An Act To Strengthen Maine's Hospitals and To Provide for a New Spirits Contract
Maine Legislature, Session 126, LD 1555
Committee: Appropriations and Financial Affairs
Sponsors: FLOOD, FREDETTE, BURNS, COLLINS, CUSHING, HAMPER, KATZ, LANGLEY, MASON, PLUMMER, SAVIELLO, SHERMAN, THIBODEAU, THOMAS, WHITTEMORE, YOUNGBLOOD, AYOTTE, BEAULIEU, BENNETT, BLACK, CAMPBELL, CHASE, COTTA, CRAFTS, CRAY, CROCKETT, DAVIS, DOAK, DUNPHY, DUPREY, FITZPATRICK, GIFFORD, GILLWAY, GUERIN, HARVELL, JACKSON, JOHNSON, KESCHL, KINNEY, KNIGHT, LONG, MAKER, MALABY, MAREAN, NADEAU, NEWENDYKE, NUTTING, PARRY, PEASE, POULIOT, REED, SANDERSON, SIROCKI, TIMBERLAKE, TURNER, TYLER, WALLACE, WEAVER, WILLETTE, WILSON, WINCHENBACH, WOOD
Amends: 28-A MRSA §2, 28-A MRSA §83, 28-A MRSA §88, 28-A MRSA §90, 28-A MRSA §453, 28-A MRSA §606, 22-A MRSA §216, 28-A MRSA §81, 28-A MRSA §84, 28-A MRSA §85, 28-A MRSA §453-C, 28-A MRSA §461, 28-A MRSA §501, 28-A MRSA §503, 28-A MRSA §1651

Legislative Document 
No. 1555 
S.P. 596 
In Senate, May 31, 2013 
An Act To Strengthen Maine's Hospitals and To Provide for a New 
Spirits Contract 
(EMERGENCY) 
Reference to the Committee on Appropriations and Financial Affairs suggested and ordered 
printed. 
DAREK M. GRANT 
Secretary of the Senate 
Presented by Senator FLOOD of Kennebec.  (GOVERNOR'S BILL) 
Cosponsored by Representative FREDETTE of Newport and 
Senators: BURNS of Washington, COLLINS of York, CUSHING of Penobscot, HAMPER of Oxford, KATZ of 
Kennebec, LANGLEY of Hancock, MASON of Androscoggin, PLUMMER of Cumberland, SAVIELLO of 
Franklin, SHERMAN of Aroostook, THIBODEAU of Waldo, THOMAS of Somerset, WHITTEMORE of 
Somerset, YOUNGBLOOD of Penobscot, Representatives: AYOTTE of Caswell, BEAULIEU of Auburn, 
BENNETT of Kennebunk, BLACK of Wilton, CAMPBELL of Orrington, CHASE of Wells, COTTA of China, 
CRAFTS of Lisbon, CRAY of Palmyra, CROCKETT of Bethel, DAVIS of Sangerville, DOAK of Columbia 
Falls, DUNPHY of Embden, DUPREY of Hampden, FITZPATRICK of Houlton, GIFFORD of Lincoln, 
GILLWAY of Searsport, GUERIN of Glenburn, HARVELL of Farmington, JACKSON of Oxford, JOHNSON of 
Eddington, JOHNSON of Greenville, KESCHL of Belgrade, KINNEY of Limington, KNIGHT of Livermore 
Falls, LONG of Sherman, MAKER of Calais, MALABY of Hancock, MAREAN of Hollis, McCLELLAN of 
Raymond, McELWEE of Caribou, NADEAU of Fort Kent, NEWENDYKE of Litchfield, NUTTING of Oakland, 
PARRY of Arundel, PEASE of Morrill, POULIOT of Augusta, REED of Carmel, SANDERSON of Chelsea, 
SIROCKI of Scarborough, TIMBERLAKE of Turner, TURNER of Burlington, TYLER of Windham, 
WALLACE of Dexter, WEAVER of York, WILLETTE of Mapleton, WILSON of Augusta, WINCHENBACH of 
Waldoboro, WOOD of Sabattus. 
Emergency preamble. Whereas, acts and resolves of the Legislature do not 
become effective until 90 days after adjournment unless enacted as emergencies; and 
Whereas, this legislation involves the operation of the liquor laws and makes 
changes necessary to maximize revenues for the benefit of the people of Maine; and 
Whereas, the State's existing wholesale spirits contract is set to expire June 30, 
2014; and 
Whereas, the use of the competitive bid process to issue a contract for the operation 
of the wholesale spirits business should be initiated as soon as practicable; and 
Whereas, in the judgment of the Legislature, these facts create an emergency within 
the meaning of the Constitution of Maine and require the following legislation as 
immediately necessary for the preservation of the public peace, health and safety; now, 
therefore, 
Be it enacted by the People of the State of Maine as follows: 
PART A 
Sec. A-1.  28-A MRSA §2, sub-§§31-A and 31-B are enacted to read: 
31-A.  Spirits administration.  "Spirits administration" or "administration" means 
the management of spirits activities involving the distribution and sale of spirits by the 
alcohol bureau or any person awarded a contract under section 90. "Spirits 
administration" includes, but is not limited to, financial and performance management; 
profitable and responsible growth management; management of contracts; management 
of agency liquor store matters and orders; personnel management; monitoring and 
reporting of spirits inventory; management of bailment records and billing; management 
of accounts receivable, accounts payable and tax collection and reporting; and sales and 
profit reporting. "Spirits administration" does not include warehousing and distribution of 
spirits by the alcohol bureau. 
31-B.  Spirits trade marketing.  "Spirits trade marketing" or "trade marketing" 
means oversight and management by the alcohol bureau or any person awarded a contract 
under section 90. "Spirits trade marketing" includes, but is not limited to, agency liquor 
store category management, analysis and recommendations; agency liquor store shelf 
reset recommendations; agency liquor store displays, advertising, point-of-sale material 
and event marketing recommendations; development, production and distribution of 
sales, marketing and informational publications; consultation and coordination with 
suppliers and brokers on matters affecting their brands; and development, production and 
distribution of any social responsibility initiatives and compliance related to those 
initiatives. 
Sec. A-2.  28-A MRSA §83, sub-§5-B is enacted to read: 
5-B.  Report on expenditures.  Expenditures and investments made by the alcohol 
bureau, including but not limited to reductions in the list price at which all spirits are sold 
and incentives offered to agency liquor stores, must be reported annually to the joint 
standing committees of the Legislature having jurisdiction over appropriations and 
financial affairs and alcoholic beverage matters. The report must include the impact of 
those spending initiatives on the number of cases of spirits sold in the State and on sales 
generally. 
Sec. A-3.  28-A MRSA §88, as enacted by PL 2003, c. 20, Pt. LLL, §2 and 
affected by §4, is repealed. 
Sec. A-4.  28-A MRSA §90 is enacted to read: 
§90.  Contract for operations of wholesale liquor activities 
1.  Statement of purpose.  The Legislature finds that it is in the public interest to 
seek efficiencies and maximize growth in the State’s wholesale spirits business while 
ensuring that growth in revenue from the business is achieved in a socially responsible 
manner.  The contracting of the operations of the wholesale spirits business should serve 
this purpose and provide the State’s agency liquor store partners with effective and 
efficient services in order to responsibly serve consumers of spirits in the State. 
2.  Contract for operations.  The Commissioner of Administrative and Financial 
Services, referred to in this section as "the commissioner," shall enter into a contract for 
warehousing, distribution and spirits administration and a contract for spirits trade 
marketing, each for a term of 10 years.  Each contract must be awarded pursuant to a 
competitive bid process in a manner similar to the process described in Title 5, chapter 
155, subchapter 1-A.  The commissioner is prohibited from contracting with a bidder who 
also holds a license in this State or another state to distill, bottle or manufacture spirits.  
3.  Development of request for bid proposals; fee.  The commissioner shall develop 
a request for proposals designed to encourage vigorous bidding for the purpose of 
awarding 2 contracts for the operations of the State's wholesale spirits business.  The 
commissioner shall request bids for the operation of spirits trade marketing separately 
from bids for the combined operations of warehousing, distribution and spirits 
administration.  In order to be considered for a contract to conduct spirits trade marketing, 
a bidder must submit a nonrefundable application fee of up to $5,000.  In order to be 
considered for a contract to conduct warehousing, distribution and spirits administration, 
a bidder must submit a nonrefundable application fee of up to $20,000.  The application 
fee must be credited to an Other Special Revenue Funds account within the division of 
purchases within the Department of Administrative and Financial Services to be used for 
managing the application process.  A request for proposals must inform potential bidders 
of the State's target gross revenue profit margin over the term of the contract and require 
the bidder to affirm that the bidder, or any of the principal officers of the bidder, does not 
hold or have a direct financial interest in a license or permit in this State or any other state 
for the distillation, bottling or manufacture of alcoholic beverages.  The request for 
proposals must instruct potential bidders to propose the scope of operations the bidder 
will provide and the fee for that service expressed as a percentage of revenue generated 
by the wholesale business. The request for proposals must direct bidders to indicate if the 
bidder intends to use subcontractors and to identify those subcontractors.  The request for 
proposals must also inform potential bidders that they may propose incentives for the 
bidder intended to encourage responsible growth of revenue and enhanced efficiencies in 
services provided. 
4.  Information provided by bidders.  A bidder seeking consideration of the award 
of a contract for the operations of the State's wholesale spirits business pursuant to this 
section shall comply with the requirements of this subsection. 
A.  A bidder on a contract to operate the warehousing, distribution and spirits 
administration functions of the wholesale spirits business shall identify services or 
operations for which the bidder may use a subcontractor and shall demonstrate: 
(1)  The bidder's financial capacity and access to capital to maintain the 
operations; 
(2)  The bidder's capabilities to provide adequate transportation and distribution 
of liquor to agency liquor stores; 
(3)  The bidder's warehousing capabilities and proposed bailment rates for liquor 
and related fees to be charged to liquor suppliers; 
(4)  That the bidder, including any principal officer of the bidder and any named 
subcontractor, is of good moral character and has not been found to have violated 
any state or federal law or rule governing the manufacture, distribution or sale of 
alcoholic beverages; 
(5)  The bidder's knowledge of the wholesale liquor business, alcoholic beverage 
industry or a related field; 
(6)  The bidder's plan to provide agency liquor stores with a minimum of 2 
deliveries per week; 
(7)  The bidder's methods for processing orders and invoices, including any 
minimum ordering requirements, split case restrictions and inventory control 
plans; 
(8)  The bidder's business plan to provide services in a manner that will assist the 
State in achieving a target growth rate comparable to or exceeding that of other 
states that control the sale and distribution of alcoholic beverages; 
(9)  The bidder's plan for enhancing services to liquor suppliers and agency liquor 
stores; and 
(10)  The positive impact on the economy, employment and state revenues that 
the bidder's overall proposal will provide. 
B.  A bidder on a contract to provide spirits trade marketing shall: 
(1)  Demonstrate the bidder's business plan and marketing strategies to encourage 
responsible growth to the wholesale spirits business; 
(2)  Demonstrate the bidder's experience or knowledge, if any, of responsible 
marketing of alcoholic beverages; 
(3)  Identify services for which the bidder may use a subcontractor; 
(4)  Demonstrate that the bidder, including any principal officer of the bidder and 
any named subcontractor, is of good moral character and has not been found to 
have violated any state or federal law or rule governing the manufacture, 
distribution or sale of alcoholic beverages; and 
(5)  Demonstrate the positive impact on the economy, employment and state 
revenues that the bidder's overall proposal will provide. 
In addition to the requirements of paragraphs A and B, the commissioner, in order to 
ensure that the objective of maximizing growth in the State's wholesale spirits business is 
achieved, may require bidders to provide additional information, including disclosure of 
the potential of a bidder's direct and substantial conflict of interest with the State's 
financial interest. 
5.  Award criteria and issuance of contract.  The commissioner shall select 
successful bidders for the contract to conduct the operations of warehousing, distribution 
and spirits administration and the contract to provide spirits trade marketing; however, 
both contracts may be awarded to the same bidder.  The commissioner shall choose the 
best value bidder in conformity with Title 5, section 1825-B, subsection 7 and shall 
consider as criteria for award the information required to be provided in subsection 4, as 
applicable.  When selecting a successful bidder for the contract to conduct the operations 
of warehousing, distribution and spirits administration, the commissioner may not 
consider as cause for disqualification for consideration any weakness in or inability to 
demonstrate proficiency in any one criterion listed in subsection 4, paragraph A, 
subparagraphs (6) to (10). 
The commissioner shall ensure that the following criteria are met before entering into a 
contract with a bidder for operations of warehousing, distribution and spirits 
administration: 
A.  That revenue to the State from the sale of spirits is predictable over the term of 
the contract; 
B.  That revenue from the sale of spirits will be maximized by the issuance of the 
contract and achieved through efficiency of services or profit sharing or both; 
C.  That the contract establishes standards of efficiency and quality of operations; 
D.  That the bidder has demonstrated that services provided to agency liquor stores 
will be enhanced; 
E.  That, upon execution of the contract, the disruption of services to agency liquor 
stores and suppliers will be minimal or absent; and 
F.  That the contract provides that the alcohol bureau must approve all bailment rates 
and related fees. 
6.  Contract provisions; oversight and performance review.  A contract provided 
to a successful bidder in accordance with this section must require that the person 
awarded the contract submit to the alcohol bureau, in a form determined by the alcohol 
bureau, an annual report audited by an independent 3rd party.  The alcohol bureau, 
following receipt of the report, shall provide the report annually to the joint standing 
committees of the Legislature having jurisdiction over appropriations and financial affairs 
and alcoholic beverages matters.  The contract must prohibit the person awarded the 
contract from engaging in activities reserved for agency liquor stores licensed as reselling 
agents to provide spirits to establishments licensed for on-premises consumption. The 
contract must also include provisions that allow for ongoing performance standards 
review so that deficiencies in such standards may result in amendments to the contract or 
nullification.  Performance standards subject to contract amendments or nullification 
include: 
A.  Working in partnership with the State to achieve the goal of a revenue growth rate 
comparable to the average growth rate of other states that control the sale and 
distribution of alcoholic beverages; 
B.  Transparency in annual reporting and conformance to the reporting requirements 
established by the alcohol bureau; and 
C.  Except for a contract awarded to conduct spirits trade marketing, responsiveness 
to the service needs of agency liquor stores. 
7.  Price regulation.  The alcohol bureau shall regulate the wholesale and retail 
prices of all liquor sold by a person awarded a contract in accordance with this section. 
Sec. A-5.  28-A MRSA §453, sub-§2-C, as enacted by PL 2009, c. 213, Pt. JJJJ, 
§2, is amended to read: 
2-C.  Licenses.  Beginning July 1, 2009, the The bureau shall consider whether the 
applicant can satisfy the following criteria when determining whether to issue an agency 
liquor store license under this section: 
A.  The Except as provided in subsection 2-D, the applicant has held a license to sell 
malt liquor and wine for off-premises consumption for more than one year 
immediately preceding application without a violation of any provision of this Title; 
B.  The applicant will be able to stock at least $10,000 worth of spirits purchased 
from the State or the State's wholesale distributor upon issuance of an agency liquor 
store license; and 
C.  The applicant can purchase the initial stock of spirits using a bank check or other 
financial instrument that certifies that funds are available. 
Sec. A-6.  28-A MRSA §453, sub-§2-D is enacted to read: 
2-D.  Exception.  If a retailer that is located in this State and has at least 5 locations 
licensed as an agency liquor store is sold or ownership is transferred to another company 
that will assume operation of some or all of the retailer's stores and that company submits 
an application for an agency liquor store license at some or all of those stores, the bureau 
may waive the requirement of subsection 2-C, paragraph A.  The bureau may provide this 
waiver only if the applicant has held a license in another state to sell malt liquor and wine 
or spirits at retail for off-premises consumption, for at least one year prior to submitting 
the application, without a violation of the laws governing the sale of alcoholic beverages 
in that state and can provide the bureau with documentation of financial success as 
determined by the bureau. 
Sec. A-7.  28-A MRSA §606, sub-§4, as amended by PL 2003, c. 20, Pt. SS, §6 
and affected by §8 and c. 51, Pt. C, §2, is repealed. 
Sec. A-8.  28-A MRSA §606, sub-§4-A is enacted to read: 
4-A.  Discount rates for agency liquor stores; rulemaking.  Beginning July 1, 2014 
the alcohol bureau shall set the price of spirits at a minimum discount of 12% of the list 
price.  The alcohol bureau may establish discount rates greater than 12%, including 
graduated discount rates, but those discount rates must be established by rules that ensure 
that any graduated discount rate is structured in a way that does not adversely affect 
agency liquor stores that stock a low level of inventory.  Rules adopted pursuant to this 
subsection are routine technical rules as defined in Title 5, chapter 375, subchapter 2-A. 
Sec. A-9.  Price regulation rulemaking.  The Department of Administrative and 
Financial Services, Bureau of Alcoholic Beverages and Lottery Operations shall adopt or 
amend rules as necessary for the effective implementation of price regulation of the 
wholesale and retail liquor business pursuant to the Maine Revised Statutes, Title 28-A, 
section 90, subsection 7 by July 1, 2014.  Rules adopted pursuant to this section are 
routine technical rules as defined in Title 5, chapter 375, subchapter 2-A. 
Sec. A-10.  Effective date.  Those sections of this Part that repeal the Maine 
Revised Statutes, Title 28-A, section 88 and Title 28-A, section 606, subsection 4 take 
effect July 1, 2014. 
PART B 
Sec. B-1.  22-A MRSA §216 is enacted to read: 
§216.  Health Care Liability Retirement Fund 
The Health Care Liability Retirement Fund, referred to in this section as "the fund," is 
established as a nonlapsing fund within the Department of Health and Human Services. 
The fund consists of proceeds from the sale of liquor operation revenue bonds pursuant to 
Title 30-A, section 6053. The money in the fund must be used for the purpose of making 
payments to health care providers for services provided prior to December 1, 2012 under 
the MaineCare program established by Title 22, chapter 855. When, as determined by the 
commissioner, there exist no outstanding amounts owed to health care providers eligible 
to be paid from the fund, the State Controller shall transfer all amounts in the fund to the 
Liquor Operation Revenue Fund established in Title 30-A, section 6054. 
Sec. B-2.  30-A MRSA c. 225, sub-c. 5 is enacted to read: 
SUBCHAPTER 5 
LIQUOR OPERATION REVENUE BONDS 
§6051.  Declaration of public policy; funding 
The Legislature finds and declares that revenue financing bonds as authorized in this 
subchapter are tax-exempt or taxable bonds payable from sources as provided in this 
subchapter and such bonds do not include a legal or equitable claim against tax revenues 
of the State and do not represent constitutional debt of or a pledge of the full faith and 
credit of the State.  The Legislature also finds that issuance of the revenue financing 
bonds authorized in this subchapter and use of the proceeds of those bonds do not violate 
the terms of the Constitution of Maine, Article V, Part Third. 
§6052.  Definitions 
As used in this subchapter, unless the context otherwise indicates, the following 
terms have the following meanings. 
1.  Ancillary obligation.  "Ancillary obligation" means the obligation of the bond 
bank in connection with liquor operation revenue bonds issued under this subchapter 
under any of the following entered into by the bond bank: 
A.  A credit enhancement or liquidity agreement, including without limitation an 
obligation in the form of bond insurance, a surety bond, a letter of credit, a standby 
bond purchase agreement, a reimbursement agreement, liquidity facility or other 
similar arrangement; 
B.  A remarketing agreement, auction agent agreement, broker-dealer agreement or 
other agreement relating to the marketing of liquor operation revenue bonds, an 
interest rate swap or another type of swap or hedging contract; or 
C.  An investment agreement, forward purchase agreement or similarly structured 
investment contract. 
2.  Cost of issuance.  "Cost of issuance" means an item of expense directly or 
indirectly payable or reimbursable by the bond bank and related to the authorization, sale 
or issuance of liquor operation revenue bonds, including, but not limited to, underwriting 
fees and fees and expenses of professional consultants and fiduciaries. 
3.  Financing costs.  "Financing costs" means all costs of issuance, capitalized 
interest, capitalized operating expenses and debt service reserves, fees and costs of any 
ancillary obligation or other fees, expenses and costs related to issuing, securing and 
marketing liquor operation revenue bonds. 
4.  Fund.  "Fund" means the Liquor Operation Revenue Fund established in section 
6054. 
5.  Liquor operation revenue bond.  "Liquor operation revenue bond" means a 
bond, note or other evidence of indebtedness issued by the bond bank pursuant to this 
subchapter. 
§6053.  Liquor operation revenue bonds authorized 
1.  Revenue bonds.  Notwithstanding any other provision of law and upon written 
approval of the Governor, the bond bank may issue liquor operation revenue bonds of up 
to $188,500,000 plus financing costs, and excluding bonds to refund bonds, for the 
purpose of retiring amounts determined by the Commissioner of Health and Human 
Services to be owed by the State to health care providers as provided by Title 22-A, 
section 216. The bonds are payable solely from funds as provided in this subchapter. 
2.  Amount and terms.  The bond bank may issue liquor operation revenue bonds 
from time to time in amounts and upon such terms as the bond bank considers 
appropriate. The terms of the liquor operation revenue bonds, their payment schedule and 
other terms and provisions to facilitate their creditworthiness must be determined by the 
bond bank. 
3.  Form; interest; taxability.  The bond bank shall determine the terms of the liquor 
operation revenue bonds, including: 
A.  The form of the liquor operation revenue bonds; 
B.  The rate or rates at which the liquor operation revenue bonds bear interest and 
whether such interest is intended to be includable in or excludable from the gross 
income of the bond owners for federal and state income tax purposes pursuant to the 
United States Internal Revenue Code of 1986, as amended; and 
C.  The maturity, except that a liquor operation revenue bond may not mature later 
than June 30, 2024. 
4.  Not a pledge of the full faith or credit; not a debt.  Liquor operation revenue 
bonds are not in any way a debt or liability of the State and do not constitute a loan of the 
credit of the State or create any debt or debts or liability or liabilities on behalf of the 
State or constitute a pledge of the faith and credit of the State.  All liquor operation 
revenue bonds issued by the bond bank, unless funded or refunded by bonds of the bond 
bank, are payable solely from revenues or funds pledged or available for their payment as 
authorized in this subchapter.  Each liquor operation revenue bond must contain on its 
face a statement to the effect that the bond bank is obligated to pay the principal, interest 
and redemption premium, if any, solely from the revenues pledged for those purposes and 
that neither the faith and credit nor the taxing power of the State is pledged to the 
payment of the principal, interest or redemption premium, if any, on the liquor operation 
revenue bonds. 
5.  Bond proceeds.  Except as otherwise be provided under the indenture of trust or 
resolution of the bond bank authorizing the liquor operation revenue bonds, the net 
proceeds from any sale of liquor operation revenue bonds must be deposited into the 
Health Care Liability Retirement Fund established in Title 22-A, section 216. 
6.  Agreements with financial institutions.  For the purposes of this subchapter, the 
bond bank may enter into an ancillary obligation or other agreement or contract with a 
commercial bank, trust company or banking or other financial institution within or 
outside the State that is necessary, desirable or convenient in the opinion of the bond bank 
to provide any services to the bond bank to assist the bond bank in effectuating the 
purposes of this subchapter. The bond bank may enter into, amend or terminate any 
ancillary obligation or other agreement as the bond bank determines to be necessary or 
appropriate. The ancillary obligation or other agreement may include without limitation 
contracts commonly known as interest rate swap agreements, forward purchase contracts 
or guaranteed investment contracts and futures or contracts providing for payments based 
on levels of, or changes in, interest rates. These contracts may be entered into by the bond 
bank in connection with or incidental to entering into or maintaining any agreement that 
secures liquor operation revenue bonds issued under this subchapter or any investment or 
contract providing for investment of reserves or similar facility guaranteeing an 
investment rate for a period of years not to exceed the underlying terms of the liquor 
operation revenue bonds. The determination by the bond bank that an ancillary obligation 
or other agreement or the amendment or termination of an ancillary obligation or other 
agreement is necessary or appropriate as provided in this section is conclusive. An 
ancillary obligation or other agreement may contain provisions regarding payment, 
security, default, remedy, termination and payments and other terms and conditions as 
determined by the bond bank, after giving due consideration to the creditworthiness of the 
counterparty or other obligated party, including any rating by any nationally recognized 
rating agency, and to any other criteria as may be appropriate. 
A liquor operation revenue bond or any ancillary obligation or other agreement made 
pursuant to this subsection may contain a recital that it is issued or executed, respectively, 
pursuant to this subchapter. The recital is conclusive evidence of the validity of the liquor 
operation revenue bond or ancillary obligation or other agreement and of the regularity of 
the proceedings relating to them. 
7.  Remedies of holders of bonds.  If the bond bank defaults in the payment of 
principal of or interest on any issue of liquor operation revenue bonds after the principal 
and interest become due, whether at maturity or upon call for redemption or otherwise, 
and that default continues for a period of 30 days, or if the bond bank fails or refuses to 
comply with this subchapter or defaults in an agreement made with the holders of an 
issue of liquor operation revenue bonds, the holders of 25% in aggregate principal 
amount of liquor operation revenue bonds then outstanding, by instrument or instruments 
filed in the office of the clerk of courts of Kennebec County and proved or acknowledged 
in the same manner as a deed to be recorded, may appoint a trustee to represent the 
bondholders. The trustee, in the trustee's own name, by mandamus or other suit, action or 
proceeding at law or in equity, shall enforce all rights of the bondholders or holders of the 
ancillary obligations or other agreements and require the bond bank to carry out any other 
agreements with the bondholders or holders of such ancillary obligations or other 
agreements and to perform the bond bank's duties required under this subchapter, as long 
as the bonds are limited revenue obligations. An obligation to make debt service 
payments does not constitute a debt or liability of the State or any political subdivision of 
the State within the meaning of any constitutional or statutory limitation, or a loan of the 
credit of the State, or a pledge of the faith and credit of the State or any political 
subdivision of the State, and the State has no legal obligation to appropriate money for 
those payments or other such obligations. Payments of the principal of, redemption 
premium, if any, and interest on the liquor operation revenue bonds must be made solely 
from amounts derived from the fund or as otherwise authorized by this subchapter. 
Neither the faith and credit nor the taxing power of the State or of any political 
subdivision of the State is pledged to the payment of the principal of, redemption 
premium for, if any, or interest on the liquor operation revenue bonds. 
8.  State authorized to enter into contracts.  The State, including any department, 
commission, agency or other instrumentality of the State, is authorized to enter into an 
agreement, contract or other arrangement with the bond bank in connection with the 
issuance of liquor operation revenue bonds. 
9.  Reserve fund for liquor operation revenue bonds.  The bond bank may 
establish a capital reserve fund for the benefit of holders of liquor operation revenue 
bonds subject to the provisions of section 6006, subsection 5. 
10.  Agreement of the State.  The bond bank is authorized to include the following 
statement in its liquor operation revenue bonds or contracts or ancillary obligations:  "The 
State hereby pledges to and agrees with the holders of any liquor operation revenue bonds 
issued pursuant to the Maine Revised Statutes, Title 30-A, chapter 225, subchapter 5 and 
with those parties who may enter into any ancillary obligation or contract with the Maine 
Municipal Bond Bank pursuant to that subchapter that the State will not limit, alter, 
restrict or impair the rights vested in the Maine Municipal Bond Bank and in any party to 
an ancillary obligation or contract until the liquor operation revenue bonds, together with 
interest, including interest on any unpaid installment of interest and all costs and expenses 
in connection with any actions or proceedings by or on behalf of the bondholders, are 
fully met and discharged and such contracts and ancillary obligations are fully performed 
on the part of the Maine Municipal Bond Bank." 
Nothing in this subchapter precludes the limitation or alteration of the rights vested in the 
bond bank and holders of liquor operation revenue bonds if and when adequate provision 
is made by law for the protection of the holders of liquor operation revenue bonds of the 
bond bank or those entering into contracts or ancillary obligations with the bond bank. 
§6054.  Liquor Operation Revenue Fund 
1.  Fund established.  The Liquor Operation Revenue Fund, referred to in this 
section as "the fund," is a nonlapsing fund established within the bond bank to receive the 
amounts referred to in subsection 2 and to pay amounts due under the liquor operation 
revenue bonds and any ancillary obligations. The fund must be held separate and apart 
from all other money, funds and accounts of the bond bank. 
2.  Funding.  Notwithstanding section 85, subsection 1, beginning July 1, 2014, there 
must be deposited directly into the fund any amounts received pursuant to Title 28-A, 
section 90 and Title 22-A, section 216 and any other money or funds transferred or made 
available to the bond bank only for the purposes of the fund from any other source 
including without limitation amounts required to be deposited in the fund by the terms of 
any ancillary obligation or other agreement related to liquor operation revenue bonds. 
3.  Use of fund during bond retirement period; fiscal years before July 1, 2017.  
Money in the fund must be held and applied solely to the payment of the liquor operation 
revenue bonds and any ancillary obligations secured by the fund as the bonds and 
ancillary obligations become due and payable and for the retirement of liquor operation 
revenue bonds, including the payment of any redemption premium required to be paid 
when any liquor operation revenue bonds are redeemed or retired before maturity or for 
the payment of ancillary obligations; except that, to the extent there is money in the fund 
not needed in accordance with terms of the liquor operation revenue bonds and ancillary 
obligations, before June 30th of each year, the bond bank shall withdraw an amount not 
exceeding $16,714,844 in the fiscal year ending June 30, 2015, $16,639,000 in the fiscal 
year ending June 30, 2016 and $16,817,000 in the fiscal year ending June 30, 2017 to be 
paid to the State and distributed as follows: 
A.  First, to the General Fund as undedicated revenue up to $8,714,884 in the fiscal 
year ending June 30, 2015, $8,889,000 in the fiscal year ending June 30, 2016 and 
$9,067,000 in the fiscal year ending June 30, 2017; 
B.  Second, the remainder, if any, in each fiscal year divided in equal amounts to an 
account within the Department of Health and Human Services and an account within 
the Department of Environmental Protection, up to $3,500,000 per account or the 
maximum amount allowed for federal matching funds purposes under federal water 
programs, whichever is less, to be used for revolving loan funds for drinking water 
systems and wastewater treatment; and 
C.  Third, the remainder, if any, to an account within the Department of 
Transportation to be used for the construction of highways and bridges. 
4.  Use of fund during bond retirement period; from July 1, 2017 until bonds 
retired.  Money in the fund must be held and applied solely to the payment of the liquor 
operation revenue bonds and any ancillary obligations secured by the fund as the bonds 
and ancillary obligations become due and payable and for the retirement of liquor 
operation revenue bonds, including the payment of any redemption premium required to 
be paid when any liquor operation revenue bonds are redeemed or retired before maturity 
or for the payment of ancillary obligations; except that, to the extent there is money in the 
fund not needed in accordance with terms of the liquor operation revenue bonds and 
ancillary obligations, before June 30th of each year, the bond bank shall withdraw an 
amount not exceeding $7,000,000 to be paid to the State and distributed as follows: 
A.  First, in equal amounts to an account within the Department of Health and Human 
Services and an account within the Department of Environmental Protection, up to 
$3,500,000 per account or the maximum amount allowed for federal matching funds 
purposes under federal water programs, whichever is less, to be used for revolving 
loan funds for drinking water systems and wastewater treatment; and 
B.  The remainder, if any, to an account within the Department of Transportation to 
be used for the construction of highways and bridges. 
Immediately upon retirement of all outstanding liquor operation revenue bonds and 
ancillary obligations secured by the fund, the bond bank shall withdraw any excess 
money in the fund and transfer it to the Maine Budget Stabilization Fund established in 
Title 5, section 1532. 
5.  Use of fund after bond retirement.  After all liquor operation revenue bonds and 
any ancillary obligations secured by the fund have been retired, additional proceeds 
credited to the fund from Title 22-A, section 216 and Title 28-A, section 90 must be 
disbursed on a quarterly basis to the State and credited by the State Controller as follows: 
A.  The lesser of 15% and the maximum amount allowed for federal matching funds 
purposes under federal water programs, divided equally between an account within 
the Department of Health and Human Services and an account within the Department 
of Environmental Protection for revolving loan funds for drinking water systems and 
wastewater treatment; 
B.  Thirty-five percent to an account within the Department of Transportation for 
construction of highways and bridges; and 
C.  The remainder to the Maine Budget Stabilization Fund established in section 
1532. 
Sec. B-3.  Appropriations and allocations.  The following appropriations and 
allocations are made. 
ENVIRONMENTAL PROTECTION, DEPARTMENT OF 
Land and Water Quality 0248 
Initiative: Allocates funds for the state share to match available federal matching funds 
for wastewater treatment projects. 
HEALTH AND HUMAN SERVICES, DEPARTMENT OF (FORMERLY DHS) 
Health - Bureau of 0143 
Initiative: Allocates funds for the state share to match available federal matching funds 
for drinking water projects. 
OTHER SPECIAL REVENUE FUNDS 
2013-14
2014-15
All Other 
$0
$1,331,000
OTHER SPECIAL REVENUE FUNDS TOTAL 
$0
$1,331,000
ENVIRONMENTAL PROTECTION, 
DEPARTMENT OF 
DEPARTMENT TOTALS 
2013-14
2014-15
OTHER SPECIAL REVENUE FUNDS 
$0
$1,331,000
DEPARTMENT TOTAL - ALL FUNDS 
$0
$1,331,000
Health Care Liability Retirement Fund N157 
Initiative: Authorizes the expenditure of bond proceeds from the sale of liquor operation 
revenue bonds for the state share of payments to health care providers for services 
provided prior to December 1, 2012. 
Medical Care - Payments to Providers 0147 
Initiative: Allocates the federal share of payments to health care providers for services 
provided prior to December 1, 2012. 
OTHER SPECIAL REVENUE FUNDS 
2013-14
2014-15
All Other 
$0
$1,331,000
OTHER SPECIAL REVENUE FUNDS TOTAL 
$0
$1,331,000
OTHER SPECIAL REVENUE FUNDS 
2013-14
2014-15
All Other 
$188,500,000
$0
OTHER SPECIAL REVENUE FUNDS TOTAL 
$188,500,000
$0
FEDERAL EXPENDITURES FUND 
2013-14
2014-15
All Other 
$301,700,000
$0
FEDERAL EXPENDITURES FUND TOTAL 
$301,700,000
$0
HEALTH AND HUMAN SERVICES, 
DEPARTMENT OF (FORMERLY DHS) 
DEPARTMENT TOTALS 
2013-14
2014-15
FEDERAL EXPENDITURES FUND 
$301,700,000
$0
OTHER SPECIAL REVENUE FUNDS 
$188,500,000
$1,331,000
DEPARTMENT TOTAL - ALL FUNDS 
$490,200,000
$1,331,000
SECTION TOTALS 
2013-14
2014-15
FEDERAL EXPENDITURES FUND 
$301,700,000
$0
OTHER SPECIAL REVENUE FUNDS 
$188,500,000
$2,662,000
SECTION TOTAL - ALL FUNDS 
$490,200,000
$2,662,000
PART C 
Sec. C-1.  28-A MRSA §81, sub-§1, as amended by PL 1999, c. 535, §3, is 
further amended to read: 
1.  Oversight of Bureau of Alcoholic Beverages and Lottery Operations.  The 
commission shall monitor the operation of the alcohol bureau in its administration of the 
laws relating to the sale of spirits and fortified wine. 
Sec. C-2.  28-A MRSA §81, sub-§2, as amended by PL 1999, c. 535, §3, is 
further amended to read: 
2.  Advice.  The commission shall advise the director of the alcohol bureau regarding 
the administration of the functions of the alcohol bureau.  The commission may advise 
the Governor and the Legislature regarding issues relating to the operation of the alcohol 
bureau and the administration of the laws relating to the sale of spirits and fortified wine. 
Sec. C-3.  28-A MRSA §83, as amended by PL 2011, c. 693, §§1 and 2, is further 
amended to read: 
§83.  Bureau of Alcoholic Beverages and Lottery Operations 
1.  Bureau of Alcoholic Beverages and Lottery Operations; rules.  Until the 
effective date of the privatization of the entire wholesale liquor business authorized by 
section 88, the The alcohol bureau or a wholesale liquor provider contracted pursuant to 
section 90 shall manage the sale, distribution and merchandising of spirits and fortified 
wine through state liquor stores, agency liquor stores and licensees.  The alcohol bureau 
may establish rules and procedures for the administration of the state liquor laws under its 
jurisdiction.  The rules adopted under this section are routine technical rules pursuant to 
Title 5, chapter 375, subchapter 2-A.  The day-to-day activities of the alcohol bureau are 
under the supervision of the Commissioner of Administrative and Financial Services and 
the director of the alcohol bureau. 
2.  Purchase.  Until the effective date of the privatization of the wholesale liquor 
business authorized by section 88, the The alcohol bureau or a wholesale liquor provider 
contracted pursuant to section 90 may buy and have in its possession spirits and fortified 
wine for sale to the public.  The alcohol bureau shall buy spirits directly and not through 
the State Purchasing Agent.  All spirits and fortified wine must be free from adulteration 
and misbranding. 
3.  Sell at retail.  The alcohol bureau may sell at retail in state liquor stores in 
original packages, either over the counter or by shipment to points within the State, spirits 
of all kinds and fortified wine for consumption off the premises of state liquor stores 
operated under the direction of the alcohol bureau. 
4.  Enter into contracts.  Subject to any applicable laws relating to public contracts, 
the alcohol bureau may enter into contracts or agreements and establish contract 
performance standards for the wholesale purchase of spirits and fortified wine. 
5.  Investigate and recommend changes.  The alcohol bureau shall carry out a 
continuous study and investigation of the sale of alcoholic beverages throughout the State 
and the operation and administration of state activities and recommend to the 
Commissioner of Administrative and Financial Services any changes in the laws or rules 
and methods of operation that are in the best interest of the State.  By December 1, 2012, 
the commissioner shall conduct a cost-benefit analysis of the discount price at which 
agency liquor stores purchase spirits and fortified wine from the State or wholesale liquor 
provider contracted by the State that includes consideration of how the discount price 
may be adjusted to allow agency liquor stores' revenue trends to mirror proportionally 
any upward trend in spirits sales and revenue realized by the State or the State's wholesale 
liquor provider.  The commissioner shall update the cost-benefit analysis at least every 2 
years and shall make the analysis available, upon request, to the joint standing committee 
of the Legislature having jurisdiction over alcoholic beverages matters. 
5-A.  Sales incentives to agents; rules.  The alcohol bureau may adopt rules to 
provide for a sales incentive program for agency liquor stores.  The alcohol bureau shall 
consider federal regulations that govern sales incentives for alcoholic beverages and the 
effect of a sales incentive program on General Fund revenue and pending or existing 
contracts with a wholesale liquor provider when developing an incentive program.  
Notwithstanding subsection 1, rules adopted in accordance with this subsection are major 
substantive rules pursuant to Title 5, chapter 375, subchapter 2-A. 
6.  Certification; annual report.  The alcohol bureau shall certify monthly to the 
Treasurer of State, the commission and the Commissioner of Administrative and 
Financial Services a complete statement of the revenues and expenses for liquor sales for 
the preceding month.  The alcohol bureau shall make an annual report to the Governor of 
its activities and of the amount of liquor license fees collected by the bureau, together 
with other information it considers advisable or that the Governor requires. 
7.  Public meetings.  The alcohol bureau and the commission may hold public 
meetings each year at various locations within the State for the purpose of outlining 
operations under the liquor laws, receiving suggestions and disseminating information to 
the public. 
Sec. C-4.  28-A MRSA §84, sub-§1, as corrected by RR 1999, c. 2, §29, is 
amended to read: 
1.  Manage sale of spirits.  Manage the sale of spirits and fortified wine through 
state liquor stores, agency liquor stores and licensees in accordance with applicable laws 
and rules that provide for the operation of wholesale distribution of spirits and fortified 
wine; 
Sec. C-5.  28-A MRSA §85, sub-§2, as enacted by PL 1997, c. 373, §28, is 
amended to read: 
2.  Inventory.  The alcohol bureau may keep and have on hand a stock of spirits and 
fortified wine for sale, the value of which, when priced for resale must be computed on 
the delivered case cost F.O.B. liquor warehouse designated by the commission filed by 
liquor suppliers.  The inventory value must be based upon actual cost for which payment 
may be due and may not at any time exceed the amount of working capital authorized.  
Spirits and fortified wine may not be considered in the inventory until payment has been 
made for them. 
Sec. C-6.  28-A MRSA §453-C, sub-§1, as amended by PL 2005, c. 539, §5, is 
further amended to read: 
1.  Agent licensed to resell spirits purchased from the alcohol bureau.  An agent 
licensed to resell spirits and fortified wine purchased from the State to a retail licensee 
licensed for on-premises consumption must be licensed as a reselling agent.  An agent is 
prohibited from reselling liquor to a retail licensee licensed for on-premises consumption 
except for spirits and fortified wine purchased from the alcohol bureau or a state liquor 
store.  A reselling agent may not resell fortified wine purchased from wholesalers 
licensed to sell beer and wine in the State. 
Sec. C-7.  28-A MRSA §453-C, sub-§2, as enacted by PL 2001, c. 711, §6, is 
amended to read: 
2.  License fee.  The fee for a state license to resell spirits and fortified wine to a 
retail licensee licensed for on-premises consumption is $50 annually. 
Sec. C-8.  28-A MRSA §461, first ¶, as enacted by PL 2011, c. 140, §1, is 
amended to read: 
An agency liquor store shall maintain a minimum number of product codes in 
accordance with this section.  For the purposes of this section, "product code" means a 
single spirit or fortified wine product purchased from the State or the State's wholesale 
distributor. 
Sec. C-9.  28-A MRSA §501, as enacted by PL 2003, c. 20, Pt. SS, §4 and 
affected by §8 and c. 51, Pt. C, §2, is amended to read: 
§501.  Wholesale liquor provider; definition 
As used in this chapter, unless the context otherwise indicates, "wholesale liquor 
provider" means an entity or entities contracted by the State as an agent of the State for 
the purpose of providing wholesale spirits and fortified wine to establishments licensed 
by the State to sell spirits and fortified wine for off-premises consumption. 
Sec. C-10.  28-A MRSA §503, as enacted by PL 2003, c. 20, Pt. SS, §4 and 
affected by §8 and c. 51, Pt. C, §2, is amended to read: 
§503.  Sale to on-premises licensees prohibited 
A wholesale liquor provider shall sell spirits and fortified wine to establishments 
licensed by the State to sell liquor for off-premises consumption.  A wholesale liquor 
provider is prohibited from selling spirits and fortified wine directly to establishments 
licensed by the State to sell liquor for on-premises consumption. 
Sec. C-11.  28-A MRSA §606, sub-§8, as amended by PL 2005, c. 539, §6, is 
further amended to read: 
8.  Limits on price.   An agency liquor store shall sell all spirits and fortified wine 
purchased from the alcohol bureau at the retail price established by the commission. 
Sec. C-12.  28-A MRSA §1651, sub-§1, as amended by PL 1999, c. 166, §1, is 
further amended to read: 
1.  State liquor tax.  Except as provided in subsection 2, the commission shall 
determine and set the list price at which to sell all spirits and fortified wine that will 
produce an aggregate state liquor tax sufficient to pay all liquor-related expenses of the 
Bureau of Alcoholic Beverages and Lottery Operations and to return to the General Fund 
an amount substantially equal to the amount of state liquor tax collected in the previous 
fiscal year.   With the exception of the discount agency liquor stores in Kittery and Calais, 
list prices must be uniform statewide. 
C.  The commission shall add any cost to the State related to handling containers 
returned for refund pursuant to Title 32, section 1863-A to the established price 
without markup. 
Sec. C-13.  Effective date.  This Part takes effect July 1, 2014. 
Emergency clause.  In view of the emergency cited in the preamble, this 
legislation takes effect when approved, except as otherwise indicated. 
SUMMARY 
This bill is based on Legislative Document 1546, except that it specifies that the 
application fees are capped at $5,000 for a bid for spirits trade marketing and $20,000 for 
a bid for spirits administration and warehousing and distribution and it eliminates those 
provisions of Legislative Document 1546 that propose to expand coverage under the 
MaineCare program. 
Part A repeals current law that allows for transfer of the State's wholesale liquor 
business through July 1, 2014. Part A directs the Commissioner of Administrative and 
Financial Services to develop a request for proposals through the competitive bid process 
to award 2 contracts, one for the operation of the State's wholesale liquor business 
encompassing spirits administration and warehousing and distribution and one for spirits 
trade marketing.  Part A also increases the discount rate at which agency liquor stores 
purchase spirits for retail sale from the current minimum of 9% of list price to 12% as of 
July 1, 2014.  Part A allows the waiver of a licensing requirement in the event that a 
retailer with more than 5 agency liquor stores in this State is purchased or control is 
transferred to another company not in this State as long as the purchasing or controlling 
company has held a license to sell beer and wine in another state for at least one year. 
Part B authorizes the bond bank, with the written approval of the Governor, to issue 
liquor operation revenue bonds in an amount up to $188,500,000. Part B establishes 2 
funds, the Health Care Liability Retirement Fund and the Liquor Operation Revenue 
Fund. The Health Care Liability Retirement Fund is funded with the revenue from the 
sale of the bonds and used to pay debts owed by the State for services provided by health 
care providers prior to December 1, 2012; anything in excess of the amount owed is 
transferred to the Liquor Operation Revenue Fund. The Liquor Operation Revenue Fund 
is funded by revenue from the management of wholesale liquor activities; such revenue 
will be used to pay the principal and interest of the liquor operation revenue bonds as 
those amounts become due. 
During fiscal years 2014-15, 2015-16 and 2016-17, any excess revenue up to a set 
amount is transferred to the General Fund to offset the amounts included in budgeted 
General Fund revenue from liquor sales and operations and to offset additional General 
Fund costs for liquor enforcement activities; after those transfers in those fiscal years and 
for the rest of the bond repayment period, excess revenue over the set amount, up to 
$7,000,000 per year, is transferred to the Department of Health and Human Services and 
the Department of Environmental Protection for revolving loan funds for drinking water 
systems and wastewater treatment, and, if the amount transferred for those loans is 
limited for federal matching funds purposes, any remainder is transferred to the 
Department of Transportation for construction of highways and bridges.  Any excess 
funds retained by the Maine Municipal Bond Bank during the bond repayment period 
must be transferred to the Maine Budget Stabilization Fund immediately upon retirement 
of the bonds.  Following the retirement of the bonds, excess revenue is also transferred to 
the Maine Budget Stabilization Fund. 
Part C removes the administration of the sale of fortified wine by the State, beginning 
July 1, 2014.