OFFICE OF FISCAL ANALYSIS

Legislative Office Building, Room 5200

Hartford, CT 06106 (860) 240-0200

http: //www. cga. ct. gov/ofa

SB-864

AN ACT CONCERNING GROCERY STORE BEER PERMITS.

OFA Fiscal Note

State Impact:

Agency Affected

Fund-Effect

FY 12 $

FY 13 $

Department of Revenue Services

GF - Revenue Gain

800,000

1,700,000

Consumer Protection, Dept.

GF – Revenue Gain

1,386,000

306,000

Consumer Protection, Dept.

GF - Cost

150,594

276,609

Comptroller Misc. Accounts (Fringe Benefits)1

GF - Cost

31,464

60,598

Note: GF=General Fund

Municipal Impact: None

Explanation

It is anticipated that the bill would increase beer consumption in the state by roughly 10%, which is estimated to result in a gain from the alcoholic beverage and sales taxes of $1. 7 million annually and $800,000 in FY 12 (partial year).

The bill results in a revenue gain of approximately $1,386,000 in FY 12 and $306,000 in FY 13 from increased permit fee revenue. An estimated 1,800 additional outlets would apply for a provisional grocery store beer permit ($500 permit fee) and then apply for a grocery store beer permit ($100 application fee and $170 permit fee) in FY 12. In FY 13 revenue would continue from the annual $170 permit fee.

The bill results in a cost to the state of $182,058 in FY 12 and $337,207 in FY 13 as 5 additional personnel would be required in the Department of Consumer Protection. These staff include 2 Liquor Control Agents, 1 Processing Technician, 1 Staff Attorney and 1 Paralegal Specialist. Total personnel costs in FY 12 are $132,425 along with supporting operating and equipment costs of $18,169. Total personnel costs sin FY 13 are $255,041 along with supporting operating and equipment costs of $21,568. Fringe benefits would cost $31,464 in FY 12 and $60,598 in FY 13. The personnel would be needed for permit processing, ongoing inspections, liquor law violation investigation and to handle remonstrances. The FY 12 costs are half year funding.

The Out Years

The annualized ongoing fiscal impact identified above would continue into the future subject to the number of permits and sales.

Sources:

DRS FY 10 Annual Report; http: //www. alcohollaws. org/georgiaalcohollaws. html

1 The fringe benefit costs for state employees are budgeted centrally in the Miscellaneous Accounts administered by the Comptroller on an actual cost basis. The following is provided for estimated costs associated with changes in personnel. The estimated non-pension fringe benefit rate as a percentage of payroll is 23. 76%. Fringe benefit costs for new positions do not initially include pension costs as the state's pension contribution is based upon the 6/30/10 actuarial valuation for the State Employees Retirement System (SERS) which certifies the contribution for FY 12 and FY 13. Therefore, new positions will not impact the state's pension contribution until FY 14 after the next scheduled certification on 6/30/2012.