No. 31273 (Amendment): R81-1-9. Liquor Dispensing Systems

DAR File No.: 31273
Filed: 04/28/2008, 12:14
Received by: NL

RULE ANALYSIS

Purpose of the rule or reason for the change:

S.B. 211, passed by the 2008 legislature, amended the Utah Liquor Act to allow for 1.5 ounces of primary liquor and a total of 2.5 total ounces of liquor in a drink sold in licensed establishments. This proposed rule not only makes amendments to implement the new statutes, it also makes some housekeeping changes that update liquor dispensing record-keeping procedures and make them easier for licensees' to manage. (DAR NOTE: S.B. 211 (2008) is found at Chapter 391, Laws of Utah 2008, and was effective 05/05/2008.)

Summary of the rule or change:

S.B. 211 (2008) changed the amount of primary liquor in drinks to up to 1.5 ounces and the total alcohol in drinks to 2.5 ounces. This proposed rule amendment brings the rule in line with the new statute. The amendment also removes unnecessary language and better adapts the liquor dispensing record-keeping requirements to the types of dispensing systems used by licensed clubs and restaurants.

State statutory or constitutional authorization for this rule:

Section 32A-1-107

Anticipated cost or savings to:

the state budget:

None--Changing the amount of primary liquor or total liquor in a drink does not necessarily reflect on costs or revenues to the Department of Alcoholic Beverage Control (DABC) or the state. DABC staff members already monitor licensee dispensing records, and changing the amount of liquor in a drink or how liquor dispensing is recorded will neither add to nor take away from the duties of DABC staff.

local governments:

None--Local governments do not regulate the dispensing requirements imposed on licensed clubs and restaurants.

small businesses and persons other than businesses:

Many liquor licensees operate businesses with fewer than 50 employees. It is difficult to know for certain what impact the new laws will have on their operations. The new laws passed by the 2008 legislature allow the primary pour of liquor in a drink to be increased by 1/2 an ounce, but the law does not require that licensees increase the primary pour of alcohol. Since the primary pour of liquor in a drink must be dispensed through a metered dispensing system, and since there may be some cost involved in having dispensing systems recalibrated, it stands to reason there may be a cost to many licensees. But, the cost will vary for each dispensing system and it is a business decision to be made by the operator of the club or restaurant.

Compliance costs for affected persons:

Though S.B. 211 permits licensees to increase the amount of primary liquor in a drink from up to 1 ounce to up to 1.5 ounces, the law does not require that licensees make that adjustment. Primary liquor in a drink must be dispensed through a metered dispensing system so it stands to reason that there may be some costs to licensees who choose to increase the primary pour in their drinks since their dispensing systems will require recalibration. It is, however, difficult to say what the costs will be because of the number of different systems approved for use by licensed clubs and restaurants. The new language in the record keeping requirements should, in most cases, make it easier for licensees to comply with the law.

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

The legislature has passed a new law that increases the amount of primary liquor in a drink while decreasing the amount of overall liquor in the drink. There may be some costs for licensees to implement this new law. The legislature hoped that increasing the primary pour of liquor in a drink would bring Utah more in line with how liquor is dispensed across the United States, and ultimately improve Utah's image. It was also hoped the law changes would make it easier for licensees to serve their customers. 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 [e-mail]

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:

06/16/2008

This rule may become effective on:

06/23/2008

Authorized by:

Dennis R. Kellen, Director

RULE TEXT

R81. Alcoholic Beverage Control, Administration.

R81-1. Scope, Definitions, and General Provisions.

R81-1-9. Liquor Dispensing Systems.

A licensee may not install or use any system for the automated mixing or dispensing of spirituous liquor unless the dispensing system has been approved by the department.

(1) Minimum requirements. The department will only approve a dispensing system which:

(a) dispenses spirituous liquor in calibrated quantities not to exceed [one ounce]1.5 ounces; and

(b) has a meter which counts the number of pours dispensed.

The margin of error of the system for a one ounce pour size cannot exceed 1/16 of an ounce or two milliliters.

(2) Types of systems. Dispensing systems may be of various types including: gun, stationary head, tower, insertable spout, ring activator or similar method.

(3) Method of approval.

(a) Suppliers. Companies which manufacture, distribute, sell, or supply dispensing systems must first have their product approved by the department prior to use by any liquor licensee in the state. They shall complete the "Supplier Application for Dispensing System Approval" form provided by the department, which includes: the name, model number, manufacturer and supplier of the product; the type and method of dispensing, calibrating, and metering; the degree or tolerance of error, and a verification of compliance with federal and state laws, rules, and regulations.

(b) Licensees. Before any dispensing system is put into use by a licensee, the licensee shall complete the "Licensee Application for Dispensing System Approval" form provided by the department. The department shall maintain a list of approved products and shall only authorize installation of a product previously approved by the department as provided in subsection (a). The licensee is thereafter responsible for verifying that the system, when initially installed, meets the specifications which have been supplied to the department by the manufacturer. Once installed, the licensee shall maintain the dispensing system to ensure that it continues to meet the manufacturer's specifications. Failure to maintain the system may be grounds for suspension or revocation of the licensee's liquor license.

(c) Removal from approved list. In the event the system does not meet the specifications as represented by the manufacturer, the licensee shall immediately notify the department. The department shall investigate the situation to determine whether the product should be deleted from the approved list.

(4) Operational restrictions.

(a) The system must be calibrated to pour a quantity of spirituous liquor not to exceed [one ounce]1.5 ounces.

(b) Voluntary consent is given that representatives of the department, State Bureau of Investigation, or any law enforcement officer shall have access to any system for inspection or testing purposes. A licensee shall furnish to the representatives, upon request, samples of the alcoholic products dispensed through any system for verification and analysis.

(c) Spirituous liquor bottles in use with a dispensing system at the dispensing location must be affixed to the dispensing system by the licensee. Spirituous liquor bottles in use with a remote dispensing system must be in a locked storage area. Any other primary spirituous liquor not in service must remain unopened. There shall be no opened primary spirituous liquor bottles at a dispensing location that are not affixed to an approved dispensing device.[ This rule does not prohibit the presence of opened containers of wine for use as provided by law.]

(d) The dispensing system and spirituous liquor bottles attached to the system must be locked or secured in such a place and manner as to preclude the dispensing of spirituous liquor at times when liquor sales are not authorized by law.

(e) All dispensing systems and devices must

(i) avoid an in-series hookup which would permit the contents of liquor bottles to flow from bottle to bottle before reaching the dispensing spigot or nozzle;

(ii) not dispense from or utilize containers other than original liquor bottles; and

(iii) prohibit the intermixing of different kinds of products or brands in the liquor bottles from which they are being dispensed.

(f) Pursuant to federal law, all liquor dispensed through a dispensing system shall be from its original container, and there shall be no re-use or refilling of liquor bottles with any substance whatsoever. The commission adopts federal regulations 27 CFR [194]31.261-31.262 and 26 USC[A] Section 5301 and incorporates them by reference.

(g) Each licensee shall keep daily records for each dispensing outlet as follows:

(i) a list of brands of liquor dispensed through the dispensing system;

(ii) [beginning and ending meter readings by brand or sales price level and ]the number of portions of liquor dispensed through the dispensing system determined by the calculated difference between the beginning and ending meter readings and/or as electronically generated by the recording software of the dispensing system;

(iii) number of portions of liquor sold[ by brand or sales price level]; and

(iv) a comparison of the number of portions dispensed to the number of portions sold including an explanation of any variances[ by brand or sales price level].

(v) These records must be made available for inspection and audit by the department or law

enforcement.

(h) This rule does not prohibit the sale of pitchers of mixed drinks as long as the pitcher contains no more than [one ounce]1.5 ounces of primary spirituous liquor and no more than a total of 2.5 ounces of spirituous liquor per person to which the pitcher is served.

(i) Licensees shall display in a prominent place on the premises a list of the types and brand names of spirituous liquor being served through its dispensing system. This requirement may be satisfied either by printing the list on an alcoholic beverage menu or by wall posting or both.

(j) A licensee or his employee shall not:

(i) sell or serve any brand of spirituous liquor not identical to that ordered by the patron; or

(ii) misrepresent the brand of any spirituous liquor contained in any drink sold or offered for sale.

(k) All dispensing systems and devices must conform to federal, state, and local health and sanitation requirements. Where considered necessary, the department may:

(i) require the alteration or removal of any system,

(ii) require the licensee to clean, disinfect, or otherwise improve the sanitary conditions of any system.

 

KEY: alcoholic beverages

Date of Enactment or Last Substantive Amendment: [August 27, 2007]2008

Notice of Continuation: August 31, 2006

Authorizing, and Implemented or Interpreted Law: 32A-1-107; 32A-1-119(5)(c); 32A-3-103(1)(a); 32A-4-103(1)(a); 32A-4-106(22); 32A-4-203(1)(a); 32A-4-304(1)(a); 32A-4-307(22); 32A-4-401(1)(a); 32A-4-403(1)(a); 32A-5-103(1)(a); 32A-5-107(40); 32A-6-103(2)(a); 32A-7-103(2)(a); 32A-7-106(5); 32A-8-103(1)(a); 32A-8-503(1)(a); 32A-9-103(1)(a); 32A-10-203(1)(a); 32A-10-206(14); 32A-10-303(1)(a); 32A-10-306(5); 32A-11-103(1)(a)