Alcoholic Beverage Control, Administration

Rule R81-10C

Beer Only Restaurant Licenses

Notice of Proposed Rule

(Amendment)

DAR File No.: 35302
Filed: 09/29/2011 11:00:34 AM

RULE ANALYSIS

Purpose of the rule or reason for the change:

This rule amendment is being proposed to implement provisions of S.B. 314 passed by the Legislature in the 2011 General Session relating to beer only restaurants.

Summary of the rule or change:

This proposed rule amendment adds subsections that make the beer only restaurant rules consistent with full service and limited service restaurants. These subsections clarify the sale of beer with food requirement; establish procedures for regulating beer only restaurants that do not meet the 70% food sales requirement; clarify the use of alcoholic products as flavoring; clarify that beer may be opened and poured at a patron's table, counter or grandfathered bar; clarify where a patron's table can be located and that consumption must be at a reasonable proximity to the table to insure that a written beverage tab can be maintained; and defines "remodeling" of a grandfathered bar.

State statutory or constitutional authorization for this rule:

• Section 32B-2-202

Anticipated cost or savings to:

the state budget:

None--This rule amendment elaborates on a statutory mandates for beer only restaurant licensees therefore there are no state budget costs or savings involved.

local governments:

None--The provisions in this rule amendment are regulated by state government and do not affect costs or savings of local governments.

small businesses:

Many licensees are small businesses that are already operating under the statutory provisions that are being clarified by this rule amendment. There will be no additional costs or savings associated with this amended rule.

persons other than small businesses, businesses, or local governmental entities:

This rule amendment only affects licensed businesses and there is no cost or savings effect on other persons.

Compliance costs for affected persons:

There are no compliance costs for affected persons created by this rule amendment as it is based on existing statutory requirements.

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

Licensed businesses are required by existing statute to comply with alcoholic beverage laws or face disciplinary action which could result in fines or the revocation of a license. Any fiscal impact is established by the statutes. This rule amendment, which clarifies the governing statutes, would have no fiscal impact on businesses.

Francine Giani, Executive 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:

• Neil Cohen at the above address, by phone at 801-977-6800, by FAX at 801-977-6889, or by Internet E-mail at ncohen@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:

11/14/2011

This rule may become effective on:

11/22/2011

Authorized by:

Francine Giani, Interim Executive Director

R81. Alcoholic Beverage Control, Administration.

R81-10C. Beer Only Restaurant Licenses.

R81-10C-6. Sale and Purchase of Beer.

(1) Beer must be sold in connection with an order for food placed and paid for by a patron. An order for food may not include food items gratuitously provided by the restaurant to patrons. A patron may pay for an alcoholic beverage at the time of purchase, or, at the discretion of both the licensee and the patron, the price charged may be added to the patron's tab, provided that a written beverage tab, as provided in Section 32B-6-905(4), shall be commenced upon the patron's first purchase and shall be maintained by the restaurant during the course of the patron's stay at the restaurant regardless of where the patron orders and consumes an alcoholic beverage.

(2) The restaurant shall maintain at least 70% of its total business from the sale of food pursuant to Section 32B-6-905(7).

(a) The restaurant shall maintain records separately showing quarterly expenditures and sales for beer and food. These shall be available for inspection and audit by representatives of the department, and maintained for a period of three years.

(b) If any inspection or audit discloses that the sales of food are less than 70% for any quarterly period, the department shall immediately put the licensee on a probationary status and closely monitor the licensee's food sales during the next quarterly period to determine that the licensee is able to prove to the satisfaction of the department that the sales of food meet or exceed 70%. Failure of the licensee to provide satisfactory proof of the required food percentage within the probationary period shall result in issuance of an order to show cause by the department to determine why the license should not be revoked by the commission.

(3) Beer dispensing shall be in accordance with Section 32B-5-304(5) and Section R81-1-11 (Multiple Licensed Facility Storage and Service) of these rules.

 

R81-10C-7. Alcoholic Product Flavoring.

Beer Only Restaurant licensees may use alcoholic products as flavoring subject to the following guidelines:

(1) Alcoholic product flavoring may be used in the preparation of food items and desserts at any time if plainly and conspicuously labeled "cooking flavoring".

(2) No restaurant employee under the age of 21 years may handle alcoholic product flavorings.

 

R81-10C-8. Table, Counter, and "Grandfathered Bar Structure" Service.

(1) Beer, if in sealed containers, may be opened and poured by the server at the patron's table, counter, or "grandfathered bar structure".

 

R81-10C-9. Consumption at Patron's Table, Counter, and "Grandfathered Bar Structure".

(1) A patron's table, counter, or "grandfathered bar structure" may be located in waiting, patio, garden and dining areas previously approved by the department.

(2) Consumption of any alcoholic beverage must be within a reasonable proximity of a patron's table, counter, or "grandfathered bar structure so as to ensure that the server can maintain a written beverage tab on the amount of alcoholic beverages consumed.

 

R81-10C-10. Grandfathered Bar Structures.

(1) Authority and Purpose.

(a) This rule is pursuant to 32B-6-902 which provides that:

(i) a bar structure, as defined in 32B-1-102(7), located in an establishment licensed as an on-premise beer retailer and operational as of August 1, 2011, may be "grandfathered" to allow beer to continue to be stored or dispensed at the bar structure, and in some instances to be served to an adult patron seated at the bar structure;

(b) This rule is also pursuant to 32B-6-902 which provides that:

(i) a "grandfathered bar structure" is no longer "grandfathered" once the restaurant "remodels the grandfathered bar structure"; and

(ii) the commission shall define by rule what is meant by "remodels the grandfathered bar structure".

(2) Application of Rule.

(a) "remodels the grandfathered bar structure" for purposes of 32B-6-902(1)(b) means that:

(i) the grandfathered bar structure has been altered or reconfigured to:

(A) extend the length of the existing structure to increase its seating capacity; or

(B) increase the visibility of the storage or dispensing area to restaurant patrons.

(c) "remodels the grandfathered bar structure" does not:

(i) preclude making cosmetic changes or enhancements to the existing structure such as painting, staining, tiling, or otherwise refinishing the bar structure;

(ii) preclude locating coolers, sinks, plumbing, cooling or electrical equipment to an existing structure; or

(iii) preclude utilizing existing space at the existing bar structure to add additional seating.

(d) Pursuant to 32B-5-303(3), the licensee must first apply for and receive approval from the department for a change of location where alcohol is stored, served, and sold other than what was originally designated in the licensee's application for the license. Thus, any modification of the alcoholic beverage storage and dispensing area at a "grandfathered bar structure" must first be reviewed and approved by the department to determine whether it is:

(i) an acceptable use of an existing bar structure; or

(ii) a remodel of a "grandfathered bar structure".

 

KEY: alcoholic beverages

Date of Enactment or Last Substantive Amendment: 2011

Authorizing, and Implemented or Interpreted Law: 32B-2-202