TO: Mayor and Town Council
FROM: Ralph D. Karpinos, Town Attorney
SUBJECT: Keg Registration Legislation
DATE: April 11, 2005
The purpose of this memorandum is to provide the Council with information on two different draft bills which have been proposed regarding keg registration. The Council may wish to make further comment on this issue now pending before the North Carolina General Assembly.
On March 7, 2005, the Council adopted a resolution establishing the Town’s Legislative Program for the 2005 Session of the North Carolina General Assembly. The first item listed in the resolution under Statewide Legislation states:
“Support the Legislature’s development of reasonable statewide legislation requiring the registration of beer kegs. (The Council defers comment on any specific proposed legislation until such a bill is drafted.)”
By letter from the Mayor the Council’s positions on this issue and other legislative matters have been shared with members of our Legislative Delegation.
In the last few days, two bills have been introduced in the North Carolina General Assembly related to the registration of beer kegs. Copies of both bills are attached.
House Bill 892 (Attachment 1) was filed on March 23, 2005, and has been referred to the House Committee on Commerce. Representative Martha B. Alexander of Mecklenburg County is the sponsor. The same bill was filed in the Senate (Senate Bill 476) on March 9, 2005, and referred to the Senate Committee on Commerce. The primary sponsor for the Senate bill is Senator Malcolm Graham of Mecklenburg County. Co-sponsors are Senator Charlie Smith Dannelly and Senator W. Edward Goodall of representing Mecklenburg County.
House Bill 855 (Attachment 2) was filed on March 21, 2005, and has been referred to the House Committee on Finance. The primary sponsor is Representative Verla Insko. Representative Joe Hackney is the co-sponsor.
During the Council’s discussion of its legislative agenda on March 7, 2005, the Council declined to give a general endorsement to legislation requiring keg registration until it had an opportunity to consider the specific language proposed.
DISCUSSION/SUMMARY OF BILLS
The regulation of alcoholic beverages in North Carolina, with some limited exceptions (such as local authority to regulate the carrying of open containers), is established by state legislation in Chapter 18B of the General Statutes.
House Bill 892/Senate Bill 476 would establish a new Section 18B-1010 in Article 10 of Chapter 18B. (Article 10 of Chapter 18B deals with retail activity related to alcoholic beverages.) The bill:
1. Defines a keg as a container capable of holding at least 7 ¾ gallons.
2. Requires kegs of malt beverages to have permanent numbering and single sale tags.
3. Requires the seller of a keg to have the purchaser fill out and sign a form developed by the State Alcohol Law Enforcement Division which includes:
a. the purchaser’s name, address and date of birth, confirmed by a driver’s license;
b. the keg’s permanent identification number and single sale tag;
c. the place where the malt beverage in the keg will be consumed and the dates of consumption.
4. Requires the purchaser to return the coded tag along with the keg to the seller.
5. States that the form filled out by the purchaser is a public record.
6. Establishes that noncompliance with the statute constitutes a Class 1 misdemeanor.
House Bill 855 would revise Section 18B-403 in Article 4 of Chapter 18B. (Article 4 of Chapter 18B deals with the transportation of alcoholic beverages.) The bill:
1. Requires a purchase-transportation permit to purchase and transport draft beer in kegs. (Under current law, a person may purchase and transport without a purchase-transportation permit any amount of draft malt beverages in kegs.)
2. Requires that a permit issued for a keg be kept with the keg and that a label be placed on the keg. The label must identify the permit number, the purchaser by name, address and telephone number and the location where the keg is to be consumed.
3. Requires that the label remain on the keg until it is returned to the store from which it was purchased.
4. Adds as a basis for disqualification for a purchase-transportation permit a conviction under G.S. Sec. 18B-302. (This is the statute regulating the sale to and purchase by underage persons of alcoholic beverages.)
5. Authorizes a local ABC board to request a criminal history check at the applicant’s expense, to ensure that the applicant is not disqualified from receiving a permit.
6. Establishes that a violation of the registration and labeling requirements constitutes a Class 1 misdemeanor and provides for the revocation, for one year, of the driver’s license of a person committing a violation.
That the Council consider the provisions contained in these two bills and decide if it wishes to express any further comment to our Legislative Delegation at this time. We will provide additional information on the status of this legislation as the Session of the General Assembly continues.
 G.S. 18B-403(d) provides that purchase-transportation permits are to be issued on forms as adopted by the North Carolina Alcoholic Beverage Control Commission and that the Commission shall adopt rules specifying the content of the permit form. Currently those rules do not address the requirements for permits for keg transportation because no such permit is required. However, according to the North Carolina Administrative Code, Title 4, Chapter 2, Subchapter 2R, Section .1801(b), information now required on a permit to transport other alcoholic beverages shall include:
1. the name and location of the store from which the purchase is to be made; and,
2. the name, address and driver’s license number of the purchaser.