Bills Seeking to Amend the Michigan Liquor Control Code Advance

Posted on June 19, 2020 by Jennifer Rigterink

Three pieces of legislation tie-barred to one another saw action this week that are designed to assist restaurants and bars with alcohol service in response to the COVID-19 pandemic’s effect on their businesses being closed, and now operating at reduced occupancy limits.

House Bill 5781 would allow a municipality to establish a social district, if they so choose. Within that established district a commons area (one or more) would be designated. A qualified licensee would obtain a permit from the Michigan Liquor Control Commission (after working with the local municipality) to sell/dispense alcoholic beverages to customers who would then walk to and consume the beverage in the clearly marked commons area of the social district. A person who bought an alcoholic beverage from a social district permittee could take the drink in to the commons area, but could not take it out of the commons area. A social district designation would have to be filed with the MLCC.

The legislative analysis states a commons area means an area within a social district that is clearly designated and clearly marked by the governing body of the local governmental unit and that is shared by and contiguous to the premises of at least two qualified licensees. A commons area would not include the licensed premises of any qualified licensee.

If a municipality chooses to establish a social district they’re required to submit a local management and maintenance plan to the MLCC that includes, but isn’t limited to, hours of operation for the commons area. The governing body would have the ability to revoke the social district designation if it is determined that the commons area is a public nuisance or threatens the health, safety, or welfare of the public. At least one public meeting would need to take place beforehand and the revocation would have to be filed with the MLCC.

The bill has a sunset of December 31, 2024 and the provisions would no longer apply after that date.

House Bill 5811 would allow restaurants and bars who are qualified licensees the ability to sell cocktails to-go or for delivery, similar to beer and wine. A qualified licensee could not sell alcoholic liquor in its original packaging, except as otherwise allowed under the liquor code. The bill has a sunset of December 31, 2025.

Senate Bill 942 would amend the Michigan Liquor Control Code to increase the discount allowed to on-premises licensees on liquor bought from the state for the 12 months following the bill being enacted. The bill would also increase the the amount a specially designated distributor is allowed to sell to an on-premises retailer during a calendar year.

The bills are tie-barred to one another, which means that none of them can take effect
unless all of them are enacted. The bills have cleared the House and are expected to see movement in the Senate next week. Proponents are hoping the bills are enacted in to law by the beginning of July, 2020.

Jennifer Rigterink is a legislative associate for the League handling economic development, land use and municipal services issues.  She can be reached at [email protected] or 517-908-0305.

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