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Article III - State Control Commission

      (235 ILCS 5/Art. III heading)ARTICLE III. STATE CONTROL COMMISSION

(235 ILCS 5/3‑1) (from Ch. 43, par. 97)     Sec. 3‑1. There is hereby created an Illinois Liquor Control Commission consisting of 7 members to be appointed by the Governor with the advice and consent of the Senate, no more than 4 of whom shall be members of the same political party. (Source: P.A. 91‑798, eff. 7‑9‑00.)

(235 ILCS 5/3‑2) (from Ch. 43, par. 98)     Sec. 3‑2. Immediately, or soon as may be after the effective date of this Act, the Governor shall appoint 3 members of the commission, one of whom shall be designated as "Chairman", one to hold office for a period of 2 years, one to hold office for a period of 4 years and one to hold office for a period of 6 years. Immediately, or as soon as may be after the effective date of this amendatory Act of 1983, the Governor shall appoint 2 members to the commission to the offices created by this amendatory Act of 1983, one for an initial term expiring the third Monday in January of 1986 and one for an initial term expiring the third Monday in January of 1988. At the expiration of the term of any such commissioner the Governor shall reappoint said commissioner or appoint a successor of said commissioner for a period of 6 years. The Governor shall have power to fill vacancies in the office of any commissioner.     Notwithstanding any provision of this Section to the contrary, the term of office of each member of the commission is abolished on the effective date of this amendatory Act of 1985, but the incumbent members shall continue to exercise all of the powers and be subject to all of the duties of members of the commission until their respective successors are appointed and qualified. The Governor shall appoint 2 members of the commission whose terms of office shall expire on February 1, 1986, 2 members of the commission whose terms of office shall expire on February 1, 1988, and one member of the commission whose term shall expire on February 1, 1990. Their respective successors shall be appointed for terms of 6 years from the first day of February of the year of appointment. Each member shall serve until his successor is appointed and qualified.     The initial term of both of the 2 additional members appointed pursuant to this amendatory Act of the 91st General Assembly shall expire on February 1, 2006. Their respective successors shall be appointed for terms of 6 years from the first day of February of the year of appointment. Each member shall serve until his or her successor is appointed and qualified. (Source: P.A. 91‑798, eff. 7‑9‑00.)

(235 ILCS 5/3‑3) (from Ch. 43, par. 99)     Sec. 3‑3. A majority of the commission shall constitute a quorum to transact business, but no vacancy shall impair the right of the remaining commissioners to exercise all of the powers of the commission; and every act of a majority of the members of the commission shall be deemed to be the act of the commission. The commission shall have a secretary who shall keep a record of all proceedings, transactions, communications and official acts of the commission and who shall be custodian of all records and perform such other duties as the commission may prescribe. (Source: P.A. 82‑783.)

(235 ILCS 5/3‑4) (from Ch. 43, par. 100)     Sec. 3‑4. The commission shall obtain, pursuant to the provisions of the "Personnel Code" enacted by the 69th General Assembly, such inspectors, clerks and other employees as may be necessary to carry out the provisions of this Act, or to perform the duties and exercise the powers conferred by law upon the commission. (Source: P.A. 82‑783.)

(235 ILCS 5/3‑5) (from Ch. 43, par. 101)     Sec. 3‑5. Each commissioner, the secretary, and each person appointed by the commission shall, before entering upon the duties of his office, take and subscribe to the constitutional oath of office. The secretary and each inspector, clerk and other employee shall devote his entire time to the duties of his office. (Source: P.A. 82‑783.)

(235 ILCS 5/3‑6) (from Ch. 43, par. 102)     Sec. 3‑6. No person shall be appointed a commissioner, secretary, or inspector for the commission who is not a citizen of the United States. No commissioner, secretary, inspector, or other employee shall be appointed who has been convicted of any violation of any Federal or State law concerning the manufacture or sale of alcoholic liquor prior or subsequent to the passage of this Act or who has paid a fine or penalty in settlement of any prosecution against him for any violation of such laws or shall have forfeited his bond to appear in court to answer charges for any such violation, nor shall any person be appointed who has been convicted of a felony. No commissioner, inspector or other employee, may, directly or indirectly, individually or as a member of a partnership, or as a shareholder of a corporation, have any interest whatsoever in the manufacture, sale or distribution of alcoholic liquor, nor receive any compensation or profit therefrom, nor have any interest whatsoever in the purchases or sales made by the persons authorized by this Act, or to purchase or to sell alcoholic liquor. No provision of this section shall prevent any such commissioner, secretary, inspector or other employee from purchasing and keeping in his possession for the use of himself or members of his family or guests any alcoholic liquor which may be purchased or kept by any person by virtue of this Act. (Source: P.A. 83‑1254.)

(235 ILCS 5/3‑7) (from Ch. 43, par. 103)     Sec. 3‑7. No commissioner, secretary, or person appointed or employed by the commission, shall solicit or accept any gift, gratuity, emolument or employment from any person subject to the provisions of this Act, or from any officer, agent or employee thereof, nor solicit, request from or recommend, directly or indirectly, to any such person or to any officer, agent or employee thereof, the appointment of any person to any place or position, and every such person, and every officer, agent or employee thereof, is hereby forbidden to offer to any commissioner, secretary, or to any person appointed or employed by the commission, any gift, gratuity, emolument or employment. If any commissioner, secretary or any person appointed or employed by the commission, shall violate any of the provisions of this Section, he shall be removed from the office or employment held by him. Every person violating the provisions of this Section shall be guilty of a Class A misdemeanor. (Source: P.A. 82‑783.)

(235 ILCS 5/3‑8) (from Ch. 43, par. 104)     Sec. 3‑8. Before entering upon the duties of his office, each commissioner shall give a bond, with surety to be approved by the Governor, in the sum of five thousand dollars ($5,000) for the faithful performance of his duties as such commissioner. Before entering upon the duties of his office the secretary shall give a bond, with surety to be approved by the Governor, in the sum of five thousand dollars ($5,000) for the faithful performance of his duties as secretary. (Source: P.A. 82‑783.)

(235 ILCS 5/3‑9) (from Ch. 43, par. 105)     Sec. 3‑9. Compensation of commissioners, secretary, and employees. The chairman of the Commission shall receive an annual salary of $32,000 or such greater amount as may be set by the Compensation Review Board. The other commissioners shall receive an annual salary of $28,000 or such greater amount as may be set by the Compensation Review Board. The secretary of the Commission shall receive an annual salary as set by the Compensation Review Board. All clerks, inspectors, and employees of the Commission shall receive reasonable compensation in an amount fixed by the Commission, subject to the approval in writing of the Governor. (Source: P.A. 91‑798, eff. 7‑9‑00.)

(235 ILCS 5/3‑10) (from Ch. 43, par. 106)     Sec. 3‑10. The commissioners, the secretary, and all clerks, inspectors and other employees shall be reimbursed for all actual and necessary traveling and other expenses and disbursements incurred or made by them in the discharge of their official duties. The commission may also incur necessary expenses for office furniture and other incidental expenses. (Source: P.A. 82‑783.)

(235 ILCS 5/3‑11) (from Ch. 43, par. 107)     Sec. 3‑11. Principal office; meetings; seal; proceedings. The principal office of the Commission shall be in Chicago, but the Commission may, with the approval of the Governor, establish and maintain branch offices at other places. The Commission shall hold regular meetings at least once a month at its office, and may hold such special meetings as it may deem necessary at any time and at any place within the State. The Commission may, for authentication of its records, process and proceedings, adopt, keep and use a common seal, of which seal judicial notice shall be taken in all of the courts of the State, and any process, notice or other paper which the Commission may be authorized by law to issue, shall be deemed sufficient if signed by the secretary of said Commission and authenticated by such seal; and all acts, orders, proceedings, rules, regulations, entries, minutes, and other records of said Commission, and all reports and documents filed with said Commission may be proved in any court of this State by copy thereof certified to by the secretary of said Commission with the seal of said Commission attached. (Source: P.A. 89‑250, eff. 1‑1‑96.)

    (235 ILCS 5/3‑12)
    Sec. 3‑12. Powers and duties of State Commission.
    (a) The State commission shall have the following powers, functions and duties:
        (1) To receive applications and to issue licenses to

manufacturers, foreign importers, importing distributors, distributors, non‑resident dealers, on premise consumption retailers, off premise sale retailers, special event retailer licensees, special use permit licenses, auction liquor licenses, brew pubs, caterer retailers, non‑beverage users, railroads, including owners and lessees of sleeping, dining and cafe cars, airplanes, boats, brokers, and wine maker's premises licensees in accordance with the provisions of this Act, and to suspend or revoke such licenses upon the State commission's determination, upon notice after hearing, that a licensee has violated any provision of this Act or any rule or regulation issued pursuant thereto and in effect for 30 days prior to such violation. Except in the case of an action taken pursuant to a violation of Section 6‑3, 6‑5, or 6‑9, any action by the State Commission to suspend or revoke a licensee's license may be limited to the license for the specific premises where the violation occurred.

In lieu of suspending or revoking a license, the

commission may impose a fine, upon the State commission's determination and notice after hearing, that a licensee has violated any provision of this Act or any rule or regulation issued pursuant thereto and in effect for 30 days prior to such violation. The fine imposed under this paragraph may not exceed $500 for each violation. Each day that the activity, which gave rise to the original fine, continues is a separate violation. The maximum fine that may be levied against any licensee, for the period of the license, shall not exceed $20,000. The maximum penalty that may be imposed on a licensee for selling a bottle of alcoholic liquor with a foreign object in it or serving from a bottle of alcoholic liquor with a foreign object in it shall be the destruction of that bottle of alcoholic liquor for the first 10 bottles so sold or served from by the licensee. For the eleventh bottle of alcoholic liquor and for each third bottle thereafter sold or served from by the licensee with a foreign object in it, the maximum penalty that may be imposed on the licensee is the destruction of the bottle of alcoholic liquor and a fine of up to $50.

(2) To adopt such rules and regulations consistent

with the provisions of this Act which shall be necessary to carry on its functions and duties to the end that the health, safety and welfare of the People of the State of Illinois shall be protected and temperance in the consumption of alcoholic liquors shall be fostered and promoted and to distribute copies of such rules and regulations to all licensees affected thereby.

(3) To call upon other administrative departments of

the State, county and municipal governments, county and city police departments and upon prosecuting officers for such information and assistance as it deems necessary in the performance of its duties.

(4) To recommend to local commissioners rules and

regulations, not inconsistent with the law, for the distribution and sale of alcoholic liquors throughout the State.

(5) To inspect, or cause to be inspected, any

premises in this State where alcoholic liquors are manufactured, distributed, warehoused, or sold.

(5.1) Upon receipt of a complaint or upon having

knowledge that any person is engaged in business as a manufacturer, importing distributor, distributor, or retailer without a license or valid license, to notify the local liquor authority, file a complaint with the State's Attorney's Office of the county where the incident occurred, or initiate an investigation with the appropriate law enforcement officials.

(5.2) To issue a cease and desist notice to persons

shipping alcoholic liquor into this State from a point outside of this State if the shipment is in violation of this Act.

(5.3) To receive complaints from licensees, local

officials, law enforcement agencies, organizations, and persons stating that any licensee has been or is violating any provision of this Act or the rules and regulations issued pursuant to this Act. Such complaints shall be in writing, signed and sworn to by the person making the complaint, and shall state with specificity the facts in relation to the alleged violation. If the Commission has reasonable grounds to believe that the complaint substantially alleges a violation of this Act or rules and regulations adopted pursuant to this Act, it shall conduct an investigation. If, after conducting an investigation, the Commission is satisfied that the alleged violation did occur, it shall proceed with disciplinary action against the licensee as provided in this Act.

(6) To hear and determine appeals from orders of a

local commission in accordance with the provisions of this Act, as hereinafter set forth. Hearings under this subsection shall be held in Springfield or Chicago, at whichever location is the more convenient for the majority of persons who are parties to the hearing.

(7) The commission shall establish uniform systems of

accounts to be kept by all retail licensees having more than 4 employees, and for this purpose the commission may classify all retail licensees having more than 4 employees and establish a uniform system of accounts for each class and prescribe the manner in which such accounts shall be kept. The commission may also prescribe the forms of accounts to be kept by all retail licensees having more than 4 employees, including but not limited to accounts of earnings and expenses and any distribution, payment, or other distribution of earnings or assets, and any other forms, records and memoranda which in the judgment of the commission may be necessary or appropriate to carry out any of the provisions of this Act, including but not limited to such forms, records and memoranda as will readily and accurately disclose at all times the beneficial ownership of such retail licensed business. The accounts, forms, records and memoranda shall be available at all reasonable times for inspection by authorized representatives of the State commission or by any local liquor control commissioner or his or her authorized representative. The commission, may, from time to time, alter, amend or repeal, in whole or in part, any uniform system of accounts, or the form and manner of keeping accounts.

(8) In the conduct of any hearing authorized to be

held by the commission, to appoint, at the commission's discretion, hearing officers to conduct hearings involving complex issues or issues that will require a protracted period of time to resolve, to examine, or cause to be examined, under oath, any licensee, and to examine or cause to be examined the books and records of such licensee; to hear testimony and take proof material for its information in the discharge of its duties hereunder; to administer or cause to be administered oaths; for any such purpose to issue subpoena or subpoenas to require the attendance of witnesses and the production of books, which shall be effective in any part of this State, and to adopt rules to implement its powers under this paragraph (8).

Any Circuit Court may by order duly entered, require

the attendance of witnesses and the production of relevant books subpoenaed by the State commission and the court may compel obedience to its order by proceedings for contempt.

(9) To investigate the administration of laws in

relation to alcoholic liquors in this and other states and any foreign countries, and to recommend from time to time to the Governor and through him or her to the legislature of this State, such amendments to this Act, if any, as it may think desirable and as will serve to further the general broad purposes contained in Section 1‑2 hereof.

(10) To adopt such rules and regulations consistent

with the provisions of this Act which shall be necessary for the control, sale or disposition of alcoholic liquor damaged as a result of an accident, wreck, flood, fire or other similar occurrence.

(11) To develop industry educational programs related

to responsible serving and selling, particularly in the areas of overserving consumers and illegal underage purchasing and consumption of alcoholic beverages.

(11.1) To license persons providing education and

training to alcohol beverage sellers and servers under the Beverage Alcohol Sellers and Servers Education and Training (BASSET) programs and to develop and administer a public awareness program in Illinois to reduce or eliminate the illegal purchase and consumption of alcoholic beverage products by persons under the age of 21. Application for a license shall be made on forms provided by the State Commission.

(12) To develop and maintain a repository of license

and regulatory information.

(13) On or before January 15, 1994, the Commission

shall issue a written report to the Governor and General Assembly that is to be based on a comprehensive study of the impact on and implications for the State of Illinois of Section 1926 of the Federal ADAMHA Reorganization Act of 1992 (Public Law 102‑321). This study shall address the extent to which Illinois currently complies with the provisions of P.L. 102‑321 and the rules promulgated pursuant thereto.

As part of its report, the Commission shall provide

the following essential information:

(i) the number of retail distributors of tobacco

products, by type and geographic area, in the State;

(ii) the number of reported citations and

successful convictions, categorized by type and location of retail distributor, for violation of the Prevention of Tobacco Use by Minors and Sale and Distribution of Tobacco Products Act and the Smokeless Tobacco Limitation Act;

(iii) the extent and nature of organized

educational and governmental activities that are intended to promote, encourage or otherwise secure compliance with any Illinois laws that prohibit the sale or distribution of tobacco products to minors; and

(iv) the level of access and availability of

tobacco products to individuals under the age of 18.

To obtain the data necessary to comply with the

provisions of P.L. 102‑321 and the requirements of this report, the Commission shall conduct random, unannounced inspections of a geographically and scientifically representative sample of the State's retail tobacco distributors.

The Commission shall consult with the Department of

Public Health, the Department of Human Services, the Illinois State Police and any other executive branch agency, and private organizations that may have information relevant to this report.

The Commission may contract with the Food and Drug

Administration of the U.S. Department of Health and Human Services to conduct unannounced investigations of Illinois tobacco vendors to determine compliance with federal laws relating to the illegal sale of cigarettes and smokeless tobacco products to persons under the age of 18.

(14) On or before April 30, 2008 and every 2 years

thereafter, the Commission shall present a written report to the Governor and the General Assembly that shall be based on a study of the impact of this amendatory Act of the 95th General Assembly on the business of soliciting, selling, and shipping wine from inside and outside of this State directly to residents of this State. As part of its report, the Commission shall provide all of the following information:

(A) The amount of State excise and sales tax

revenues generated.

(B) The amount of licensing fees received.             (C) The number of cases of wine shipped from

inside and outside of this State directly to residents of this State.

(D) The number of alcohol compliance operations

conducted.

(E) The number of winery shipper's licenses

issued.

(F) The number of each of the following: reported

violations; cease and desist notices issued by the Commission; notices of violations issued by the Commission and to the Department of Revenue; and notices and complaints of violations to law enforcement officials, including, without limitation, the Illinois Attorney General and the U.S. Department of Treasury's Alcohol and Tobacco Tax and Trade Bureau.

(15) As a means to reduce the underage consumption of

alcoholic liquors, the Commission shall conduct alcohol compliance operations to investigate whether businesses that are soliciting, selling, and shipping wine from inside or outside of this State directly to residents of this State are licensed by this State or are selling or attempting to sell wine to persons under 21 years of age in violation of this Act.

(16) The Commission shall, in addition to

notifying any appropriate law enforcement agency, submit notices of complaints or violations of Sections 6‑29 and 6‑29.1 by persons who do not hold a winery shipper's license under this amendatory Act to the Illinois Attorney General and to the U.S. Department of Treasury's Alcohol and Tobacco Tax and Trade Bureau.

(17) (A) A person licensed to make wine under the

laws of another state who has a winery shipper's license under this amendatory Act and annually produces less than 25,000 gallons of wine or a person who has a first‑class or second‑class wine manufacturer's license, a first‑class or second‑class wine‑maker's license, or a limited wine manufacturer's license under this Act and annually produces less than 25,000 gallons of wine may make application to the Commission for a self‑distribution exemption to allow the sale of not more than 5,000 gallons of the exemption holder's wine to retail licensees per year.

(B) In the application, which shall be sworn

under penalty of perjury, such person shall state (1) the date it was established; (2) its volume of production and sales for each year since its establishment; (3) its efforts to establish distributor relationships; (4) that a self‑distribution exemption is necessary to facilitate the marketing of its wine; and (5) that it will comply with the liquor and revenue laws of the United States, this State, and any other state where it is licensed.

(C) The Commission shall approve the application

for a self‑distribution exemption if such person: (1) is in compliance with State revenue and liquor laws; (2) is not a member of any affiliated group that produces more than 25,000 gallons of wine per annum or produces any other alcoholic liquor; (3) will not annually produce for sale more than 25,000 gallons of wine; and (4) will not annually sell more than 5,000 gallons of its wine to retail licensees.

(D) A self‑distribution exemption holder shall

annually certify to the Commission its production of wine in the previous 12 months and its anticipated production and sales for the next 12 months. The Commission may fine, suspend, or revoke a self‑distribution exemption after a hearing if it finds that the exemption holder has made a material misrepresentation in its application, violated a revenue or liquor law of Illinois, exceeded production of 25,000 gallons of wine in any calendar year, or become part of an affiliated group producing more than 25,000 gallons of wine or any other alcoholic liquor.

(E) Except in hearings for violations of this

Act or amendatory Act or a bona fide investigation by duly sworn law enforcement officials, the Commission, or its agents, the Commission shall maintain the production and sales information of a self‑distribution exemption holder as confidential and shall not release such information to any person.

(F) The Commission shall issue regulations

governing self‑distribution exemptions consistent with this Section and this Act.

(G) Nothing in this subsection (17) shall

prohibit a self‑distribution exemption holder from entering into or simultaneously having a distribution agreement with a licensed Illinois distributor.

(H) It is the intent of this subsection (17) to

promote and continue orderly markets. The General Assembly finds that in order to preserve Illinois' regulatory distribution system it is necessary to create an exception for smaller makers of wine as their wines are frequently adjusted in varietals, mixes, vintages, and taste to find and create market niches sometimes too small for distributor or importing distributor business strategies. Limited self‑distribution rights will afford and allow smaller makers of wine access to the marketplace in order to develop a customer base without impairing the integrity of the 3‑tier system.

(b) On or before April 30, 1999, the Commission shall present a written report to the Governor and the General Assembly that shall be based on a study of the impact of this amendatory Act of 1998 on the business of soliciting, selling, and shipping alcoholic liquor from outside of this State directly to residents of this State.     As part of its report, the Commission shall provide the following information:         (i) the amount of State excise and sales tax revenues

generated as a result of this amendatory Act of 1998;

(ii) the amount of licensing fees received as a

result of this amendatory Act of 1998;

(iii) the number of reported violations, the number

of cease and desist notices issued by the Commission, the number of notices of violations issued to the Department of Revenue, and the number of notices and complaints of violations to law enforcement officials.

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