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| SPONSOR: | Taylor, J.G. | DATE TYPED: | 03/01/01 | HB | 757 | ||
| SHORT TITLE: | Minimum Percent Markup for Package Liquor | SB | |||||
| ANALYST: | Valdes | ||||||
| Recurring
or Non-Rec |
Fund
Affected | ||||
| FY01 | FY02 | FY01 | FY02 | ||
| $ 100.0 | Recurring | General Fund | |||
(Parenthesis ( ) Indicate Expenditure Decreases)
SOURCES OF INFORMATION
Alcohol and Gaming Division, Regulation and Licensing Department
SUMMARY
Synopsis of Bill
House Bill 757 proposes to enact a new section of the Liquor Control Act to require a minimum markup of 20 percent above wholesale price in the sale of alcoholic beverages in unbroken packages.
Significant Issues
The bill would require retailers and wholesalers to retain purchase and sales records of all alcoholic beverages sold in unbroken package for two years following the sale of the time. Information identifying the contents, brand, lot and purchase and sale prices of the item is required to be clearly set forth on the records.
PERFORMANCE IMPLICATIONS
This will not impact the division's measures.
FISCAL IMPLICATIONS
Based on the administrative implications noted below, it is estimated that an additional FTE with associated costs would require approximately $100.0 in the first year of operations.
ADMINISTRATIVE IMPLICATIONS
Unknown, however may be significant. The requirement that the Alcohol and Gaming Division audit the records of those affected by the bill would most likely require at least one additional FTE to accomplish this task. Additionally, the position would require funding, office space, equipment and travel budget.
OTHER SUBSTANTIVE ISSUES
The Alcohol and Gaming Division provided the following information regarding this bill:
Section (A) of the bill states that "no licensee" shall sell alcoholic beverages in unbroken packages at retail for less than twenty percent above the wholesale price paid by the licensee for the alcoholic beverage. Section (B), however, only requires "a retailer" to retain purchase and sales records of all alcoholic beverages sold in unbroken packages. Currently there are approximately 78 licensed retailers in the State. There are other types of licensees, however, that have the ability to sell alcoholic beverages in unbroken packages. It is unclear whether the intent of the bill is to require all licensees that have the ability to sell alcoholic beverages in unbroken packages to retain the records provided for in the bill.
Moreover, there is no clear indication from the contents of the bill what is expected to be accomplished by this requirement. Additionally, the minimum mark-up provision of the bill may be unconstitutional pursuant to previous federal court decisions. Brown-Forman Crp v. N.M. Department of ABC, 672 F. Supp 1383 (D.M.M. 1987)
MV/ar