license:
Class 1. Distiller ............................. $3,600
Class 2. Rectifier ............................. 3,600
Class 3. Brewer ................................ 900
Class 4. First-class Wine Manufacturer ......... 600
Class 5. Second-class
Wine Manufacturer .......................... 1,200
Class 6. First-class wine-maker ................ 600
Class 7. Second-class wine-maker ............... 1200
Class 8. Limited Wine Manufacturer.............. 120
For a Brew Pub License ......................... 1,050
For a caterer retailer's license................ 200
For a foreign importer's license ............... 25
For an importing distributor's license ......... 25
For a distributor's license .................... 270
For a non-resident dealer's license
(500,000 gallons or over) .................. 270
For a non-resident dealer's license
(under 500,000 gallons) .................... 90

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For a wine-maker's premises license ............ 100
For a winery shipper's license
(under 250,000 gallons)..................... 150
For a winery shipper's license
(250,000 or over, but under 500,000 gallons). 500
For a winery shipper's license
(500,000 gallons or over)................... 1,000
For a wine-maker's premises license,
second location ............................ 350
For a wine-maker's premises license,
third location ............................. 350
For a retailer's license ....................... 500
For a special event retailer's license,
(not-for-profit) ........................... 25
For a special use permit license,
one day only ............................... 50
2 days or more ............................. 100
For a railroad license ......................... 60
For a boat license ............................. 180
For an airplane license, times the
licensee's maximum number of aircraft
in flight, serving liquor over the
State at any given time, which either
originate, terminate, or make
an intermediate stop in the State .......... 60
For a non-beverage user's license:

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Class 1 .................................... 24
Class 2 .................................... 60
Class 3 .................................... 120
Class 4 .................................... 240
Class 5 .................................... 600
For a broker's license ......................... 600
For an auction liquor license .................. 50
Fees collected under this Section shall be paid into the
Dram Shop Fund. On and after July 1, 2010 2003, of the funds
received for a retailer's license, $270 in addition to the
first $175, an additional $75 shall be paid into the Dram Shop
Fund, and $230 $250 shall be paid into the General Revenue
Fund. Beginning June 30, 1990 and on June 30 of each subsequent
year through June 29, 2003, any balance over $5,000,000
remaining in the Dram Shop Fund shall be credited to State
liquor licensees and applied against their fees for State
liquor licenses for the following year. The amount credited to
each licensee shall be a proportion of the balance in the Dram
Fund that is the same as the proportion of the license fee paid
by the licensee under this Section for the period in which the
balance was accumulated to the aggregate fees paid by all
licensees during that period.
No fee shall be paid for licenses issued by the State
Commission to the following non-beverage users:
(a) Hospitals, sanitariums, or clinics when their use
of alcoholic liquor is exclusively medicinal, mechanical

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or scientific.
(b) Universities, colleges of learning or schools when
their use of alcoholic liquor is exclusively medicinal,
mechanical or scientific.
(c) Laboratories when their use is exclusively for the
purpose of scientific research.
(Source: P.A. 95-634, eff. 6-1-08.)
Section 99. Effective date. This Act takes effect July 1,
2010.