Chief Sponsor: Karen Mayne

House Sponsor: ____________


8     General Description:
9          This bill modifies the Alcoholic Beverage Control Act to address the budget of the
10     Department of Alcoholic Beverage Control and the Alcoholic Beverage Control
11     Commission.
12     Highlighted Provisions:
13          This bill:
14          ▸     provides for how the budget is to be determined;
15          ▸     addresses how money is to be spent; and
16          ▸     makes technical changes.
17     Money Appropriated in this Bill:
18          None
19     Other Special Clauses:
20          This bill provides a special effective date.
21     Utah Code Sections Affected:
22     AMENDS:
23          32B-2-301, as last amended by Laws of Utah 2013, Chapter 349

25     Be it enacted by the Legislature of the state of Utah:
26          Section 1. Section 32B-2-301 is amended to read:
27          32B-2-301. State property -- Liquor Control Fund -- Markup Holding Fund.

28          (1) The following are property of the state:
29          (a) the money received in the administration of this title, except as otherwise provided;
30     and
31          (b) property acquired, administered, possessed, or received by the department.
32          (2) (a) There is created an enterprise fund known as the "Liquor Control Fund."
33          (b) Except as provided in Sections 32B-3-205 and 32B-2-304, money received in the
34     administration of this title shall be transferred to the Liquor Control Fund.
35          (3) (a) There is created an enterprise fund known as the "Markup Holding Fund."
36          (b) In accordance with Section 32B-2-304, the State Tax Commission shall deposit
37     revenue remitted to the State Tax Commission from the markup imposed under Section
38     32B-2-304 into the Markup Holding Fund.
39          (c) Money deposited into the Markup Holding Fund may be expended:
40          (i) to the extent appropriated by the Legislature; and
41          (ii) to fund the deposits required by Subsection 32B-2-304(4) and Subsection
42     32B-2-305(4).
43          (4) (a) The department may draw from the Liquor Control Fund only to the extent
44     appropriated by the Legislature or provided for by statute, except that the department may draw
45     by warrant without an appropriation from the Liquor Control Fund for an expenditure that is
46     directly incurred by the department:
47          [(a)] (i) to purchase an alcoholic product;
48          [(b)] (ii) to transport an alcoholic product from the supplier to a warehouse of the
49     department; and
50          [(c)] (iii) for variances related to an alcoholic product.
51          (b) (i) (A) Subject to the other provisions of this Subsection (4), the Legislature shall
52     appropriate from the Liquor Control Fund to the department an amount equal to or greater than
53     15% of the five-year average of gross revenue from sales of liquor by the department calculated
54     under Subsection (4)(b)(i)(B).
55          (B) The five-year average of gross revenue from sales of liquor by the department is
56     the yearly average of the gross revenue, not including sales tax collected, from the sale of
57     liquor by the department for the five fiscal years that have been closed by the Division of
58     Finance that immediately precede the fiscal year for which the calculation is made.

59          (ii) If the five-year average of gross revenue from sales of liquor calculated under
60     Subsection (4)(b)(i), as compared to the gross revenue from sales of liquor in fiscal year
61     2014-2015, does not increase in an amount sufficient to fund the 15% required by Subsection
62     (4)(b)(i), the Legislature shall appropriate an amount equal to or greater than the amount of:
63          (A) the amount appropriated to the department in fiscal year 2014-2015 calculated as a
64     percentage of the gross revenue from sales of liquor; or
65          (B) the amount of the increase calculated as a percentage of the five-year average of
66     gross revenue from sales of liquor by the department calculated under Subsection (4)(b)(i)(B).
67          (c) The department shall use the money appropriated by the Legislature and drawn
68     from the Liquor Control Fund for the following:
69          (i) to pay for the general operations of the department and the commission;
70          (ii) beginning with fiscal year 2016-2017, to raise the minimum salary of part-time
71     department personnel to at least $12.00 per hour;
72          (iii) to increase the salary of assistant store managers in an amount commensurate to
73     the raise described in Subsection (4)(c)(ii);
74          (iv) to assign one manager for each state store;
75          (v) beginning with fiscal year 2016-2017, to maintain at least 50% of the employees of
76     the department as full-time employees determined on the basis of the employee working 40
77     hours a week and being eligible for benefits normally provided by the department;
78          (vi) to provide training for new hires and annual follow-up training for existing state
79     store employees to enhance recognition of an intoxicated or an underage purchaser of an
80     alcoholic product;
81          (vii) to offer to 25% of state store employees on a rotating yearly basis training
82     concerning knowledge of alcoholic products;
83          (viii) for fiscal year 2016-2017, to raise the salary of the full-time, as described in
84     Subsection (4)(c)(v), state store employees by 10%;
85          (ix) to provide sufficient security for state stores; and
86          (x) to cover costs incurred by the department for credit card fees, transportation, and
87     increases in revenue provided to package agencies.
88          (5) The department shall transfer annually from the Liquor Control Fund and the State
89     Tax Commission shall transfer annually from the Markup Holding Fund to the General Fund a

90     sum equal to the amount of net profit earned from the sale of liquor since the preceding transfer
91     of money under this Subsection (5). The transfers shall be calculated by no later than
92     September 1 and made by no later than September 30 after a fiscal year. The Division of
93     Finance may make year-end closing entries in the Liquor Control Fund and the Markup
94     Holding Fund in order to comply with Subsection 51-5-6(2).
95          (6) (a) By the end of each day, the department shall:
96          (i) make a deposit to a qualified depository, as defined in Section 51-7-3; and
97          (ii) report the deposit to the state treasurer.
98          (b) A commissioner or department employee is not personally liable for a loss caused
99     by the default or failure of a qualified depository.
100          (c) Money deposited in a qualified depository is entitled to the same priority of
101     payment as other public funds of the state.
102          (7) If the cash balance of the Liquor Control Fund is not adequate to cover a warrant
103     drawn against the Liquor Control Fund by the department, the cash resources of the General
104     Fund may be used to the extent necessary. At no time may the fund equity of the Liquor
105     Control Fund fall below zero.
106          Section 2. Effective date.
107          This bill takes effect on July 1, 2016.

Legislative Review Note
Office of Legislative Research and General Counsel