DAR File No. 32575

Alcoholic Beverage Control, Administration

R81-4D-1

Licensing

NOTICE OF PROPOSED RULE

DAR File No.: 32575
Filed: 04/29/2009, 10:17
Received by: NL

RULE ANALYSIS

Purpose of the rule or reason for the change:

This rule amendment is being proposed to implement S.B. 187 which was passed by the 2009 State Legislature. (DAR NOTE: S.B. 187 (2009) is found at Chapter 383, Laws of Utah 2009, and was effective 05/12/2009.)

Summary of the rule or change:

The amendment to this rule stipulates that a conference center must be at least 30,000 square feet in size unless it is grandfathered. The amendment also corrects a statutory reference. Both of these amendments are proposed to implement S.B. 187.

State statutory or constitutional authorization for this rule:

Section 32A-1-107

Anticipated cost or savings to:

the state budget:

None--This rule mirrors new language in S.B. 187. Except for possible lost licensing fees for small venues that no longer qualify for this permit (which cannot be determined at this time), this amendment will not affect the state budget.

local governments:

None--On-premise banquet facilities are licensed by the state. This amendment will not affect local governments since they are not involved in this licensing.

small businesses and persons other than businesses:

Since this rule amendment simply mirrors new language in S.B. 187, it does not, in itself, affect small businesses. The new law, however, does affect small businesses in that most small conference centers can be categorized as small businesses and no longer qualifying for an on-premise banquet permit will very likely impede their ability to provide full service to their patrons. Though it is not possible to estimate to what extent small businesses will be affected, it can be surmised that some of these small venues may lose business as a result of the new law.

Compliance costs for affected persons:

It is likely there will be no compliance costs to affected persons unless the owner of a grandfathered small conference center decides to enlarge the space of the facility to qualify for the on-premise baquet permit. None of the owners of grandfathered licensees have indicated they will do this.

Comments by the department head on the fiscal impact the rule may have on businesses:

A majority of the Alcoholic Beverage Control (ABC) commissioners felt that small venues should qualify for an on-premise banquet license because the permit adds controls to the service of alcoholic beverages. The Legislature thought differently. I feel this new law and rule will have a negative fiscal impact on the owners of many small conference centers who would otherwise be licensed to sell liquor in a more responsible and controlled manner. Dennis R. Kellen, Director

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Alcoholic Beverage Control
Administration
1625 S 900 W
SALT LAKE CITY UT 84104-1630

Direct questions regarding this rule to:

Sharon Mackay at the above address, by phone at 801-977-6800, by FAX at 801-977-6889, or by Internet E-mail at smackay@utah.gov

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

06/15/2009

This rule may become effective on:

06/22/2009

Authorized by:

Dennis R. Kellen, Director

R81. Alcoholic Beverage Control, Administration.

R81-4D. On-Premise Banquet License.

R81-4D-1. Licensing.

(1) An on-premise banquet license may be issued only to a hotel, resort facility, sports center or convention center as defined in this rule.

(a) "Hotel" is a commercial lodging establishment:

(i) that offers temporary sleeping accommodations for compensation;

(ii) that is capable of hosting conventions, conferences, and food and beverage functions under a banquet contract;

(iii) that has adequate kitchen or culinary facilities on the premises of the hotel to provide complete meals; and

(iv) that has at least 1000 square feet of function space consisting of meeting and/or dining rooms that can be reserved for private use under a banquet contract that can accommodate a minimum of 75 people, provided that in cities of the third, fourth or fifth class, unincorporated areas of a county, and towns, the commission shall have the authority to waive the minimum function space size requirements.

(b) "Resort facility" is a publicly or privately owned or operated commercial recreational facility or area:

(i) that is designed primarily to attract and accommodate people to a recreational or sporting environment;

(ii) that is capable of hosting conventions, conferences, and food and beverage functions under a banquet contract;

(iii) that has adequate kitchen or culinary facilities on the premises of the resort to provide complete meals; and

(iv) that has at least 1500 square feet of function space consisting of meeting and/or dining rooms that can be reserved for private use under a banquet contract that can accommodate a minimum of 100 people, provided that in cities of the third, fourth, or fifth class, unincorporated areas of a county, and towns, the commission shall have the authority to waive the minimum function space size requirements.

(c) "Sports center" is a publicly or privately owned or operated facility:

(i) that is designed primarily to attract people to and accommodate people at sporting events;

(ii) that has a fixed seating capacity for more than 2,000 persons;

(iii) that is capable of hosting conventions, conferences, and food and beverage functions under a banquet contract;

(iv) that has adequate kitchen or culinary facilities on the premises of the sports center to provide complete meals; and

(v) that has at least 2500 square feet of function space consisting of meeting and/or dining rooms that can be reserved for private use under a banquet contract that can accommodate a minimum of 100 people, provided that in cities of the third, fourth, or fifth class, unincorporated areas of a county, and towns, the commission shall have the authority to waive the minimum function space size requirements.

(d) "Convention center" is a publicly or privately owned or operated facility:

(i) the primary business or function of which is to host conventions, conferences, and food and beverage functions under a banquet contract;

(ii) that has adequate kitchen or culinary facilities on the premises of the convention center to provide complete meals;[ and]

(iii) that is in total at least 30,000 square feet unless the facility is a "grandfathered facility" under 32A-4-401(8); and

[(iii)](iv) that has at least 3000 square feet of function space consisting of meeting and/or dining rooms that can be reserved for private use under a banquet contract that can accommodate a minimum of 100 people, provided that in cities of the third, fourth, or fifth class, unincorporated counties, and towns, the commission shall have the authority to waive the minimum function space size requirements.

(2)(a) A "banquet contract" as used in this rule means an agreement between an on-premise banquet licensee and a host of a banquet to provide alcoholic beverage services at a meal, reception, or other private banquet function at a defined location on a specific date and time for a pre-arranged, guaranteed number of attendees at a negotiated price.

(b) Each "banquet contract" shall:

(i) clearly define the location of the private banquet function;

(ii) require that the private banquet function be separate from other areas of the facility that are open to the general public; and

(iii) require signage at or near the entrance to the private banquet function to indicate that the location has been reserved for a specific group.

(3) On-premise banquet licenses are issued to persons as defined in Section 32A-1-105[(41)](44). Any contemplated action or transaction that may alter the organizational structure or ownership interest of the person to whom the license is issued must be submitted to the department for approval prior to consummation of any such action to ensure there is no violation of Sections 32A-4-402(4), 32A-4-403, and 32A-4-406(24).

 

KEY: alcoholic beverages

Date of Enactment or Last Substantive Amendment: [July 30, 2008]2009

Notice of Continuation: July 31, 2008

Authorizing, and Implemented or Interpreted Law: 32A-1-107