Ramona Prieto ABC Director
OVERVIEW OF ABC Department of Alcoholic Beverage Control John Carr, Public Information Officer February, 2017
DEPARTMENT OF ALCOHOLIC BEVERAGE CONTROL State agency responsible for licensing and regulating the manufacture, distribution, and sale of alcoholic beverages in California.
Pre-Prohibition! Mid-1800 s! Set the political stage! Saloons proliferated! Prohibition groups formed
Prohibition! The Noble Experiment! 18 th Amendment 1919! 1920-1933 Alcohol was prohibited
Prohibition! Rationale for initiating Prohibition:! Reduce crime! Decrease poverty! Decrease death rate associated with alcoholic beverage use.! Increase quality of life! Positive aspects! Effects on industry! Negative events of the time
Repeal of Prohibition! Rationale for initiating Repeal! Reduce crime! Decrease poverty! 21 st Amendment 1933! Granted States Constitutional Authority to Regulate
Early Alcohol Regulation California Constitution States choose type of regulatory systems: control or licensing. California chooses licensing A separate alcoholic beverage control authority protected in every possible way from political influences and having a wide authority over liquor laws administration will promote the public welfare. - Board of Equalization (1933)
Department of Alcoholic Beverage Control! 1955 - Constitutional Amendment Creates ABC! Independent department of the Executive Branch! Authority for licensing and enforcement! B of E retained authority over taxation (sales taxes).! ABC Act I am convinced that the majority of licensees are now making a conscientious effort to comply with the law, and I think we should take this into consideration in our application of the law. - - Director Russell Munro Governor Business and Consumer Services Agency Department of Alcoholic Beverage Control
Notable Events! 1960 s - Established ratios for licenses.! 1970 s - Established rules to restrict liquor outlets.! 1990 s Growth of ABC Programs.! 1992 - ABC becomes special fund agency.! 1994 - Supreme Court ruling on Decoy Ops! 1995 - Cities and Counties have more input on license issues.
California Statistics! CA population: 38.8 million! Alcoholic Beverage Licenses! Retail Licenses! Number of Restaurants- 35,500! Number of Bars/Clubs - 3,000! Number of Markets - 28,000! Non-Retail Licenses! Number of Wineries 5,500! Number of Breweries - 600! Number of Wholesalers/Distributors 2,800
Economic Impact! Estimates range from 1.5 to 2 million jobs! Billions in Activity
ABC Licenses Big Events Rock Concerts Big Stadiums
ABC s Mission Provide the highest level of service through licensing, education and enforcement.
Special Fund Agency Where does the money come from?! License Fees! Annual renewal fees = 83 % of total revenue.! Original General License fees = 7 percent.! Other smaller revenue sources! Fees tied to the Consumer Price Index! Most fees have not been increased in 30 years.
Organizational Structure! Headquarters & Administrative Hearing OfWice about 100 positions! Two Divisions:! North -162.5 Positions! South - 186.5 Positions
Licensing! Approximately 90,000 ABC licenses in California! License approvals take approx. 45-90 days! Protested applications can take longer! Possible protest reasons - increased crime, too close to a school, church, houses, contrary to local zoning, etc.
ABC Responsibilities
Licensing & Support Staff
Licensing Representatives Investigate Applications
Enforcement Programs! GAP! TRACE! MINOR DECOY! DECOY SHOULDER TAP! TRAPDOOR! SOU! TEU Public Safety, Education and Prevention.
Who Enforces? Answer: ABC Agents Agents are sworn peace ofwicers Education/Prevention LEAD training Inspections IMPACT Trade Enforcement Unit Special Operations Unit Grant Assistance Program Training (Wirearms/defensive tactics) Enforcement undercover operations Work with local agencies (police & sheriff)
Tied House Laws Purpose: To keep business strong, reduce intemperance, thereby increasing public safety. The laws were also created to maintain a fair market place by keeping the three industry tiers separate:! Manufacturers! Wholesalers (Distributors)! Retailers (Stores, Bars, &Restaurants)
Tied House Challenges Exceptions have been enacted. Created some complexities. Some question if the laws need to be updated given today s technological advances in the business community.
TEU Trade Enforcement Unit! ABC regulates and enforces trade prac3ces.! The unit provides exper3se and guidance to ABC's field staff on trade prac3ce law
GAP Grant Assistance Program! Created in 1995! Mission is to work with local law enforcement agencies to increase safety.! Over $46 million awarded to local communities since 1995
Decoy Shoulder Tap Program! Used to deter adults from furnishing alcohol to minors in order to increase public safety.! Buying alcohol for a minor = arrest
Operation Trapdoor Cops in Shops ABC licensees call ABC Agents or Local Police when they have concerns about false ID s. Protect youth. Build a safer community.
Prevention Programs Increase Public Safety & Compliance! LEAD! Licensee Education on Alcohol and Drugs! IMPACT! Informed Merchants Preventing Alcohol Crime Tendencies! ROSTF! Retail Operating Standards Task Force! Community & Media Outreach
LEAD Licensee Education on Alcohol & Drugs! Created in 1991.! Free three-hour! workshop for ABC licensees and employees.! Trained over 350,000 persons to date.! ABC is Working Hard to Offer Training Online
IMPACT Informed Merchants Preventing Alcohol Crime Tendencies! A preven3on approach to educate licensees and increase public safety.! Teams an ABC agent with local law enforcement.! Together they visit ABC licensed businesses.
ROSTF Retail Operating Standards Task Force! Similar to IMPACT! Enforcement oriented but geared to increase public safety through education! and prevention! Requires no loitering signage and other signage
Public Outreach A Tool for Education and Prevention! Websites! Social Media: Twitter, Facebook! News Releases! Public Service Announcements! Stakeholder E-mail and ListServ Network! Grant Programs through NHTSA, OJJDP, OTS
Please Click on our Home Page Click here
Looking Ahead Striving for excellence in customer service through:! Education! Prevention! Licensing! Enforcement
Dept. of Alcoholic Beverage Control 3927 Lennane Drive, Suite 100 Sacramento, CA 95834 (916) 419-2500 John.Carr@abc.ca.gov
Sunshine Garside & Helena Williams ABC Chief Deputy Directors
Randall Deems ABC Assistant Director - Administration
ABC Financial Management and Technology Services
ABC Fund Balance $32 million as of June 30, 2016 Represents approximately a 6 month reserve Target reserve is 3 months or about $17 million
Revenue and Expenditure Alignment Fiscal Year Revenues Expenditures/ Budget Change in Balance Fund Balance 6/30/2015 $35 2015-16 $57 $60 -$3 $32 2016-17 $58 $65 -$7 $25 2017-18 $59 $67 -$8 $17 *dollars in millions Deficit projected to grow to about $10 million
Upward Pressures on Expenditures Filling Agent Vacancies Salaries new 3 year contracts Lease Costs Licensing Staff Information Security and Technology
Current Action to Align Revenues and Expenditures Statutory authority to increase fees consistent with Consumer Price Index (CPI) Submitted 11.48 percent increase in annual renewal and original general fees
Current Action to Align Revenues and Expenditures Represents 6 years of CPI Effective January 1, 2018 Generates: $2.5 million in 2017-18 $5.0 million annually thereafter
Future Action to Align Revenues and Expenditures Fund balance at end of 2017-18 is projected to be $19 million Ongoing difference between revenues and the budget is projected to be about $5 million Potential future pressure the implementation of eservices
Potential eservices Electronic Payment Online Application Online Training (LEAD) Improved Licensing Query System Website improvement Online Price Posting Online Winegrowers/Blenders annual report
Potential eservices Feedback needed: Which services are important to you? Are we missing some? Are they worth the upward pressure on fees? Executing a survey soon to collect this feedback.
Matthew Botting - General Counsel Jacob Rambo - Chief Counsel
LaKenya Jordan ABC Director of Legislation & Governmental Affairs Matthew Botting General Counsel
Matthew Botting General Counsel
Kathleen Barnes, Southern Division Chief Chris Albrecht, Northern Division Chief