Reprinted

March 4, 2003





HOUSE BILL No. 1738

_____


DIGEST OF HB 1738 (Updated March 3, 2003 4:50 PM - DI 103)



Citations Affected: IC 7.1-1; IC 7.1-2; IC 7.1-3; IC 7.1-4; IC 35-46.

Synopsis: Various alcoholic beverage and tobacco matters. Limits the deposit of an alcoholic beverage dealer or retailer permit with the alcohol and tobacco commission to three years. Reduces the fee for a tobacco sales certificate from $100 to $50. Increases the supplemental caterer's permit fees and employee permit fees. Establishes a fee of $10 for a duplicate or reissued permit. Provides requirements for the location of the display of alcoholic beverages. Requires tobacco retailers to have certificates to sell tobacco products. Authorizes the alcohol and tobacco commission to issue and enforce certificates. Provides that fees collected shall be deposited in the enforcement and administration fund. Amends provisions concerning the sale and distribution of tobacco products. Provides that the prosecutor for the alcohol and tobacco commission has the powers pertaining to tobacco that the prosecutor has for alcohol offenses. Provides that failure to pay civil penalties for certain violations is a Class B infraction. Provides that a person who sells or distributes tobacco products without a certificate commits a class A infraction. Provides that selling tobacco products to minors at least 6 times within 6 months is a Class B infraction. Repeals prohibition on certain tobacco billboard advertisements. Repeals a provision prohibiting the issuance of a season permit to a person who: (1) owns, manages, or controls a resort hotel; and (2) has violated an alcoholic beverage law. Repeals a provision concerning advertising of tobacco products that is preempted by federal law.

Effective: Upon passage; July 1, 2003.





Kuzman




    January 21, 2003, read first time and referred to Committee on Public Policy, Ethics and Veterans Affairs.
    February 25, 2003, amended, reported _ Do Pass.
    March 3, 2003, read second time, amended, ordered engrossed.





Reprinted

March 4, 2003

First Regular Session 113th General Assembly (2003)


PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana Constitution) is being amended, the text of the existing provision will appear in this style type, additions will appear in this style type, and deletions will appear in this style type.
Additions: Whenever a new statutory provision is being enacted (or a new constitutional provision adopted), the text of the new provision will appear in this style type. Also, the word NEW will appear in that style type in the introductory clause of each SECTION that adds a new provision to the Indiana Code or the Indiana Constitution.
Conflict reconciliation: Text in a statute in this style type or this style type reconciles conflicts between statutes enacted by the 2002 Regular or Special Session of the General Assembly.

HOUSE BILL No. 1738



    A BILL FOR AN ACT to amend the Indiana Code concerning alcoholic beverages and tobacco.

Be it enacted by the General Assembly of the State of Indiana:

SOURCE: IC 7.1-1-1-1; (03)HB1738.2.1. -->     SECTION 1. IC 7.1-1-1-1 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2003]: Sec. 1. General Purposes. The following are the general purposes of this title: are:
        (a) (1) To protect the economic welfare, health, peace and morals of the people of this state.
        (b) (2) To regulate and limit the manufacture, sale, possession, and use of alcohol and alcoholic beverages. and,
        (c) (3) To regulate the sale, possession, and distribution of tobacco products.
        (4)
To provide for the raising of revenue.
SOURCE: IC 7.1-1-2-2; (03)HB1738.2.2. -->     SECTION 2. IC 7.1-1-2-2, AS AMENDED BY P.L.213-2001, SECTION 1, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2003]: Sec. 2. Except as provided in IC 7.1-5-1-3 and IC 7.1-5-1-6, this title applies to the following:
        (1) The
commercial manufacturing, bottling, selling, bartering, importing, transporting, delivering, furnishing, or possessing of alcohol, alcoholic beverages, industrial alcohol, malt, malt syrup,

malt extract, liquid malt or wort.
         (2) The sale, possession, and distribution of tobacco products.

SOURCE: IC 7.1-1-3-8.5; (03)HB1738.2.3. -->     SECTION 3. IC 7.1-1-3-8.5 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2003]: Sec. 8.5. "Certificate" means a tobacco sales certificate for purposes of IC 7.1-3-18.5.
SOURCE: IC 7.1-1-3-47.5; (03)HB1738.2.4. -->     SECTION 4. IC 7.1-1-3-47.5 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2003]: Sec. 47.5. "Tobacco product" has the meaning set forth in IC 7.1-6-1-3.
SOURCE: IC 7.1-2-3-33; (03)HB1738.2.5. -->     SECTION 5. IC 7.1-2-3-33, AS ADDED BY P.L.177-1999, SECTION 5, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2003]: Sec. 33. The commission is authorized to:
        (1) investigate a violation of; and
        (2) enforce a penalty for a violation of;
IC 35-46-1-10, IC 35-46-1-10.2, IC 35-46-1-11.3, IC 35-46-1-11.5, or IC 35-46-1-11.7.
SOURCE: IC 7.1-2-2-5; (03)HB1738.2.6. -->     SECTION 6. IC 7.1-2-2-5 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2003]: Sec. 5. Prosecutor: Powers and Duties. The prosecutor shall have the following powers and duties:
    (a) To prosecute before the commission all violations of laws pertaining to alcohol, and alcoholic beverages, and tobacco, including violations pertaining to tobacco vending machines;
    (b) To prosecute before the commission all violations of the rules and regulations of the commission;
    (c) To assist the prosecuting attorneys of the various judicial circuits in the investigation and prosecution of violations of laws pertaining to alcohol, and alcoholic beverages, and tobacco, including violations pertaining to tobacco vending machines, and to represent the state in these matters;
    (d) To appear before grand juries to assist in their investigations into matters pertaining to alcohol, and alcoholic beverages, and tobacco, including matters pertaining to tobacco vending machines;
    (e) To establish a seal of his office;
    (f) To administer oaths and to do all other acts authorized by law for notaries public; and,
    (g) To employ, with the consent of the commission and at salaries fixed by the commission in their budget, the clerical staff required by him to effectively discharge his duties.
SOURCE: IC 7.1-3-1-3.5; (03)HB1738.2.7. -->     SECTION 7. IC 7.1-3-1-3.5 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2003]: Sec. 3.5. A permittee to whom a retailer or dealer permit has been issued under this title, may

deposit that permit with the commission for a period of one (1) year if the permittee is unable to immediately operate the business to which the permit applies. The commission may extend the term of the deposit for an not more than four (4) additional one (1) year period periods if the permittee is able to show to the satisfaction of the commission that the permittee is making a good faith effort to put the permit into operation.

SOURCE: IC 7.1-3-6-3; (03)HB1738.2.8. -->     SECTION 8. IC 7.1-3-6-3 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2003]: Sec. 3. Reasons for Permit. The commission may issue a temporary beer permit only to:
        (a) (1) Enable a fair, athletic event, barbecue, picnic, wedding reception, convention, exhibition, spectacle or contest to be publicly held and carried on; or
        (b) Accomodate (2) Accommodate the institutional activities of an association, society, charitable or benevolent organization, or a branch of one (1) of these, or both.
SOURCE: IC 7.1-3-18.5; (03)HB1738.2.9. -->     SECTION 9. IC 7.1-3-18.5 IS ADDED TO THE INDIANA CODE AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2003]:
     Chapter 18.5. Tobacco Sales Certificate
    Sec. 1. (a) A person may not sell or distribute a tobacco product at retail without a valid tobacco sales certificate issued by the commission.
    (b) A certificate may only be issued to a person who owns or operates at least one (1) of the following:
        (1) A premises consisting of a permanent building or structure, where the tobacco product is sold or distributed.
        (2) A cigarette vending machine (as defined by IC 35-43-4-7).
    Sec. 2. (a) A person who desires a certificate must provide the following to the commission:
        (1) The applicant's name and mailing address, and the address of the premises for which the permit is being issued.
        (2) A fee of fifty dollars ($50).
    (b) A separate certificate is required for each location where the tobacco products are sold or distributed.

     (c) The fees collected under this section shall be deposited in the enforcement and administration fund under IC 7.1-4-10.
    Sec. 3. (a) A certificate issued by the commission under this chapter must contain the following information:
        (1) The certificate number.
        (2) The permit holder's name.
        (3) The permanent location of the business or vending

machine for which the certificate is issued.
        (4) The expiration date of the certificate.
    (b) A certificate is:
        (1) valid for one (1) year after the date of issuance, unless the commission suspends the certificate; and
        (2) nontransferable.
    Sec. 4. The commission shall adopt rules under IC 4-22-2 to establish procedures for the issuance, renewal, and reinstatement of a certificate.
    Sec. 5. (a) Subject to subsection (b), the commission may suspend the certificate of a person who fails to pay a civil penalty imposed for violating IC 35-46-1-10, IC 35-46-1-10.2, IC 35-46-1-11.5, or IC 35-46-1-11.7.
    (b) Before imposing a civil penalty or suspending a certificate under this chapter, the commission shall provide the written notice of the alleged violation to the certificate holder and conduct a hearing. The commission shall provide written notice of the civil penalty or suspension to the certificate holder.
    Sec. 6. (a) If a certificate has:
            (1) expired; or
            (2) been suspended;
the commission may not reinstate or renew the certificate until all civil penalties imposed against the certificate holder for violating IC 35-46-1-10, IC 35-46-1-10.2, IC 35-46-1-11.5, or IC 35-46-1-11.7 have been paid.
    (b) The failure to pay a civil penalty described in subsection (a) is a Class B infraction.
    Sec. 7. A person who is required to have a certificate under this chapter and who sells or distributes tobacco products without a valid certificate commits a Class A infraction. Each violation of this section constitutes a separate offense.

SOURCE: IC 7.1-3-23-16; (03)HB1738.2.10. -->     SECTION 10. IC 7.1-3-23-16 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2003]: Sec. 16. Revocation upon Conviction. The commission may revoke a wholesaler's, retailer's, or dealer's permit of any type after final judgment of conviction for an offense defined in this title. The commission shall may revoke the permit of a wholesaler, retailer, or dealer upon a second violation of a provision of this title whether a judgment of conviction ensues or not.
SOURCE: IC 7.1-4-4.1-2; (03)HB1738.2.11. -->     SECTION 11. IC 7.1-4-4.1-2, AS ADDED BY P.L.204-2001, SECTION 43, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2003]: Sec. 2. The fee for a supplemental caterer's permit is five one hundred fifty dollars ($5) ($150) per event. year.
SOURCE: IC 7.1-4-4.1-3; (03)HB1738.2.12. -->     SECTION 12. IC 7.1-4-4.1-3, AS ADDED BY P.L.204-2001, SECTION 43, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2003]: Sec. 3. The following biennial license fee is imposed for an employee's permit:
        (1) Five dollars ($5) if the permit is used only to perform volunteer service that benefits a nonprofit organization.
        (2) Twenty Thirty dollars ($20) ($30) if subdivision (1) does not apply.
The term of a biennial employee's license is two (2) years.
SOURCE: IC 7.1-4-4.1-18; (03)HB1738.2.13. -->     SECTION 13. IC 7.1-4-4.1-18 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2003]: Sec. 18. The fee for a duplicate or reissued permit of any type is ten dollars ($10). The fees collected under this section shall be deposited in the enforcement and administration fund under IC 7.1-4-10.
SOURCE: IC 35-46-1-10; (03)HB1738.2.14. -->     SECTION 14. IC 35-46-1-10, AS AMENDED BY P.L.204-2001, SECTION 65, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2003]: Sec. 10. (a) A person who knowingly:
        (1) sells or distributes tobacco to a person less than eighteen (18) years of age; or
        (2) purchases tobacco for delivery to another person who is less than eighteen (18) years of age;
commits a Class C infraction. For a sale to take place under this section, the buyer must pay the seller for the tobacco product.
    (b) It is not a defense that the person to whom the tobacco was sold or distributed did not smoke, chew, or otherwise consume the tobacco.
    (c) The following defenses are available to a person accused of selling or distributing tobacco to a person who is less than eighteen (18) years of age:
        (1) The buyer or recipient produced a driver's license bearing the purchaser's or recipient's photograph, showing that the purchaser or recipient was of legal age to make the purchase.
        (2) The buyer or recipient produced a photographic identification card issued under IC 9-24-16-1, or a similar card issued under the laws of another state or the federal government, showing that the purchaser or recipient was of legal age to make the purchase.
        (3) The appearance of the purchaser or recipient was such that an ordinary prudent person would believe that the purchaser or recipient was not less than the age that complies with regulations promulgated by the federal Food and Drug Administration.
    (d) It is a defense that the accused person sold or delivered the tobacco to a person who acted in the ordinary course of employment or

a business concerning tobacco:
        (1) agriculture;
        (2) processing;
        (3) transporting;
        (4) wholesaling; or
        (5) retailing.
    (e) As used in this section, "distribute" means to give tobacco to another person as a means of promoting, advertising, or marketing the tobacco to the general public.
    (f) Unless a person buys or receives tobacco under the direction of a law enforcement officer as part of an enforcement action, a person who sells or distributes tobacco is not liable for a violation of this section unless the person less than eighteen (18) years of age who bought or received the tobacco is issued a citation or summons under section 10.5 of this chapter.
    (g) Notwithstanding IC 34-28-5-4(c), civil penalties collected under this section must be deposited in the youth tobacco education and enforcement fund (IC 7.1-6-2-6).

SOURCE: IC 35-46-1-10.2; (03)HB1738.2.15. -->     SECTION 15. IC 35-46-1-10.2, AS AMENDED BY P.L.1-2001, SECTION 38, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2003]: Sec. 10.2. (a) A retail establishment that sells or distributes tobacco to a person less than eighteen (18) years of age commits a Class C infraction. For a sale to take place under this section, the buyer must pay the retail establishment for the tobacco product. Notwithstanding IC 34-28-5-4(c), a civil judgment for an infraction committed under this section must be imposed as follows:
        (1) If the retail establishment at that specific business location has not been issued a citation or summons for a violation of this section in the previous ninety (90) days, a civil penalty of fifty dollars ($50).
        (2) If the retail establishment at that specific business location has had one (1) citation or summons issued for a violation of this section in the previous ninety (90) days, a civil penalty of one hundred dollars ($100).
        (3) If the retail establishment at that specific business location has had two (2) citations or summonses issued for a violation of this section in the previous ninety (90) days, a civil penalty of two hundred fifty dollars ($250).
        (4) If the retail establishment at that specific business location has had three (3) or more citations or summonses issued for a violation of this section in the previous ninety (90) days, a civil penalty of five hundred dollars ($500).
A retail establishment may not be issued a citation or summons for a violation of this section more than once every twenty-four (24) hours for each specific business location.
    (b) It is not a defense that the person to whom the tobacco was sold or distributed did not smoke, chew, or otherwise consume the tobacco.
    (c) The following defenses are available to a retail establishment accused of selling or distributing tobacco to a person who is less than eighteen (18) years of age:
        (1) The buyer or recipient produced a driver's license bearing the purchaser's or recipient's photograph showing that the purchaser or recipient was of legal age to make the purchase.
        (2) The buyer or recipient produced a photographic identification card issued under IC 9-24-16-1 or a similar card issued under the laws of another state or the federal government showing that the purchaser or recipient was of legal age to make the purchase.
        (3) The appearance of the purchaser or recipient was such that an ordinary prudent person would believe that the purchaser or recipient was not less than the age that complies with regulations promulgated by the federal Food and Drug Administration.
    (d) It is a defense that the accused retail establishment sold or delivered the tobacco to a person who acted in the ordinary course of employment or a business concerning tobacco:
        (1) agriculture;
        (2) processing;
        (3) transporting;
        (4) wholesaling; or
        (5) retailing.
    (e) As used in this section, "distribute" means to give tobacco to another person as a means of promoting, advertising, or marketing the tobacco to the general public.
    (f) Unless a person buys or receives tobacco under the direction of a law enforcement officer as part of an enforcement action, a retail establishment that sells or distributes tobacco is not liable for a violation of this section unless the person less than eighteen (18) years of age who bought or received the tobacco is issued a citation or summons under section 10.5 of this chapter.
    (g) Notwithstanding IC 34-28-5-5(c), civil penalties collected under this section must be deposited in the youth tobacco education and enforcement fund (IC 7.1-6-2-6).
     (h) A person who violates subsection (a) at least six (6) times in any six (6) month period commits habitual illegal sale of tobacco, a Class B infraction.
SOURCE: IC 7.1-3-23-15; (03)HB1738.2.16. -->     SECTION 16. IC 7.1-3-23-15 IS REPEALED [EFFECTIVE UPON PASSAGE].
SOURCE: IC 35-46-1-11.3; (03)HB1738.2.17. -->     SECTION 17. IC 35-46-1-11.3 IS REPEALED [EFFECTIVE JULY 1, 2003].
SOURCE: ; (03)HB1738.2.18. -->     SECTION 18. An emergency is declared for this act.