Section 19E: Farmer-distillery licenses; applicants; requirements; evidentiary hearings; written notice of applications; schools and churches; fees
Section 19E. (a) For the purpose of encouraging the development of domestic farms, the commission shall issue a farmer-distillery license to an applicant who is both a citizen and resident of the commonwealth and to applying partnerships composed solely of such individuals, and to applying corporations organized under the laws of the commonwealth or organized under the laws of any other state of the United States and admitted to do business in the commonwealth, unless:--
(1) such person does not comply with reasonable application procedures required by the commission;
(2) the commission determines that such person is not of responsible character;
(3) a church or school located within 500 feet of the farmer-distillery premises has objected to the issuance of a license in accordance with section 16C;
(4) the commission determines that the applicant retains or owns an interest, directly or indirectly, in the business of a licensee under section 12 or 15;
(5) the commission determines that the applicant retains or owns an interest, directly or indirectly, in more than 1 business licensed under section 18;
(6) the applicant has not furnished the requisite license fee or bond; or
(7) the commission determines that the co-partners, corporate officials or stockholders of the applicant do not meet the requirements of paragraphs (2), (4) and (5) or that the agent or manager who intends to conduct the farmer-distillery business on the applicant's behalf does not meet the requirements or that the co-partners, officials, stockholders, agent or manager remain undisclosed.
(b) The commission may on its own motion, and shall upon the written request of an applicant who has been refused a farmer-distillery license or who has been refused transfer or renewal of such a license, hold an evidentiary hearing, notice of which shall be mailed to the applicant at the address given in his application. Such hearing shall be before the commission, a member of the commission or an examiner authorized by the commission. The commission shall present its reasons for refusing issuance, transfer or renewal of the license. The applicant may appear in person or by counsel, may call and examine witnesses, may cross examine witnesses whom the applicant did not call or whom the presiding officer deems hostile and may present evidence, including rebuttal evidence. The hearing shall be stenographically or sound recorded. If an examiner conducts the hearing, the examiner shall report on the hearing to the commission. The commission shall decide within 30 days of the completion of the hearing whether to issue the farmer-distillery license or grant the transfer or renewal. If the commission refuses to grant the license or its transfer or renewal, notice in writing of the refusal shall be mailed to the applicant following the hearing. In all such cases, the commission shall keep on file a statement in the form of an opinion of the reasons for the refusal and shall furnish a copy of the statement to the applicant.
(c) An applicant who has appeared before the commission at such a hearing and who has been refused a farmer-distillery license or the transfer or renewal of such a license may appeal to the superior court of the county where the applicant resides or has his principal place of business or to the superior court for Suffolk county.
(d) An applicant for an original farmer-distillery license or for the transfer of such a license shall, within 7 days after filing an application with the commission, send written notice of his application by registered mail, return receipt requested, to:
(1) each school which offers instruction and training to children of compulsory school age in accordance with sections 1 and 4 of chapter 71 and which is located within a radius of 500 feet from the premises on which the farmer-distillery is to be operated; and
(2) each church as defined in section 16C which is located within a radius of 500 feet from such premises.
The notice shall also state that the church or school has the right to object under said section 16C to the issuance or transfer of the farmer-distillery license. If the authorities in charge of any such school or church complain to the commission in writing that a farmer-distillery license has been issued or transferred without the mailing of the requisite notice, and that they object to such issuance or transfer, the commission shall hold a hearing to determine whether the requisite notice was mailed. If, after a hearing, the commission determines that notice was not mailed as required, then the commission shall cancel the farmer-distillery license unless:
(i) such school or church had actual notice, prior to issuance or transfer, of the application and of the right to object under said section 16C; or
(ii) such school or church did not complain as soon as possible after actual notification of the application and of the right to object.
(e) A farmer-distiller aggrieved by the cancellation of his license, or a school or church aggrieved by the commission's refusal to cancel a farmer-distillery license, may appeal as provided in subsection (d).
(f) A farmer-distiller may operate a farmer-distillery under such conditions as the commission may prescribe by regulation.
(g) A farmer-distiller may import the unfermented juice of fruits, flowers, herbs and vegetables and may, using wine or fermented juice produced by the farmer-distiller, distill such wine or fermented juice on the premises of the farmer for the purpose of manufacturing or producing neutral spirits, brandy, gin and other distilled spirits with or over fruits, flowers, plants and pure juices therefrom, and from natural flavoring materials, and with extracts derived from infusion, percolation or maceration of such materials; provided, however, that a farmer-distiller may not import wine or alcohol into the commonwealth.
(h) A holder of a farmer-distillery license may sell distilled products:--
(1) at wholesale to a person holding a valid license to manufacture alcoholic beverages under section 19;
(2) at wholesale to a person holding a valid license as a wholesaler and importer under section 18;
(3) at wholesale to a person holding a valid farmer-distillery license under this section;
(4) at wholesale in kegs, casks, barrels and bottles to a person holding a license to sell under section 12, 13 or 14 and, for the sole purpose of resale in containers in which the distilled product was delivered, to a person holding a license to sell under section 15; provided, however, that the total annual sales to sections 12, 13, 14 and 15 licensees shall not exceed 50,000 gallons;
(5) at wholesale to a registered pharmacist holding a certificate of fitness under section 30;
(6) at wholesale to churches and religious societies, educational institutions, incorporated hospitals, homes for the aged, manufacturers of food products and manufacturers of drugs and chemicals as authorized by, and subject to, section 28;
(7) at retail by the bottle to consumers for consumption off the farmer-distillery premises;
(8) at wholesale to a person in a state or territory in which the importation and sale of distilled products is not prohibited by law; and
(9) at wholesale to a person in a foreign country.
(i) A farmer-distiller may not sell at retail to consumers a distilled product not produced by the farmer-distillery or produced for the farmer-distillery and sold under the farmer-distillery brand name. All retail sales shall be made on the farmer-distillery premises.
(j) A farmer-distiller may be licensed by local licensing authorities to sell distilled products for consumption on the farmer-distillery premises in accordance with this section and with such regulations as the commission may prescribe.
(k) Distilled products sold by a licensee under this section shall be sold and delivered in such a manner and under such conditions and with such labels or other marks to identify the producer as the commission may prescribe.
(l) A farmer-distiller holding a farmer-distillery license under this section shall keep such records as the commission may prescribe and shall file with the commission, as required, duplicates of copies of such records. The commission shall, at all times through its designated officers or agents, have access to all books and records or other documents of a licensed farmer-distillery relating to a licensee's farmer-distillery business.
(m) The annual license fee for a farmer-distiller, in respect to each farmer-distillery, shall be computed based on the proof gallons produced by the farmer-distillery as follows:--
5,000 proof gallons or less per year: $22 per year
More than 5,000 but not more than 20,000 proof $44 per year
gallons per year:
More than 20,000 but not more than 100,000 proof $82 per year
gallons per year:
More than 100,000 but not more than 200,000 proof $110 per year
gallons per year:
More than 200,000 but not more than 1,000,000 proof $110 per year
gallons per year:
Each additional 1,000,000 proof gallons per year: $111 per year.
For the purpose of this section "proof gallon'' shall have the meaning set forth in section 21.
(n) An applicant for a farmer-distillery license shall, at the time of filing an application, pay a license fee based on a reasonable estimate of the amount of proof gallons to be produced during the year covered by the license. A person holding a farmer-distillery license shall report annually at the end of the year covered by the license the amount of proof gallons produced during the year. If the total amount of distillery beverages exceeds the amount permitted by the fee already paid, the licensee shall pay such additional fee as is owing under this section.
[ Subsection (o) effective until August 10, 2016. For text effective August 10, 2016, see below.]
(o) Notwithstanding section 17, a local licensing authority, subject to the approval of the commission, may grant a license to sell spirits for consumption on the distillery premises to a farmer-distiller authorized to operate a farmer-distillery pursuant to this section; provided, however, that such licensees may sell for on-premises consumption spirits produced by the distillery or produced for the distillery and sold under the distillery brand name.
[ Subsection (o) as amended by 2016, 219, Sec. 104 effective August 10, 2016. For text effective until August 10, 2016, see above.]
(o) Notwithstanding section 17, a local licensing authority, subject to the approval of the commission, may grant a license to sell distilled spirits for consumption on the premises at any location it deems reasonable and proper, and approves in writing, on the grounds of a farmer-distillery licensed under this section and on the grounds of the farm operated as appurtenant and contiguous to, and in conjunction with, such farmer-distillery; provided, however, that such licensees may sell for on-premises consumption only distilled spirits produced by the distillery or produced for the distillery and sold under the distillery brand name. All the procedures under section 15A of this chapter shall apply to the granting of a license under this subsection.