HOUSE BILL NO. 5728

April 24, 2020, Introduced by Rep. Iden and referred to the Committee on Government Operations.

A bill to amend 1998 PA 58, entitled

"Michigan liquor control code of 1998,"

by amending section 231 (MCL 436.1231) and by adding section 231a.

the people of the state of michigan enact:

Sec. 231. The commission may buy, possess, and sell in its own name all alcoholic liquor for distribution as provided in sections 227 and 229. The commission shall supply such the types of alcoholic liquor as are demanded by the public. However, if the public demands a brand so demanded that is not manufactured within the United States or is not readily obtainable within the United States, then an order for that the commission shall fill an order for the brand shall be filled by the commission at the entire expense of the person placing that the order subject to any gross profit or discounts, or both, provided for in section 233. The commission may lease or occupy any building or land required for its operation, and may purchase any warehouse required for its operation, subject to the approval of the state administrative board.

Sec. 231a. (1) Subject to subsection (2), the commission may offer to a licensee a cash buyback of any spirits the licensee ordered from the commission and received and accepted from an authorized distribution agent before March 16, 2020. If a licensee opts into the buyback program under this section, the commission must advance to the licensee 100% of the purchase price of those spirits that are in the licensee's inventory.

(2) The commission may accept buyback requests under this section, by electronic mail or on its website, only from a licensee that holds 1 of the following license types:

(a) Class C.

(b) B-Hotel.

(c) G-1.

(d) Club.

(e) Continuing care retirement center.

(f) Aircraft.

(g) Watercraft.

(h) Train.

(3) The commission shall accept all requests made by a licensee under this section by 5 p.m. on April 26, 2020.

(4) Upon advancing cash to a licensee under the buyback program under this section, the commission will hold legal title to all spirits purchased by the licensee before March 16, 2020 that are in the licensee's inventory at the time the licensee opts into the buyback program. Except as otherwise provided in subsection (6), the commission shall not take physical possession of any spirits purchased under this section. The licensee shall take all reasonable care to account for and preserve the inventory of any spirits purchased under this section.

(5) A licensee that opts into the buyback program under this section may, at any time until the commission takes physical possession of spirits it owns under subsection (6), repay to the commission the full amount advanced to the licensee. Upon repayment of the full buyback amount, the licensee will again hold title to the spirits in its possession.

(6) Ninety days after the state of emergency declared under Executive Order No. 2020-4 or any extension of that order has expired, the commission may take physical possession of any spirits held by a licensee to which the commission holds legal title under this section.