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Alcohol Code Revision Commission to study permits, quotas

July 18, 2018

The Indiana Alcohol Code Revision Commission went back to work on Wednesday with a new leader and a new slate of alcohol-related issues to study ahead of the 2019 legislative session.

At its first meeting after the successful passage of Sunday sales legislation earlier this year, the commission charted its course for this year’s possible legislative recommendations. Topics on the agenda included reducing the complexity and increasing the consistency of Indiana’s alcohol licensing laws, evaluating the permit quota structure, and studying over-consumption and its causes and effects.

Led by former state Rep. Bill Davis – whom House Speaker Brian Bosma appointed to replace former chair Beverly Gard – the commission spent much of Wednesday’s meeting discussing the growing number of Indiana alcohol permit types and the complexity of obtaining a permit in light of the state’s quota system. As an example, Rep. Ben Smaltz, the Auburn Republican who championed Sunday sales legislation in the House of Representatives, read directly from state code and listed several permit types relating only to beer, including “beer dealer – social club,” “beer retailer – fraternal,” “beer retailer – social club,” “beer retailer – stadium” and “seasonal resort hotel.”

“Why don’t we just have a “beer dealer?’” Smaltz said.

Smaltz also raised concerns about alcohol permits that are being held in escrow, meaning that they have been granted but are not in use. He said roughly 800 permits are currently sitting on the sidelines, creating a “competitive disadvantage” for business owners who want to sell alcohol but cannot do so because many of the state’s available permits – which are limited by the quota system – are unavailable but not in use.

During her presentation before the legislative commission, Jessica Allen, executive secretary for the Alcohol and Tobacco Commission, identified 12 different ways alcohol permits can be attained through the quota system, with each way depending on permittee type, population and/or alcohol type. Rep. Matt Lehman, R-Berne, questioned how each population limit was set and suggested that those limits be re-visited.

Lehman specifically referenced the situation in his town, Berne, where there is only one bar. The representative said local entrepreneurs in Berne want to open an upscale restaurant that serves alcohol, but cannot do so because the bar already has the only available permit.

Lindsey Moss, the assistant government affairs director and legislative council to Aim Indiana, expressed a similar sentiment, telling commission members that municipalities’ economic development efforts are often frustrated by the quota limits and permit requirements. And Fishers Deputy Mayor Leah McGrath said the quota structure is unable to keep up with the population boom in the northern Indianapolis suburb.

Aside from discussion about permit and quota requirements, commission members also discussed the impact alcohol-related legislation has on the ATC. According to Rep. Terri Austin, D-Anderson, the ATC’s responsibilities have grown in recent years as alcohol laws have changed, but its resources and personnel have not kept pace. Allen said the commission has 23 to 28 staffers, plus herself, a prosecutor and the four-person commission.

To that end, Smaltz suggested working in concert with the Interim Study Committee on Fiscal Policy to determine if additional funding could be allocated to the ATC.

Read more about the first meeting of the Alcohol Code Revision Commission in the July 25 issue of Indiana Lawyer.

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