Oregon Liquor Control Commission

Transcription

1 Oregon Liquor Control Commission Rob Patridge, Chair, Commission Steven Marks, Executive Director Bill Schuette, Economist Presentation to the House Interim Committee on Revenue November 17,

2 Agency Overview Alcohol Program Oversees the distribution and sale of distilled spirits in the state Centrally purchases, warehouses and distributes distilled spirits to Oregon's independently operated retail liquor locations Licenses and regulates businesses that: Serve alcohol (bars and restaurants) Sell alcohol to go (grocery stores, convenience stores) Manufacture or wholesale alcohol (breweries, wineries, distillers, distributors) Recreational Marijuana Program Responsible for implementation of Measure 91, Recreational Marijuana Licenses and regulates growers, processors, wholesalers, retail, laboratories, research certificates, and marijuana handler permits Tracks the growing, transporting, processing and selling of recreational marijuana products through Cannabis Tracking System (seed to sale system) 2

3 Alcohol Program What we do License businesses that sell alcohol Issue service permits to trained alcohol servers Manage/distribute distilled spirits Regulate businesses that sell/serve alcohol Public information about responsible use of alcohol Generate revenue for essential services like police, education and health care Administrative hearings unit Regulation of Oregon s Bottle Bill, siting of Redemption Centers Establishing an annual liquor agent training event 3

4 Legislative Directives for Increase OLCC Warehouse Shipping Capacity Upgrade equipment - $5 million Repair OLCC Facilities Roof repair - $4.2 million Upgrade Phone System - $110,000 Meet Peace Officer Training Requirements - $290,000 Non-Exclusive Store Differential - $612,000 Application Fee Establishes a non-refundable application fee, not to exceed $150 4

5 Oregon Retail Liquor Locations 248 retail liquor locations 152 Stand-alone stores 96 Co-located with grocery or general goods Not shown: 87 Distillery retail outlets (sell only their own products) 5

6 Retail Liquor Expansion Open Recruitment OLCC is recruiting up to 17 new liquor retail locations in the Portland metro area Recruitment period ends January 15, 2016 Area Population* # Stores Population Per Store Washington 560, ,023 Clackamas 391, ,033 Multnomah 765, ,702 Tri-County 1,717, ,262 Statewide 3,962, ,979 6

7 Projected Gross Alcohol Revenue Sources Biennium $1.2 Billion Total Gross Revenue 7

8 In 100 Millions $16 $1,600,000,000 $14 $1,400,000,000 $12 $1,200,000,000 $10 $1,000,000,000 Ten-Year Forecast of Gross Liquor Sales By Biennium $1.06 Billion Biennium $1.13 Billion GRB Forecast $8 $800,000,000 $6 $600,000,000 $4 $400,000, % Average Annual Growth over the last 20 years $2 $200,000,000 $- $- Actual Biennium Sales Biennium Biennium Forecast 8

9 Distilled Spirits Model Based on Average $16.50 Bottle Price 4% OLCC Operating Expenses Includes Enforcement, Licensing, Administration, Distribution functions 1% 8.93% Bank Card Costs 69% of all purchases made with bank cards Liquor Store Operator Commission Average Liquor Store Operator Compensation 37% Profit for State, Cities and Counties 49% Manufacturer Cost 9

10 Oregon Distilleries 77 Distilleries in 2015 Includes 87 distillery locations that can sell retail $69 million in Gross Sales in Oregon in % of total liquor sales $5.6 million from distillery locations in FY

11 50-cent Surcharge Extension The current 50-cent per bottle surcharge has been extended through June 30, 2017 Expected to generate $33.8 million for the biennium Distribution of the revenue is determined by the legislature 11

12 $'S $12,000,000 Beer and Wine Tax Collections $10,000,000 Oregon Beer and Wine Tax Revenue Beer Tax is $0.08 per gallon (1977) Wine Tax is $0.67 per gallon (1977) $8,000,000 $6,000,000 $4,000,000 $36.6 Million Expected in Biennium (2.5% Average Annual Growth over last 20 years) $2,000,000 $- FISCAL YEAR Wine Tax Malt Beverage Tax 12

13 Oregon Malt Beverage Production From 2013 Tax Filings 43.1 million gallons from Oregon Brewers 15.9 million gallons sold in Oregon About 19% of Oregon beer consumption 27.2 million gallons sold outside of Oregon 13

14 $8,000,000 $7,000,000 $6,000,000 Annual Liquor License Fee Revenue Off-Premises License Fee: $100 (Grocery and Convenience Stores) 4,600 licenses On-Premise License Fee: $400 (Full-Service Bars & Restaurants) 4,400 licenses $5,000,000 $4,000,000 $3,000,000 $11.7 million in Biennium ( 4.7% Average Annual Growth Over Last 20 Years) $2,000,000 $1,000,000 $ License Fee Revenue Forecast 14

15 $700,000,000 Biennial Alcohol Revenue Distributions to General Fund, Cities and Counties $600,000,000 $500,000,000 $400,000,000 $436 Million $442 Million Biennium Projected distribution For Biennium $470 Million GRB Forecast $300,000,000 $200,000, % Annual Growth over the Last 20 Years $100,000,000 $- Biennium Total Distribution From Alcohol Biennium Forecast Distribution Long Term Forecast 15

16 $54.1 M City Revenue Sharing Alcohol Revenue Distribution Biennium All Revenue Sources $247.4 M General Fund $77.4 M Incorporated Cities $17.3 M Mental Health, Alcoholism & Drug Services $589 K Oregon Wine Board $38.7 M Counties $435.5 Million Total Distributions 16

17 Marijuana Tax and Fee Revenue HB 2041 Moved tax collection from OLCC to DOR Moved tax collection point to point of sale 17% tax on value of product at retail 3% optional local tax OLCC to support DOR in tax collection HB 3400 OLCC will license and regulate recreational marijuana Established fee-based regulation program OLCC to set fees (by rule) that cover program costs 17

18 Marijuana Revenue $8.3 million approved for program implementation. Borrowing from the Liquor Fund to finance new positions, information technology systems and other start up costs Startup costs will be covered by license fees and tax revenue during the current biennium Includes repayment of borrowed liquor fund money from Fiscal Year 2015 Marijuana will be completely fee-funded by biennium 18

19 Setting Marijuana Fees Estimate Budget $7,900,000 (Current Service Level) Estimate Number of Licenses State 2014 Population Grower Licenses Processor, Wholesaler, Testing Lab Licenses Retail Licenses Total Licenses Colorado 5,268, Washington 6,984, * (Capped) 1,330 Oregon Estimate 3,933,

20 Marijuana License Fees Adopted by the OLCC October 22, 2015 FEE TYPE AMOUNT Application Fee for Initial License or Certificate $ 250 Annual Marijuana Producers (growers) License Tier I $ 3,750 Annual Marijuana Producers (growers) License Tier 2 $ 5,750 Annual Marijuana Processor License $ 4,750 Annual Marijuana Wholesaler License $ 4,750 Annual Marijuana Retailer License $ 4,750 Annual Marijuana Laboratory License $ 4,750 Research Certificate (three year term) $ 4,750 Marijuana Handler Permit (five year term) $ 100 Additional Criminal Background Check $ 50 Change of Ownership Review $ 1,000 Change of Business Structure Review $ 1,000 Transfer of Location of Premises Review $ 1,000 Packaging Preapproval fee $ 100 Labeling Preapproval Fee $ 100 Late Renewal Fee for license if received less than 20 days before expiration date $ 150 Late Renewal Fee for license if received after expiration date $ 300 Late Renewal Fee for handler permit if received less than 20 days before expiration $ 50 Late Renewal Fee for handler permit received after expiration date $

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