An Act To Create a Framework for Maine's Spirits Contract
Maine Legislature, Session 130, LD 1750
Committee Amendment CA_A_S490 (Senate)
Amends: 28-A MRSA §90, 28-A MRSA §83-C, 28-A MRSA §606

COMMITTEE AMENDMENT ",4 " to S.P. 608, L.D. 1750, "An Act To Create a 
Framework for Maine's Spirits Contract" 
Amend the bill by striking out everything after the enacting clause and inserting the 
following: 
'PART A 
Sec. A-1. 28-A MRSA §90, as enacted by PL 2013, c. 269, Pt. A, §4 and amended 
by c. 368, Pt. V, §61, is repealed and the following enacted in its place: 
§90. Contract for wholesale spirits activities and marketing 
1. Statement of purpose. The Legislature finds that it is in the public interest to 
continue to 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 serves this purpose and 
provides 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 spirits administration and trade marketing. Upon the expiration 
or termination of all contracts for the operation of the State's wholesale spirits business in 
effect on January 1, 2022, the commissioner shall enter into a single 10-year contract for 
spirits administration and spirits trade marketing in accordance with the requirements in 
this section. 
3. Competitive bid process. A contract described in subsection 2 must be awarded 
pursuant to a competitive bid process in a manner consistent with the process described in 
Title 5, chapter 155, subchapter 1-A. 
4. Request for proposals. The commissioner shall develop a request for proposals for 
the competitive bid process required under subsection 3 designed to encourage vigorous 
bidding. The request for proposals must: 
A. Inform potential bidders of the State's target gross revenue profit margin over the 
term of the contract; 
COMMITTEE AMENDMENT 
COMMITTEEAMENDMENT"A "to S.P. 608,L.D. 1750 {S* 1-JCI~ 
B. Instruct potential bidders to propose the scope of spirits administration and spirits 
trade marketing services that will be provided and the fee for those services expressed 
as a percentage of revenue generated by the wholesale business; 
C. Direct potential bidders to indicate whether subcontractors will be used for any 
portion of the services described in paragraph B and to identify those subcontractors; 
D. Inform potential bidders that they may propose incentives intended to encourage 
responsible growth of revenue and enhanced efficiencies in services provided; and 
E. Require each bidder to affirm that neither the bidder nor any of the principal officers 
of the bidder has a direct fmancial interest in a license or permit in this State or another 
state for the manufacture of spirits, other than a minor investment in not more than 1 % 
of the securities of a business entity that holds such a license or permit. 
5. Information provided by bidder. A bidder seeking consideration of the award of 
a contract pursuant to this section shall: 
A. Demonstrate the bidder's knowledge of the wholesale liquor business, the alcoholic 
beverage industry or a related field as well as the bidder's experience or knowledge, if 
any, of the responsible marketing of liquor; 
B. Propose the bidder's marketing strategies and the scope of the spirits administration 
services the bidder will provide as well as the fee for those strategies and services 
expressed as a percentage of revenue generated by the wholesale business; 
C. Identify the strategies and services proposed in paragraph B for which the bidder 
may use a subcontractor and identify those subcontractors; 
D. Demonstrate the bidder's fmancial capacity and access to capital to maintain the 
strategies and services proposed in paragraph B; 
E. Demonstrate the bidder's capabilities for providing transportation and distribution 
of spirits to agency liquor stores, which must include: 
(1) Delivery vehicles with the appropriate capacity to deliver spirits to the full 
range of agency liquor stores, including both large and small stores; 
{2) Drivers with the requisite driver's license credentials to drive all sizes of 
delivery vehicles; 
{3) The ability to make deliveries to agency liquor stores on at least 250 days per 
year;and 
(4) The ability to provide the minimum number of deliveries established in the 
request for proposals per week to each store, which may not be less than 2; 
F. Demonstrate the bidder's warehousing capacity and ability to expand its 
warehousing capacity over the term of the contract. The bidder shall propose bailment 
rates and related fees that the bidder proposes to charge spirits suppliers; 
G. Describe the bidder's information technology capabilities, which must include 
methods for processing orders and invoices, inventory management and sales data 
analysis; 
H. Describe the bidder's plan for enhancing services to spirits suppliers and agency 
liquor stores; 
COMMITTEE AMENDMENT 
COMMITTEEAMENDMENT"A "to S.P. 608,L.D.1750 (s~~40 
I. Describe the bidder's business plan to provide services in a manner that will assist 
the State in achieving a responsible growth rate for the wholesale spirits business; 
J. Demonstrate the positive impact on the economy, employment and state revenues 
that the bidder's overall proposal will provide; 
K. Demonstrate that the bidder, any principal officer of the bidder and any named 
subcontractor have not been found to have violated any state or federal law or rule 
governing the manufacture, distribution or sale of spirits; and 
L. Affirm that neither the bidder nor any of the principal officers of the bidder has a 
direct financial interest in a license or permit in this State or another state for the 
manufacture of spirits, other than a minor investment in not more than 1 % of the 
securities of a business entity that holds such a license or permit. 
In addition to the requirements of paragraphs A to L, the commissioner, in order to ensure 
that the objective of maximizing growth in the State's wholesale spirits business is 
achieved, may require a bidder 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. 
6. Award criteria and issuance of contract. 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 5. 
The 
commissioner may not award the contract to a bidder that holds or has a direct financial 
interest in, or that has a principal officer that holds or has a direct financial interest in, a 
license or permit in this State or another state to manufacture spirits. A minor investment 
in not more than 1 % of the securities of a business entity that holds a license or permit in 
this State or another state to manufacture spirits does not constitute a financial interest 
prohibited by this subsection. 
The commissioner shall ensure that the following criteria are met before entering into a 
contract: 
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; 
C. That the bidder has demonstrated that services provided to agency liquor stores will 
be enhanced; and 
D. That, upon execution of the contract, the disruption of services to agency liquor 
stores and spirits suppliers will be minimal or absent. 
7. Mandatory contract provisions. A contract entered into with a successful bidder 
in accordance with this section must: 
A. Require that the person awarded the contract submit to the bureau, in a manner 
determined by the bureau, an annual report audited by an independent 3rd party. The 
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; 
COMMITTEE AMENDMENT 
COMMITTEE AMENDMENT" ft "to S.P. 608, L.D. 1750 ( ~- l.j o/Dj 
B. 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; 
C. 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: 
(1) Working in partnership with the State to achieve the goal of a responsible 
growth rate for the wholesale spirits business as negotiated with the successful 
bidder at the time of award; 
(2) Transparency in annual reporting and conformance to the reporting 
requirements established in consultation with the successful bidder throughout the 
term of the contract by the bureau; and 
(3) Responsiveness to the service needs of agency liquor stores; 
D. Include provisions establishing standards of efficiency and quality of operations; 
and 
E. Require that the bureau approve all bailment rates and related fees. 
8. Extension. The commissioner and a successful bidder awarded a contract under this 
section may agree to a single extension of the existing terms of the contract for a period of 
no more than 3 years following the end of the original 10-year contract term. 
9. Price regulation. Notwithstanding any other provision of this section to the 
contrary, the State shall regulate the wholesale and retail prices of all spirits sold in the 
State. 
Sec. A-2. No effect on existing contracts. Nothing in this Act is intended to affect 
the validity of or cause a premature termination of the spirits administration and spirits 
trade marketing contracts under the Maine Revised Statutes, Title 28-A, section 90 that 
were in effect on the day prior to the effective date of this Act. 
PARTB 
Sec. B-1. 28-A MRSA §83-C, sub-§5, as enacted by PL 2013, c. 476, Pt. A, §9, is 
repealed. 
Sec. B-2. 28-A MRSA §606, sub-§4-A, as amended by PL 2019, c. 404, §10, is 
repealed and the following enacted in its place: 
4-A. Discount rates for agency liquor stores; rulemaking. Beginning July 1, 2014, 
the bureau shall set the wholesale price of spirits, which is the price an agency liquor store 
pays to purchase spirits, at a minimum discount of 12% off the retail price. Upon the 
expiration or termination of all contracts for the operation of the State's wholesale spirits 
business in effect on January 1, 2022, the bureau shall set the wholesale price of spirits, 
7 
which is the price an agency liquor store pays to purchase spirits, at a minimum discount 
8 
of 18% off of the retail price. 
The bureau by rule may establish discount rates greater than the minimum discount rates 
established in this subsection, including: 
COMMITTEE AMENDMENT 
,.,--, 
:-'-<.• 
,,.,_, 
COMMITTEE AMENDMENT" fl "to S.P. 608, L.D. 1750( S-tff 0 
A. Graduated discount rates, which must be structured in a way that does not adversely 
affect agency liquor stores that stock a low level of inventory; and 
B. Increased discount rates to be awarded as part of a sales incentive program for 
agency liquor stores. In adopting a sales incentive program under this paragraph, the 
bureau shall consider the effect of the sales incentive program on state revenue and on 
any pending or existing contracts awarded under section 90. 
Rules adopted pursuant to this subsection are routine technical rules as defined in Title 5, 
chapter 375, subchapter 2-A. 
Sec. B-3. 
Report on discount rate rulemaking. 
The Department of 
Administrative and Financial Services, Bureau of Alcoholic Beverages and Lottery 
Operations shall submit a report to the joint standing committee of the Legislature having 
jurisdiction over alcoholic beverages matters no later than February 1, 2023 describing the 
steps taken by the bureau after the effective date of this Act to adopt or amend or to propose 
to adopt or amend rules governing the wholesale prices of spirits under the Maine Revised 
Statutes, Title 28-A, section 606, subsection 4-A, including rules establishing graduated 
discount rates or a sales incentive program for agency liquor stores. The report must 
include a copy of any rules finally adopted after the effective date of this Act or a 
description of the substance of the rules that the bureau has proposed or intends to propose 
for adoption after the effective date of this Act. The joint standing committee of the 
Legislature having jurisdiction over alcoholic beverages matters may report out legislation 
based upon the report to any session of the 131st Legislature. 
Sec. B-4. 
Bureau of Alcoholic Beverages and Lottery Operations to 
convene stakeholder group regarding sale and distribution of certain spirits 
products; report. The Department of Administrative and Financial Services, Bureau of 
Alcoholic Beverages and Lottery Operations shall convene a stakeholder group to consider 
changes to the law that would allow the importation and sale of spirits products containing 
between 8% and 15% alcohol by volume by certificate of approval holders under the Maine 
Revised Statutes, Title 28-A, section 1361 and that would allow the production and sale of 
such spirits products by in-state manufacturers of malt liquor or wine licensed under Title 
28-A, section 1355-A. The stakeholder group must include, at a minimum, agency liquor 
stores; on-premises and off-premises retail licensees; certificate of approval holders under 
Title 28-A, sections 1361 and 1381; in-state manufacturers licensed under Title 28-A, 
section 1355-A, including small breweries and small distilleries; and wholesale licensees. 
The stakeholder group shall hold at least 3 meetings for the purpose of considering the 
following: 
1. Changes to current law that would allow retailers licensed to sell malt liquor or wine 
for on-premises or off-premises consumption that are not agency liquor stores to sell spirits 
products containing between 8% and 15% alcohol by volume, including but not limited to 
amending the definition of "low-alcohol spirits products" and creating a new category of 
spirits product that includes products commonly known as "ready-to-drink" cocktails; and 
2. Changes to current law that would establish the category of the spirits products 
identified in subsection 1 that certificate of approval holders under Title 28-A, section 13 61 
should be authorized to import and sell and that manufacturers of malt liquor or wine 
licensed under Title 28-A, section 1355-A should be authorized to produce and sell; the 
COMMITTEE AMENDMENT 
COMMITTEE AMENDMENT" A "to S.P. 608, L.D. 1750 c~~ Lj q& 
categories of the spirits products identified in subsection 1 that wholesale licensees should 
be authorized to distribute for resale; and the categories of spirits products identified in 
subsection 1 that the State should continue to distribute to agency liquor stores. 
No later than March 1, 2023, the bureau shall submit a report summarizing any 
conclusions reached and proposals supported by the stakeholder group, which may include 
suggested legislation, to the joint standing committee of the Legislature having jurisdiction 
over alcoholic beverages matters. The committee may report out legislation related to the 
report to the 131st Legislature in 2023.' 
Amend the bill by relettering or renumbering any nonconsecutive Part letter or section 
number to read consecutively. 
SUMMARY 
This amendment replaces the bill, which is a concept draft. 
Part A of the amendment: 
1. Directs the Commissioner of Administrative and Financial Services to award a 
single 10-year contract for spirits administration and spirits trade marketing through a 
competitive bidding process for a contract term that will begin when the current contracts 
for spirits administration and spirits trade marketing expire; 
2. Directs the commissioner to develop a request for proposals that is designed to 
encourage vigorous bidding and that requires bidders to provide detailed information, 
including: information regarding the bidder's prior experience and knowledge of the 
relevant industries; a description of the bidder's proposed marketing strategies and the 
scope of the spirits administration services the bidder will provide, as well as the fee that 
the bidder will charge for these strategies and services; an identification of the services for 
which the bidder proposes to use a subcontractor and the identity of that subcontractor; 
information demonstrating the bidder's financial capacity and access to capital; a 
description of the bidder's capabilities for providing transportation and distribution of 
spirits to agency liquor stores, including its capability to make deliveries on a minimum of 
days per year and, for each agency liquor store, a minimum of 2 deliveries per week; 
information demonstrating the bidder's warehousing capabilities and ability to expand its 
warehouse capacity over the term of the contract; a description of the bidder's information 
technology capabilities related to invoicing, inventory management and sales data analysis; 
and information demonstrating that the bidder's proposal will enhance services to agency 
liquor stores, assist the State in achieving a responsible growth rate for the spirits business 
and positively impact the state economy. In addition, the commissioner shall require each 
bidder to demonstrate that the bidder, each principal officer of the bidder and any named 
subcontractor have not been found to have violated any state or federal law or rule 
governing the manufacture, distribution or sale of spirits. Each bidder must also affirm that 
neither the bidder nor any of the bidder's principal officers has a direct financial interest in 
a license or permit in any state for the manufacture of spirits, other than a minor investment 
in not more than 1 % of the securities of a business entity holding such a license or permit; 
3. Establishes the criteria for issuance of the contract and mandatory contract 
provisions, including those regarding auditing, oversight and performance review, which 
closely adhere to the law that was in effect when the commissioner entered into the current 
spirits administration and spirits trade marketing contracts; and 
COMMITTEE AMENDMENT 
COMMITTEE AMENDMENT" /1 "to S.P. 608, L.D. 1750 ( S-'-1'1 D) 
4. Authorizes the commissioner and the successful bidder to agree to a single extension 
of the contract for a period of no more than 3 years following the end of the original 10-
year contract term. 
Part B of the amendment: 
1. When the new spirits administration and spirits trade marketing contract described 
in Part A takes effect, increases from 12% to 18% the statutory minimum discount rate for 
agency liquor stores. The discount rate is the percentage taken off of the retail price when 
calculating the wholesale price that an agency liquor store pays to purchase spirits from the 
State; 
2. Combines within one statutory provision the Department of Administrative and 
Financial Services, Bureau of Alcoholic Beverages and Lottery Operations' authority to 
adopt rules establishing discount rates above the statutory minimum, including graduated 
discount rates and increased discount rates to be awarded as part of a sales incentive 
program for agency liquor stores and specifies that these are routine technical rules; 
3. Requires the bureau to submit a report to the joint standing committee of the 
Legislature having jurisdiction over alcoholic beverages matters by February 1, 2023 on its 
proposals to adopt new or to amend existing rules governing discount rates. The committee 
is authorized to report out legislation based on the report to any session of the 131 st 
Legislature; and 
4. Directs the bureau to convene a stakeholder group to consider changes to the law 
that would allow the production, importation and sale of spirits products containing 
between 8% and 15% alcohol by volume by certificate of approval holders under the Maine 
Revised Statutes, Title 28-A, section 1361 and by in-state manufacturers of malt liquor or 
wine licensed under section 1355-A. 
FISCAL NOTE REQUIRED 
(See attached) 
COMMITTEE AMENDMENT 
Fiscal Detail and Notes 
Approved: 03/19/22 ;'k?ae 
LD 1750 
LR2226(02) 
An Act To Create a Framework for Maine's Spirits Contract 
Fiscal Note for Bill as Amended by Committee Amendment '';f' ( S-l.\ 96) 
Committee: Veterans and Legal Affairs 
Fiscal Note Required: Yes 
Fiscal Note 
Minor cost increase - General Fund 
Any additional costs to the Bureau of Alcoholic Beverages and Lottery Operations within the Department of 
Administrative and Financial Services as a result of changes to the criteria used to evaluate a new contract for spir: 
administration and spirits trade marketing when the current contracts expire are anticipated to be minor and can be 
absorbed within existing budgeted resources. 
LR2226(02) - Fiscal Note - Page 1 of 1