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F I S C A L I M P A C T R E P O R T

SPONSOR Vigil

ORIGINAL DATE

LAST UPDATED

2/12/07

HB 986

SHORT TITLE Definition of Licensed Alcohol Premises

SB

ANALYST C. Sanchez

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY07

FY08

NFI

(Parenthesis ( ) Indicate Expenditure Decreases)

SOURCES OF INFORMATION

LFC Files

Responses Received From

Department of Health (DOH)

Attorney General’s Office (AGO)

Regulation and Licensing Department (RLD)

SUMMARY

Synopsis of Bill

House Bill 986 amends NMSA Section 60-3A-3 of the Liquor Control Act to exempt gasoline

stations and other facilities where motor fuel or liquefied petroleum gases or compressed natural

gases are sold for the generation of power in an internal combustion engine from the definition of

“licensed premises".

The bill also provides that the holder of a “qualified license" formerly issued pursuant to the

Liquor Control Act for a location that no longer meets the definition of licensed premises on and

after July 1, 2007 may renew the license in an inactive status and the license shall not be subject

to cancellation for failure to engage in business pursuant to Section 60-6B-7 NMSA 1978 until

July 1, 2009, at which time the director may exercise the discretion provided to the director in

Section 60-6B-7 NMSA 1978 to extend the inactive period for good cause shown. Those

licenses, and any stock of alcoholic beverages held by the licensee, may be sold or otherwise

transferred.

House Bill 986 – Page

2

FISCAL IMPLICATIONS

On its face, HB 986 does not have any fiscal implications. Licenses currently held at gas stations

or locations where gas is sold, will be required to pay a $200.00 fee to transfer the license or a

$250.00 fee to lease the license. When a license is placed into voluntary temporary suspension,

the licensee is required to pay a $20.00 fee.

SIGNIFICANT ISSUES

The bill appears to be intended to prohibit the operation of a liquor license, and the attendant sale

of alcoholic beverages, at fueling stations. NMSA Section 60-7A-4.1 provides that it is unlawful

for any person to sell or attempt to sell alcoholic beverages at any place other than a licensed

premises or as otherwise provided by the Liquor Control Act.

The bill provides for the renewal and transfer of licenses used at fueling stations after July 1,

2007 in spite of provisions in NMSA Section 60-6B-6 requiring cancellation of licenses held by

businesses which have failed to operate continuously for 120 days.

ADMINISTRATIVE IMPLICATIONS

The staff of the Alcohol and Gaming Division will be required to provide close scrutiny on

licenses currently held at locations that sell gasoline.

CONFLICT, DUPLICATION, COMPANIONSHIP, RELATIONSHIP

HB986 duplicates SB 191 which amends the Liquor Control Act as it related to the definitions of

“club" and “licensed premises".

HB986 relates to HB 754 which would prohibit the issuance of a retail liquor license within one-

half mile of an interstate highway in NM and provide for transfer of existing liquor license.

OTHER SUBSTANTIVE ISSUES

According to the Department of Health studies of restrictions on retail availability of alcohol

have generally found that reduced retail availability results in lower alcohol consumption and

associated problems. Local regulations to prevent underage drinking such as restricting or

prohibiting concurrent sales of alcohol and gasoline have been enacted in other states. Other

strategies, such as responsible beverage service practices, have been shown to decrease service to

intoxicated patrons and underage persons in bars, restaurants, and off-license premises.

In New Mexico, there are no comprehensive data available on location of alcohol sales.

However, according to a Metro Court study in 2005, 8% of persons arrested for DWI had

obtained alcohol from a grocery or convenience store prior to their arrest.

In addition, 2.5% of high school students who were past 30-day drinkers usually got their alcohol

by buying it in “a store such as a liquor store, convenience store, supermarket, discount store, or

gas station" (NM Youth Risk and Resiliency Survey, 2005). The frequency of DWI was 47%

among those who usually bought their alcohol at “stores", compared to 50% who bought alcohol

House Bill 986 – Page

3

at restaurants, 31% who bought alcohol at public events, and 21% who received it from a person

18 years or older.

WHAT WILL BE THE CONSEQUENCES OF NOT ENACTING THIS BILL

The Liquor Control Act would not be amended to change the definitions of “licensed premises"

and “club".

CS/csd