BILL ANALYSIS H.B. 2367 By: Brimer 4-4-95 Committee Report (Unamended) BACKGROUND Package stores permittees are authorized to sell distilled spirits at retail for off-premise consumption. Traditionally, package stores have had stricter regulations imposed upon them than retailers who sell only beer and wine. PURPOSE H.B. 2367 raises the annual fee for package stores from $300 to $500. Would also prohibit, with exceptions, the employment of anyone under 21 in a package store. H.B. 2367 also requires that a package store permittee's premises and the conduct of business be completely separated from the premises of other businesses. It also prohibits ownership of a package store by a public corporation, and provides for guidelines for comparative price advertising. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 22.02, Alcoholic Beverage Code Raises the annual fee for a package store permit from $300 to $500. SECTION 2. Amends Chapter 22, Alcoholic Beverage Code. Sec. 22.13. Prohibits, with exceptions, a package store from employing any person under the age of 21 to work on the premises of the package store. The exceptions include persons under 21 who are employed on the effective date and the children of the package store owner. Sec. 22.14. Requires package stores to maintain completely separated premises from another business, and a public entrance. For all premises built or first occupied as a package store after September 1, 1995, the premises must have a rear or side door serving as an emergency exit and must have a bathroom which complies with Title III of the Americans with Disabilities Act. There is an exemption for hotels and for pre-1971 locations which were grandfathered from the current separation of premises requirement. Subsection (e) states that a package store may sell non-alcohol items as part of the package store business, but the package store business must be closed to the public during hours in which the sale of alcohol is prohibited by law. Sec. 22.15. Package stores which are not wholly owned by the same persons are prohibited from conducting their business in such a manner as to appear as if they share common ownership. They can not cooperatively set prices or credit policies, share advertising, use the same tradename in a county, utilize the same in-house bookkeeper or computer processing service, unless the company is in the business of providing such service to the general public, shift funds, merchandise, equipment or personnel, they also may not utilize the same independent contractor unless the independent contractor offers their services to the general public, or pool their buying power to receive an increased discount based upon higher volume. Existing tradenames and trademarks are grandfathered. At renewal, permittees must affirm compliance with this section. Provides that a package store permittee who has been injured by a violation of this section may institute suit to recover treble (3x's) damages plus costs of court and attorney's fees. Sec. 22.16. Prohibits public corporations from directly or indirectly owning an interest in a package store. Defines public corporation, and provides that at renewal, the permittee must show compliance with this section. Provides for an exception for package store located in hotels. A package store permittee injured by another who violates this section may seek redress by filing suit to recover treble (3x's) damages plus costs of court and attorney's fees. Sec. 22.17. Standards are established for comparative price advertising. Requires that comparative advertising prices must be for the same brand, product, size, and proof, and the same date of sale. Prices must be verified at least one week prior to the ads publication date. Also requires that credit card policies must be noted. "Everyday" prices must be compared with "everyday" prices and "special" prices must be compared with "special" prices. Package store permittees who are injured as a result of a violation of this section may bring suit to recover treble (3x's) damages, costs of court and attorney's fees. SECTION 3. Effective Date: September 1, 1995. SECTION 4. Emergency Clause. SUMMARY OF COMMITTEE ACTION HB 2367 was heard in a Public Hearing on March 29, 1995. The Chair recognized the following person to testify in favor of the bill: Mr. Fred Niemann, Jr., Texas Package Store Assoc., Inc.; HB 2367 was left pending in committee. HB 2367 was heard in a Formal Meeting on April 4, 1995. Representative Kubiak moved that the full committee adopt HB 2367, and that it be reported favorably to the full House with the recommendation that it do pass and be printed. The motion prevailed by the following vote: AYES: (9), NAYS: (0), ABSENT: (0). Representative Kubiak moved that HB 2367 be sent to the Local and Consent Calendar, by the vote which HB 2367 had been favorably approved. There was no objection.