February 2, 2005, Introduced by Reps. Farhat and Accavitti and referred to the Committee on Regulatory Reform.
A bill to amend 1998 PA 58, entitled
"Michigan liquor control code of 1998,"
by amending section 1201 (MCL 436.2201) and by adding section 521a.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 521a. (1) In addition to any licenses for the sale of
alcoholic liquor for consumption on the premises that may be
available in the local governmental unit under section 531(1), and
the resort and resort economic development licenses authorized in
section 531(2), (3), and (4), the commission may issue not more
than 10 tavern or class C licenses to persons who operate
businesses that meet all of the following conditions:
(a) The business is a full service restaurant, is open to the
public, and prepares food on the premises.
(b) The business is open for food service not less than 10
hours per day and at least 6 days per week.
(c) At least 60% of the gross receipts of the business are
derived from the sale of food for consumption on the premises. For
purposes of this subdivision, food does not include beer and wine.
(d) The business has dining facilities to seat not fewer than
25 persons.
(e) The business is located in a city in an entertainment zone
or other area designated by the city of not more than 1 square mile
in size that would accommodate at least 20 establishments that are
full-service restaurants serving alcoholic liquor on-premises, as
determined by the commissioner.
(2) The individual signing the application for a license under
subsection (1) shall state and demonstrate that the applicant
attempted to secure an appropriate on-premise escrowed license or
quota license issued under section 531 and that, to the best of his
or her knowledge, an on-premise escrowed license or quota license
issued under section 531 is not readily available within the city
in which the entertainment zone is located.
(3) If in any licensing year the sale of food for consumption
on the premises of a person that holds a license under this section
represents less than 60% of the gross receipts for the business,
the commission, after notice and opportunity for an administrative
hearing, shall prohibit the licensee from operating later than 2
a.m. as allowed under subsection (7).
(4) Not more than 1 license shall be issued under subsection
(1) to any individual, partnership, limited partnership, limited
liability company, corporation, or any combination of any of the
above, including stockholders, general partners, or limited
partners. A license issued under this section is transferable as to
ownership or location only within the entertainment zone or other
designated area.
(5) The commission shall not issue a specially designated
merchant license, specially designated distributor license, or any
other license that allows the sale of alcoholic liquor for
consumption off the premises in conjunction with a license issued
under subsection (1) or at the premises for which a license has
been issued under subsection (1).
(6) The commission shall not issue to an establishment
licensed pursuant to this section a topless activity permit under
section 916.
(7) Notwithstanding sections 1113 and 1114, hours of operation
for a licensee under this section are extended to 4 a.m. Pursuant
to a resolution adopted by the governing body of the city, hours of
operation may be further extended to 5 a.m.
(8) The commission shall annually report to the legislature
the names of the businesses issued licenses under this section and
their locations.
(9) As used in this section:
(a) "City" means a city established under either of the
following:
(i) The home rule city act, 1909 PA 279, MCL 117.1 to 117.38.
(ii) The fourth class city act, 1895 PA 215, MCL 81.1 to
113.20.
(b) "Escrowed license" means a license for which the licensee
fee is current and in which the rights of the licensee in the
license or to the renewal of the license are still in existence and
are subject to renewal and activation in the manner provided for in
R 436.1107 of the Michigan administrative code.
(c) "Readily available" means available under a standard of
economic feasibility, as applied to the specific circumstances of
the applicant, that includes but is not limited to the following:
(i) The fair market value of the license, if determinable.
(ii) The size and scope of the proposed operation.
(iii) The existence of mandatory contractual restrictions or
inclusions attached to the sale of the license.
Sec. 1201. (1) In addition to any and all taxes imposed by
law, there is imposed and levied upon and collected a specific tax
equal to 4% of the retail selling price of spirits. The tax shall
be collected by the commission at the time of sale by the
commission. In the case of sales to licensees, the tax shall be
computed on the retail selling price established by the commission
without allowance of discount.
(2) Upon collection and except as otherwise provided for in
this
section, the commission shall deposit
the entire proceeds in
the
state treasury , to the credit of the general fund.
(3) In the case of the sale of spirits to a licensee holding a
license issued to an establishment located in an entertainment zone
or other designated area described in section 521a, 5% of the tax
collected shall be appropriated from the general fund to cities
within which the entertainment zones are located for the purpose of
police and fire protection.
(4) (3)
If this section 1201 is
repealed, every licensee,
who has on hand any spirits on the effective date of the repeal,
shall file a complete inventory of those spirits with the
commission within 20 days after the repeal. The commission shall
credit to such a licensee an amount equal to 4% of the retail
selling price of those spirits on future purchases of spirits from
the commission.