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Senate Bill 320 (SB 320) creates new types of liquor licenses and alters the requirements and powers conferred by certain liquor licenses
Senate Bill 320 (SB 320) creates new types of liquor licenses. In Section 60-3A-3 NMSA 1978, it adds a definition for package licensee and eliminates the definition for retailer. In Sections Section 60-5A-2, 60-6A-1 and 60-6A-2NMSA 1978, it replaces retailer with package licensee. SB 320 creates class A, class B and class C package licenses in 60-6A-2 NMSA 1978 and three new sections that delineate the three classes of package licenses. Class A package license (Section 60-6A-2.1 NMSA 1978) is open to those who have a retailer’s license on 30 June 2021 and limited to package sale of beer, wine and spirituous liquors. Class A package licenses are transferable from one local option district to another or from one qualified person to another. Class B package licenses (Section 60-6A-2.2 NMSA 1978) may sell packaged beer, wine or spirituous liquors in local option districts with populations of less than ten thousand people. Class B package licenses are transferable from one location to another location within the local option district but not transferable from a licensee to another person. Class C package license (Section 60-6A-2.3 NMSA 1978) are limited to package sale of beer or wine within a local option district and with the same limitations on transferability as Class B. SB 320 creates five classes of dispenser licenses (A-E) in Section 60-6A-3 NMSA 1978. Class A dispenser’s license (Section 60-6A-3.1 NMSA 1978) will be issued to those who hold a valid dispenser’s license on 30 June 2021 and entitles the holder to sell package liquor, including at another premises operated by the same ownership, and liquor by the drink. They are transferable from one local option district to another without any change in rights conferred by the license. Class B dispenser’s license (Section 60-6A-3.2 NMSA 1978) allows liquor sales by the drink and are transferable from location to location within a local option district, between districts, and outside the district including package sales with some conditions. Class C dispenser’s licenses (Section 60-6A-3.3 NMSA 1978) are limited to liquor sales by the drink within local option districts with a population of ten thousand people or less. They may be transferred from one location to another within the same district. Class D dispenser’s licenses Section 60-6A-3.4 NMSA 1978) are limited to sale of liquor by the drink and are not transferable. Class E dispenser’s licenses (Section 60-6A-3.5 NMSA 1978) are limited to the serving or sales of beer, wine or spirituous liquors to the guests of a hotel and will only be issued to an owner or operator of a hotel. This license will be valid for one year and may be renewed. If the owner, operator or employee holds a server permit then the hotel may dispense beer, wine or spirituous liquors to guests. These licenses are nontransferable. There are limits on beer, wine and spirituous alcohol available in a guest’s room. SB 320 modifies Section 60-6A-4 NMSA 1978 to create a Class A and Class B restaurant license. Class A allows for the consumption of beer, wine or spirituous liquors and Class B is limited to the consumption of beer and wine. Each license is subject to the same conditions that currently exist for restaurant licenses generally with the exception that these licenses may be transferred from one location to another within the local option district. It adds a restriction on counter service with exceptions. SB 320 replaces retailer license with package license and makes technical changes in the following sections in Chapter 60, Article 6A (State Licenses): Sections 60-6A-7; 60-6A-18; 60-6A-19; 60-6A-29; 60-6A-33; and 60-6A-36 NMSA 1978. SB 320 replaces retailer license with package license and makes technical changes in the following sections in Chapter 60, Article 6B (License Provisions): Sections 60-6B-2; 60-6B-5; 60-6B-9; 60-6B-11; 60-6B-19; and 60-6B-21 NMSA 1978. SB 320 replaces retailer license with package license and makes technical changes in the following sections in Chapter 60, Article 7A (Offenses): Sections 60-7A-1; 60-7A-9; 60-7A-10; 60-7A-11; 60-7B-10; 60-7B-11; and 60-7B-12 NMRA. SB 320 replaces retailer license with package license and makes technical changes in the following sections in Chapter 60, Article 8A (Trade Practices): Sections 60-8A-1; 60-8A-3; 60-8A-5; and 60-8A-17 NMSA 1978. It amends the fee schedule and includes initial and renewal fees in Section 60-6A-15 NMSA 1978 to reflect these new classes of dispensers and package licenses. SB 320 makes technical changes in Section 60A-24 NMSA 1978 (Wine Blender’ License) It modifies Section 60-6B-12 NMSA 1978 to reflect the changes from retailer to package licenses and effective dates in this act. It makes technical changes including provisions whose dates have expired. SB 320 repeals Section 60-6A-34 NMSA 1978. SB 320 would be effective on 1 July 2021.
Position: Serious Concerns Priority: High
ICBA/NM has serious concerns regarding any actions taken by local or state officials that could impact the value of licenses held by New Mexico Community Banks as collateral for commercial loans. It is only logical to assume that a sudden devaluation of the value of liquor licenses would cause New Mexico banks (and other lenders) to seek alternative or additional collateral to shore-up commercial loans that have been made. In extreme cases of under-collateralized loans, it is conceivable that loans could be called (the borrower asked to pay the debt in full) due to the bank’s asset to debt ratio requirements for commercial loans being out of alignment. While ICBA/NM takes no position on the public policy issue surrounding reform of New Mexico Liquor Laws, we urge extreme caution due to financial impact that will surely occur in the marketplace.