Posted on March 16, 2012 by sharkins

The Michigan Municipal League has been contacted by several members telling us that the Michigan Liqupr Control Commission is no longer issuing one-day liquor licenses to local units of government for fairs and festivals and other one-day events.  Here is what we know:

Up until this year, local units of government were able to get one-day liquor licenses. This year, though, the Attorney General’s office changed their interpretation of who qualifies for one-day liquor licenses. The Assistant Attorneys General who are counseling the Michigan Liqupor Control Commission are now saying that the statute and rule only allow these licenses to be issued to a bona fide nonprofit organization, duly organized and in continuous existence for one year before the filing of its application (MCL 436.1525(1)(r)).  They are saying that the rule does not specifically require the entity to be a “charitable” nonprofit organization, but the entity must be organized as a nonprofit organization.  They said that the MLCC staff does in the course of their duties check electronic filings of the state’s corporations and securities page to verify such status.  If the entity applying is not a bona fide nonprofit organization and cannot demonstrate that it is such, the entity is not eligible under the statute or the rules (administrative rules R 436.572 – R 436.582). MLCC has said that they are very committed to interpreting the statutes and rules as they are constructed, and they follow the counsel given to them by the Alcohol and Gambling Enforcement Division of the Office of the Attorney General. As such, they now think that municipalities and governmental entities do not qualify.  They do know, though, that many municipalities have created non-profit organizations and foundations.  These entities – provided they meet all criteria – have been issued these licenses.

The Michigan Municipal League is talking to the Governor’s office and to the Liquor Control Commission. We have indicated that this will greatly hurt our members and is against the economic gardening and placemaking strategies of the Governor.  We have been told that the existing rule will continue to be interpreted in this fashion, but that the Governor’s office is seeking to change the rule to allow local governments to qualify.  We do not know, though, the timeline for changing and implementing this rule or whether or not the Administration will support an emergency rule.  We are following this closely and will update the Inside208 blog and weekly Legislative Link email as we have more information.

Andy Schor is the Assistant Director of State Affairs for the Michigan Municipal League. Contact him at (517) 908-0300 or by email at [email protected].

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