Section 28-3A-20.4 Wine Festivals - Licensure Requirements; Tastings and Sale of Wine for On-Premises or Off-Premises Consumption.

(a) The Legislature finds and declares that this section has been enacted pursuant to the authority granted to the state under the Twenty-first Amendment to the United States Constitution and the powers reserved to the state under the Tenth Amendment to the United States Constitution and the inherent powers of the state under the Constitution of Alabama of 2022. It is the intent of the Legislature that this section maintains the current three-tier system of control over the sale, distribution, purchase, transportation, manufacture, consumption, and possession of alcoholic beverages in the state and promotes the health, safety, and welfare of residents of this state. (b)(1) Notwithstanding any other section of this title, including, but not limited to, Sections 28-3A-6, 28-3A-25, and 28-7-4, upon application made on a form provided by the board at least 25 days in advance of the event for which a license is sought and accompanied by a fee not to exceed fifty dollars ($50), the board shall issue a license for a wine festival to a manufacturer of wine licensed by the board manufacturing at least 500 gallons of table wine in this state annually; a retailer; an organization comprised entirely of grape growers, wineries, or grape growers and wineries; a municipality; a county; or an incorporated arts council, main street program, 501(c) organization, other nonprofit organization as that term is defined by rule of the board, or downtown development entity upon such terms and conditions as the board may prescribe by rule. (2) The wine festival license shall authorize the licensee to host a festival at which wine festival participant licensees may dispense tastings and sell at retail to individuals physically present at the festival for on-premises or off-premises consumption and for personal use and not for resale, subject to subsection (e). (3) If the applicant for a wine festival license is a licensee of the board at the time of application, the board shall only require submission of all of the following information: a. The name and address of the applicant and photo identification. b. The start and end dates of the festival. c. A description of the wine festival location. If the applicant does not own or control the wine festival location, then the applicant shall include written permission by the person with ownership or control over the property for the wine festival licensee and any wine festival participant licensees to use the property for that wine festival. (4) The board shall not require either of the following: a. That the applicant submit the application to the board in person. b. That the applicant certify that a liquor liability insurance policy providing coverage for the applicant for the wine festival has been purchased if the applicant submits a written statement from the liquor liability insurer that the applicant’s existing liquor liability insurance policy covers the applicant’s activities at the wine festival. (c) A wine festival licensed under this section may not operate for more than five consecutive days. (d)(1) Upon application made on a form provided by the board at least 15 days in advance of the event for which a license is sought and accompanied by a fee not to exceed ten dollars ($10) , the board shall issue a wine festival participant license to any retailer or any manufacturer of table wine licensed by the board that manufactures at least 500 gallons of table wine in this state annually. (2) A wine festival participant license shall authorize the licensee to dispense tastings and sell at retail to individuals physically present at the festival for on-premises consumption or off-premises consumption and for personal use and not for resale, subject to subsection (e). (3) Because the applicant for a wine festival participant license is already a licensee of the board at the time of application, the board shall only require submission of all of the following information: a. The name and address of the applicant and photo identification. b. The start and end dates of the festival. c. A description of the wine festival location. d. If the host licensee for the wine festival is a 501(c)(3) organization or other nonprofit organization as described in subdivision (b)(1), a written certification from the applicant that a majority of the net proceeds from the applicant’s sales at the festival shall go to the nonprofit organization. (4) The board shall not require any of the following: a. That the applicant submit the application to the board in person. b. A certificate showing that the applicant has purchased a liquor liability insurance policy for the wine festival if the applicant submits one of the following: 1. A written statement from the applicant’s liquor liability insurer certifying that the applicant’s existing liquor liability insurance policy covers the applicant’s activities at the wine festival. 2. A written statement from the wine festival licensee’s liquor liability insurer that the licensee’s existing liquor liability insurance policy covers the activities of the host and any wine festival participant licensee at the wine festival who does not currently possess a liquor liability insurance policy. (e)(1) Wine sold at a wine festival for off-premises consumption shall only be sold by a wine festival participant licensee and shall be sealed, labeled, and packaged in accordance with local, state, and federal laws and regulations. (2) A wine festival participant licensee may not sell more than one case of wine to any individual per festival. (3) For purposes of this section, one case of wine means the equivalent of 12 750-milliliter bottles of wine. (f) The sale of wine at any wine festival may not be permitted on any Sunday in a county or municipality that has not authorized alcoholic beverages to be sold on Sunday. (g) If a wine festival is to take place entirely on the premises of the winery that was granted the license to host the wine festival or a winery that is a member of the organization granted the license to host the festival, then the board may not require any fee for the wine festival license or any wine festival participant license relating to that festival. (h) (1) Each wine festival participant licensee participating in a wine festival shall collect and remit all state and local sales and use taxes and all excise and other taxes due on the sale of wine by the licensee to customers at retail. (2) Notwithstanding subdivision (1), a wine festival participant licensee that is a retail licensee of the board, or a wine festival participant licensee that is a manufacturer licensee of the board which also sells wine at retail, in a method and manner established by the Department of Revenue, may include the collection and remittance of all state taxes due on the sale of wine at the festival in the same method and manner as other sales of wine at retail. (3) Each wine festival participant licensee shall collect all county and local sales and use taxes due on the sale of wine at the festival and may remit those taxes to the wine festival licensee in a manner and method established by the wine festival licensee. The wine festival licensee shall remit the state and local sales and use taxes to the appropriate governing body within seven days following the conclusion of the wine festival, whether or not the wine festival licensee is exempt from sales tax by law. (4)a. A wine festival licensee shall send notification, in writing, to the county governing body, and if applicable, to the municipal governing body no less than seven days prior to the wine festival. This notification shall include any information necessary to ensure the proper sales tax is collected and remitted from all sales by each wine festival participant licensee and shall include a list of all current wine festival participant licensees for that wine festival with contact information for each licensee. b. The wine festival licensee shall collect county and local sales and use taxes for sales made by all wine festival participant licensees at a wine festival which have elected to remit taxes through the wine festival licensee pursuant to subdivision (3), whether or not that wine festival licensee is exempt from sales tax by law. The wine festival licensee shall remit the sales and use taxes as provided in subdivision (3). c. Each wine festival licensee and wine festival participant licensee shall be subject to audit by the county and municipal governing body of the location at which the wine festival occurs, for the county and local sales tax remitted by or on behalf of that licensee. Each wine festival licensee shall be responsible for any unreported sales or unremitted sales tax, including unreported or unremitted sales tax related to the failure of that licensee to fully remit and record any sale during the wine festival. Failure to remit sales tax pursuant to this section shall be enforced pursuant to Chapter 23 of Title 40. (i) The board may not limit or prohibit the serving or featuring of food at a licensed wine festival, provided that the person serving or featuring food complies with all applicable laws and rules. (j) A wine festival participant licensee shall not be required to apply for or purchase any county or municipal business license or alcoholic beverage license in order to participate in a wine festival pursuant to this section; provided, that the wine festival licensee for that wine festival is in compliance with paragraph (h)(4)a. (k) For purposes of this section, “retailer” means a retailer licensed for off-premises consumption of table wine. (l) The board may adopt rules to implement this section, including, but not limited to, rules regarding the liability of a wine festival participant licensee. (m) If any provision of this section or its application to any person or circumstance is determined by a court to be invalid or unconstitutional, that provision shall be stricken and the remaining provisions shall be construed in accordance with the intent of the Legislature to further limit, rather than expand, commerce in alcoholic beverages, including by prohibiting any commerce in alcoholic beverages not expressly authorized, and to enhance strict regulatory control over taxation, distribution, and sale of alcoholic beverages through the existing uniform system of regulation of alcoholic beverages.