As Reported by the Senate Agriculture Committee

124th General Assembly
Regular Session
2001-2002
Sub. H. B. No. 330


REPRESENTATIVE Peterson



A BILL
To amend sections 4301.17 and 4303.181 of the Revised1
Code to allow the Division of Liquor Control to2
base the population quota restrictions for agency3
stores that sell spirituous liquor on the4
Division's behalf on state population estimates5
determined by the Department of Development between6
federal decennial censuses; to change these7
population quota restrictions; and to eliminate the8
restriction against the same person operating or9
having an interest in more than sixteen agency10
stores in the state or more than eight agency11
stores in the same county; to require the Division12
to adopt rules governing the allocation and13
equitable distribution of agency store contracts;14
to allow a restaurant located at an airport15
operated by a port authority to be issued a D-5d16
liquor permit; to remove the prohibition against17
more than one D-5d permit being issued in the same18
county; and to allow permit holders that sell beer19
or intoxicating liquor for consumption on the20
premises to operate an agency store adjacent to the21
premises.22


BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

       Section 1. That sections 4301.17 and 4303.181 of the Revised23
Code be amended to read as follows:24

       Sec. 4301.17.  (A)(1) Subject to local option as provided in25
sections 4301.32 to 4301.40 of the Revised Code, five state liquor26
stores or agencies may be established in each county. One27
additional store may be established in any county for each thirty28
twenty-five thousand of population of that county or major29
fraction thereof in excess of the first forty thousand, according30
to the last preceding federal decennial census or according to the31
population estimates certified by the department of development32
between decennial censuses. A person engaged in a mercantile33
business may act as the agent for the division of liquor control34
for the sale of spirituous liquor in a municipal corporation, in35
the unincorporated area of a township of not less than two36
thousand population, or in an area designated and approved as a37
resort area under section 4303.262 of the Revised Code, provided38
that not more than one agency contract shall be awarded in the39
unincorporated area of a county for each fifty thousand population40
of the county. The division shall fix the compensation for such41
an agent in the manner it considers best, but the compensation42
shall not exceed seven per cent of the gross sales made by the43
agent in any one year.44

       (2) The division shall adopt rules in accordance with45
Chapter 119. of the Revised Code governing the allocation and46
equitable distribution of agency store contracts. The division47
shall comply with the rules when awarding a contract under48
division (A)(1) of this section.49

        (3) Except as otherwise provided in this section, no50
mercantile business that sells beer or intoxicating liquor for51
consumption on the premises under a permit issued by the division52
shall operate an agency store at the premises or at any adjacent53
premises. An agency to which a D-1 permit has been issued may54
offer for sale tasting samples of beer, an agency to which a D-255
permit has been issued may offer for sale tasting samples of wine56
and mixed beverages, and an agency to which a D-5 permit has been57
issued may offer for sale tasting samples of beer, wine, and mixed58
beverages, but not spirituous liquor. A tasting sample shall not59
be sold for the purpose of general consumption. As used in this60
section, "tasting sample" means a small amount of beer, wine, or61
mixed beverages that is provided in not more than four servings of62
not more than two ounces each to an authorized purchaser and that63
allows the purchaser to determine, by tasting only, the quality64
and character of the beverage.65

       (B) When an agency contract is proposed or when an existing66
agency contract is assigned, before entering into any contract or67
consenting to any assignment, the division shall notify the68
legislative authority of the municipal corporation in which the69
agency store is to be located, or the board of county70
commissioners and the board of township trustees of the county and71
the township in which the agency store is to be located if the72
agency store is to be located outside the corporate limits of a73
municipal corporation, of the proposed contract or assignment, and74
an opportunity shall be provided officials or employees of the75
municipal corporation or county and township for a complete76
hearing upon the advisability of entering into the contract or77
consenting to the assignment. When the division sends notice to78
the legislative authority of the political subdivision, the79
departmentdivision shall notify, by certified mail or by personal80
service, the chief peace officer of the political subdivision, who81
may appear and testify, either in person or through a82
representative, at any hearing held on the advisability of83
entering into the contract or consenting to the assignment.84

       If the proposed agency store would be located within five85
hundred feet of a school, church, library, public playground, or86
township park, the division shall not enter into an agency87
contract until it has provided notice of the proposed contract to88
the authorities in control of the school, church, library, public89
playground, or township park and has provided those authorities90
with an opportunity for a complete hearing upon the advisability91
of entering into the contract. If an agency store so located is92
operating under an agency contract, the division may consent to93
the assignment of that contract to operate an agency store at the94
same location, but the division shall not consent to an95
assignment until it has notified the authorities in control of the96
school, church, library, public playground, or township park and97
has provided those authorities with an opportunity for a complete98
hearing upon the advisability of consenting to the assignment.99

       Any hearing provided for in this division shall be held in100
the central office of the division, except that upon written101
request of the legislative authority of the municipal corporation,102
the board of county commissioners, orthe board of township103
trustees, or the authorities in control of the school, church,104
library, public playground, or township park, the hearing shall be105
held in the county seat of the county where the proposed agency106
store is to be located.107

       (C) All agency contracts entered into by the division108
pursuant to this section shall be in writing and shall contain a109
clause providing for the termination of the contract at will by110
the division upon its giving ninety days' notice in writing to 111
the agent of its intention to do so. Any agency contract may112
include a clause requiring the agent to report to the appropriate113
law enforcement agency the name and address of any individual114
under twenty-one years of age who attempts to make an illegal115
purchase.116

       An agent may engage in the selling of beer, mixed beverages,117
and wine pursuant to permits issued to the agent under Chapter118
4303. of the Revised Code.119

       The division shall issue a C-1 and C-2 permit to each agent120
who prior to November 1, 1994, had not been issued both of these121
permits, notwithstanding the population quota restrictions122
contained in section 4303.29 of the Revised Code or in any rule of123
the liquor control commission and notwithstanding the requirements124
of section 4303.31 of the Revised Code. The location of a C-1 or125
C-2 permit issued to such an agent shall not be transferred. The126
division shall revoke any C-1 or C-2 permit issued to an agent127
under this paragraph if the agent no longer operates an agency128
store.129

       No person shall operate, or have any interest, directly or130
indirectly, in more than eight state agencies in any one county131
or more than sixteen state agencies in the state for the sale of132
spirituous liquor. For purposes of this section, a person has an133
interest in a state agency if the person is a partner, member,134
officer, or director of, or a shareholder owning ten per cent or135
more of the capital stock of, any legal entity with which the136
department has entered into an agency contract.137

       The division may enter into agreements with the department of138
development to implement a minority loan program to provide139
low-interest loans to minority business enterprises, as defined in140
section 122.71 of the Revised Code, that are awarded liquor agency141
contracts or assignments.142

       (D) If the division closes a state liquor store and replaces143
that store with an agency store, any employees of the division144
employed at that state liquor store who lose their jobs at that145
store as a result shall be given preference by the agent who146
operates the agency store in filling any vacancies that occur147
among the agent's employees, if that preference does not conflict148
with the agent's obligations pursuant to a collective bargaining149
agreement.150

       If the division closes a state liquor store and replaces the151
store with an agency store, any employees of the division employed152
at the state liquor store who lose their jobs at that store as a153
result may displace other employees as provided in sections154
124.321 to 124.328 of the Revised Code. If an employee cannot155
displace other employees and is laid off, the employee shall be156
reinstated in another job as provided in sections 124.321 to157
124.328 of the Revised Code, except that the employee's rights of158
reinstatement in a job at a state liquor store shall continue for159
a period of two years after the date of the employee's layoff and160
shall apply to jobs at state liquor stores located in the161
employee's layoff jurisdiction and any layoff jurisdiction162
adjacent to the employee's layoff jurisdiction.163

       (E) The division shall require every agent to give bond164
with surety to the satisfaction of the division, in the amount 165
the division fixes, conditioned for the faithful performance of166
the agent's duties as prescribed by the division.167

       Sec. 4303.181.  (A) Permit D-5a may be issued either to the168
owner or operator of a hotel or motel that is required to be169
licensed under section 3731.03 of the Revised Code, that contains170
at least fifty rooms for registered transient guests, and that171
qualifies under the other requirements of this section, or to the172
owner or operator of a restaurant specified under this section, to173
sell beer and any intoxicating liquor at retail, only by the174
individual drink in glass and from the container, for consumption175
on the premises where sold, and to registered guests in their176
rooms, which may be sold by means of a controlled access alcohol177
and beverage cabinet in accordance with division (B) of section178
4301.21 of the Revised Code; and to sell the same products in the179
same manner and amounts not for consumption on the premises as may180
be sold by holders of D-1 and D-2 permits. The premises of the181
hotel or motel shall include a retail food establishment or a182
food service operation licensed pursuant to Chapter 3717. of the183
Revised Code that operates as a restaurant for purposes of this184
chapter and that is affiliated with the hotel or motel and within185
or contiguous to the hotel or motel, and that serves food within186
the hotel or motel, but the principal business of the owner or187
operator of the hotel or motel shall be the accommodation of188
transient guests. In addition to the privileges authorized in189
this division, the holder of a D-5a permit may exercise the same190
privileges as the holder of a D-5 permit.191

       The owner or operator of a hotel, motel, or restaurant who192
qualified for and held a D-5a permit on August 4, 1976, may, if193
the owner or operator held another permit before holding a D-5a194
permit, either retain a D-5a permit or apply for the permit195
formerly held, and the division of liquor control shall issue the196
permit for which the owner or operator applies and formerly held,197
notwithstanding any quota.198

       A D-5a permit shall not be transferred to another location.199
No quota restriction shall be placed on the number of such permits200
that may be issued.201

       The fee for this permit is one thousand eight hundred202
seventy-five dollars.203

       (B) Permit D-5b may be issued to the owner, operator,204
tenant, lessee, or occupant of an enclosed shopping center to sell205
beer and intoxicating liquor at retail, only by the individual206
drink in glass and from the container, for consumption on the207
premises where sold; and to sell the same products in the same208
manner and amount not for consumption on the premises as may be209
sold by holders of D-1 and D-2 permits. In addition to the210
privileges authorized in this division, the holder of a D-5b211
permit may exercise the same privileges as a holder of a D-5212
permit.213

       A D-5b permit shall not be transferred to another location.214

       One D-5b permit may be issued at an enclosed shopping center215
containing at least two hundred twenty-five thousand, but less216
than four hundred thousand, square feet of floor area.217

       Two D-5b permits may be issued at an enclosed shopping center218
containing at least four hundred thousand square feet of floor219
area. No more than one D-5b permit may be issued at an enclosed220
shopping center for each additional two hundred thousand square221
feet of floor area or fraction of that floor area, up to a222
maximum of five D-5b permits for each enclosed shopping center.223
The number of D-5b permits that may be issued at an enclosed224
shopping center shall be determined by subtracting the number of225
D-3 and D-5 permits issued in the enclosed shopping center from226
the number of D-5b permits that otherwise may be issued at the227
enclosed shopping center under the formulas provided in this228
division. Except as provided in this section, no quota shall be229
placed on the number of D-5b permits that may be issued.230
Notwithstanding any quota provided in this section, the holder of231
any D-5b permit first issued in accordance with this section is232
entitled to its renewal in accordance with section 4303.271 of the233
Revised Code.234

       The holder of a D-5b permit issued before April 4, 1984,235
whose tenancy is terminated for a cause other than nonpayment of236
rent, may return the D-5b permit to the division of liquor237
control, and the division shall cancel that permit. Upon238
cancellation of that permit and upon the permit holder's payment239
of taxes, contributions, premiums, assessments, and other debts240
owing or accrued upon the date of cancellation to this state and241
its political subdivisions and a filing with the division of a242
certification of that payment, the division shall issue to that243
person either a D-5 permit, or a D-1, a D-2, and a D-3 permit, as244
that person requests. The division shall issue the D-5 permit, or245
the D-1, D-2, and D-3 permits, even if the number of D-1, D-2,246
D-3, or D-5 permits currently issued in the municipal corporation247
or in the unincorporated area of the township where that person's248
proposed premises is located equals or exceeds the maximum number249
of such permits that can be issued in that municipal corporation250
or in the unincorporated area of that township under the251
population quota restrictions contained in section 4303.29 of the252
Revised Code. Any D-1, D-2, D-3, or D-5 permit so issued shall253
not be transferred to another location. If a D-5b permit is254
canceled under the provisions of this paragraph, the number of255
D-5b permits that may be issued at the enclosed shopping center256
for which the D-5b permit was issued, under the formula provided257
in this division, shall be reduced by one if the enclosed shopping258
center was entitled to more than one D-5b permit under the259
formula.260

       The fee for this permit is one thousand eight hundred261
seventy-five dollars.262

       (C) Permit D-5c may be issued to the owner or operator of a 263
retail food establishment or a food service operation licensed264
pursuant to Chapter 3717. of the Revised Code that operates as a265
restaurant for purposes of this chapter and that qualifies under266
the other requirements of this section to sell beer and any267
intoxicating liquor at retail, only by the individual drink in268
glass and from the container, for consumption on the premises269
where sold, and to sell the same products in the same manner and270
amounts not for consumption on the premises as may be sold by271
holders of D-1 and D-2 permits. In addition to the privileges272
authorized in this division, the holder of a D-5c permit may273
exercise the same privileges as the holder of a D-5 permit.274

       To qualify for a D-5c permit, the owner or operator of a 275
retail food establishment or a food service operation licensed276
pursuant to Chapter 3717. of the Revised Code that operates as a277
restaurant for purposes of this chapter, shall have operated the278
restaurant at the proposed premises for not less than twenty-four279
consecutive months immediately preceding the filing of the280
application for the permit, have applied for a D-5 permit no later281
than December 31, 1988, and appear on the division's quota waiting282
list for not less than six months immediately preceding the filing283
of the application for the permit. In addition to these284
requirements, the proposed D-5c permit premises shall be located285
within a municipal corporation and further within an election286
precinct that, at the time of the application, has no more than287
twenty-five per cent of its total land area zoned for residential288
use.289

       A D-5c permit shall not be transferred to another location.290
No quota restriction shall be placed on the number of such permits291
that may be issued.292

       Any person who has held a D-5c permit for at least two years293
may apply for a D-5 permit, and the division of liquor control294
shall issue the D-5 permit notwithstanding the quota restrictions295
contained in section 4303.29 of the Revised Code or in any rule of296
the liquor control commission.297

       The fee for this permit is one thousand two hundred fifty298
dollars.299

       (D) Permit D-5d may be issued to the owner or operator of a 300
retail food establishment or a food service operation licensed301
pursuant to Chapter 3717. of the Revised Code that operates as a302
restaurant for purposes of this chapter and that is located at an303
airport operated by a board of county commissioners pursuant to304
section 307.20 of the Revised Code, at an airport operated by a305
port authority pursuant to Chapter 4582. of the Revised Code, or306
at an airport operated by a regional airport authority pursuant to307
Chapter 308. of the Revised Code. Not more than one D-5d permit308
shall be issued in each county. The holder of a D-5d permit may309
sell beer and any intoxicating liquor at retail, only by the310
individual drink in glass and from the container, for consumption311
on the premises where sold, and may sell the same products in the312
same manner and amounts not for consumption on the premises where313
sold as may be sold by the holders of D-1 and D-2 permits. In314
addition to the privileges authorized in this division, the holder315
of a D-5d permit may exercise the same privileges as the holder of316
a D-5 permit.317

       A D-5d permit shall not be transferred to another location.318
Except as otherwise provided in this division, noNo quota319
restrictions shall be placed on the number of such permits that320
may be issued.321

       The fee for this permit is one thousand eight hundred322
seventy-five dollars.323

       (E) Permit D-5e may be issued to any nonprofit organization324
that is exempt from federal income taxation under the "Internal325
Revenue Code of 1986," 100 Stat. 2085, 26 U.S.C.A. 501(c)(3), as326
amended, or that is a charitable organization under any chapter of327
the Revised Code, and that owns or operates a riverboat that328
meets all of the following:329

       (1) Is permanently docked at one location;330

       (2) Is designated as an historical riverboat by the Ohio331
historical society;332

       (3) Contains not less than fifteen hundred square feet of333
floor area;334

       (4) Has a seating capacity of fifty or more persons.335

       The holder of a D-5e permit may sell beer and intoxicating336
liquor at retail, only by the individual drink in glass and from337
the container, for consumption on the premises where sold.338

       A D-5e permit shall not be transferred to another location.339
No quota restriction shall be placed on the number of such permits340
that may be issued. The population quota restrictions contained341
in section 4303.29 of the Revised Code or in any rule of the342
liquor control commission shall not apply to this division, and343
the division shall issue a D-5e permit to any applicant who meets344
the requirements of this division. However, the division shall345
not issue a D-5e permit if the permit premises or proposed permit346
premises are located within an area in which the sale of347
spirituous liquor by the glass is prohibited.348

       The fee for this permit is nine hundred seventy-five dollars.349

       (F) Permit D-5f may be issued to the owner or operator of350
a retail food establishment or a food service operation licensed351
under Chapter 3717. of the Revised Code that operates as a352
restaurant for purposes of this chapter and that meets all of the353
following:354

       (1) It contains not less than twenty-five hundred square355
feet of floor area.356

       (2) It is located on or in, or immediately adjacent to, the357
shoreline of, a navigable river.358

       (3) It provides docking space for twenty-five boats.359

       (4) It provides entertainment and recreation, provided that360
not less than fifty per cent of the business on the permit361
premises shall be preparing and serving meals for a consideration.362

       In addition, each application for a D-5f permit shall be363
accompanied by a certification from the local legislative364
authority that the issuance of the D-5f permit is not inconsistent365
with that political subdivision's comprehensive development plan366
or other economic development goal as officially established by367
the local legislative authority.368

       The holder of a D-5f permit may sell beer and intoxicating369
liquor at retail, only by the individual drink in glass and from370
the container, for consumption on the premises where sold.371

       A D-5f permit shall not be transferred to another location.372
No more than fifteen D-5f permits shall be issued by the division373
of liquor control, and no more than two such permits shall be374
issued in any county. However, the division shall not issue a375
D-5f permit if the permit premises or proposed permit premises are376
located within an area in which the sale of spirituous liquor by377
the glass is prohibited.378

       A fee for this permit is one thousand eight hundred379
seventy-five dollars.380

       As used in this division, "navigable river" means a river 381
that is also a "navigable water" as defined in the "Federal Power382
Act," 94 Stat. 770 (1980), 16 U.S.C. 796.383

       (G) Permit D-5g may be issued to a nonprofit corporation384
that is either the owner or the operator of a national385
professional sports museum. The holder of a D-5g permit may sell386
beer and any intoxicating liquor at retail, only by the individual387
drink in glass and from the container, for consumption on the388
premises where sold. The holder of a D-5g permit shall sell no389
beer or intoxicating liquor for consumption on the premises where390
sold after one a.m. A D-5g permit shall not be transferred to391
another location. No quota restrictions shall be placed on the392
number of D-5g permits that may be issued. The fee for this393
permit is one thousand five hundred dollars.394

       (H) Permit D-5h may be issued to any nonprofit organization395
that is exempt from federal income taxation under the "Internal396
Revenue Code of 1986," 100 Stat. 2085, 26 U.S.C.A. 501(c)(3), as397
amended, that owns or operates a fine arts museum and has no less398
than five thousand bona fide members possessing full membership399
privileges. The holder of a D-5h permit may sell beer and any400
intoxicating liquor at retail, only by the individual drink in401
glass and from the container, for consumption on the premises402
where sold. The holder of a D-5h permit shall sell no beer or403
intoxicating liquor for consumption on the premises where sold404
after one a.m. A D-5h permit shall not be transferred to another405
location. No quota restrictions shall be placed on the number of406
D-5h permits that may be issued. The fee for this permit is one407
thousand five hundred dollars.408

       (I) Permit D-5i may be issued to the owner or operator of409
a retail food establishment or a food service operation licensed410
under Chapter 3717. of the Revised Code that operates as a411
restaurant for purposes of this chapter and that meets all of the412
following requirements:413

       (1) It is located in a municipal corporation or a township414
with a population of fifty thousand or less.415

       (2) It has inside seating capacity for at least one hundred416
forty persons.417

       (3) It has at least four thousand square feet of floor418
area.419

       (4) It offers full-course meals, appetizers, and sandwiches.420

       (5) Its receipts from beer and liquor sales do not exceed421
twenty-five per cent of its total gross receipts.422

       (6) The value of its real and personal property exceeds423
seven hundred twenty-five thousand dollars.424

       The holder of a D-5i permit shall cause an independent audit425
to be performed at the end of one full year of operation following426
issuance of the permit in order to verify the requirements of427
division (I)(5) of this section. The results of the independent428
audit shall be transmitted to the division. Upon determining that429
the receipts of the holder from beer and liquor sales exceeded430
twenty-five per cent of its total gross receipts, the division431
shall suspend the permit of the permit holder under section432
4301.25 of the Revised Code and may allow the permit holder to433
elect a forfeiture under section 4301.252 of the Revised Code.434

       The holder of a D-5i permit may sell beer and any435
intoxicating liquor at retail, only by the individual drink in436
glass and from the container, for consumption on the premises437
where sold, and may sell the same products in the same manner and438
amounts not for consumption on the premises where sold as may be439
sold by the holders of D-1 and D-2 permits. The holder of a D-5i440
permit shall sell no beer or intoxicating liquor for consumption441
on the premises where sold after two-thirty a.m. In addition to442
the privileges authorized in this division, the holder of a D-5i443
permit may exercise the same privileges as the holder of a D-5444
permit.445

       A D-5i permit shall not be transferred to another location. 446
The division of liquor control shall not renew a D-5i permit447
unless the food service operation for which it is issued continues448
to meet the requirements described in divisions (I)(1) to (6) of449
this section. No quota restrictions shall be placed on the number450
of D-5i permits that may be issued. The fee for this permit is451
one thousand eight hundred seventy-five dollars.452

       (J)(1) Permit D-5j may be issued to the owner or the453
operator of a retail food establishment or a food service454
operation licensed under Chapter 3717. of the Revised Code to455
sell beer and intoxicating liquor at retail, only by the456
individual drink in glass and from the container, for consumption457
on the premises where sold and to sell beer and intoxicating458
liquor in the same manner and amounts not for consumption on the459
premises where sold as may be sold by the holders of D-1 and D-2460
permits. The holder of a D-5j permit may exercise the same461
privileges, and shall observe the same hours of operation, as the462
holder of a D-5 permit.463

       (2) The D-5j permit shall be issued only within a community464
entertainment district that is designated under section 4301.80 of465
the Revised Code and that is located in a municipal corporation466
with a population of at least one hundred thousand.467

       (3) The location of a D-5j permit may be transferred only468
within the geographic boundaries of the community entertainment469
district in which it was issued and shall not be transferred470
outside the geographic boundaries of that district.471

       (4) Not more than one D-5j permit shall be issued within472
each community entertainment district for each five acres of land473
located within the district. Not more than fifteen D-5j permits474
may be issued within a single community entertainment district.475
Except as otherwise provided in division (J)(4) of this section,476
no quota restrictions shall be placed upon the number of D-5j477
permits that may be issued.478

       (5) The fee for a D-5j permit is one thousand eight hundred479
seventy-five dollars.480

       Section 2. That existing sections 4301.17 and 4303.181 of the481
Revised Code are hereby repealed.482