Senate Bill S7750A

2015-2016 Legislative Session

Designates nationally recognized credit cards as "cash" for purposes of the sale of alcoholic beverages

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Archive: Last Bill Status - In Senate Committee Judiciary Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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Date of Action	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jun 13, 2016	print number 7750a
Jun 13, 2016	amend and recommit to judiciary
May 12, 2016	referred to investigations and government operations

Bill Amendments

Original

A (Active)

co-Sponsors

2015-S7750 - Details

See Assembly Version of this Bill:: A10361
Current Committee:: Senate Judiciary
Law Section:: Alcoholic Beverage Control Law
Laws Affected:: Amd §§101-aaa & 101-aa, ABC L

2015-S7750 - Summary

Designates nationally recognized credit cards as "cash" for purposes of the sale of alcoholic beverages.

2015-S7750 - Sponsor Memo

                                 BILL NUMBER:  S7750            Revised 05/16/16

 TITLE OF BILL :

An act to amend the alcoholic beverage  control law, in relation to
designating nationally recognized credit cards as "cash" for purposes
of the sale of alcoholic beverages

 PURPOSE OR GENERAL IDEA OF BILL :

To allow retailers to use nationally recognized credit cards to
purchase wine, beer and liquor from licensed wholesalers.

 SUMMARY OF SPECIFIC PROVISIONS :

Section 1 amends § 101-aa(1)(f) of the Alcoholic Beverage Control Law
to include within the definition of cash "nationally recognized credit
card."

Section 2 amends § 101-aaa(1)(g) of the Alcoholic Beverage Control Law
to include within the definition of cash "nationally recognized credit
card."

Section 3 provides the effective date.

 EXISTING LAW :

Under current law, the definition of "cash" for purposes of these
sections of the ABC Law includes: currency and coin of the United
State of America, certified check, money order, electronic funds
transfer, bank officer's check or draft or a check drawn on the
account of the retail licensee payable to the manufacturer or
wholesaler and dated no later than the date of delivery of the
alcoholic beverages and which is honored upon presentment for payment.

 JUSTIFICATION :

Amending the ABC Law in the manner prescribed by this legislation
furthers Governor Cuomo's stated directive to modernize the regulation
of New York's alcohol beverage industry. These simple amendments will
permit licensees to operate in accordance with 21st Century business
practices while continuing to protect the purpose of the ABC Law's
credit restriction, i.e., prohibiting "tiedhouse" arrangements whereby
the retailer becomes indebted to the upper-tier industry member.

Credit cards are basic tools of modern commerce, and are ubiquitous
throughout the world today. As such, they can and should be included
in the definition of "cash" that alcohol beverage retailers may use to
purchase products from duly licensed alcohol beverage wholesalers.
Allowing licensed retailers to buy alcohol beverages from distributors
using credit cards will facilitate commercial transactions and improve
accountability through enhanced record-keeping, while preserving
regulatory policy objectives such as credit limitations and tied-house
evil restrictions If a retailer uses a credit card to buy alcohol
beverage inventory, the wholesaler receives payment immediately. The
wholesaler is not extending credit to the retailer; rather, credit is
extended by a financial institution that has no direct interest in the
alcohol beverage industry. The involvement of the third-party
financial institution actually creates an additional barrier between
the retailer and the, wholesaler, effectively alleviating the
historical concerns behind these credit limitations. Moreover, the
involvement of the financial institution issuing the credit card
increases timely and effective accountability through independent,
timely and effective record-keeping as to all credit card
transactions. Hence, as a matter of alcohol regulatory policy, the use
of a credit card in no way affords the wholesaler an opportunity to
gain undue influence with the retailer; the ensuing credit obligation
owed by the retailer is to the card-issuer, not the merchant selling
the alcohol inventory to the card holder.

 PRIOR LEGISLATIVE HISTORY :

New bill.

 FISCAL IMPLICATIONS :

None.

 EFFECTIVE DATE :
This act shall take effect immediately.

2015-S7750 - Bill Text download pdf

                            
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  7750

                            I N  S E N A T E

                              May 12, 2016
                               ___________

Introduced  by  Sen.  LANZA  -- read twice and ordered printed, and when
  printed to be committed to the Committee on Investigations and Govern-
  ment Operations

AN ACT to amend the alcoholic beverage   control  law,  in  relation  to
  designating  nationally recognized credit cards as "cash" for purposes
  of the sale of alcoholic beverages

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1.  Paragraph  g  of  subdivision 1 of section 101-aaa of the
alcoholic beverage control law, as amended by chapter 298 of the laws of
2010, is amended to read as follows:
  g. "Cash" means and includes currency and coin of the United States of
America,  certified  check,  money  order,  electronic  funds  transfer,
NATIONALLY  RECOGNIZED  CREDIT CARD, bank officer's check or draft, or a
check drawn on the  account  of  the  retail  licensee  payable  to  the
manufacturer  or wholesaler and dated no later than the date of delivery
of the alcoholic beverages and which is  honored  upon  presentment  for
payment;  provided,  however,  that  if  any  check  or other instrument
described in this paragraph tendered by a retail licensee on the  delin-
quent  list  is not honored upon presentment for payment, the license of
such retail licensee may be suspended for not more than fifteen days for
the first offense, and  not  more  than  sixty  days  for  a  subsequent
offense,  which penalty shall be in addition to the penalty provided for
by the provisions of subdivision  six  of  this  section,  and  provided
further,  that  nothing  in this section shall require a manufacturer or
wholesaler to accept a check tendered by or drawn on the  account  of  a
retail  licensee  on the delinquent list unless the same has been certi-
fied.
  S 2. Paragraph f of subdivision 1 of section 101-aa of  the  alcoholic
beverage  control  law, as amended by chapter 84 of the laws of 2004, is
amended to read as follows:
  f. "Cash" means and includes currency and coin of the United States of
America,  certified  check,  money  order,  electronic  funds  transfer,
NATIONALLY  RECOGNIZED  CREDIT CARD, bank officer's check or draft, or a

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.

                                                           LBD15416-02-6

S. 7750                             2

check drawn on the  account  of  the  retail  licensee  payable  to  the
manufacturer  or wholesaler and dated no later than the date of delivery
of the alcoholic beverages and which is  honored  upon  presentment  for
payment,  provided,  however,  that  if  any  check  or other instrument
described herein tendered by a retail licensee on the delinquent list is
not honored upon presentment for payment, the  license  of  such  retail
licensee  may  be suspended for not more than fifteen days for the first
offense, and not more than sixty days for a  subsequent  offense,  which
penalty  shall  be  in  addition  to  the  penalty  provided  for by the
provisions of subdivision six of this  section,  and  provided  further,
that nothing herein contained shall require a manufacturer or wholesaler
to accept a check tendered by or drawn on the account of a retail licen-
see on the delinquent list unless the same has been certified.
  S 3. This act shall take effect immediately.

co-Sponsors

2015-S7750A (ACTIVE) - Details

See Assembly Version of this Bill:: A10361
Current Committee:: Senate Judiciary
Law Section:: Alcoholic Beverage Control Law
Laws Affected:: Amd §§101-aaa & 101-aa, ABC L

2015-S7750A (ACTIVE) - Summary

Designates nationally recognized credit cards as "cash" for purposes of the sale of alcoholic beverages.

2015-S7750A (ACTIVE) - Sponsor Memo

                                 BILL NUMBER:  S7750A

 TITLE OF BILL :  An act to amend the alcoholic beverage  control law,
in relation to designating nationally recognized credit cards as
"cash" for purposes of the sale of alcoholic beverages

 PURPOSE OF THE BILL :

To allow retailers to use nationally recognized credit cards to
purchase wine, beer and liquor from licensed wholesalers.

 SUMMARY OF SPECIFIC PROVISIONS :

Section 1 amends S 101-aa(1)(f) of the Alcoholic Beverage Control Law
to include within the definition of cash "nationally recognized credit
card."

Section 2 amends § 101-aaa(1)(g) of the Alcoholic Beverage Control Law
to include within the definition of cash "nationally recognized credit
card."

Section 3 provides the effective date.

 EXISTING LAW :

Under current law, the definition of "cash" for purposes of these

sections of the ABC Law includes: currency and coin of the United
State of America, certified check, money order, electronic funds
transfer, bank officer's check or draft or a check drawn on the
account of the retail licensee payable to the manufacturer or
wholesaler and dated no later than the date of delivery of the
alcoholic beverages and which is honored upon presentment for payment.

 JUSTIFICATION :

Amending the ABC Law in the manner prescribed by this legislation
furthers Governor Cuomo's stated directive to modernize the regulation
of New York's alcohol beverage industry. These simple amendments will
permit licensees to operate in accordance with 21st Century business
practices while continuing to protect the purpose of the ABC Law's
credit restriction, i.e., prohibiting "tiedhouse" arrangements whereby
the retailer becomes indebted to the upper-tier industry member.

Credit cards are basic tools of modern commerce, and are ubiquitous
throughout the world today. As such, they can and should be included
in the definition of "cash" that alcohol beverage retailers may use to
purchase products from duly licensed alcohol beverage wholesalers.
Allowing licensed retailers to buy alcohol beverages from distributors
using credit cards will facilitate commercial transactions and improve
accountability through enhanced record-keeping, while preserving
regulatory policy objectives such as credit limitations and tied-house
restrictions. If a retailer uses a credit card to buy alcohol beverage
inventory, the wholesaler receives payment immediately. The wholesaler
is not extending credit to the retailer; rather, credit is extended by
a financial institution that has no direct interest in the alcohol
beverage industry. The involvement of the third-party financial
institution actually creates an additional barrier between the
retailer and the, wholesaler, effectively alleviating the historical
concerns behind these credit limitations. Moreover, the involvement of
the financial institution issuing the credit card increases timely and
effective accountability through independent, timely and effective
record-keeping as to all credit card transactions. Hence, as a matter
of alcohol regulatory policy, the use of a credit card in no way
affords the wholesaler an opportunity to gain undue influence with the
retailer; the ensuing credit obligation owed by the retailer is to the

card-issuer, not the merchant selling the alcohol inventory to the
card holder.

 PRIOR LEGISLATIVE HISTORY :

New bill.

 FISCAL IMPLICATIONS :

None.

 EFFECTIVE DATE :
This act shall take effect immediately.

2015-S7750A (ACTIVE) - Bill Text download pdf

                            
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                 7750--A

                            I N  S E N A T E

                              May 12, 2016
                               ___________

Introduced  by  Sens.  LANZA, CROCI, GALLIVAN, KENNEDY -- read twice and
  ordered printed, and when printed to be committed to the Committee  on
  Investigations and Government Operations -- committee discharged, bill
  amended,  ordered reprinted as amended and recommitted to said commit-
  tee

AN ACT to amend the alcoholic beverage   control  law,  in  relation  to
  designating  nationally recognized credit cards as "cash" for purposes
  of the sale of alcoholic beverages

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1.  Paragraph  g  of  subdivision 1 of section 101-aaa of the
alcoholic beverage control law, as amended by chapter 298 of the laws of
2010, is amended to read as follows:
  g. "Cash" means and includes currency and coin of the United States of
America,  certified  check,  money  order,  electronic  funds  transfer,
NATIONALLY  RECOGNIZED  CREDIT CARD, bank officer's check or draft, or a
check drawn on the  account  of  the  retail  licensee  payable  to  the
manufacturer  or wholesaler and dated no later than the date of delivery
of the alcoholic beverages and which is  honored  upon  presentment  for
payment;  provided,  however,  that  if  any  check  or other instrument
described in this paragraph tendered by a retail licensee on the  delin-
quent  list  is not honored upon presentment for payment, the license of
such retail licensee may be suspended for not more than fifteen days for
the first offense, and  not  more  than  sixty  days  for  a  subsequent
offense,  which penalty shall be in addition to the penalty provided for
by the provisions of subdivision  six  of  this  section,  and  provided
further,  that  nothing  in this section shall require a manufacturer or
wholesaler to accept a check tendered by or drawn on the  account  of  a
retail  licensee  on the delinquent list unless the same has been certi-
fied; AND ALSO PROVIDED THAT THE ACCEPTANCE OF A  NATIONALLY  RECOGNIZED
CREDIT  CARD  SHALL  BE  LIMITED TO THOSE WHOLESALERS WHO DO NOT DELIVER
THEIR MERCHANDISE TO A RETAIL LICENSEE.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD15416-04-6

S. 7750--A                          2

  S 2. Paragraph f of subdivision 1 of section 101-aa of  the  alcoholic
beverage  control  law, as amended by chapter 84 of the laws of 2004, is
amended to read as follows:
  f. "Cash" means and includes currency and coin of the United States of
America,  certified  check,  money  order,  electronic  funds  transfer,
NATIONALLY RECOGNIZED CREDIT CARD, bank officer's check or draft,  or  a
check  drawn  on  the  account  of  the  retail  licensee payable to the
manufacturer or wholesaler and dated no later than the date of  delivery
of  the  alcoholic  beverages  and which is honored upon presentment for
payment, provided, however,  that  if  any  check  or  other  instrument
described herein tendered by a retail licensee on the delinquent list is
not  honored  upon  presentment  for payment, the license of such retail
licensee may be suspended for not more than fifteen days for  the  first
offense,  and  not  more than sixty days for a subsequent offense, which
penalty shall be  in  addition  to  the  penalty  provided  for  by  the
provisions  of  subdivision  six  of this section, and provided further,
that nothing herein contained shall require a manufacturer or wholesaler
to accept a check tendered by or drawn on the account of a retail licen-
see on the delinquent list unless the same has been certified; AND  ALSO
PROVIDED  THAT  THE  ACCEPTANCE  OF  A NATIONALLY RECOGNIZED CREDIT CARD
SHALL BE LIMITED TO THOSE WHOLESALERS WHO DO NOT DELIVER THEIR  MERCHAN-
DISE TO A RETAIL LICENSEE.
  S 3. This act shall take effect immediately.

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Senate Bill S7750A

Sponsored By

Archive: Last Bill Status - In Senate Committee Judiciary Committee

Actions

Bill Amendments

co-Sponsors

2015-S7750 - Details

2015-S7750 - Summary

2015-S7750 - Sponsor Memo

2015-S7750 - Bill Text download pdf

co-Sponsors

2015-S7750A (ACTIVE) - Details

2015-S7750A (ACTIVE) - Summary

2015-S7750A (ACTIVE) - Sponsor Memo

2015-S7750A (ACTIVE) - Bill Text download pdf

Comments

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Sponsored By

Andrew J. Lanza

Archive: Last Bill Status - In Senate Committee Judiciary Committee

Actions

Bill Amendments

co-Sponsors

Thomas D. Croci

Patrick M. Gallivan

Timothy M. Kennedy

2015-S7750 - Details

2015-S7750 - Summary

2015-S7750 - Sponsor Memo

2015-S7750 - Bill Text download pdf

co-Sponsors

Thomas D. Croci

Patrick M. Gallivan

Timothy M. Kennedy

2015-S7750A (ACTIVE) - Details

2015-S7750A (ACTIVE) - Summary

2015-S7750A (ACTIVE) - Sponsor Memo

2015-S7750A (ACTIVE) - Bill Text download pdf

Comments