Legislative seats in the Kansas State Senate and House of Representatives are up for election this year.  You've probably noticed the campaigners in your local Independence Day parades and knocking doors in your neighborhood.  

Kansas retailers must support legislators who support our small businesses and appreciate the important role you play in your community.   Start NOW by reaching out to your local candidates, showing up to forums and asking questions.  Show your support through contributions, posting signs and talking to friends, family and neighbors.  

For more information, reach out to KABR and we will help to connect you and answer your questions!

Key Election Dates

• Last Day to Register to Vote for Primary Election - JULY 16
• Advance Primary Voting by Mail Begins - JULY 17
• Advance Primary Voting in Person (CHECK WITH YOUR LOCAL COUNTY)
• LAST DAY to Request an Advance Mail Ballot - JULY 30
• Advance Primary Voting Ends - NOON AUGUST 5
• Last Day to Register to Vote for General Election - OCTOBER 15
• Advance Voting by Mail Begins - OCTOBER 16

The Kansas Legislature reconvened for a one day special session after Governor Laura Kelly called for new tax legislation.  Three major tax packages and a couple of smaller bills were vetoed by the Governor during the 2024 Legislative Session, to the frustration of Republican leaders.

The legislation passed today included compromise provisions to assure the Governor will sign this package.  

Specifically, Senate Bill 1 will:

• Restructure individual income tax brackets and rates to provide for a two-bracket system;
• Exempt Social Security income from the individual income tax;
• Increase the standard deduction and personal exemption amounts;
• Reduce privilege tax rates;
• Abolish the Local Ad Valorem Tax Reduction Fund and County and City Revenue Sharing Fund;
• Increase the amount of the appraised value of residential property exempt from the statewide uniform school finance levy;
• Increase the child and dependent care income tax credit; and
• Exclude Section 1031 exchange sales from being considered valid sales for property valuation purposes.

For details link to Legislative Brief - https://klrd.org/2024/06/18/summary-of-special-session-sb-1/ 

Today, representatives of the House and Senate Federal and State Affairs Committees met to discuss Senate Substitute for HB 2124 - formerly SB 511 the microbrewery self-distribution legislation.  The House of Representatives hasn't held any hearings on the microbrewery proposal this session, but will vote whether or not to accept the bill through conference committee agreement.  The House members asked questions about the compromise language, including the background information to support numbers in the new bill. 

There was specific discussion whether or not 30,000 barrels is an appropriate upper limit for microbrewery production - in other words - is it still too high to be considered "micro"?  The numbers in the bill are supposed to prevent any legal challenges to the state's three-tier distribution system related to Granholm v. Heald.

Conferees accepted a proposal by Rep. Kessler to add to the legislation a required report to the Legislature from the Division of Alcoholic Beverage Control regarding microbreweries production, compliance and tax payment and reporting due January 2025.  

The House representatives accepted the rest of the bill as passed by the full Senate.  Many legislators have expressed relief to see the microbrewery/distributor compromise move forward.  The microbrewery bill garnered a lot of attention by legislators in both chambers, as the microbrewery owners met with many legislators from across the state to promote their proposal over the past few months. 

Sub for HB 2124 will:   

• Change the statutory definition of microbrewery to reduce the production limit to 30,000 (from 60,000)  Note: no Kansas microbrewery approaches these production numbers and only 4-5 make more than 1000 barrels,
• Allow a microbrewery to self-distribute to retailers, public venues, clubs, drinking establishments, caterers and temporary permit holders,
• Limit the total amount of beer and/or hard cider manufactured by the microbrewery to be self-distributed to 1000 barrels of beer and 3000 gallons of hard cider.
• Exempt from these limits product distributed to their own drinking establishments or catering businesses (at least 25% ownership) or between microbreweries/packaging facilities that are commonly owned,
• Require the microbrewery to file a written notice stating the geographic territory for such sales,
• Allow sales to the public off the licensed premises at special events regulated by the ABC,
• Add microbreweries to the statutes regulating trade practices, non-discrimination requirements, and allocations and prohibiting quantity discounts,
• Allows delivery charges to licensees under the club and drinking establishment act,

AND

• At the request of the wholesalers, amended Liquor Control Act to allow distributors or microbreweries to buy back or exchange, at the original sales price, any item of beer or cereal malt beverage that is within 30 days of its expiration date - replacing the 14 day limitation.

This week, the Senate Federal and State Affairs adopted amendments to SB 511 - the microbrewery bill - inserting compromise language that was forged between representatives of the microbreweries and wholesalers.  Senate leaders supervised the compromise to bridge a significant gap between the microbreweries' proposal and the wholesalers' offer.  The Director of the Division of Alcoholic Beverage Control also provided advice regarding regulatory parameters.  KABR was not present at this negotiation meeting.

The amendments:   Read the bill at this link

• Change the statutory definition of microbrewery to reduce the production limit to 30,000 (from 60,000)  Note: no Kansas microbrewery approaches these production numbers and only 4-5 make more than 1000 barrels,
• Allow a microbrewery to self-distribute to retailers, public venues, clubs, drinking establishments, caterers and temporary permit holders,
• Limit the total amount of beer and/or hard cider manufactured by the microbrewery to be self-distributed to 1000 barrels of beer and 3000 gallons of hard cider.
• Exempt from these limits product distributed to their own drinking establishments or catering businesses (at least 25% ownership) or between microbreweries/packaging facilities that are commonly owned,
• Require the microbrewery to file a written notice stating the geographic territory for such sales,
• Allow sales to the public off the licensed premises at special events regulated by the ABC,
• Add microbreweries to the statutes regulating trade practices, non-discrimination requirements, and allocations and prohibiting quantity discounts,
• Allows delivery charges to licensees under the club and drinking establishment act,

AND

• At the request of the wholesalers, amended Liquor Control Act to allow distributors or microbreweries to buy back or exchange, at the original sales price, any item of beer or cereal malt beverage that is within 30 days of its expiration date - replacing the 14 day limitation.

The amended language was inserted into Sub for HB 2124.  This action is called a "gut and go" - to remove the contents of another bill and insert new language.  Sub for HB 2124 is a bill that already passed the House in 2023.  If and when this bill passes the Senate, it will be eligible to go straight to a conference committee with the House of Representatives, rather than having to go through the committee process in the House.  

We expect the Microbrewery legislation to be debated in the full Senate next week.  We have reviewed this new language (published today) to be sure it includes the non-discrimination language that is so important for retailers.

The greatest worry for your lobbyist is how many unknown liquor amendments might pop up when the bill is debated by the full Senate next week.  There is nothing like a liquor bill on the floor of the House or Senate to bring out "great ideas".  Now is a good time to reach out to your Senator to share this concern.

Whatever is passed by the Senate is still subject to review by the House of Representatives.  Microbreweries have done a good job talking to lots of legislators in both chambers, so they are likely to be happy that the two sides crafted a compromise.  The members of the conference committee would include the Chair, Vice Chair and Ranking Minority Members of the House and Senate Federal and State Affairs Committees.

SB 253

SB 253 is still sitting in Senate Federal and State Affairs Committee - with no action planned.  The bill would allow Alcohol Home Delivery proposed by Walmart and a number of third party delivery platforms, including DoorDash, UberEats, Amazon/WholeFoods, etc.  It could be brought as an amendment on the floor when Sub for HB 2124 is debated next week - although we hope such an effort would be voted down.

Time for the 2024 Legislative Session is growing short.  First Adjournment is April 5 with legislators returning for the veto session April 27.

When: Wednesday, February 21, 2024 11:00 AM, CST
Where: The Pennant, 915 S Kansas Ave, Topeka, KS 66612

EVENT DETAILS:

Kansas Association of Beverage Retailers: Legislative Lunch and Retailer Meeting

Wednesday, February 21 - Topeka

The Pennant, 2nd floor private room, 915 S Kansas Ave, Topeka, KS 66612

11:00 a.m.     KABR Business and Policy meeting - Board Members and KABR Members     

12:00 - 1:15 p.m.  Legislators Luncheon - State Legislators and Retailers

Since the Beer Law, retailers have not been as active with the Kansas Legislature, but it is time to get back into action.  There are many new legislators in the House of Representatives who need to see and learn from their retailers.  Come to Topeka for a short business meeting and lunch with legislators. 

The Senate Federal and State Affairs Committee appears likely to take action on SB 253 - the Walmart Home Delivery legislation.  A House Bill was introduced to allow wine in grocery stores.  Retailers must communicate with policymakers to represent our small businesses for these issues and those that will be coming up in the future.

Stick around to attend the Kansas Wine and Spirits Wholesalers Reception from 5:00 to 7:00 p.m. at the Beacon Building.

1.  If you haven't already, please RSVP.  We will invite your legislator(s) to the lunch if we know you are attending.

2.  Contact your legislator in advance to be sure they will join you for the lunch or for a meeting in their office before or after our event.

3.  Communicate with Amy to let her know that you have made contact.  

Dress is business casual.  

Do not wait until February 21 to reach out to your legislators!  Let us know if you need help to make contact.

Contact:  Amy Campbell - 785-969-1617 

The Senate Federal and State Affairs Committee held a public hearing on SB 253 Friday, March 10.  The Committee spent most of its meeting on a different bill, leaving only 30 minutes for the hearing on Alcohol Home Delivery.  Committee Chair Mike Thompson allowed ten minutes for proponents and 10 minutes for the opponents, with time also allowed for ABC Director Debbi Beavers to provide neutral testimony.  Link to committee information.

KABR opposes this bill as proposed by Walmart and a number of third-party delivery platforms, including DoorDash, UberEats, Amazon/WholeFoods, etc.  Our opposition rests primarily on the delivery system envisioning a large role for online/apps owned by technology companies who arrange alcohol delivery with non-employees.  The platforms own and control the data and how many eyes will see the product information posted on behalf of retailers/establishments.  Retailers do not control where the customers are directed by the platform.  Delivery companies are not held to a comparable regulatory standard or penalties.  Pushing alcohol transactions online will also increase the online traffic of illegal/unlicensed alcohol marketing - a format that has already shown a poor public safety performance and increasing illegal/counterfeit activity across the country.  Further, the legislation appears to hold the retailer/drinking establishment partially responsible for the product up to the point of delivery and payment - causing serious concern.  

See the recorded hearing at this link - fast forward to 11:14 to skip the first bill hearing.  Link to Revisor's bill description.

See a list of conferees and their testimony below:

Proponents:  Only O’Neal and Madon spoke in the time allotted.

Mike O’Neal, Walmart

Scott Schneider JD, Kansas Restaurant and Hospitality Association

Alexi Madon, Doordash

Proponents Written Only:

Ryan Bissett, Whole Foods Market

Elizabeth Patton, Americans for Prosperity

Eric Stafford, Kansas Chamber

Neutral:

Debbi Beavers, Director, Alcoholic Beverage Control Division

   The Director requested amendments in her testimony.

Neutral Written Only:

Philip Bradley, Kansas Licensed Beverage Association

Tuck Duncan, Kansas Wine and Spirits Wholesalers Association

Opponents:

Amy Campbell, Kansas Association of Beverage Retailers (gave her time to the retailers to speak)

Whitney Damron, Kansas Association of Responsible Liquor Laws

Aaron Rosenow, Vern’s Retail Liquor, Topeka

Brian Davis, Davis Retail Liquor, Wichita

Phillip Cosby, State Director, American Family Action of Kansas and Missouri  DUI Data

Opponents Written Only:

Philip Bradley, KS Craft Brewers Assn, KS Viticulture Farm Winery Assn, Artisan Distillers of KS

Jeff Breault, R & J Discount Liquor, Wichita

Monica Tieben, Blackjack’s Liquor, Dodge City

SB 253 would authorize the delivery of alcoholic liquor and cereal malt beverages to patrons by licensed retailers, licensed clubs, drinking establishments and restaurants, and third party delivery services. The bill would provide for the issuance of permits authorizing third-party delivery services to make deliveries of alcoholic liquor and cereal malt beverages on behalf of a licensed retailer, club, establishment, or restaurant. Such permits would cost $1,500 and be valid for one year. The bill would require that all individuals making such deliveries for a third-party delivery service permit holder be 21 years of age and have proper insurance coverage. The bill specifies that each delivery permit holder would be liable for any violation involving the sale and consumption of alcoholic liquor or cereal malt beverage that is committed by any individual conducting deliveries on behalf of the permit holder. SB 253 would authorize the Alcohol and Beverage Control Director to impose civil fines of no more than $1,000 for violations involving deliveries.

The Senate Federal and State Affairs Committee will have a public hearing on SB 253 Friday, March 10.  The Committee meets at 10:30 a.m. in Statehouse Room 144-S and there is another bill scheduled that day, with SB 253 second on the agenda.    Read the bill.

KABR opposes this bill – proposed by Walmart and a number of third party delivery platforms, including DoorDash, UberEats, Amazon/WholeFoods, etc.

A similar bill was tabled by the House Federal and State Affairs Committee last year. The new bill does include restaurants, so there will be fewer opponents.

SB 253 would authorize the delivery of alcoholic liquor and cereal malt beverages to patrons by licensed retailers, licensed clubs, drinking establishments and restaurants, and third party delivery services. The bill would provide for the issuance of permits authorizing third-party delivery services to make deliveries of alcoholic liquor and cereal malt beverages on behalf of a licensed retailer, club, establishment, or restaurant. Such permits would cost $1,500 and be valid for one year.

The bill would require that all individuals making such deliveries for a third-party delivery service permit holder be 21 years of age and have proper insurance coverage. The bill specifies that each delivery permit holder would be liable for any violation involving the sale and consumption of alcoholic liquor or cereal malt beverage that is committed by any individual conducting deliveries on behalf of the permit holder. SB 253 would authorize the Alcohol and Beverage Control Director to impose civil fines of no more than $1,000 for violations involving deliveries.

2023 SB 104 KABR Testimony for Credit Surcharge Senate FII.pdf

HB 2170 KABR Testimony for HFSA Campbell Support.pdf

Members of KABR are encouraged to attend a luncheon with legislators in Topeka February 15 - get to know some of the legislators who make decisions about Kansas statutes regulating the liquor industry.  We know that developing relationships with our elected officials creates a better understanding of the needs of our Kansas owned small businesses.

RSVP HERE

A few bills under consideration this session would allow retailers to charge surcharges for credit processing and discounts for cash customers, change the quantity of product a distributor may sample to a retailer, and a new version of the Walmart home delivery legislation that includes third party delivery platforms.