Oregon Bulletin
April 1, 2011
Rule
Caption: Amend interest in the business
rule to add clarity to the term “unlicensable”.
Adm.
Order No.: OLCC 1-2011
Filed with Sec. of
State: 2-23-2011
Certified to be
Effective: 3-1-11
Notice Publication
Date: 11-1-2010
Rules Amended: 845-005-0311
Subject: This rule defines “interest in the business”,
including financial interest, for the purposes of describing to whom the
Commission’s license refusal reasons apply. Staff recommended amending section
(4) of this rule to clarify the term “unlicensable”. There has been some
confusion amongst both licensees and staff as to the meaning of this term. This
amendment adds language directly from the authorizing statute (ORS 471.757) in
order to add more specificity to the concept of “unlicensable”.
Rules Coordinator: Jennifer Huntsman—(503) 872-5004
845-005-0311
True Name on Application; Interest
in Business
(1) True name on application: Applications for licenses
must specify the real and true names of all persons who own or have an interest
in the business proposed to be licensed by the Commission, and these persons or
in the case of corporations, a duly authorized officer, must sign the
application.
(2) License privileges: The license privileges are
available only to the persons specified in the application and only for the premises
designated on the license.
(3) Interest in the business: For purposes of section
(1) of this rule, the following persons have an “interest in the business”:
(a) Any person who receives or is entitled to receive,
directly or indirectly, any of the profits of a licensed business except
persons who receive any of the profits as:
(A) A bonus paid to an employee, if the employee is on
a fixed wage or salary and the bonus is not more than 25 percent of the
employee’s pre-bonus annual compensation, or the bonus is based on a written
incentive/bonus program and is not unreasonable or out of the ordinary for the
services rendered;
(B) Repayment of a loan or payment on a contract to
purchase property unless the loan or contract holder exercises control over or
participates in the management of the business;
(C) Reasonable payment for rent under a bona fide lease
or rental obligation unless the lessor or property manager exercises control
over or participates in the management of the business;
(D) Reasonable payment for a franchise under a bona
fide franchise agreement;
(E) Payment of dividends to corporate stockholders.
(b) A person who does not receive any of the profits
but receives compensation that is out of the ordinary for the services
rendered. “Out of the ordinary” includes both over and under compensations;
(c) Any person or firm who contracts to provide food
service or to manage or operate any part of the licensed premises, other than
as an employee;
(d) Any person who invests money or other property in
the licensed business, other than a stockholder. Any stockholder who owns ten
percent or more stock must receive Commission approval (OAR 845-006-0475). For
purposes of this subsection, a bona fide loan that entitles the lender to a
return of only the principal and interest on the principal is not an
investment;
(e) A contract purchaser of a licensed business. A
contract purchaser may not operate or invest prior to Commission approval. A
contract purchaser may make contract payments into an escrow account prior to
Commission approval of the change of ownership, but may not operate the
business other than as an employee.
(4) ORS 471.757 allows the Commission to deny, cancel
or suspend a license if circumstances exist with regard to any person who has
any financial interest in the licensed business or place of business such that
the Commission would have a basis to cancel or refuse to issue a license to the
person with a financial interest if that person were the licensee or applicant.
For purposes of ORS 471.757, financial interest exists if a person may
financially benefit or suffer based on the performance of the licensed
business. Examples of persons having a financial interest in the business
include:
(a) Any person who rents or leases property to or for
the licensed business;
(b) Any person who invests or loans money or other
property for the licensed business;
(c) Any person who gives money or property for the
licensed business and who
(A) Exercises control over or participates in the management
of the licensed business; or
(B) Is employed by the licensed business; or
(d) The spouse or domestic partner of the licensee or
license applicant. For purposes of this rule, domestic partners (lower case)
are individuals who share the same regular and permanent address and who share
joint financial assets, resources, accounts or obligations, such as home
ownership, checking or banking accounts, brokerage accounts or health care
coverage. Domestic partner (lower case) also includes a “Domestic Partner”
(upper case), which means an individual who, along with another individual of
the same sex, has received a Certificate of Registered Domestic Partnership
pursuant to the Oregon Family Fairness Act.
(5) For good cause shown, the Commission may waive the
requirements in this rule to take into account unusual or extraordinary
circumstances.
Stat. Auth.: ORS 471, including
471.030, 471.040 & 471.730(1) & (5)
Stats. Implemented: ORS 471.757
Hist.: OLCC 19-2000, f. 12-6-00,
cert. ef. 1-1-01; OLCC 9-2002, f. 6-12-02 cert. ef. 7-1-02; OLCC 9-2008, f.
6-12-08, cert. ef. 7-1-08; OLCC 1-2011, f. 2-23-11, cert. ef. 3-1-11
Rule
Caption: Address neighborhood livability
issues by tying license notice requirements and additional restrictions to
licensing criteria.
Adm.
Order No.: OLCC 2-2011
Filed with Sec. of
State: 2-23-2011
Certified to be
Effective: 3-1-11
Notice Publication
Date: 11-1-2010
Rules Amended: 845-005-0331, 845-005-0355, 845-006-0480
Subject: OAR 845-005-0331 Licensing Exterior Areas: This
rule describes the refusal basis for licensing an exterior area of a premises.
The rule lists the reasons the Commission will refuse to license an exterior
area unless the applicant can show good cause to overcome the refusal basis.
Staff proposed an additional refusal reason, section (5), for when an applicant
or licensee will allow entertainment in the exterior area after midnight. This
should assist the Commission in addressing late night noise issues that may
impact neighborhood livability.
OAR
845-005-0355 Restricting License Privileges and Conduct of Operations: This
rule describes the conditions under which the Commission may restrict a license
or service permit. Staff proposed an additional reason to impose restrictions,
section (1)(d), where if an applicant or licensee submits a qualifying control
or operating plan as good cause to overcome a license refusal basis, the
Commission shall impose as restrictions on the license those elements of the
control plan that were essential to the decision to grant the license. As with
any other restrictions, these will remain in place until removed and failure to
comply with the restrictions is a Category I violation. In addition, staff
proposed additional language in section (2)(b) related to determining public
interest or convenience reasons to restrict a license. The new language
specifies that excessive or obtrusive noise, music or sound vibrations is one
of the areas of violations where restrictions can be designed to eliminate or
prevent contributing conditions.
OAR
845-006-0480 Change in Premises or Operation: Prior Notice Required: This
rule provides a way for a licensee to make changes in their business operation
while still assuring the Commission that the changes will meet our licensing
criteria. With these amendments licensees are only required to notify the
Commission when there are changes to the premises that effect licensure, such
as a change in the physical dimensions, a change in the business trade name, or
a change that could reasonably affect the assigned minor posting.
Overall, the
amendments in this rule package are designed to provide the Commission with
additional tools to address neighborhood livability issues, specifically in the
area of excessive and late night noise. At the same time, by tying required
notices and additional restrictions to licensure, the amendments help focus
both our enforcement and licensing efforts on those factors in a business’
ongoing operating plan that impact what is within our authority to regulate.
Rules Coordinator: Jennifer Huntsman—(503) 872-5004
845-005-0331
Licensing Exterior Areas
(1) The Commission shall refuse to license an exterior
area, and may revoke its approval of an outdoor area previously licensed, for
any of the reasons listed in this rule unless the applicant shows good cause
that outweighs the refusal basis. The following sections state the refusal
reasons that apply to exterior areas.
(2) The applicant or licensee requests licensing of an
area controlled by the local governing body, and the local governing body has
not approved, or withdraws its approval of, the use proposed by the applicant
or licensee.
(3) The exterior area proposed to be licensed is not
adjacent to the licensee’s existing or the applicant’s proposed licensed
premises.
(4) The applicant or licensee fails to demonstrate
there will be adequate supervision of the area so as to prevent violations of
the liquor laws.
(5) The applicant or licensee will allow entertainment
in the exterior area between 12:00 a.m. and 7:00 a.m.
Stat. Auth.: ORS 471, including
471.030, 471.040, 471.730(1) & (5)
Stats. Implemented: ORS 471.313
Hist.: OLCC 19-2000, f. 12-6-00,
cert. ef. 1-1-01; OLCC 2-2011, f. 2-23-11, cert. ef. 3-1-11
845-005-0355
Restricting License Privileges and
Conduct of Operations
(1) The Commission may restrict a license or service
permit when:
(a) In the absence of a restriction, the Commission has
a basis to cancel, suspend/fine or deny the license or service permit;
(b) In addition to all or part of a suspension or fine,
a restriction may prevent the recurrence of the problem(s) that caused the
violation(s);
(c) The Commission determines that a restriction is in
the public interest or convenience; or
(d) The Commission has a basis to refuse the license
and the applicant or licensee has submitted a qualifying control or operating
plan as good cause to overcome the refusal basis. In these circumstances the
Commission shall impose as restrictions those elements of the control or operating
plan that the Commission determines are essential to overcoming the refusal
basis.
(2) In determining public interest or convenience
reasons to restrict a license or permit, the Commission considers factors that
include but are not limited to:
(a) The character or environment of the neighborhood in
which the licensed premises operate;
(b) The need to eliminate or prevent conditions that
have contributed to or that the Commission reasonably believes will contribute
to liquor or criminal law violations by the licensee, patrons of the licensed
premises or the public, including conditions that have or are likely to
contribute to noise, music or sound vibrations from inside or outside the
premises that a reasonable person would consider excessive or obtrusive; or
(c) The need to limit the availability of alcohol to
minors, visibly intoxicated persons or street drinkers.
(3) The Commission has determined that it is not in the
public interest or convenience to issue or renew:
(a) A license that allows off-premises sales in an area
frequented by street drinkers, unless the Commission restricts the sales of the
alcoholic beverages associated with street drinkers;
(b) A license to a relative or associate of a person
whose license was cancelled, surrendered or not renewed because of problems at
the premises that involved the person, unless the Commission restricts the
relative or associate from permitting the person from being on the premises;
(c) A license or permit to a person who has a recent
history or record of alcohol or drug problems, unless the Commission requires
the person to complete an alcohol/drug treatment program and follow the
program’s recommendations regarding alcohol/drug use or to abstain from
alcohol/drug use.
(4) When the Commission restricts a license or service
permit, it notifies the licensee or permittee. If the licensee or permittee
disagrees with the restriction, the licensee or permittee has the right to a
hearing under the procedures in ORS chapter 183; OAR chapter 137, division 003;
and OAR chapter 845, division 003.
(5) A licensee or permittee who has a restricted
license or permit must exercise license or permit privileges only in compliance
with the restriction(s). Failure to comply with the restriction(s) is a
Category I violation.
(6) A restriction remains in effect until the
Commission removes it. The licensee or permittee may ask the Commission to
remove or modify a restriction. The written request must explain why the
licensee or permittee believes the Commission should remove or modify the
restriction. The Commission will notify the licensee or permittee, in writing,
of its decision to approve or deny the request and the basis for its decision.
If the Commission denies the request, the licensee or permittee has the right
to a hearing under the procedures in ORS chapter 183; OAR chapter 137, division
003; and chapter 845, division 003.
(7) As used in subsections (2)(c) and (3)(a) of this
rule, “street drinkers” means people who drink unlawfully in streets, alleys,
parks and other similar public places.
(8) As used in subsection (2)(b) of this rule,
“conditions” means conditions in the immediate vicinity of the premises that
are related to the exercise of the license privileges and conditions in the
premises or in the areas around the premises that the applicant/licensee
controls.
Stat. Auth.: ORS 471, including
471.030, 471.040, 471.730(1) & (5)
Stats. Implemented: ORS 471.313, 471.405(1)
Hist.: OLCC 19-2000, f. 12-6-00,
cert. ef. 1-1-01; OLCC 6-2001, f. 8-15-01, cert. ef. 9-1-01; OLCC 7-2006(Temp),
f. & cert. ef. 6-15-06 thru 12-11-06; OLCC 13-2006, f. 10-19-06, cert. ef.
12-12-06; OLCC 2-2011, f. 2-23-11, cert. ef. 3-1-11
845-006-0480
Changes in Premises or Operation:
Notice Required
(1) The Commission issues licenses with the understanding
that the licensee will operate the business as proposed at the time of
licensing. The Commission also realizes that a licensee may need to change the
business during the licensing year. This rule provides a way for a licensee to
make changes, and for the Commission to be assured that the changes will meet
the criteria for licensing.
(2) A licensee licensed to sell alcoholic beverages at
retail for on-premises consumption must notify the Commission in writing and
provide an updated floor plan whenever the licensee changes the physical
dimensions of the licensed premises within 30 days of the change.
(3) A licensee must notify the Commission in writing
whenever the licensee changes the business trade name within 30 days of the
change.
(4) A licensee licensed to sell alcoholic beverages for
on-premises consumption must notify the Commission in writing of any change to
the premises or the business operation that could reasonably affect the minor
posting assigned to the premises or any room or area of the premises prior to
the change.
(5) Failure to provide the notice that this rule
requires is a Category V violation.
Stat. Auth.: ORS 471, including
471.030, 471.040, 471.730(1) & (5)
Stats. Implemented: ORS 471.313,
471.315
Hist.: OLCC 19-2000, f. 12-6-00,
cert. ef. 1-1-01; OLCC 2-2011, f. 2-23-11, cert. ef. 3-1-11
Notes
1.) This online version of the OREGON BULLETIN is provided for convenience of reference and enhanced access. The official, record copy of this publication is contained in the original Administrative Orders and Rulemaking Notices filed with the Secretary of State, Archives Division. Discrepancies, if any, are satisfied in favor of the original versions. Use the OAR Revision Cumulative Index found in the Oregon Bulletin to access a numerical list of rulemaking actions after November 15, 2010.
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