SENATE, No. 1425
STATE OF NEW JERSEY
INTRODUCED JULY 25, 1996
By Senator MATHEUSSEN
An Act concerning the issuance of certain alcoholic beverage licenses, amending R.S.33:1-25 and R.S.33:1-31 and supplementing Title 33 of the Revised Statutes.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. R.S.33:1-25 is amended to read as follows:
33:1-25. No license of any class shall be issued to any person under the age of 21 years or to any person who has been convicted of a crime involving moral turpitude.
In applications by corporations, except for club licenses, the names and addresses of, and the amount of stock held by, all stockholders holding 1% or more of any of the stock thereof, and the names and addresses of all officers and of all members of the board of directors must be stated in the application, and if one or more of the officers or members of the board of directors or one or more of the owners, directly or indirectly, of more than 10% of the stock would fail to qualify as an individual applicant in all respects, no license of any class shall be granted.
In applications for club licenses, the names and addresses of all officers, trustees, directors, or other governing official, together with the names and addresses of all members of the corporation, association or organization, must be stated in the application.
In applications by partnerships, the application shall contain the names and addresses of all of the partners. No license shall be issued unless all of the partners would qualify as individual applicants.
A photostatic copy of all federal permits necessary to the lawful conduct of the business for which a State license is sought and which relate to alcoholic beverages, or other evidence in lieu thereof satisfactory to the director, must accompany the license application, together with a deposit of the full amount of the required license fee, which deposit to the extent of 90% thereof shall be returned to the applicant by the director or other issuing authority if the application is denied, and the remaining 10% shall constitute an investigation fee and be accounted for as other license fees.
Every applicant for a license that is not a renewal of an annual license shall cause a notice of the making of the application to be published in a form prescribed by rules and regulations, once per week for two weeks successively in a newspaper printed in the English language, published and circulated in the municipality in which the licensed premises are located; but if there shall be no such newspaper, then the notice shall be published in a newspaper, printed in the English language, published and circulated in the county in which the licensed premises are located. No publication shall be required with respect to applications for transportation or public warehouse licenses or with respect to applications for renewal of licenses.
The Division of Alcoholic Beverage Control shall cause a general notice of the making of annual renewal applications and the manner in which members of the public may object to the approving of the applications to be published in a form prescribed by rules and regulations, once per week from the week of April 1 through the week of June 1 in a newspaper printed in the English language published and circulated in the counties in which the premises of applicants for renewals of annual licenses are located. Any application for the renewal of an annual license shall be made by May 1, and none shall be approved before May 1.
Every person filing an application for a license[, renewal of license] or transfer of a license with a municipal issuing authority shall, within 10 days of such filing, file with the director a copy of the application together with a nonreturnable filing fee of [$100.00] $600. If there has been a change in the membership of a corporation or partnership which is renewing a license, or if any other circumstances occur which, in the discretion of the director, require a background investigation of any licensee, the fee for the renewal shall be $600. The fee for all other renewals shall be $100.
Applicants for licenses shall answer questions as may be asked and make declarations as shall be required by the form of application for license as may be promulgated by the director from time to time. All applications shall be duly sworn to by each of the applicants, except in the case of applicants in the military service of the United States whose applications may be signed in their behalf by an attorney-in-fact holding a power of attorney in form approved by the director, and except in cases of applications by corporations which shall be duly sworn to by the president or vice-president. All statements in the applications required to be made by law or by rules and regulations shall be deemed material, and any person who shall knowingly misstate any material fact, under oath, in the application shall be guilty of a misdemeanor. Fraud, misrepresentation, false statements, misleading statements, evasions or suppression of material facts in the securing of a license are grounds for suspension or revocation of the license.
(cf: P.L.1992, c.188, s.3)
2. R.S.33:1-31 is amended to read as follows:
33:1-31. Any license, whether issued by the director or any other issuing authority, may be suspended or revoked by the director, or the other issuing authority may suspend or revoke any license issued by it, for any of the following causes:
a. Violation of any of the provisions of this chapter;
b. Manufacture, transportation, distribution or sale of alcoholic beverages in a manner or to an extent not permitted by the license or by law;
c. Nonpayment of any excise tax or other payment required by law to be paid to the State Tax Commissioner;
d. Failure to comply with any of the provisions of subtitle 8 of the Title Taxation (§ 54:41-1 et seq.);
e. Failure to have at all times a valid, unrevoked permit, license or special tax stamp, or other indicia of payment, of all fees, taxes, penalties and payments required by any law of the United States;
f. Failure to have at all times proper stamps or other proper evidence of payment of any tax required to be paid by any law of this State;
g. Any violation of rules and regulations;
h. Any violation of any ordinance, resolution or regulation of any other issuing authority or governing board or body;
i. Any other act or happening, occurring after the time of making of an application for a license which if it had occurred before said time would have prevented the issuance of the license; or
j. For any other cause designated by this chapter.
No suspension or revocation of any license shall be made until a 5-day notice of the charges preferred against the licensee shall have been given to him personally or by mailing the same by registered mail addressed to him at the licensed premises and a reasonable opportunity to be heard thereon afforded to him. If the licensee has been afforded a hearing and the director determines that the suspension or revocation shall be imposed, the licensee shall be assessed the State's costs directly associated with that hearing. The hearing costs assessed pursuant to this section shall be in addition to any other penalty that the director may impose.
A suspension or revocation of license shall be effected by a notice in writing of such suspension or revocation, designating the effective date thereof, and in case of suspension, the term of such suspension, which notice may be served upon the licensee personally or by mailing the same by registered mail addressed to him at the licensed premises. Such suspension or revocation shall apply to the licensee and to the licensed premises.
A revocation shall render the licensee and the officers, directors and each owner, directly or indirectly, of more than 10% of the stock of a corporate licensee ineligible to hold or receive any other license, of any kind or class under this chapter, for a period of two years from the effective date of such revocation and a second revocation shall render the licensee and the officers, directors and each owner, directly or indirectly, of more than 10% of the stock of a corporate licensee ineligible to hold or receive any such license at any time thereafter. Any revocation may, in the discretion of the director or other issuing authority as the case may be, render the licensed premises ineligible to become the subject of any further license, of any kind or class under this chapter, during a period of two years from the effective date of the revocation.
The director may, in his discretion and subject to rules and regulations, accept from any licensee an offer in compromise in such amount as may in the discretion of the director be proper under the circumstances in lieu of any suspension of any license by the director or any other issuing authority.
No refund, except as expressly permitted by [section] R.S.33:1-26 [of this Title], shall be made of any portion of a license fee after issuance of a license; but if any licensee, except a seasonal retail consumption licensee, shall voluntarily surrender his license, there shall be returned to him, after deducting as a surrender fee 50% of the license fee paid by him, the prorated fee for the unexpired term; provided, that such licensee shall not have committed any violation of this chapter or of any rule or regulation or done anything which in the fair discretion of the director or other issuing authority, as the case may be, should bar or preclude such licensee from making such claim for refund and that all taxes and other set-offs or counterclaims which shall have accrued and shall have become due and payable to this State or any municipality, or both, have been paid. Such refund, if any, shall be made as of the date of such surrender. The surrender of a license shall not bar proceedings to revoke such license. The refusal of the other issuing authority to grant any refund hereunder shall be subject to appeal to the director within 30 days after notice of such refusal is mailed to or served upon the licensee. Surrenders of retail licenses shall be promptly certified by the issuing authority to the director. Surrender fees shall be accounted for as are investigation fees. If any licensee to whom a refund shall become due under the provisions of this section shall be indebted to the State of New Jersey for any taxes, penalties or interest by virtue of the provisions of subtitle 8 of the Title Taxation (§ 54:41-1 et seq.), it shall be the duty of the issuing authority before making any such refund, upon receipt of a certificate of the State Tax Commissioner evidencing the said indebtedness to the State of New Jersey, to deduct therefrom, and to remit forthwith to the State Tax Commissioner the amount of such taxes, penalties and interest.
In the event of any suspension or revocation of any license by the other issuing authority, the licensee may, within 30 days after the date of service or of mailing of said notice of suspension or of revocation, upon payment to the director of a nonreturnable filing fee of $100.00, appeal to the director from the action of the other issuing authority in suspending or revoking such license which appeal shall act as a stay of such suspension or revocation pending the determination thereof unless the director shall otherwise order. When any person files with any other issuing authority written complaint against a licensee specifying charges and requesting that proceedings be instituted to revoke or suspend such license, he may appeal to the director from its refusal to revoke or suspend such license or other action taken by it in connection therewith within 30 days from the time of service upon or mailing of notice to him of such refusal or action. The director shall thereupon fix a time for the hearing of the appeal and before hearing the same shall give at least five days[']notice of the time so fixed to such licensee, other issuing authority and appellant.
(cf: P.L.1992, c.188, s.11)
3. (New section) The municipal issuing authority shall forward to the Alcohol Beverage Control Enforcement Bureau in the Division of State Police a copy of any application for issuance or transfer of any license issued under R.S.33:1-12. The municipal issuing authority shall not take action with respect to any application until completion of an appropriate and thorough investigation by the Alcohol Beverage Control Enforcement Bureau in the Division of State Police. Upon completion of the investigation, the Division of Alcoholic Beverage Control shall certify whether granting of the application is in the public interest. If the Division of Alcoholic Beverage Control finds that granting the application will not be contrary to the public interest, the municipal issuing authority may grant the application. If the Division of Alcoholic Beverage Control finds that granting the application is not in the public interest, the municipal issuing authority shall deny the application. The applicant may appeal to the director of the Division of Alcoholic Beverage Control the denial of the application by the municipal issuing authority and shall be afforded a hearing.
4. This act shall take effect on the first day of the second month after enactment.
STATEMENT
Under this bill, the Division of State Police, Alcoholic Beverage Control Enforcement Bureau would assume the responsibility for investigating persons applying for a retail liquor license. Currently, the municipality issuing the license conducts the background investigation. Under the provisions of section 3 of the bill, the municipal issuing authority would forward to the Division of State Police, Alcoholic Beverage Control Enforcement Bureau a copy of any application for issuance or transfer of any license issued under R.S.33:1-12. The issuing authority could not take action with respect to the application until completion of an investigation by the Division of State Police, Alcoholic Beverage Control Enforcement Bureau. Following that investigation, if the Division of Alcoholic Beverage Control certifies that granting of the application will not be contrary to the public interest, the issuing authority may grant the application. The applicant could appeal to the director of the Division of Alcoholic Beverage Control the denial of any application by the muncipality and would be afforded a hearing.
The bill amends R.S.33:1-25 to increase the application fee for a license of any class or the transfer of a license from the current $100 to $600. The fee for renewals shall also be increased from $100 to $600 if there is a change in the membership of the partnership or corporation or other circumstances requiring a background check. The fee for other renewals remains at $100.
The bill also provides funding sources for the Division of Alcoholic Beverage Control to assume these duties. The bill increases the application fee for a license and transfer of a license from $100 to $600 as discussed above. Another source of revenue is provided by requiring the licensee to pay the State's costs directly associated with a hearing in any contested case for a violation of any rule or regulation. These hearing costs would be in addition to any other penalty that the director may impose. This requirement is set forth in R.S.33:1-31.
The State takeover provision in the bill is modeled on N.J.A.C.13:2-3.7 by which the State took over the investigation of license applications filed in Atlantic City. Under this authority, the Atlantic City Joint Task Force was created in 1977.
In a March 1992 report the State Commission of Investigation (SCI) concluded that the lax manner in which some municipalities conduct liquor license background checks was the "principal reason" that organized crime was still involved in the liquor business. The SCI concluded that the State should assume the responsibility for all background investigations of applicants for liquor licenses and suggested that the State use the proceedings by which liquor licenses are issued in Atlantic City as the model for a State takeover of background investigations. Since the commission recognized that the new responsibilities would result in additional costs, it suggested three funding sources--additional applicant fees for investigative costs, increased penalties for violations and assessment of costs in administrative cases.
Requires State to assume background checks for liquor license applicants.