SENATE BILL No. 969
Introduced by Senator Wiener
(Coauthor: Assembly Member Lee)
January 25, 2024
An act to amend Sections 23039.5, 23357, 23358, 23396, and 25690 of, and to add Sections 25691 and 25692 to, the Business and Professions Code, relating to alcoholic beverages.
legislative counsel’s digest
SB 969, as introduced, Wiener. Alcoholic beverages: entertainment zones: consumption.
The Alcoholic Be verage Control Act contains v arious pro visions regulating the application for , the issuance of, the suspension of, and the conditions imposed upon alcoholic be verage licenses by the Department of Alcoholic Be verage Control. Existing la w defines “entertainment zone” for purposes of the act as a zone created by ordinance on or after January 1, 2024, in the City and County of San Francisco, that authorizes consumption of one or more types of alcoholic beverages on public streets, sidewalks, or public rights-of-way adjacent to and during a special event permitted or licensed by the department.
Existing la w authorizes the City and County of San Francisco to establish an entertainment zone, subject to certain requirements, including providing specified information relating to the entertainment zone to the department and establishing a process or procedure by which persons in possession of alcoholic beverages in the entertainment zone may be readily identifiable as being 21 years of age or older.
This bill would, instead, define “entertainment zone” as a zone created by a city, county, or city and county ordinance on or after January 1, 2025, that authorizes consumption of one or more types of alcoholic beverages on public streets, sidewalks, or public rights-of-way. The bill
99 would additionally authorize an y city, county, or city and county to establish an entertainment zone, subject to the abo ve-described requirements. Before enacting an ordinance to establish an entertainment zone, the bill would require a city, county, or city and county to notify local law enforcement and request feedback about specific information, including, among others, the entertainment zone’s proposed boundaries and days and hours of operation. The bill would require a city, county, or city and county that establishes an entertainment zone, or its designated subordinate officer or body, to review the operation of the entertainment zone e very 2 years follo wing the adoption of the entertainment zone, as specified, and to mak e any reports produced during the review available to the department upon request.
Existing la w authorizes a licensed beer manuf acturer, a licensed winegrower, and any on-sale licensee to permit consumers to leave the premises with open containers of alcoholic beverages for consumption off the premises within an entertainment zone, subject to certain conditions. Existing law specifies that a licensed beer manufacturer, a licensed winegrower, and an y on-sale licensee whose pri vileges are restricted due to operating conditions or other statutory restrictions may be prohibited from e xercising entertainment zone pri vileges that are contrary to their operating conditions. F or this purpose, e xisting law requires any restrictions on the exercise of off-sale privileges to apply to the removal of alcoholic be verages from the licensed premises for consumption in the entertainment zone.
This bill would, instead, prohibit any restrictions on the e xercise of off-sale pri vileges from applying to the remo val of open alcoholic beverages from the licensed premises for consumption in the entertainment zone.
Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.
The people of the State of California do enact as follows:
line 1 SECTION 1. Section 23039.5 of the Business and Professions line 2 Code is amended to read:
line 3 23039.5. “Entertainment zone” means a zone created by a city, line 4 county, or city and county ordinance on or after January 1, 2024, line 5 in the City and County of San Francisco 2025, that authorizes line 6 consumption of one or more types of alcoholic beverages on public line 7 streets, sidewalks, or public rights-of-way adjacent to and during 99 — 2 — SB 969
line 1 a special e vent permitted or licensed by the department. line 2 rights-of-way.
line 3 SEC. 2. Section 23357 of the Business and Professions Code line 4 is amended to read:
line 5 23357. (a) A licensed beer manufacturer may, at the licensed line 6 premises of production, sell to consumers for consumption off the line 7 premises beer that is produced and bottled by , or produced and line 8 packaged for, that manufacturer. Licensed beer manufacturers may line 9 also exercise any of the following privileges:
line 10 (1) Sell that beer to an y person holding a license authorizing line 11 the sale of beer.
line 12 (2) Sell that beer to consumers for consumption on the line 13 manufacturer’s licensed premises or on premises o wned by the line 14 manufacturer that are contiguous to the licensed premises and line 15 which are operated by and for the manufacturer. line 16 (3) Sell beer and wine, re gardless of source, to consumers for line 17 consumption at a bona fide public eating place on the line 18 manufacturer’s licensed premises or at a bona fide public eating line 19 place on premises owned by the manufacturer which are contiguous line 20 to the licensed premises and which are operated by and for the line 21 manufacturer.
line 22 (4) (A) Permit consumers to lea ve the premises with open line 23 containers of alcoholic beverages for consumption off the premises line 24 within an entertainment zone if all of the following conditions are line 25 satisfied:
line 26 (i) The premises is located within the entertainment zone. line 27 (ii) Consumption of that type of alcoholic beverage is authorized line 28 by the ordinance creating the entertainment zone. line 29 (iii) Open alcohol containers only leave the premises during the line 30 hours allo wed by the ordinance establishing the entertainment line 31 zone.
line 32 (iv) Patrons with open containers exit the premises directly into line 33 an entertainment zone.
line 34 (v) All alcoholic be verages in the entertainment zone are line 35 purchased only at a licensed premises located within the line 36 entertainment zone.
line 37 (vi) The premises expressly prohibits open containers or closed line 38 containers of alcoholic beverages acquired outside their premises. line 39 (vii) Delivery of alcoholic be verages to consumers within the line 40 entertainment zone by the licensee or by any third-party delivery 99 SB 969 — 3 —
line 1 service is expressly prohibited unless the delivery is to a residential line 2 building or private business that is not a licensee. line 3 (viii) No alcoholic beverages purchased at the licensed premises line 4 may leave the premises in an open glass or metal container for line 5 consumption in an entertainment zone.
line 6 (ix) The licensee annually submits their notice of intent to line 7 participate in an open container entertainment zone to the line 8 department.
line 9 (B) This paragraph does not require a licensee to sell an y line 10 alcoholic beverage for consumption of f the premises within an line 11 entertainment zone.
line 12 (C) Licensees whose privileges are restricted due to operating line 13 conditions or other statutory restrictions may be prohibited from line 14 exercising entertainment zone privileges that are contrary to their line 15 operating conditions. F or purposes of this paragraph, an y line 16 restrictions on the e xercise of of f-sale privileges shall not apply line 17 to the remo val of open alcoholic be verages from the licensed line 18 premises for consumption in the entertainment zone. line 19 (b) Notwithstanding any other provision of this division, licensed line 20 beer manufacturers and holders of out-of-state beer manufacturer’s line 21 certificates may be issued and may hold retail package of f-sale line 22 beer and wine licenses. Alcoholic beverage products sold at or line 23 from the off-sale premises that are not produced and bottled by , line 24 or produced and packaged for , the beer manuf acturer shall be line 25 purchased by the beer manuf acturer only from a licensed line 26 wholesaler.
line 27 (c) Notwithstanding an y other pro vision of this di vision, a line 28 licensed beer manufacturer may manufacture cider or perry at the line 29 licensed premises of production and may sell cider or perry to any line 30 licensee authorized to sell wine. For purposes of this subdivision, line 31 “cider” and “perry” ha ve the meanings pro vided in Section line 32 4.21(e)(8) of Title 27 of the Code of Federal Re gulations. This line 33 subdivision does not alter or amend the classification of cider or line 34 perry as wine for an y purpose other than that pro vided by this line 35 section.
line 36 (d) A beer manuf acturer may also ha ve upon the licensed line 37 premises, or on premises o wned by the manuf acturer that are line 38 contiguous to the licensed premises and are operated by and for line 39 the manufacturer all beers and wines, regardless of source, for sale line 40 or service only to guests during private events or private functions 99 — 4 — SB 969
line 1 not open to the general public. Alcoholic beverage products sold line 2 at the premises that are not produced and bottled by, or produced line 3 and packaged for, the beer manufacturer shall be purchased by the line 4 beer manufacturer only from a licensed wholesaler. All alcoholic line 5 beverages sold or served shall be produced by a licensee authorized line 6 to manufacture the product.
line 7 SEC. 3. Section 23358 of the Business and Professions Code line 8 is amended to read:
line 9 23358. (a) Licensed winegrowers, notwithstanding any other line 10 provisions of this di vision, may also e xercise the follo wing line 11 privileges:
line 12 (1) Sell wine and brandy to an y person holding a license line 13 authorizing the sale of wine or brandy.
line 14 (2) Sell wine and brandy to consumers for consumption off the line 15 premises where sold.
line 16 (3) Sell wine to consumers for consumption on the premises. line 17 (4) Sell all beers, wines, and brandies, regardless of source, to line 18 consumers for consumption on the premises in a bona fide eating line 19 place as defined in Section 23038, which is located on the licensed line 20 premises or on premises owned by the licensee that are contiguous line 21 to the licensed premises and which is operated by and for the line 22 licensee. At such a bona fide public eating place beer , wine, and line 23 brandy may be used in the preparation of food and be verages to line 24 be consumed on the premises.
line 25 (5) (A) Permit consumers to lea ve the premises with open line 26 containers of alcoholic beverages for consumption off the premises line 27 within an entertainment zone if all of the following conditions are line 28 satisfied:
line 29 (i) The premises is located within the entertainment zone. line 30 (ii) Consumption of that type of alcoholic beverage is authorized line 31 by the ordinance creating the entertainment zone. line 32 (iii) Open alcohol containers only leave the premises during the line 33 hours allo wed by the ordinance establishing the entertainment line 34 zone.
line 35 (iv) Patrons with open containers exit the premises directly into line 36 an entertainment zone.
line 37 (v) All alcoholic be verages in the entertainment zone are line 38 purchased only at a licensed premises located within the line 39 entertainment zone.
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line 1 (vi) The premises expressly prohibits open containers or closed line 2 containers of alcoholic beverages acquired outside their premises. line 3 (vii) Delivery of alcoholic be verages to consumers within the line 4 entertainment zone by the licensee or by any third-party delivery line 5 service is expressly prohibited unless the delivery is to a residential line 6 building or private business that is not a licensee. line 7 (viii) No alcoholic beverages purchased at the licensed premises line 8 may leave the premises in an open glass or metal container for line 9 consumption in an entertainment zone.
line 10 (ix) The licensee annually submits their notice of intent to line 11 participate in an open container entertainment zone to the line 12 department.
line 13 (B) This paragraph does not require a licensee to sell an y line 14 alcoholic beverage for consumption of f the premises within an line 15 entertainment zone.
line 16 (C) Licensees whose privileges are restricted due to operating line 17 conditions or other statutory restrictions may be prohibited from line 18 exercising entertainment zone privileges that are contrary to their line 19 operating conditions. F or purposes of this paragraph, an y line 20 restrictions on the e xercise of of f-sale privileges shall not apply line 21 to the remo val of open alcoholic be verages from the licensed line 22 premises for consumption in the entertainment zone. line 23 (6) Produce spirits of wine and blend those spirits of wine into line 24 wine produced by the winegrower or sell those spirits of wine to line 25 an industrial alcohol dealer or a distilled spirits manufacturer. line 26 (b) A winegrower may also ha ve upon the premises all beers, line 27 wines, and brandies, regardless of source, for sale or service only line 28 to guests during private events or private functions not open to the line 29 general public. Alcoholic beverage products sold at the premises line 30 that are not produced and bottled by , or produced and packaged line 31 for, the wine grower shall be purchased by the wine grower only line 32 from a licensed wholesaler.
line 33 (c) A winegrower shall actually produce on the wine grower’s line 34 licensed premises by conversion of grapes, berries, or other fruit, line 35 into wine, not less than 50 percent of all wines sold to consumers line 36 on the wine grower’s licensed premises and an y licensed branch line 37 premises.
line 38 (d) The department may, if it shall determine for good cause line 39 that the granting of any such privilege would be contrary to public line 40 welfare or morals, deny the right to exercise any on-sale privilege 99 — 6 — SB 969
line 1 authorized by this section in either a bona fide eating place the line 2 main entrance to which is within 200 feet of a school or church, line 3 or on the licensed winery premises, or both.
line 4 (e) Nothing in this section or in Section 23390 is intended to line 5 alter, diminish, replace, or eliminate the authority of a county, city, line 6 or city and county from e xercising land use re gulatory authority line 7 by law to the extent the authority may restrict, but not eliminate, line 8 privileges afforded by these sections.
line 9 SEC. 4. Section 23396 of the Business and Professions Code line 10 is amended to read:
line 11 23396. (a) Any on-sale license authorizes the sale of the line 12 alcoholic beverage specified in the license for consumption on the line 13 premises where sold. No alcoholic be verages, other than beers, line 14 may be sold or serv ed in an y bona fide public eating place for line 15 which an on-sale license has been issued unless the premises line 16 comply with the requirements prescribed in Section 23038, line 17 23038.1, 23038.2, or 23038.3.
line 18 (b) (1) In addition to the privilege in subdivision (a), any on-sale line 19 license for a premises located in an entertainment zone authorizes line 20 the licensee to permit consumers to lea ve the licensed premises line 21 with open containers of alcoholic beverages for consumption off line 22 the premises within the entertainment zone if all of the following line 23 conditions are satisfied:
line 24 (A) The alcoholic beverage is specified in both the license and line 25 the ordinance creating the entertainment zone.
line 26 (B) Open alcohol containers only leave the premises during the line 27 hours allo wed by the ordinance establishing the entertainment line 28 zone.
line 29 (C) Patrons with open containers e xit the licensed premises line 30 directly into an entertainment zone.
line 31 (D) All alcoholic be verages in the entertainment zone are line 32 purchased only at a licensed premises located within the line 33 entertainment zone.
line 34 (E) The premises expressly prohibits open containers or closed line 35 containers of alcoholic beverages acquired outside their premises. line 36 (F) Delivery of alcoholic be verages to consumers within the line 37 entertainment zone by the licensee or by any third-party delivery line 38 service is expressly prohibited unless the delivery is to a residential line 39 building or private business that is not a licensee. 99 SB 969 — 7 —
line 1 (G) No alcoholic beverages purchased at the licensed premises line 2 may leave the premises in an open glass or metal container for line 3 consumption in an entertainment zone.
line 4 (H) The licensee annually submits their notice of intent to line 5 participate in an open container entertainment zone to the line 6 department.
line 7 (2) This subdi vision does not require a licensee to sell an y line 8 alcoholic beverage for consumption of f the premises within an line 9 entertainment zone.
line 10 (3) Licensees whose privileges are restricted due to operating line 11 conditions or other statutory restrictions may be prohibited from line 12 exercising entertainment zone privileges that are contrary to their line 13 operating conditions. F or purposes of this paragraph, an y line 14 restrictions on the e xercise of of f-sale privileges shall not apply line 15 to the remo val of open alcoholic be verages from the licensed line 16 premises for consumption in the entertainment zone. line 17 SEC. 5. Section 25690 of the Business and Professions Code line 18 is amended to read:
line 19 25690. (a) If the City and County of San Francisco A city, line 20 county, or city and county that establishes an entertainment zone, line 21 it zone shall do both of the following:
line 22 (1)
line 23 (a) Establish a process or procedure by which persons in line 24 possession of alcoholic beverages in the entertainment zone may line 25 be readily identifiable as being 21 years of age or older. line 26 (2)
line 27 (b) Provide all of the following to the department:
line 28 (A)
line 29 (1) A copy of the ordinance establishing the entertainment zone. line 30 (B)
line 31 (2) Information as may be necessary to identify the boundaries line 32 of the entertainment zone.
line 33 (C)
line 34 (3) The days and hours of operation of the entertainment zone. line 35 (D)
line 36 (4) The types of alcoholic be verages permitted within the line 37 entertainment zone.
line 38 (E)
line 39 (5) The approved nonglass and nonmetal containers in which line 40 alcoholic beverages may be authorized.
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line 1 (b) The Legislature finds and declares that a special statute is line 2 necessary and that a general statute cannot be made applicable line 3 within the meaning of Section 16 of Article IV of the California line 4 Constitution because of the unique economic circumstances in the line 5 City and County of San Francisco.
line 6 SEC. 6. Section 25691 is added to the Business and Professions line 7 Code, to read:
line 8 25691. (a) An ordinance establishing an entertainment zone line 9 shall not authorize consumption of alcoholic beverages during the line 10 hours in which sales of alcoholic be verages are prohibited under line 11 Section 25631.
line 12 (b) An ordinance establishing an entertainment zone may only line 13 authorize consumption of alcoholic beverages during the hours in line 14 which at least one licensee within the boundaries of the line 15 entertainment zone is permitted to sell alcoholic be verages for line 16 consumption on the premises.
line 17 SEC. 7. Section 25692 is added to the Business and Professions line 18 Code, to read:
line 19 25692. (a) Before enacting an ordinance to establish an line 20 entertainment zone, a city, county, or city and county shall notify line 21 local la w enforcement and request feedback about both of the line 22 following:
line 23 (1) Potential health and safety impacts that might be generated line 24 by the entertainment zone and strategies to mitigate those impacts. line 25 (2) The entertainment zone’ s proposed boundaries, days and line 26 hours of operation, types of alcoholic be verages permitted, and line 27 approved nonglass and nonmetal containers.
line 28 (b) A city , county , or city and county that establishes an line 29 entertainment zone, or its designated subordinate officer or body, line 30 shall review the operation of the entertainment zone e very two line 31 years following the adoption of the entertainment zone to ensure line 32 that the entertainment zone is being maintained in a manner that line 33 protects the health and safety of the general public. This review line 34 shall be conducted in consultation with local la w enforcement line 35 agencies and any reports produced during the review shall be made line 36 available to the department upon request.
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