Senate Bill text for SB0811

SENATE BILL 811

48th legislature - STATE OF NEW MEXICO - first session, 2007

INTRODUCED BY

Phil A. Griego

AN ACT

RELATING TO BUSINESS LICENSES; CHANGING LICENSING REQUIREMENTS FOR CERTAIN BUSINESSES; CHANGING THE APPLICATION FEE FOR LIQUOR LICENSES; CHANGING FINGERPRINT REQUIREMENTS FOR LIQUOR LICENSES; CHANGING THE EXPIRATION DATE FOR CERTAIN LIQUOR LICENSES; AMENDING SECTIONS OF THE LIQUOR CONTROL ACT.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

Section 1. Section 60-6B-2 NMSA 1978 (being Laws 1981, Chapter 39, Section 38, as amended) is amended to read:

"60-6B-2. APPLICATIONS.--

A. Before a new license authorized by the Liquor Control Act may be issued by the director, the applicant for the license shall:

(1) submit to the director a written application for the license under oath, in the form prescribed by and stating the information required by the director, together with a nonrefundable application fee of [two hundred dollars ($200)] three hundred dollars ($300);

(2) submit to the director for [his] approval a description, including floor plans, in a form prescribed by the director, that shows the proposed licensed premises for which the license application is submitted. The area represented by the approved description shall become the licensed premises;

(3) submit the name and street address of a New Mexico resident upon whom the director may serve any notice related to ownership or operation of the license, including any notice of change pursuant to Chapter 60, Article 6C NMSA 1978; [(3)] (4) if the applicant is a corporation, be required to submit as part of its application the following:

(a) a certified copy of its articles of incorporation or, if a foreign corporation, a certified copy of its certificate of authority;

(b) the names and addresses of all officers and directors and those stockholders owning ten percent or more of the voting stock of the corporation and the amounts of stock held by each stockholder; provided, however, a corporation may not be licensed if an officer, manager, director or holder of more than a ten percent [of the stock] interest in the applicant entity would not be eligible to hold a license pursuant to the Liquor Control Act [except that the provision of Subsection D of Section 60-6B-1 NMSA 1978 shall not apply if the stock is listed with a national securities exchange;

(c) the name of the resident agent of the corporation authorized to accept service of process for all purposes, including orders and notices of the director, which agent shall be approved by the director with respect to his character;

(d) a duly executed power of attorney authorizing the agent described in Subparagraph (c) of this paragraph to exercise full authority, control and responsibility for the conduct of all business and transactions of the corporation within the state relative to the sale of alcoholic beverages under authority of the license requested]; and

[(e)] (c) such additional information regarding the corporation as the director may require to assure full disclosure of the corporation's structure and financial responsibility;

[(4)] (5) if the applicant is a limited partnership, submit as part of its application the following:

(a) a certified copy of its certificate of limited partnership;

(b) the names and addresses of all general partners and of all limited partners contributing ten percent or more of the total value of contributions made to the limited partnership or entitled to ten percent or more of the profits earned or other income paid by the limited partnership. A limited partnership shall not receive a license if [any] a partner or holder of a ten percent or greater interest in the applicant entity designated in this subsection would not be eligible to hold a license issued pursuant to the Liquor Control Act; and

(c) such additional information regarding the limited partnership as the director may require to assure full disclosure of the limited partnership's structure and financial responsibility; [and]

(6) if the applicant is a limited liability company, submit as part of its application the following:

(a) a copy of the articles of organization, with a copy of the certificate of filing with the public regulation commission;

(b) the name and addresses of all the managing members and all of the nonmanaging members that own a greater than ten percent interest in the limited liability company. Any direct or indirect parent entity of the limited liability company with an interest of ten percent or more in the applicant entity shall submit application forms and qualify to hold a license; and

(c) such additional information regarding the limited liability company as the director may require to assure full disclosure of the limited liability company's structure and financial responsibility;

(7) if the applicant is a trust, submit as part of its application:

(a) the names and addresses of the trustees;

(b) the names and addresses of any beneficiaries having control over the property of the trust or receiving regular and substantial distributions of principal and income from the trust. Any beneficiary receiving regular and substantial distributions from the trust shall qualify to hold a license. The director may request a copy of the trust agreement for review, which trust agreement need not become part of the application. Affidavits as to the operation and distribution of the principal and income may be requested in lieu of, or in addition to, the copy of the trust agreement that is supplied for review by the department; and

(c) such additional information regarding the trust as the director may require to assure full disclosure of the trust's structure and financial responsibility; and

[(5)] (8) obtain approval for the issuance from the governing body of the local option district in which the proposed licensed premises are to be located in accordance with the provisions of the Liquor Control Act.

B. Except for individual officers, directors, shareholders, members or partners of entities that file regular reports with the United States securities and exchange commission and for individuals who have been fingerprinted for another New Mexico license and had no prior criminal or arrest record, every applicant for a new license or for a transfer of ownership of a license [if an individual or general partnership] shall file with the application two complete sets of fingerprints [of each individual] taken under the supervision of and certified to by an officer of the New Mexico state police, a county sheriff, [or] a municipal chief of police, a police officer in a foreign country or an individual qualified to take fingerprints by virtue of training or experience, for each of the following individuals:

(1) if the applicant is a person, for the applicant;

(2) if the applicant or the holder of a ten percent or greater direct or indirect interest in the applicant is a corporation, for each principal officer, for each member of the board of directors who is employed by the corporation and who participates in operation of the license in some way other than infrequent meetings of the board of directors and for each stockholder with a ten percent or greater interest in the corporation;

(3) if the applicant or the holder of a ten percent or greater direct or indirect interest in the applicant is a general partnership, for each partner;

(4) if the applicant or the holder of a ten percent or greater direct or indirect interest in the applicant is a limited partnership, for each general partner, for each limited partner holding a ten percent or greater interest in the partnership and for any principal officers of the limited partnership;

(5) if the applicant or the holder of a ten percent or greater direct or indirect interest in the applicant is a limited liability company, for each managing member, for each member who owns a ten percent or greater interest in the limited liability company and for any principal officer of the limited liability company; and

(6) if the applicant is a trust, for each trustee and for each beneficiary who has control over trust property and income or who receives substantial and regular distributions from the trust. [If the applicant is a corporation, it shall file two complete sets of fingerprints for each stockholder holding ten percent or more of the outstanding stock, principal officer, director and the agent responsible for the operation of the licensed business. The fingerprints shall be taken and certified to as provided for an individual or partnership. If the applicant is a limited partnership, it shall file two complete sets of fingerprints for each general partner and for each limited partner contributing ten percent or more of the total value of contributions made to the limited partnership or entitled to ten percent or more of the profits earned or other compensation by way of income paid by the limited partnership. The fingerprints shall be taken and certified to as provided for an individual or partnership.]

C. Upon submission of a sworn affidavit from each person who is required to file fingerprints stating that the person has not been convicted of a felony in any jurisdiction and pending the results of background investigations, a temporary license for ninety days may be issued. The temporary license may be extended by the director for an additional ninety days if the director determines there is not sufficient time to complete the background investigation or obtain reviews of fingerprints from appropriate agencies. A temporary license shall be surrendered immediately upon order of the director.

D. An applicant who files a false affidavit shall be denied a license. When the director determines a false affidavit has been filed, [he] the director shall refer the matter to the attorney general or district attorney for prosecution of perjury.

E. If an applicant is not a resident of New Mexico, fingerprints may be taken under supervision and certification of comparable officers in the state of residence of the applicant.

F. Before issuing a license, the department shall hold a public hearing within thirty days after receipt of the application pursuant to Subsection K of this section.

G. An application for transfer of ownership shall be filed with the department no later than thirty days after the date a person acquired an ownership interest in a license. It shall contain the actual date of sale of the license and shall be accompanied by a sworn affidavit from the owner of record of the license agreeing to the sale of the license to the applicant as well as attesting to the accuracy of the information required by this section to be filed with the department. A license shall not be transferred unless it will be placed into operation in an actual location within one hundred twenty days of issuance of the license, unless for good cause shown the director grants an additional extension for a length of time determined by the director.

H. Whenever it appears to the director that there will be more applications for new licenses than the available number of new licenses during any time period, a random selection method for the qualification, approval and issuance of new licenses shall be provided by the director. The random selection method shall allow each applicant an equal opportunity to obtain an available license, provided that all dispenser's and retailer's licenses issued in [any] a calendar year shall be issued to residents of the state. For the purposes of random selection, the director shall also set a reasonable deadline by which applications for the available licenses shall be filed. A person shall not file more than one application for each available license and no more than three applications per calendar year.

I. After the deadline set in accordance with Subsection H of this section, no more than ten applications per available license shall be selected at random for priority of qualification and approval. Within thirty days after the random selection for the ten priority positions for each license, a hearing pursuant to Subsection K of this section shall be held to determine the qualifications of the applicant having the highest priority for each available license. If necessary, such a hearing shall be held on each selected application by priority until a qualified applicant for each available license is approved. Further random selections for priority positions shall also be held pursuant to this section as necessary.

J. All applications submitted for a license shall expire upon the director's final approval of a qualified applicant for that available license.

K. The director shall notify the applicant by certified mail of the date, time and place of the hearing. The hearing shall be held in Santa Fe. The director may designate a hearing officer to take evidence at the hearing. The director or the hearing officer shall have the power to administer oaths.

L. In determining whether a license shall be issued, the director shall take into consideration all requirements of the Liquor Control Act. In the issuance of a license, the director shall specifically consider the nature and number of prior violations of the Liquor Control Act by the applicant or of any citations issued within the prior five years against a license held by the applicant or in which the applicant had an ownership interest required to be disclosed under the Liquor Control Act. The director shall disapprove the issuance or give preliminary approval of the issuance of the license based upon a review of all documentation submitted and any investigation deemed necessary by the director.

M. Before a new license is issued for a location, the director shall cause a notice of the application [therefor] for the license to be posted conspicuously, on a sign not smaller than thirty inches by forty inches, on the outside of the front wall or front entrance of the immediate premises for which the license is sought or, if no building or improvements exist on the premises, the notice shall be posted at the front entrance of the immediate premises for which the license is sought, on a billboard not smaller than five feet by five feet. The contents of the notice shall be in the form prescribed by the department, and such posting shall be over a continuous period of twenty days prior to preliminary approval of the license. The director shall prescribe the manner in which the posting may be accomplished by the licensee, the licensee's representative or the director's designee.

N. A license shall not be issued until the posting requirements of Subsection M of this section have been met.

O. All costs of publication and posting shall be paid by the applicant.

P. It is unlawful for a person to remove or deface a notice posted in accordance with this section. A person convicted of a violation of this subsection shall be punished by a fine of not more than three hundred dollars ($300) or by imprisonment in the county jail for not more than one hundred twenty days or by both.

Q. A person aggrieved by a decision made by the director as to the approval or disapproval of the issuance of a license may appeal to the district court pursuant to the provisions of Section 39-3-1.1 NMSA 1978. If the disapproval is based upon local option district disapproval pursuant to Subsection H of Section 60-6B-4 NMSA 1978, the local option district shall be a necessary party to [any] an appeal. The decision of the director shall continue in force, pending a reversal or modification by the district court, unless otherwise ordered by the court."

Section 2. Section 60-6B-5 NMSA 1978 (being Laws 1981, Chapter 39, Section 41, as amended) is amended to read:

"60-6B-5. EXPIRATION AND RENEWAL OF LICENSES.--Effective January 1, 2008, dispenser, retailer and canopy licenses shall expire on October 31 of each year and may be renewed yearly thereafter. Dispenser, retailer and canopy licensees shall pay renewal fees in a prorated amount not to exceed one thousand seven hundred thirty-four dollars ($1,734) in 2008, and thereafter shall pay license fees pursuant to Chapter 60, Article 6A NMSA 1978. All other licenses provided for in the Liquor Control Act, except nonresident licenses and common carrier registrations, shall expire on June 30 of each year and may be renewed from year to year under the rules of the department. Current nonresident licenses and common carrier registrations shall expire on June 30, 1998 and may be renewed for three-year periods thereafter. The director shall determine whether any of the licensees under [his] the director's jurisdiction are delinquent in any taxes administered by the taxation and revenue department as of [June 1 of each renewal period] the first day of the month in which the license expires. The director shall also determine whether [or not] there exists any other reason why a license should not be renewed. If the director determines that the license should not be renewed, [he] the director shall enter an order requiring the licensee, after notice, to show cause why [his] the licensee's license should be renewed, and [he] the director shall conduct a hearing on the matter. If, after the hearing, the director finds that the licensee is qualified, [he] the director shall renew the license."

Section 3. Section 60-6B-6 NMSA 1978 (being Laws 1981, Chapter 39, Section 42, as amended) is amended to read:

"60-6B-6. CORPORATE LICENSEES--LIMITED PARTNERSHIP LICENSEES--REPORTING.--

A. A corporation [which] that holds a license issued under the Liquor Control Act shall notify the director within thirty days after the occurrence of any change in the officers, directors or holders of more than ten percent of the voting stock of the corporation, giving the names and addresses of the new officers, directors or stockholders. A corporate licensee shall also notify the director immediately of a change of agent by filing a new power of attorney. The director shall by regulation define what corporate changes, including but not limited to transfer of stock, merger and consolidation, constitute transfers of ownership of corporate licenses and shall, upon making such a determination, order appropriate compliance with the Liquor Control Act, provided that a transfer of ownership of a corporate license shall not be deemed to occur where ultimate ownership of the corporation does not change.

B. A limited partnership [which] that holds a license issued under the Liquor Control Act shall notify the director within thirty days after the occurrence of any change of general partners or of limited partners contributing ten percent or more of the total value of contributions made to the limited partnership or entitled to ten percent or more of the profits earned or other compensation by way of income paid by the limited partnership. The director shall by regulation define what limited partnership changes constitute transfers of ownership of limited partnership licenses and shall, upon making such determination, order appropriate compliance with the Liquor Control Act, provided that a transfer of ownership of a licensee that is a limited partnership shall not be deemed to occur where ultimate ownership of the limited partnership does not change.

C. A legal entity [which] that is not a corporation or limited partnership and [which] that holds a license issued under the Liquor Control Act shall notify the director within thirty days after the occurrence of any change in the trustees or partners or owners of more than a ten percent interest in the entity, giving the names and addresses of the new trustees, partners or owners. The director shall by regulation define what entity changes constitute a transfer of ownership of such entity's license and shall, upon making such determination, order appropriate compliance with the Liquor Control Act, provided that a transfer of ownership of a licensee shall not be deemed to occur where there is no change in the ultimate ownership of the legal entity."

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