Following the trail of California’s booze exemptions

Assemblyman Chris Norby wants to end the parade of piecemeal exemptions from the state’s alcoholic beverage laws – at least for community colleges.

The time-conscious Irvine Republican, who routinely chides his colleagues for squandering legislative floor sessions debating resolutions, was in a committee hearing in which one community college district sought an exemption from the state’s ban on drinking alcohol on school campuses.

There is already an exception to the ban for “special events” such as foundation-sponsored or student-sponsored fundraisers but only for those held at community colleges “located in a county of the first, fourth or 10th class.”

Because the state constitution bans special legislation, counties are classified in the Government Code based on their population, allowing bills to be specifically targeted.

Respectively, exemptions exist for campuses in Los Angeles, Alameda and San Mateo counties.  

Traditionally, exemptions sought to California’s liquor laws have been done one entity at a time.

Norby thinks that’s a waste.

“Listening to the discussion of the bill, Chris thought every individual school district is going to have to come to the Legislature and ask for this. Why should they?” said Dave Titus, Norby’s press secretary.

So Norby introduced a measure, AB 319, which extends the exception to all community colleges so long as the event is approved by the college governing boards.

Norby isn’t the first to seek an exception to the school campus drinking ban. There are 16 previously approved ones listed in his bill.

Wine is OK on campus if it is part of an instructional program in viticulture and enology.  Beer or wine that’s part of a culinary arts course is also acceptable.

There are some very narrowly tailored exceptions.

If a school is surplus property leased to a “general law city of less than 50,000” or located in an unincorporated area and used by a civic group as a community center, booze is permitted.

Alcohol is allowed at football games and other events at a “college-owned or operated veterans stadium with a capacity of over 12,000 people, located in a county with a population of over 6 million.” Only Los Angeles has a population over 6 million.

Also winning an exemption is a performing arts facility with more than 300 permanent seats on community college property but leased to a non-profit.

So do any professional minor league baseball games played at a community college in a county with less than 250,000 people.

Curiously, wine can be used on campus for “sacramental or other religious purposes” – but only for services held before January 1, 1995.

This year, among the more than 15 alcohol-related bills introduced, is one that would carve out another exception to the on-campus ban. This one is for events at a city-owned community center when students aren’t engaged in a school-sponsored activity at the site.

Much of alcohol-related legislation centers on what are known as the state’s “tied house” laws.

Those laws, enacted more than 70 years ago, are aimed at preventing manufacturers from dominating local retail markets and using aggressive marketing to create excessive sales of alcohol.

The phrase originates in England where a pub that was either owned by a beer, wine or distilled spirits maker or served only one of the manufacturer’s products was known as a “tied house.”

At the core of California’s “tied house” is a series of prohibitions beginning with Business and Professions Code Section 25500:

“No manufacturer, winegrower, manufacture’s agent, rectifier, California winegrower’s agent, distiller, bottler, importer or wholesaler or any officer, director or agent of any such persons shall hold the ownership, directly or indirectly of any interest in any on-sale license.”

In other words, there’s supposed to be a firewall between manufacturers and retailers.

Retailers receive several types of licenses from the Department of Alcoholic Beverage Control but primarily “on-sale” for bars and restaurants and “off-sale” for supermarkets and convenience stores.

Business and Professions Code Section 25502 lays out the same prohibition for manufacturers having interests in entities holding off-sale licenses.

Even from its enactment, the law has contained exemptions to its blanket prohibition. The fifth paragraph of Section 25500 says someone in a county with a population not exceeding 15,000 can hold both a wholesaler and on-sale license.

Paid advertising by vintners, beer makers and producers of distilled spirits at sports or entertainment venues owned by someone with a retail liquor license is also prohibited.
Over the years, numerous holes have been punched in that provision, as most attendees of sports events or concerts would quickly notice.

Twelve are listed in Section 25503.6 including Disneyland, Kern County Arena, Fresno’s Grizzly Stadium, Carson’s Home Depot Center, San Jose’s HP Pavilion, Raley Field in West Sacramento, Fontana’s California Speedway, the Indian Wells Tennis Club and what’s now Powerband Pavilion in Sacramento.

Assembly Speaker John Perez, a Los Angeles Democrat, gained some notoriety in 2009 carrying an exemption for AEG – the Anschutz Entertainment Group – which owns both Home Depot Center and the Staples Center in Los Angeles.

Perez’s bill gave a license to AEG in addition to the one held by Wolfgang Puck who is contracted to provide food and beverage at AEG’s Club Nokia in Los Angeles. With a license in hand, AEG could negotiate with an alcoholic beverage supplier for advertising space at the venue.

This legislative session, an advertising exemption was sought by John F. Quinn, the CEO of Stockton-based PAQ Inc., which operates a string of supermarkets in the Central Valley. Quinn also runs Q Productions, whose website has ads for Food4Less and Rancho Miguel markets, the two chains PAQ operates.

The bill, AB 775 by Assemblywoman Cathleen Galgiani, a Tracy Democrat, would have allowed Quinn to negotiate with alcoholic beverage makers to sponsor or advertise at events at various venues in San Luis Obispo, San Joaquin and Stanislaus counties where Q Productions could produce sporting or concert events.

Galgiani’s office said she was not moving the measure out of the Assembly Governmental Organization Committee.

The Food Network’s Guy Fieri is also looking for a change in state law to allow sponsorship from alcohol makers. Assemblywoman Fiona Ma, a San Francisco Democrat, has been working with him on legislation, which has yet to be introduced.

Negotiators of the deal say the bill will allow Fieri to accept sponsorships but none of their products can be sold in Fieri’s restaurants.

Among the other alcohol-related legislation:
*SB 346 by Sen. Tom Harmon, a Huntington Beach Republican, would add gondola rides to limousines and hot air balloon rides, which can offer alcohol without getting a license.

*AB 351 by Assemblyman Wes Chesbro, a Eureka Democrat, would allow vintners and beer makers to talk to license holders about the “composition” of their products. The law now says manufacturers can only talk about the “history, nature, values and characteristics” of beer and wine.

*AB 623 by Assemblyman Das Williams, a Santa Barbara Democrat, would create a new type of off-sale wine license for
wine sold through the Internet, direct mail or by telephone.

*SB 487 by Sen. Gloria Negrete-McLeod, a Chino Democrat, would allow nonprofits or other groups who obtain temporary licenses for special events or fundraisers to return unopened or unsold beer to who they purchased it from.

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