103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
SB3245

 

Introduced 2/6/2024, by Sen. Cristina Castro

 

SYNOPSIS AS INTRODUCED:
 
235 ILCS 5/6-4  from Ch. 43, par. 121

    Amends the Liquor Control Act of 1934. Provides that any person licensed as a brewer, class 1 brewer, or class 2 brewer shall be permitted to sell on the licensed premises to non-licensees for on-premises or off-premises consumption (instead of for on or off-premises consumption for the premises in which he or she actually conducts such business). Provides that any person licensed as a brewer, class 1 brewer, or class 2 brewer may sell wine or spirits on the licensed premises for off-premises consumption. Provides that any person licensed as a brewer may designate, contract with, use, and pay reasonable compensation to a management company, including a retail licensee, to provide services to the licensed brewer for the licensed premises if: (1) the compensation paid to the management company represents fair market value for the services provided; (2) the agreements under which the arrangements are made were approved by the Illinois Liquor Control Commission; and (3) the arrangements are not a subterfuge to provide any retailer with a prohibited thing of value.


LRB103 37761 RPS 67889 b

 

 

A BILL FOR

 

SB3245LRB103 37761 RPS 67889 b

1    AN ACT concerning liquor.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Liquor Control Act of 1934 is amended by
5changing Section 6-4 as follows:
 
6    (235 ILCS 5/6-4)  (from Ch. 43, par. 121)
7    Sec. 6-4. (a) No person licensed by any licensing
8authority as a distiller, or a wine manufacturer, or any
9subsidiary or affiliate thereof, or any officer, associate,
10member, partner, representative, employee, agent or
11shareholder owning more than 5% of the outstanding shares of
12such person shall be issued an importing distributor's or
13distributor's license, nor shall any person licensed by any
14licensing authority as an importing distributor, distributor
15or retailer, or any subsidiary or affiliate thereof, or any
16officer or associate, member, partner, representative,
17employee, agent or shareholder owning more than 5% of the
18outstanding shares of such person be issued a distiller's
19license, a craft distiller's license, or a wine manufacturer's
20license; and no person or persons licensed as a distiller,
21craft distiller, class 1 craft distiller, or class 2 craft
22distiller by any licensing authority shall have any interest,
23directly or indirectly, with such distributor or importing

 

 

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1distributor.
2    However, an importing distributor or distributor, which on
3January 1, 1985 is owned by a brewer, or any subsidiary or
4affiliate thereof or any officer, associate, member, partner,
5representative, employee, agent or shareholder owning more
6than 5% of the outstanding shares of the importing distributor
7or distributor referred to in this paragraph, may own or
8acquire an ownership interest of more than 5% of the
9outstanding shares of a wine manufacturer and be issued a wine
10manufacturer's license by any licensing authority.
11    (b) The foregoing provisions shall not apply to any person
12licensed by any licensing authority as a distiller or wine
13manufacturer, or to any subsidiary or affiliate of any
14distiller or wine manufacturer who shall have been heretofore
15licensed by the State Commission as either an importing
16distributor or distributor during the annual licensing period
17expiring June 30, 1947, and shall actually have made sales
18regularly to retailers.
19    (c) Provided, however, that in such instances where a
20distributor's or importing distributor's license has been
21issued to any distiller or wine manufacturer or to any
22subsidiary or affiliate of any distiller or wine manufacturer
23who has, during the licensing period ending June 30, 1947,
24sold or distributed as such licensed distributor or importing
25distributor alcoholic liquors and wines to retailers, such
26distiller or wine manufacturer or any subsidiary or affiliate

 

 

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1of any distiller or wine manufacturer holding such
2distributor's or importing distributor's license may continue
3to sell or distribute to retailers such alcoholic liquors and
4wines which are manufactured, distilled, processed or marketed
5by distillers and wine manufacturers whose products it sold or
6distributed to retailers during the whole or any part of its
7licensing periods; and such additional brands and additional
8products may be added to the line of such distributor or
9importing distributor, provided, that such brands and such
10products were not sold or distributed by any distributor or
11importing distributor licensed by the State Commission during
12the licensing period ending June 30, 1947, but can not sell or
13distribute to retailers any other alcoholic liquors or wines.
14    (d) It shall be unlawful for any distiller licensed
15anywhere to have any stock ownership or interest in any
16distributor's or importing distributor's license wherein any
17other person has an interest therein who is not a distiller and
18does not own more than 5% of any stock in any distillery.
19Nothing herein contained shall apply to such distillers or
20their subsidiaries or affiliates, who had a distributor's or
21importing distributor's license during the licensing period
22ending June 30, 1947, which license was owned in whole by such
23distiller, or subsidiaries or affiliates of such distiller.
24    (e) Any person licensed as a brewer, class 1 brewer, or
25class 2 brewer shall be permitted to sell on the licensed
26premises to non-licensees for on-premises on or off-premises

 

 

SB3245- 4 -LRB103 37761 RPS 67889 b

1consumption for the premises in which he or she actually
2conducts such business: (i) beer manufactured by the brewer,
3class 1 brewer, class 2 brewer, or class 3 brewer; (ii) beer
4manufactured by any other brewer, class 1 brewer, class 2
5brewer, or class 3 brewer; and (iii) cider, or mead, wine, or
6spirits. Any person licensed as a class 3 brewer shall be
7permitted to sell on the licensed premises to non-licensees
8for on-premises on or off-premises off premises consumption
9for the premises in which he or she actually conducts such
10business: (i) beer manufactured by the class 3 brewer on the
11premises; (ii) beer manufactured by any other brewer, class 1
12brewer, class 2 brewer, or class 3 brewer; and (iii) cider,
13wine, and spirits. All products sold under this subsection
14that are not manufactured on premises must be purchased
15through a licensed distributor, importing distributor, or
16manufacturer with self-distribution privileges. Such sales
17shall be limited to on-premises, in-person sales only, for
18lawful consumption on or off premises. Such authorization
19shall be considered a privilege granted by the brewer license
20and, other than a manufacturer of beer as stated above or a
21designated management company, including a retail licensee, as
22described in this subsection, no manufacturer or distributor
23or importing distributor, excluding airplane licensees
24exercising powers provided in paragraph (i) of Section 5-1 of
25this Act, or any subsidiary or affiliate thereof, or any
26officer, associate, member, partner, representative, employee

 

 

SB3245- 5 -LRB103 37761 RPS 67889 b

1or agent, or shareholder shall be issued a retailer's license,
2nor shall any person having a retailer's license, excluding
3airplane licensees exercising powers provided in paragraph (i)
4of Section 5-1 of this Act, or any subsidiary or affiliate
5thereof, or any officer, associate, member, partner,
6representative or agent, or shareholder be issued a
7manufacturer's license or importing distributor's license.
8    Notwithstanding any other provision of this Act, any
9person licensed as a brewer may designate, contract with, use,
10and pay reasonable compensation to a management company,
11including a retail licensee, to provide services to the
12licensed brewer for the licensed premises if: (1) the
13compensation paid to the management company represents fair
14market value for the services provided; (2) the agreements
15under which the arrangements are made were approved by the
16State Commission; and (3) the arrangements are not a
17subterfuge to provide any retailer with a prohibited thing of
18value in violation of Section 6-5.
19    A manufacturer of beer that imports or transfers beer into
20this State must comply with Sections 6-8 and 8-1 of this Act.
21    A person who holds a class 2 brewer license and is
22authorized by this Section to sell beer to non-licensees shall
23not sell beer to non-licensees from more than 3 total brewer or
24commonly owned brew pub licensed locations in this State. The
25class 2 brewer shall designate to the State Commission the
26brewer or brew pub locations from which it will sell beer to

 

 

SB3245- 6 -LRB103 37761 RPS 67889 b

1non-licensees.
2    A person licensed as a class 1 craft distiller or a class 2
3craft distiller, including a person who holds more than one
4class 1 craft distiller or class 2 craft distiller license,
5not affiliated with any other person manufacturing spirits may
6be authorized by the State Commission to sell (1) up to 5,000
7gallons of spirits produced by the person to non-licensees for
8on or off-premises consumption for the premises in which he or
9she actually conducts business permitting only the retail sale
10of spirits manufactured at such premises and (2) vermouth
11purchased through a licensed distributor for on-premises
12consumption. Such sales shall be limited to on-premises,
13in-person sales only, for lawful consumption on or off
14premises, and such authorization shall be considered a
15privilege granted by the class 1 craft distiller or class 2
16craft distiller license. A class 1 craft distiller or class 2
17craft distiller licensed for retail sale shall secure liquor
18liability insurance coverage in an amount at least equal to
19the maximum liability amounts set forth in subsection (a) of
20Section 6-21 of this Act.
21    A class 1 craft distiller or class 2 craft distiller
22license holder shall not deliver any alcoholic liquor to any
23non-licensee off the licensed premises. A class 1 craft
24distiller or class 2 craft distiller shall affirm in its
25annual license application that it does not produce more than
2650,000 or 100,000 gallons of distilled spirits annually,

 

 

SB3245- 7 -LRB103 37761 RPS 67889 b

1whichever is applicable, and that the craft distiller does not
2sell more than 5,000 gallons of spirits to non-licensees for
3on or off-premises consumption. In the application, which
4shall be sworn under penalty of perjury, the class 1 craft
5distiller or class 2 craft distiller shall state the volume of
6production and sales for each year since the class 1 craft
7distiller's or class 2 craft distiller's establishment.
8    A person who holds a class 1 craft distiller or class 2
9craft distiller license and is authorized by this Section to
10sell spirits to non-licensees shall not sell spirits to
11non-licensees from more than 3 total distillery or commonly
12owned distilling pub licensed locations in this State. The
13class 1 craft distiller or class 2 craft distiller shall
14designate to the State Commission the distillery or distilling
15pub locations from which it will sell spirits to
16non-licensees.
17    (f) (Blank).
18    (g) Notwithstanding any of the foregoing prohibitions, a
19limited wine manufacturer may sell at retail at its
20manufacturing site for on or off premises consumption and may
21sell to distributors. A limited wine manufacturer licensee
22shall secure liquor liability insurance coverage in an amount
23at least equal to the maximum liability amounts set forth in
24subsection (a) of Section 6-21 of this Act.
25    (h) The changes made to this Section by Public Act 99-47
26shall not diminish or impair the rights of any person, whether

 

 

SB3245- 8 -LRB103 37761 RPS 67889 b

1a distiller, wine manufacturer, agent, or affiliate thereof,
2who requested in writing and submitted documentation to the
3State Commission on or before February 18, 2015 to be approved
4for a retail license pursuant to what has heretofore been
5subsection (f); provided that, on or before that date, the
6State Commission considered the intent of that person to apply
7for the retail license under that subsection and, by recorded
8vote, the State Commission approved a resolution indicating
9that such a license application could be lawfully approved
10upon that person duly filing a formal application for a retail
11license and if that person, within 90 days of the State
12Commission appearance and recorded vote, first filed an
13application with the appropriate local commission, which
14application was subsequently approved by the appropriate local
15commission prior to consideration by the State Commission of
16that person's application for a retail license. It is further
17provided that the State Commission may approve the person's
18application for a retail license or renewals of such license
19if such person continues to diligently adhere to all
20representations made in writing to the State Commission on or
21before February 18, 2015, or thereafter, or in the affidavit
22filed by that person with the State Commission to support the
23issuance of a retail license and to abide by all applicable
24laws and duly adopted rules.
25    (i) Notwithstanding any other provision of this Act, the
26common ownership of a brewery, winery, or a distillery shall

 

 

SB3245- 9 -LRB103 37761 RPS 67889 b

1not authorize the grant of and aggregation of retail
2privileges granted to any person or licensees in subsection
3(e). Any person or licensee with common ownership in a
4brewery, winery, or a distillery shall be limited to the
5retail privileges granted to only one of the commonly owned
6brewery, winery, or distillery. The State Commission is hereby
7authorized to restrict the locations of any commonly owned
8brewery, winery, or distillery to prevent the expansion of
9retail privileges, including, without limitation, restricting
10a commonly owned brewery, winery, or distillery from operating
11in adjacent licensed premises or restricting self-distribution
12privileges.
13(Source: P.A. 101-81, eff. 7-12-19; 101-482, eff. 8-23-19;
14101-615, eff. 12-20-19; 102-442, eff. 8-20-21.)