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Licensing Participates in Results Washington’s Design Challenge

The Licensing Division recently participated in Results Washington’s Agency Design Challenge to improve our liquor licensing process. The Design Challenge focuses on human-centered design principles. Our goal was to engage recent licensees to learn how we can improve our applicant’s experiences and make the licensing process easier to navigate. After interviewing licensees and stakeholders in October, the Licensing team began developing tools for a more responsive licensing process. 
We are working on:
  • A starter’s guide for new business owners
  • Explanatory videos
  • Increased outreach opportunities for direct contact with licensees and applicants
We want to thank those of you who participated in our interviews. You provided helpful feedback that guided us to our next steps.  The Licensing Division will be working with stakeholders to develop these concepts in 2020 – look for updates in upcoming newsletters!

Special Occasions Season Is Coming

Are you starting to take reservations for the upcoming busy non-profit season? Do you have questions about what non-profits can and cannot do with alcohol and a special occasion license?

Time to Plan for Outside Summer Seating

During the cold, rainy months it's hard to imagine that spring and summer are right around the corner. We want to help you prepare for outside seating before the season starts. Find out what you need to do now so you'll be ready.  
To make sure you have all your approvals ready, contact our alterations staff or submit your alterations application (you can find it on our website under added activities) to liquoralterations@lcb.wa.gov. If you have questions, please call 360-664-1600 (option 1).

Common Liquor License Questions

The Licensing staff want to help you stay in compliance with liquor laws. We often get the following questions and want to provide some clarity to you about license requirements.
Do I need an agent’s license?
If you are a brewery, distillery, distributor, importer or U.S. certificate of approval holder, you and any employees who sell alcohol need an agent’s license on file with the Board.  There are two exceptions:
  • If you are licensed as a sole proprietor, you are not required to have an agent’s license. Only the employees who are involved in sales need to have one on file with the Board.
  • If you are licensed as a winery in Washington, you and your employees do not need an agent’s license.  However, any third-party contractor that sells for you is required to have licenses on file for their employees. 
You can find more information on the agent’s license here. If you have questions about whether or not you need an agent’s license, please e-mail us at NonRetailLiquorLicensing@lcb.wa.gov
How do I report changes in my business ownership?  We know that things are constantly changing in the business world. As you make changes to your business ownership, you need prior approval from the LCB. Types of changes include:
  • The sale or purchase of interest in the business that totals more than 10%.
  • The addition or removal of a corporate officer, partner, or LLC manager.
Please apply for these changes before you make them. The application is on the Department of Revenue’s Business Licensing Services website. Fill out the online “Change in Governing People, Percentage Owned and/or Stock/Unit Ownership” application and submit the $75 fee. 
Once we receive the application, a licensing specialist will contact you and walk you through the process. If you have questions, please send us an email at retailliquorlicensing@lcb.wa.gov.

Alcohol Rules Update 

Several rulemakings are underway, and are detailed below. As always, LCB encourages your participation in the rulemaking process and values your input. You can find information about current rulemaking under Laws and Rules on the LCB website. Additional materials related to rulemaking items discussed at Board meetings can be found at the Board Meeting Schedule and Information page.
Barriers and Demarcation Options for Restaurants
The Board adopted rules on January 22, 2020 revising WAC 314-02-025, WAC 314-02-033, and WAC 314-03-200. The revisions outline several demarcation options available for  beer and wine restaurants, and spirits, beer, and wine restaurants to designate areas classified as off-limits to minors. The revisions also:
  • Clarify that floor plans and demarcation options must be approved by the Board;  
  • Specifically exclude tape, paint, or stickers on floors, walls, or ceilings as demarcation options;
  • Update requirements for “minor prohibited” signs to include the requirements that signage be visible to patrons who are approaching the off-limits areas, and signs inside the off-limits area;
  • Allow licensees to request reclassification of their off-limits areas as "open to minors" for regularly scheduled or special events with prior Board approval (reclassification requests are considered an alteration to a licensed premises under WAC 314-03-300);
  • Change references to demarcation(s) instead of barrier(s);
  • Correct an error in WAC 314-03-200 referencing that demarcations must be placed no more than 10 feet apart (for outside sidewalk café service under (6)(c)); and
  • Make technical and clarifying changes.
If licensees want to change floor plans or reclassify areas off-limits to minors, all floor plan changes and requests for reclassification must be pre-approved by the Board’s licensing division before implementing the change.
The adopted rules are effective February 22, 2020.
View the adopted rules and the Concise Explanatory Statement here.
Spirits Distributor Licensing Fees
The Board adopted rules on October 2, 2019 with a delayed effective date of January 1, 2020 to address the requirement in RCW 66.24.055 that retailers pay distributor fees on sales of spirits for resale when no prior distributor fee has been paid. Revisions were made to WAC 314-02-106, WAC 314-28-070, and eight sections of chapter 314-23 WAC. The revisions:
  • Clarify who is required to pay spirits distributor license fees as a result of a 2017 Court of Appeals Opinion; and
  • Require that retailers selling spirits for resale must pay the spirits distributor license fee when no other distributor license fee has been paid.
2019 Legislation Implementation– Substitute House Bill (SHB) 1034, House Bill (HB) 1672, and Senate Bill (SB) 5909
The Board held a public hearing on January 22, 2020 regarding implementation of three bills that passed during the 2019 legislative session.
Substitute House Bill (SHB) 1034 created an endorsement that allows spirits, beer, and wine restaurants to serve bottles of soju for on-premises consumption to tables of two or more customers. The new law also allows restaurants to recap soju bottles and for customers to remove recapped soju bottles from the premises. WAC 314-02-015 was revised to allow service of soju by the bottle.
  • SHB 1034 also required the Board to develop a "responsible sale and service of soju" training curriculum for individuals serving soju. The curriculum is available on the WSLCB’s website. The training curriculum and information related to the soju endorsement are also on the WSLCB’s website in the Korean language.
House Bill 1672 allows spirits, beer, and wine restaurants and beer and wine restaurants to recap sake bought for consumption with a meal. The new law also allows patrons to remove recapped sake from the premises. WAC 314-02-015 and WAC 314-02-045 were revised to allow recapping and removal of sake.
Senate Bill 5909 allows manufacturers licensed under RCW 66.24.150 to contract with distilleries, breweries, and wineries to provide packaging services. WAC 314-30-010 was revised to include packaging and added a reference to the packaging provisions outlined in statute.
Additional technical and clarifying changes were made to all revised sections of WAC, and unnecessary language in WAC 314-30-010 was removed.
The Board anticipates adoption of these rules revisions in early 2020.
Special Occasion Licenses – Rules Review
The Board held a public hearing on January 8, 2020 regarding proposed revisions to chapter 314-05 WAC. The proposed revisions:
  • Remove unnecessary and outdated language;
  • Make technical and clarifying changes;
  • Clarify that a special occasion license is a retail license;
  • Update application requirements and add information from the online application;
  • Make updates to guidelines for special occasion events to provide clarity for applicants, licensees, and industry members; and
  • Add statutory references and information from chapter 314-52 WAC (Advertising) to clarify requirements for alcohol and monetary donations, advertising, ticket, and alcohol sales, and payment information.
Written comments and comments received at the public hearing are currently being reviewed and considered.
2019 Legislation – Engrossed House Bill (EHB) 1563 and Chapter Review
A CR-101 was filed on May 29, 2019 to implement EHB 1563 that passed during the 2019 legislative session. Chapter 314-38 WAC will be amended to implement this legislation and review additional language in the chapter for relevance, clarity, and accuracy. EHB 1563 permits students eighteen to twenty years old to taste alcoholic beverages while on the premises of the college or university at which the student is enrolled or while on a field trip to a grape-growing area or production facility.
A CR-102 and proposed rules will be filed in early 2020, which will set a public hearing date and open the formal comment period.
Alternating Proprietorships for Distilleries and Craft Distilleries
A CR-101 was filed November 13, 2019 to consider adding language to chapter 314-28 WAC regarding alternating proprietorships for distilleries and craft distilleries. The Board adopted Board Interim Policy BIP-16-2019 until the rules are proposed (CR-102) and adopted (CR-103).
A CR-102 and proposed rules will be filed in early 2020, which will set a public hearing date and open the formal comment period.
Breweries and Wineries
A CR-101 was issued on February 21, 2018, to initiate the rulemaking process to review, update, and provide clarification for brewery and winery rules, chapters 314-20 and 314-24 WAC. The rulemaking will also address alternating proprietorships, bulk storage of wine, and internet sales. Rules are currently being reviewed and revised.
How can you participate in the rulemaking process? Visit Laws and Rules on the LCB website and submit comments to rules@lcb.wa.gov. Rulemaking activity occurs at Board meetings. Find Board agendas and meeting materials at Board Meeting Schedule and Information.

Are You Ready for 2020 Age-restricted Product Changes?

Contributed by Lieutenant Reynolds, LCB Spokane Enforcement
On March 27, 2019, with a bipartisan vote of 33-12 in the Washington State Senate, the Washington State Legislature passed legislation to raise the age for sales of tobacco and vapor products to 21+.  The legislation went into effect on Jan. 1, 2020.
These changes primarily impact “off-premises” grocery and convenience store license holders that sell tobacco and vapor products.
Sales clerks are the first line of defense in preventing underage sales of restricted products to minors. Off-premises employees are not required to have training on checking identification, as is required for “on-premises” (bar and restaurant) employees who serve alcohol, and therefore may not have any experience in how to check identification to determine if a person is old enough to purchase age-restricted products - alcohol, tobacco, or vapor products.
To prevent sales of restricted products to minors, the wise manager will ensure their new employees receive training on checking identification on or before their first day of employment. This training may be used as a refresher for existing staff. The LCB provides free, Age Restricted Product Sales Training 24/7/365 days a year on our website.
Updated Tobacco and Liquor Year-to-Date signs are available in English, Spanish, and Korean.
If you have questions after viewing the Age Restricted Product Sales Training, please contact your local Enforcement Officer or office.

Independent Enforcement Review

A message from Director Garza
The 2019 legislative session included legislation (SB 5318) that strongly emphasized the LCB’s focus to be on compliance and education rather than just enforcement when overseeing the regulated cannabis marketplace. Following the 2019 legislative session, the LCB hired an independent, respected organization - Hillard Heintze (HH) to review and report on all aspects of our Enforcement Division’s operations, organizational structure, and management.
Without direct involvement from LCB staff, HH led: interviews with industry members, interviews with cannabis and alcohol trade organizations, forums on each side of the state and interviews with a handful of agency staff. Last week, HH released its final report that included 18 recommendations. There were three themes that emerged in the HH recommendations:
  1. Interpretations of agency decisions (rules, policies, etc.) are inconsistently communicated and applied not only within the agency but with the regulated community as well.
  2. A lack of transparency and understanding by stakeholders exists about agency decisions and interpretations; and
  3. Stronger outreach, communication, education, and collaboration with the industry is needed to help them understand and comply with laws, rules and policy.
The LCB welcomes and accepts the recommendations in the HH review. In fact, there was nothing in the report that came as a complete surprise. It affirmed many concerns we’ve heard previously or were action points already begun or planned for in the near future. For example, the agency has already taken steps to restructure the enforcement penalty guidelines, the recent Enforcement Division re-organization to revise policy/procedures and develop expertise, and the Licensing Division implemented dozens of collaborative actions in 2019 to increase communication and effectiveness between the two divisions.
Implementing the Recommendations
The LCB will be adopting many of the recommendations in the report – starting with those things we can implement within the first six months. The steps we are taking will impact the agency overall. We will make changes throughout the agency that will reflect the agency’s commitment to transparency and fundamental change. Highlights include:
  • Revising the agency mission statement revision to reflect our “education” role;
  • Revising the enforcement officer’s position description and the division’s policies and procedures to emphasize the importance of outreach and education as well as the approach with licensees in the officer’s work;
  • Revising our apparel and firearm policies to reflect our commitment to education;
  • Reorganizing the Director’s Office to include a unit that will focus on outreach and education to further education, understanding and compliance within the industries we regulate;
  • The Director’s Office will also centralize our policy and rules coordination so that agency decisions can be consistently and clearly articulated with agency and staff and the industry. We are creating a Legal/Policy Team that will be the central source of developing and conveying agency decisions;
  • Decisions will be maintained in a central repository that staff and licensees may use to have a reliable, consistent answer going forward;
 Thank you for your commitment to working together.  I look forward to our continued work together in 2020.
Cover of  Hillard Heintze Report

Promote public safety and trust through fair administration and enforcement of liquor, cannabis, tobacco, and vapor laws.
-WSLCB Mission Statement
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