81st Legislative Session _ 2006

Committee: House Local Government
Tuesday, February 07, 2006

                                            P - Present
                                            E - Excused
                                            A - Absent

Roll Call
P    Cutler
P    Davis
P    Gassman
P    Hanks
P    Howie
P    Kroger
P    McCoy
P    Rounds
P    Sigdestad
P    Thompson
P    Tornow
P    Murschel, Vice-Chair
P    Hennies, Chair

OTHERS PRESENT: See Original Minutes

The meeting was called to order by Representative Tom Hennies, Chair

MOTION:     TO APPROVE THE MINUTES OF THURSDAY, FEBRUARY 2, 2006

Moved by:    Rounds
Second by:    Cutler
Action:    Prevailed by voice vote.

         HB 1233: restrict where certain alcoholic beverage licenses may be located.

Presented by:    Representative Shantel Krebs
Proponents:    Jamison Rounds, Tourism & State Development
        Michael Kenyon, Department of Revenue and Regulation

MOTION:     AMEND HB 1233

1233fb
     On the printed bill, delete everything after the enacting clause and insert:

"

     Section 1. Terms used in this Act mean:

             (1)    "Artisan distiller," an artisan distiller located in South Dakota that produces fifty thousand gallons or less of distilled spirits annually;
             (2)    "Department," the Department of Revenue and Regulation;
             (3)    "Farm Winery," any winery licensed pursuant to chapter 35-12;
             (4)    "Distilled spirits sample or liquor sample," any sample of distilled spirits given with or without charge to a customer, visitor, or tourist, but does not include amounts consumed or tested as a part of production, or given to employees, directors, members, owners, consultants, or paid taste panels as a part of product development, product production, or marketing research;
             (5)    "Produces," the distillation of distilled spirits on the premises of the artisan distiller licensee.

     Section 2. The secretary of the Department of Revenue and Regulation may issue an artisan distiller license to the owner or operator of an artisan distiller located within the state. A license may be issued and renewed for an annual fee of five hundred dollars, which is in lieu of all other license fees required by chapter 35-4. The fee shall be deposited in the general fund.

     Section 3. The department may, upon receipt of an application, issue an artisan distiller license to a person who is authorized under the provisions of the Federal Alcohol Administration Act, 27 U.S.C. § § 201 to 212, inclusive, as of January 1, 2006. A licensee may import, manufacture, distill, rectify, blend, process, denature, sell, transport, and store distilled spirits of an alcoholic content greater than seventeen percent alcohol by weight and may transport the distilled spirits out of this state for sale outside this state. A licensee may sell alcoholic beverages as provided in section 6 of this Act.

     Section 4. No agricultural producer, association of agricultural producers, or legal agent who manufactures and converts agricultural surpluses, byproducts, or wastes into denatured ethyl and industrial alcohol for purposes other than human consumption is required to obtain an artisan distiller license.

     Section 5. An artisan distiller that produces distilled spirits within the state pursuant to section 2 of this Act shall maintain records of all sales and shipments. The artisan distiller shall furnish the department a monthly and other reports concerning quantities and prices of distilled spirits shipped and other information that the department determines to be necessary to ensure that the distribution of distilled spirits within this state conforms to the requirements of this Act.

     Section 6. An artisan distiller licensed pursuant to this Act may:

             (1)    Import necessary products in bulk;
             (2)    Bottle, produce, blend, store, transport, or export distilled spirits that the artisan distiller produces;
             (3)    Perform any operation that is permitted for bonded artisan distiller premises under applicable regulations of the United States Department of the Treasury;
             (4)    Provide, with or without charge, not more than four ounces of any distilled spirits sample that the artisan distiller produces at that location for consumption on the premises between twelve noon to twelve midnight;
             (5)    Provide without charge more than four ounces of any distilled spirits sample that the artisan distiller produces at that location to employees, directors, members, owners, shareholders, paid consultants, or paid taste panels as long as the sample is used for the purposes of product research or product development;
             (6)    Sell distilled spirits, if produced, manufactured, blended, or processed at that artisan distiller, at retail to any person for off-premises consumption. However, no artisan distiller may sell more than three and one-half liters per day to any person. However, an artisan distiller may sell more than three and one-half liters per day if the artisan distiller holds a license an off-sale license pursuant to subdivision 35-4-2(3);
             (7)    Sell distilled spirits aging or to be aged at the premises or at a licensed warehouse operated by the artisan distiller in advance of the bottling of that distilled spirits, provided that delivery of that distilled spirits does not exceed three liters per day per person. Any advanced sale delivered by a distributor licensed pursuant to chapter 35-2 is not limited by this section;
             (8)    Sell and transport distilled spirits to a farm winery made from product from the respective farm winery;
             (9)    Hold on the premises where the distilled spirits is produced, an on-sale license issued pursuant to subdivision 35-4-2(4) or (6) or pursuant to the license issued pursuant to section 2 of this Act;
             (10)    Hold on the premises where the distilled spirits is produced, an off-sale license issued pursuant to subdivision 35-4-2(5) or (19) or pursuant to the license issued pursuant to section 2 of this Act.

     Section 7. Except as otherwise specified in this Act, all provisions of this title apply to the production, sale, possession, and consumption of distilled spirits produced by an artisan distiller.

     Section 8. Notwithstanding the provisions of §  35-2-6.4, any person employed by or with an interest in a business that holds a license pursuant to subdivisions 35-4-2(2), (3), (4), (5), (6), (12), (13), (16), (17), (18), and (19) may have an interest of ten percent or less in an artisan distiller provided that the total percent of ownership of an artisan distiller by persons with such interest does not exceed forty-nine percent.

     Section 9. There is hereby levied on all distilled spirits manufactured or produced by a South Dakota artisan distillery an excise tax imposed at the same rates and collected and administered in the same manner as the tax imposed on distilled spirits in chapter 35-5.

     Section 10. The excise tax on distilled spirits established in section 9 of this Act shall be paid to the secretary of the Department of Revenue and Regulation on or before the fifteenth day of the month following the month in which the first sale is made in this state by a licensed farm winery and shall be deposited in the general fund. The artisan distillery licensee shall file with the secretary a return in the form prescribed by the secretary, and shall keep records and render reports required by the secretary in rules promulgated pursuant to chapter 1-26.

     Section 11. A farm winery may sell for off sale consumption up to one liter per person per day of distilled spirits made from product provided by that winery and purchased from an artisan distiller pursuant to this Act.

     Section 12. A farm winery licensed pursuant to chapter 35-12 may provide, with or without charge, not more than two ounces of distilled spirits samples produced at an artisan distiller pursuant to this Act to any person for consumption on the premises between twelve noon and twelve midnight.

     Section 13. An artisan distiller or farm winery which receives less then ten dollars a month from the tax on the sale of distilled spirits samples is not required to file a return or pay the tax under Title 35.

     Section 14. Any artisan distiller or farm winery who owe taxes amounting to less than one hundred dollars per month on an annual average may be permitted by the department to report any pay the tax on a semiannual basis or other time period and in such manner as deemed reasonable by the department.

     Section 15. That § 35-2-6.3 be amended to read as follows:

     35-2-6.3.   Any distiller, manufacturer, wholesaler, or retailer licensee under this title must , except as provided in this Act, shall be the owner or actual lessee of the premises where the business is to be conducted and the sole owner of the business to be operated under such license. "


Moved by:    Cutler
Second by:    McCoy
Action:    Prevailed by voice vote.

MOTION:     AMEND THE AMENDMENT

1233ff
     On the previously adopted amendment (1233fb), in Section 6, subdivision (7), after "three" insert "and one-half".

Moved by:    Cutler
Second by:    Rounds
Action:    Prevailed by voice vote.

MOTION:     DO PASS HB 1233 AS AMENDED

Moved by:    Cutler
Second by:    McCoy
Action:    Prevailed by roll call vote.(12-1-0-0)

Voting Yes:    Cutler, Davis, Gassman, Hanks, Howie, Kroger, McCoy, Rounds, Sigdestad, Thompson, Murschel, Hennies

Voting No:    Tornow

         SB 97: allow the governing body of taxing districts to automatically refer a property tax opt out to the voters.

Presented by:    Senator Garry Moore
Proponents:    Michael Kenyon, Department of Revenue and Regulation (Handout #1)

MOTION:     DO PASS SB 97

Moved by:    Rounds
Second by:    Gassman
Action:    Prevailed by roll call vote.(13-0-0-0)

Voting Yes:    Cutler, Davis, Gassman, Hanks, Howie, Kroger, McCoy, Rounds, Sigdestad, Thompson, Tornow, Murschel, Hennies

MOTION:     PLACE SB 97 ON CONSENT CALENDAR

Moved by:    McCoy
Second by:    Gassman
Action:    Prevailed by voice vote.


         SB 109: provide for statewide mutual aid requests among certain public agencies.

Presented by:    Representative Tim Rave
Proponents:    Senator J.P. Duniphan
        Yvonne Taylor, SD Municipal League
        Steve Willard, SD Joint Fire Council
        Kristi Turman, DPS

MOTION:     DO PASS SB 109

Moved by:    McCoy
Second by:    Hanks
Action:    Prevailed by roll call vote.(12-1-0-0)

Voting Yes:    Cutler, Davis, Gassman, Hanks, Howie, Kroger, McCoy, Rounds, Sigdestad, Thompson, Murschel, Hennies

Voting No:    Tornow

         SB 146: update certain statutory references to the South Dakota Firefighters Association, Incorporated.

Presented by:    Representative Tim Rave
Proponents:    Senator J.P. Duniphan
        Steve Willard, SD Joint Fire Council

MOTION:     DO PASS SB 146

Moved by:    Thompson
Second by:    McCoy
Action:    Prevailed by roll call vote.(13-0-0-0)

Voting Yes:    Cutler, Davis, Gassman, Hanks, Howie, Kroger, McCoy, Rounds, Sigdestad, Thompson, Tornow, Murschel, Hennies

MOTION:     PLACE SB 146 ON CONSENT CALENDAR

Moved by:    Hanks
Second by:    McCoy
Action:    Prevailed by voice vote.
         SB 90: revise certain provisions regarding the approval of plats.

Presented by:    Senator Eric Bogue

MOTION:     AMEND SB 90

90oa
     On page 2, after line 4 of the printed bill, insert:

"
     Section 2. That § 43-28-23 be amended to read as follows:

     43-28-23.   Any real estate document recorded with the register of deeds, except for plats, shall:

             (1)      Consist of one or more individual sheets measuring no larger than 8.5 inches by 14 inches and no smaller than 8.5 inches by 11 inches. No sheet may be attached or affixed to a page that covers up any information or printed material on the document. Any continuous document or any document sheets that are stapled, glued, or bound together are subject to the additional fee established pursuant to subdivision 7-9-15(1);
             (2)      Be printed, typewritten, or computer generated in black ink and the print type of the document may not be smaller than 10-point type;
             (3)      Be on white paper of not less than twenty pound weight;
             (4)      Contain a blank space at the top measuring no less than three inches as measured from the top of the first page. The right half shall be used by the register of deeds for recording information and the left half shall be used by the document preparer as required pursuant to § 7-9-1 and may include a return designation and address. All other margins shall be a minimum of one inch;
             (5)      Have a title prominently displayed at the top of the first page below the blank space referred to in subdivision (4) of this section;
             (6)      Be sufficiently legible to reproduce a readable copy using the register of deed's current method of reproduction; and
             (7)      Conform to the standards provided in this section or be subject to the increased fees as provided in § 7-9-15.

     However, the register of deeds may not charge an increased fee for any document that has a seal or stamp in a margin. Any affidavit of publication, corner record, survey, certified court or governmental document, and UCC form recorded against real estate is exempt from the provisions of this section. Any plat or survey and certified vital record attached to documents is also exempt from the provisions of this section.

     The provisions of this section do not apply to any real estate document prepared and executed prior to July 1, 2002. ".

Moved by:    Rounds
Second by:    Cutler
Action:    Prevailed by voice vote.

MOTION:     TO AMEND TITLE OF SB 90

90ota
     On page 1, line 1 of the printed bill, after " plats " insert "and the format standards for certain real estate documents recorded with the register of deeds".

Moved by:    Murschel
Second by:    McCoy
Action:    Prevailed by voice vote.

MOTION:     DO PASS SB 90 AS AMENDED

Moved by:    Howie
Second by:    Cutler
Action:    Prevailed by roll call vote.(13-0-0-0)

Voting Yes:    Cutler, Davis, Gassman, Hanks, Howie, Kroger, McCoy, Rounds, Sigdestad, Thompson, Tornow, Murschel, Hennies

MOTION:     PLACE SB 90 ON CONSENT CALENDAR

Moved by:    McCoy
Second by:    Tornow
Action:    Prevailed by voice vote.

         SB 118: revise certain provisions regarding the type of personal identification required when voting.

Presented by:    Representative Mike Buckingham

MOTION:     AMEND SB 118

118fa
     On page 1, line 11 of the printed bill, after " A " insert " current ".

Moved by:    Tornow

Second by:    Murschel
Action:    Prevailed by voice vote.

MOTION:     AMEND SB 118

118fb
     On page 1, line 13 of the printed bill, overstrike " , located within the State of South Dakota " .

Moved by:    Rounds
Second by:    Thompson
Action:    Prevailed by roll call vote.(10-3-0-0)

Voting Yes:    Cutler, Gassman, Hanks, Kroger, McCoy, Rounds, Sigdestad, Thompson, Murschel, Hennies

Voting No:    Davis, Howie, Tornow

MOTION:     DO PASS SB 118 AS AMENDED

Moved by:    Kroger
Second by:    Gassman
Action:    Prevailed by roll call vote.(12-1-0-0)

Voting Yes:    Cutler, Davis, Gassman, Hanks, Kroger, McCoy, Rounds, Sigdestad, Thompson, Tornow, Murschel, Hennies

Voting No:    Howie

MOTION:     ADJOURN

Moved by:    Hanks
Second by:    McCoy
Action:    Prevailed by voice vote.

Linda Daugaard

____________________________

Committee Secretary
Thomas Hennies, Chair

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