NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
 
BILL NUMBER: A6989
SPONSOR: Hunter
 
TITLE OF BILL:
An act to amend the alcoholic beverage control law, in relation to
establishing supermarket wine licenses
 
PURPOSE:
To allow certain off premises sales locations to sell wine in addition
to their existing alcohol sales of beer, cider, and wine products.
 
SUMMARY OF PROVISIONS:
This bill creates a new definition of supermarket for purposes of estab-
lishing a supermarket wine license. This license would only be available
to full-service grocery stores that are primarily engaged in the sale of
food (at least 65% of sales from food-related products), already have a
license for off premises beer sales, and are more than five thousand
square feet. Applicants would pay a one-time franchise fee of ten thou-
sand dollars per location. There would also be an annual fee for main-
taining such licenses that is based on the licensee's total sales of
wine in the prior year. Sales of New York wines would not be included,
thereby providing an incentive to promote and sell New York wines.
 
JUSTIFICATION:
New York's restriction on the sale of wine in supermarkets can be traced
back to the era of Prohibition. While many laws have been updated to
reflect modern times, consumers are still stuck making multiple trips to
different stores for groceries and wine. This anachronistic model
provides no consumer protections, but instead protects an entrenched
monopoly that is to the detriment of convenient access for consumers. If
consumers can be trusted to buy beer in supermarkets, they should be
given the option to also purchase wine with their groceries as well.
A January 2023 Siena poll found that 76% of New Yorkers support the sale
of wine in grocery stores and 86% supported modernizing NY laws on wine
sales to create more opportunities for NY wineries and grape producers
to sell their products. New York is the only major wine-producing state
that does not allow wine to be sold in grocery stores- unlike our larg-
est competitors California, Washington, and Oregon- and New York's
wineries will significantly benefit from increased distribution in
supermarkets under this bill.
Currently, more than forty states allow for the sale of wine in super-
markets. In the states where wine is sold in grocery stores, such as
Florida, liquor stores still exist and thrive. Allowing supermarkets to
sell wine is simply about consumer access and ease, while also striking
a balance - not including liquor - which ensures there will always be a
market for traditional liquor stores. These traditional liquor stores
will also likely continue to offer wines beyond what a supermarket can
dedicate floor space to.
The requirement for 65% of sales to be food-related will exclude
national big box retailers and superstores (which may sell some food,
but primarily are general goods retailers with significant buying
power). Additionally, the bill's proposed minimum square foot threshold
of 5,000 square feet would ensure that only full-service grocery stores
are included, and not thousands of smaller convenience stores, gas
station quick marts, drug stores, etc.
This legislation also seeks to incentivize the sale of New York made
wines by providing reductions in the stores' annual fees for New York
wines sold. The focus on New York wines will greatly boost New York
wineries and provide a steady stream of new customers for locally made
products.
 
LEGISLATIVE HISTORY:
This is a new bill.
 
FISCAL IMPLICATIONS:
None to the State, but there is expected increased revenue from applica-
tion and license fees.
 
EFFECTIVE DATE:
Immediately.
STATE OF NEW YORK
________________________________________________________________________
S. 6786 A. 6989
2023-2024 Regular Sessions
SENATE - ASSEMBLY
May 10, 2023
___________
IN SENATE -- Introduced by Sens. KRUEGER, COONEY, FELDER, HOYLMAN-SIGAL
-- read twice and ordered printed, and when printed to be committed to
the Committee on Investigations and Government Operations
IN ASSEMBLY -- Introduced by M. of A. HUNTER, HYNDMAN, WILLIAMS,
CUNNINGHAM -- read once and referred to the Committee on Economic
Development
AN ACT to amend the alcoholic beverage control law, in relation to
establishing supermarket wine licenses
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 3 of the alcoholic beverage control law is amended
2 by adding a new subdivision 13-a to read as follows:
3 13-a. "Supermarket" shall mean any retail establishment (a) whose
4 primary business is the sale of foodstuffs for off-premises consumption,
5 and (b) which is at least five thousand square feet, in total floor
6 area. There shall be a rebuttable presumption that a retail establish-
7 ment is primarily engaged in the sale of foodstuffs where such sales of
8 foodstuffs constitutes greater than sixty-five percent of the total
9 revenue of such establishment in the twelve months preceding submission
10 of an application.
11 § 2. Subdivisions 3 and 5 of section 75 of the alcoholic beverage
12 control law, subdivision 3 as amended by section 4 of part K of chapter
13 60 of the laws of 2004, subdivision 5 as added by chapter 355 of the
14 laws of 2013, are amended and a new subdivision 6 is added to read as
15 follows:
16 3. Seven day license to sell wine at retail for consumption off the
17 premises subject to paragraph (a) of subdivision fourteen of section one
18 hundred five of this chapter[.];
19 5. Roadside farm market license[.];
20 6. Supermarket wine license.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD10893-01-3
S. 6786 2 A. 6989
1 § 3. The alcoholic beverage control law is amended by adding a new
2 section 79-e to read as follows:
3 § 79-e. Supermarket wine license. 1. Any person may apply to the
4 authority for a license to sell from the licensed premises wine in
5 sealed containers for consumption off such premises.
6 2. No such license shall be issued, however, to any person for any
7 premises other than a supermarket, as defined in subdivision thirteen-a
8 of section three of this chapter.
9 3. (a) Notwithstanding any other provision of this chapter, except for
10 good cause shown, the authority shall issue a supermarket license to the
11 holder of a license to sell beer at retail for consumption off the prem-
12 ises pursuant to section fifty-four of this chapter, or beer and wine
13 products at retail for consumption off the premises pursuant to section
14 fifty-four-a of this chapter, at the request of such licensee and there-
15 after renewed or transferred, which authorizes the holder thereof to
16 sell beer at retail to a person for consumption in his or her home.
17 (b) For the purposes of this section, the premises of the supermarket
18 wine licensee shall be the same as the premises licensed under section
19 fifty-four or fifty-four-a of this chapter.
20 (c) Notwithstanding any other provisions of this chapter, any license
21 issued pursuant to this section shall run concurrently with the underly-
22 ing license under section fifty-four or fifty-four-a of this chapter,
23 and shall be deemed expired at such time as the underlying license
24 expires.
25 (d) Any person licensed to sell wine pursuant to this article shall
26 be permitted to conduct wine tastings. Wine tastings which are conducted
27 under the auspices of an official agent of a farm winery, winery, whole-
28 saler, or importer and where such agent is physically present at all
29 times during the conduct of the tasting, then, in that event, any
30 liability stemming from a right of action resulting from a wine tasting
31 as authorized pursuant to this section, and in accordance with the
32 provisions of sections 11-100 and 11-101 of the general obligations law,
33 shall accrue to the farm winery, winery, wholesaler, or importer.
34 4. Such application shall be in such form and shall contain such
35 information as shall be required by the rules of the authority and shall
36 be accompanied by a check or draft in the amount required by this arti-
37 cle for such license.
38 5. Notwithstanding any other provisions of this chapter, any person
39 receiving a license pursuant to this section shall not be subject to the
40 provisions of subdivision two, three or four of section seventy-nine of
41 this article.
42 6. Notwithstanding any other provisions of this chapter, any person
43 receiving a license pursuant to this section shall not be subject to the
44 provisions of subdivision two, paragraph (a) of subdivision three, and
45 subdivision fourteen of section one hundred five of this chapter.
46 7. (a) A one-time franchise fee shall be paid for by each licensee to
47 the state liquor authority. This franchise fee is hereby imposed at a
48 rate of ten thousand dollars.
49 (b) No license shall be issued pursuant to this section until the
50 franchise fee or estimated franchise fee required by paragraph (a) of
51 this subdivision has been paid in full.
52 (c) The franchise fee shall be deposited and disposed of in the same
53 manner as any license fee as provided in section one hundred twenty-five
54 of this chapter.
55 8. Any person licensed to sell wine at retail for consumption off the
56 premises under section seventy-nine of this article is authorized to
S. 6786 3 A. 6989
1 sell wine to persons licensed to sell wine under this article and this
2 section who operate the premises of the supermarket wine licensee.
3 9. The state liquor authority may make such rules as it deems neces-
4 sary to carry out the provisions of this section.
5 § 4. Section 83 of the alcoholic beverage control law is amended by
6 adding a new subdivision 10 to read as follows:
7 10. The annual fee for a supermarket wine license pursuant to section
8 seventy-nine-e of this article shall be at a rate of one-half (0.5)
9 percent of sales of wine sold, less the amount from sales of wines sold
10 that were produced in New York state.
11 § 5. Subdivision 2-a of section 100 of the alcoholic beverage control
12 law, as amended by chapter 249 of the laws of 2002, is amended to read
13 as follows:
14 2-a. No retailer shall employ, or permit to be employed, or shall
15 suffer to work, on any premises licensed for retail sale hereunder, any
16 person under the age of eighteen years, as a hostess, waitress, waiter,
17 or in any other capacity where the duties of such person require or
18 permit such person to sell, dispense or handle alcoholic beverages;
19 except that: (1) any person under the age of eighteen years and employed
20 by any person holding a grocery or drug store beer license shall be
21 permitted to handle and deliver beer and wine products for such licen-
22 see, (2) any person under the age of eighteen employed as a cashier by a
23 person holding a grocery or drug store beer license shall be permitted
24 to record and receive payment for beer and wine product sales when in
25 the presence of and under the direct supervision of a person eighteen
26 years of age or over, (2-a) any person under the age of eighteen years
27 and employed by a person holding a grocery store or drug store beer
28 license as either a cashier or in any other position to which handling
29 of containers which may have held alcoholic beverages is necessary,
30 shall be permitted to handle the containers if such have been presented
31 for redemption in accordance with the provisions of title ten of article
32 twenty-seven of the environmental conservation law, [and] (3) any person
33 under the age of eighteen years employed as a dishwasher, busboy, or
34 other such position as to which handling of containers which may have
35 held alcoholic beverages is necessary shall be permitted to do so under
36 the direct supervision of a person of legal age to purchase alcoholic
37 beverages in the state, (4) any person under the age of eighteen years
38 and employed by any person holding a supermarket wine license shall be
39 permitted to handle and deliver wine for such licensee, and (5) any
40 person under the age of eighteen employed as a cashier by a person hold-
41 ing a supermarket wine license shall be permitted to record and receive
42 payment for wine when in the presence of and under the direct super-
43 vision of a person eighteen years of age or over.
44 § 6. Subdivisions 3-a and 3-b of section 102 of the alcoholic beverage
45 control law, as amended by chapter 458 of the laws of 1993, are amended
46 to read as follows:
47 3-a. No licensee or permittee shall purchase or agree to purchase any
48 alcoholic beverages from any person within the state who is not duly
49 licensed to sell such alcoholic beverage as the case may be, at the time
50 of such agreement and sale nor give any order for any alcoholic beverage
51 to any individual who is not the holder of a solicitor's permit, except
52 as provided for in section eighty-five [or], ninety-nine-g, or seventy-
53 nine-e of this chapter.
54 3-b. No retail licensee shall purchase, agree to purchase or receive
55 any alcoholic beverage except from a person duly licensed within the
56 state by the liquor authority to sell such alcoholic beverage at the
S. 6786 4 A. 6989
1 time of such agreement and sale to such retail licensee, except as
2 provided for in section eighty-five [or], ninety-nine-g, or seventy-
3 nine-e of this chapter.
4 § 7. Severability clause. If any clause, sentence, paragraph, subdivi-
5 sion, section or part of this act shall be adjudged by any court of
6 competent jurisdiction to be invalid, such judgment shall not affect,
7 impair, or invalidate the remainder thereof, but shall be confined in
8 its operation to the clause, sentence, paragraph, subdivision, section
9 or part thereof directly involved in the controversy in which such judg-
10 ment shall have been rendered. It is hereby declared to be the intent of
11 the legislature that this act would have been enacted even if such
12 invalid provisions had not been included herein.
13 § 8. This act shall take effect immediately.