In August of 2016, Act 39 of 2016 went into effect changing the Pennsylvania Liquor Code substantially. The act included dozens of changes which impacted licensees, consumers and the Pennsylvania LCB (“LCB”). One area most affected by the changes to the law involves how Pennsylvanians buy and sell wine.
“Wine Expanded Permits” for Existing Licensees
Act 39 created a Wine Expanded Permit (“WEP”) for restaurant and hotel liquor licensees. This permit allows the holder to sell wine for off-premises consumption (wine-to-go). Restaurants and hotels are now permitted to sell up to three liters of wine in much the same way they currently sell beer for off-premises consumption. Additionally, in the last year many grocery stores with restaurant licenses have begun selling wine in addition to beer for off-premises consumption.
Act 39 imposes parameters for wine-to-go sales under a WEP and some of the rules differ from those of traditional beer-to-go sales. There is no special permit needed for Restaurant and Hotel licensees to sell beer and malt brewed beverages for off-premises consumption. A WEP, however, is an additional permit a licensee has to obtain. Restaurant and hotel licensees are permitted to sell up to 192 ounces of malt or brewed beverages for off-premises consumption up to the time of closing, or 2 AM. Licensees with a WEP, however, may only sell wine for off-premises consumption until 11 PM. While licensees who sell beer and malt brewed beverages for off-premises consumption only need to verify age using a simple visual check of a patron’s identification, all wine sales for off-premises consumption require that the patron’s picture identification be verified using transactional scanning devises.
Additional requirements needed for a WEP include the following: there is an initial $2,000 application fee for this permit and an annual renewal fee equal to 2 percent of the revenue from wine purchased from the PLCB for off-premises consumption. A permit cannot be issued to a licensee whose license is subject to a pending objection from the PLCB’s Bureau of Licensing. However, if the licensee already holds the permit, it can continue to use it while the licensing matter is pending.
A WEP holder may sell up to three liters of wine in a single transaction; like beer and malt brewed beverage sales, patrons are permitted to make multiple purchases in a day. Wine sales must occur at a specifically designated area of the licensed premises, but other items, both alcoholic and non-alcoholic, may be purchased at the same point of sale register. Registers designated for wine sales must be staffed at all times by a Responsible Alcohol Management Program (RAMP) certified attendant. No wine-to-go sales may occur elsewhere, especially not in self-checkout registers. “Staffed at all times” means staff must be present on the licensed portion of the premises at all times during normal hours of operation. A WEP holder may not sell a private label product, defined generally as a product made under contract by a manufacturer for the exclusive right to sell by a specific retailer. A WEP holder may request that the LCB bring a product into its system, however, any product brought into the LCB system will be made available for sale by any other wholesale or retail licensee; a retail licensee cannot have the exclusive right to sell a product. Wine and malt or brewed beverages may only be displayed for sale on the licensed portion of a premises. A WEP licensee cannot sell wine to go for a price lower than the price at which it purchased the product from the LCB. Licensees pay the sales tax on wine at the time they make their purchase from the LCB. Sales tax from wine-to-go sales are paid by the consumers to the licensee and the licensee may then seek a tax credit from the Pennsylvania Department of Revenue for the sales tax paid to the PLCB when filing sales and use tax returns.
Licensees permitted to obtain a WEP include: Airport Restaurant Liquor (AR); Economic Development Restaurant Liquor (EDR); Hotel Liquor (H); Municipal Golf Course Liquor (GR); Off-Track Wagering Restaurant Liquor (OWR); Privately-owned Public Golf Course Liquor (PGR); and Restaurant Liquor (R);
Other changes that were made to the Liquor Code last year expanded how a limited winery is permitted to operate in the Commonwealth. A Limited Winery license may be held by any in-state or out-of-state winery that produces up to 200,000 gallons of alcoholic ciders, wines and wine coolers per year. Limited wineries may sell their products to individuals on the licensed premises, to the Pennsylvania Liquor Control Board, and to licensed hotels, restaurants, clubs, breweries and public service liquor licensees. Limited wineries may accept orders by mail, telephone and the Internet and may now ship or deliver their products to private homes either directly or through a licensed transporter-for-hire. Limited wineries may provide visitors on the licensed premises with samples of wines for testing at no charge. Limited wineries are also permitted to sell food for consumption on or off the licensed premises; to sell by the glass wine and alcoholic ciders that may otherwise be sold by the bottle; and to sell wine or liquor scented candles acquired or produced by the winery. Finally, bed and breakfast owners are permitted to provide up to one bottle of wine to their paying guests provided the wine is a Pennsylvania preferred alcoholic product from a licensed limited winery in Pennsylvania.
– J. Ken Butera