First look at alcohol ordinance

By Greg Bird
birdman@tmcvoice.com

Tonight’s Fiscal Court meeting will be of particular interest to anyone interested in the future of alcohol sales in McCreary County is concerned.
The Fiscal Court is expected to vote on the first reading of Ordinance 410.0 – the local Alcohol Beverage Control Ordinance.
Judge Executive Jimmie Greene and his staff have been working on the ordinance since the measure passed in November and will present it to be voted on by the Magistrates at the meeting.
The bulk of the ordinance is taken directly from a draft ordinance presented to the Fiscal Court by KaCO as the majority of alcohol laws are established at the state level. But the county did have to make specific decisions about some aspects of the bill, such as Sunday sales, regulatory fees and quota licenses.
Judge Greene said he had asked the Magistrates for input on their opinions, and used that information to finalize the first draft of the ordinance to be voted on. He added he and his staff have spoken with other Administrators across the state to learn more about what can and can’t be done.
The initial draft of the ordinance that will be presented tonight can still be changed or amended prior to becoming official law in the county. A second reading, expected to take place either on January 2 or 3, must be held before the ordinance is enacted.
Judge Greene stated the ordinance would not contain a license permitting Sunday sales in any form. As such, all alcohol sales in McCreary County would be limited from 6:00 a.m. through midnight – Monday through Saturday.
State law actually prohibits Sunday sales, but it does allow counties to sell special licenses permitting it.
It will also not include a license for Quota Retail by the Drink, which would allow for restaurants to sell liquor or wine without any restrictions in regards to food sales requirements. Not allowing such a license essentially bans “bars” operating – selling only beer, wine or alcohol.
The county will have non-quota by the drink licenses available, but such licenses place certain restrictions on how much alcohol can be sold in relation to food at the establishment. A non-quota type 2 license would require a restaurant to have at least 50 seats and derive at least 50 percent of their sales from food. A limited restaurant license would also be available, which also required at least 70 percent of the sales from food and either at least 50 or 100 seats.
The planned regulatory fee would be set at six-percent of gross sales for all sales – by-the drink and package. Those fees will generate the revenue to run the local ABC administration office and additional law enforcement.
State law dictates a maximum of five percent can be collected in a year, but the rates of certain fees can be set higher as long as the total collected does not exceed the five-percent. Somerset and Corbin, for example, have rates of seven percent for liquor by the drink, five percent on liquor package and four percent on beer sales. Danville, by comparison, has rates of five, four and three percent respectively.
The majority of licenses expected to be granted in the county would most likely be for beer package sales, which would presumably also be the highest generator of fees.
Judge Greene said, at least through the first year, those regulatory fees will be collected monthly – mainly to allow the county to get a better grasp on what to expect from alcohol sales.
With no idea on how much revenue would be gained from the fees, the county will have to estimate costs for hiring an ABC Administrator, policing the ordinance and providing extra police coverage.
The draft ordinance provided to the Fiscal Court had suggested license costs for certain licenses. A retail package license, along with a retail quota drink license and a non-quota retail license – all dealing with liquor sales – would be $1,000 per year. A beer package and beer by the drink license would be $400 annually. Other licenses, such as Sunday sales and limited golf course licenses range from $300 to $1,400.
Those license fees are not expected to change.
With a second reading of the ordinance scheduled for the first week of the new year, the county will be officially “wet” on January 5, 2020.
Once the county becomes officially “wet,” it would likely be at least a few weeks before the first license could be issued.
By law, a license applicant must advertise they are seeking a license, and be subject to a 30-day period where the application could be contested. Any contest of a local license would be overseen by the state ABC Board.
Even after a local license is issued, the licensee would also need to obtain a state license, which would be their official license to sell. State law does require a local license before granting a state license, except for certain situations.