ABC Community Advisory Council Meeting Minutes

East Region - Hampton and Chesapeake

February 23, 2008 Meeting

The East Region's first Advisory Council meeting was held at the Chesapeake's Virginia Department of Alcoholic Beverage Control office building in Chesapeake on Saturday, February 23, 2008. The meeting was facilitated by Special Agent in Charge (SAC) Leon G. Coleman of the Chesapeake Region and by SAC Robert M. Brooks of the Hampton Region.

SAC Coleman gave an overview of the Commissioners of the ABC Board: Susan Swecker, Esther Vassar and Pamela O'Berry Evans. He introduced Commissioner Esther Vassar. Commissioner Vassar gave a welcome message to all the council members, and thanked them for their time commitment. She stated that this meeting is a way for the Board members and enforcement staff to hear from community members and work with them in establishments, underage drinking and much more. The council is designed to provide insight and resources to improve communication for community issues and needs, crime prevention, new laws and regulations. As a twice-nominated board member, Commissioner Vassar said she has chosen education and development, addressing underage drinking and alcohol abuse, alcohol and aging, as her particular interests. She discussed various educational programs and stated that public safety comes first in all board decisions. She again thanked the members for being a part of the council.

Introductions continued: Director of Law Enforcement Frank Monahan, SAC Robert Brooks for the Hampton Region, Deputy Director Shawn Walker, Director of Hearings and Appeals Robert O'Neal, ASAC Clyde Santana, ASAC Kyle Blanks, and from ABC Wholesale Retail, Supervisors Laurie Holcomb and Mike Zingraff.

Director Monahan then addressed the group. He explained that the first meeting is to educate members about who we are and what we do and get some conversation from the members. We already held our first council meeting in the South region. Although Pamela O'Berry Evans is spearheading the Advisory Council, the entire Board is focused on reaching out to communities. Because the state encompasses such a large area, it was determined the best way to proceed was to create four regional councils. Once the groups have an initial meeting they will meet at least annually to discuss issues of interest. As a group, members will determine how many times they need or would like to meet. ABC SACs will facilitate these decisions. The Richmond group wants to meet twice a year. The concept is that each council will work off the efforts of the other regional councils. "Old business" will include issues from the previous councils meeting of the sitting council as well as unaddressed issues from previous regions' councils. Reading each other's meeting minutes before a meeting is important. Each council will have access to the work of the other councils and will build on that work. A bulletin board is on ABCs Web site where minutes from each regional meeting and additional questions and comments will be posted for all to review. The Director used the analogy of "we are flying the airplane as we are building it." We will change the process so it best fits the needs and desires of the council. We are going statewide and will try to address specific issues and be in dialog with our stakeholders. While each regional council is from different geographic areas, they all contain urban and rural constituents and we believe will have many issues in common. We have learned that similar situations arise both in the southwest as well in the Tidewater area. When we created the advisory council, each regional SAC was asked to recruit council members. The SACs were charged with identifying people with a variety of expertise and involvement in the community who were known to have mutual concerns regarding alcohol issues.

The Advisory Council Members from the community were asked to introduce themselves, tell a little about who they are and tell us why they are committed to this organization:

Ms. Nancy Young - with Suffolk PTA Council. Involved in enforcement and military, son in Iraq, home in May. Interest lies in youth and underage drinking. Here to help in any way I can.
Mr. James R. Champman - Adjutant for Northampton American Legion, here to understand ABC a little better and help American Legions statewide. Want to do things right and within the law. Some law concerns. Director asked if he would help us down the road on how hard it was to obtain a license as a non-profit organization.
Sheriff J.P. Robbins - Northampton County Sheriff. For the past three years have received a grant from ABC. These grants helped their department with conducting DUI Checkpoints, local under age drinking programs, etc. Discussed unlicensed party investigations.
Ms. Lynette White - In law enforcement for 25 years, son just returned from Iraq. Director of Tourism for City of Suffolk. Looking at application process.
Mr. Bruce Watts - Senior Commercial Business Development for City of Norfolk, work with ABC, here to help where ever he can.
Ms. Marcia Snyder - Environmental Health Supervisor, Norfolk Department of Health. The department has a strong relationship with ABC regarding city development. Also part of application process.
Ms. Monica Elliott - Director of Compliance with Farm Fresh Food & Pharmacy. Uses ABC Web site for training, compliance checks etc, found this council and thought it would be great resource.
Mr. Chris Livingston - Found council information online. Owner of The Cave Nightclub and here to represent licensees' concerns and comments.
Ms. Gail Easley - Executive Director of the CAAC/Attucks Theatre. Can offer feedback from non-profit organizations.
Ms. Susan Milhoan - President of Retail Alliance. Represents retailers and mother of teenagers. Advises that retailers want to learn more about ABC.
Mr. Scott Burgess - Vice President, Hoffman Beverages (Budweiser, Wholesaler Representative). Glad to be a part of the council, would like to hear from the board as well as concerns statewide. Welcomes constructive ways to talk about issues regarding regulations. Regarding education and training, looking at effective ways to communicate and educate organizations on the UAB program.
Ms. Karen Scherberger - Executive Director of Norfolk Festevents. Works with ABC on obtaining special event licenses. Here to get an update on regulations, develop a way where we can get new regulation update. Education and Internet advertising need clarification. Director mentioned we need help in Special Event non-profits.
Ms. Lillian DeVenny - President, Virginians Opposing Drunk Driving. Agency is a 501c3, and was the first anti drunk driver organization ever to register with FDC. Instituted quite a few programs, we are not against alcohol, just driving while under the influence. A drunk driver killed her only daughter.
Mr. Mauro Zenerolla - President, JJK Enterprises Inc. Owns 24 stores in area, and states that the #1 problem is UAB and it is taken very seriously.
Ms. Kathy Grook - Employed with the Economic Development for the City of Hampton. Educate Business on ABC regulations and how they should start off their businesses.
Ms. Angela Freeman - Employed with the Economic Development for the City of Hampton. Works with Retail businesses throughout the state and helps with their start up. Goal is to be proactive and work to create solutions.
Ms. Cindy Hall - Norfolk City Attorney's Office. Assists Night Vision Alliance - group of clubs and is in charge of the Norfolk Bar Task Force.
Mr. Robert Brown - Owner of restaurant, here to represent retailer side.
Mr. Anthony Burfoot - Councilman, Office of the City Council.

Members who could not attend:

Mr. Terry Drivas
Mr. Robert Hershberger
Dr. R. Murray
Rev. Joseph Green Jr.
Ms. Cynthia Duncan
Mr. Harry Young
Ms. Laurie Naismith
Ms. Cathy Coleman
Mr. Michael Goodove

Reviewed Old Business

The following issues were raised by the South Region meeting:

Can we have access to ABC codes and look up first offense penalties?
- This information is now available to council members on the ABC Web site.
Can we see reports on UAB checks and see who were the compliant retailers and violators?
- This is now being developed and will be available online in late spring.
Can we get the media interested in featuring these checks much like they do the health department checks?
- An out reach was made in Richmond but does not seem to be interested.
Can we find out how ABC decides to put their ABC stores where they are, how do they determining setting, what criteria?
- This will be addressed in future meetings.
Can we post from our organization on the Council's Web site / Bulletin board?
- Yes - information can be posted on the bulletin board.

Presentation

SAC Brooks gave a presentation on Agent Responsibility.

Question from Scott Burgess, regarding kegs found in quantity, are those returned to the distributor?
- Keg registration was explained.
Question from Nancy Young regarding revoked license. How long after a license is revoked can it be renewed?
- 12 months.

New Business

Nightclubs - SAC Coleman discussed issues pertaining to nightclubs. We do not issue licenses to nightclubs, only restaurants. Business models may resemble nightclubs, but they still need to meet the food requirements. Food requirements were discussed and meal definition of entrée. This is an ongoing discussion.
House parties - SAC Coleman said we do work house parties. The ABC Crimeline number was discussed, any time a call is made on the Crimeline, an investigation is generated and mandatory.
- Question: Do we get involved with Military member house parties?
  - If the military requests our assistance, yes, but we do notify the military police of incident. Commissioner Vassar noted that she is currently working on some new projects with the Military Commands located in the Commonwealth to develop a better relationship with them.
Texas Hold'em - SAC Coleman provided the definition and the elements of Gambling: consideration, chance and prize. To be considered unlawful, all three elements are needed. ABC does not regulate Texas Hold'em games occurring in private homes.
Fatalities - SAC Coleman explained that we investigate many fatal accidents where alcohol beverages are involved to determine if a licensee was involved.
UAB - SAC Brooks explained ABC UAB Program. Active program for over 10 years. Conduct tobacco and alcohol under age buying program. Passed out UAB brochure. Question from Mr. Zenerolla, wanted to know how the UAB locations were selected as he had been checked and caught on more than one occasion at the same location. Director replied that the ones caught come back into the mix. Question, how are the chosen, computer generated 3,500, system initiated 1,500-previous offenses or every four years if you are not chosen, agent initiated, information or complaint 500 a year. 4,800 per year. Question from Chris Livingston, are the UAB's done after 10 p.m. - yes, but not as many after 10 p.m., usually earlier, if a club opens up at 7 p.m., and they have been selected, yes, we will conduct the UAB when the business is open.
Community Coalition Grants - Effort to reduce underage drinking throughout the Commonwealth. Have not received 2008 as of yet. When grant is approved, we will send grant list to each council member. SAC Brooks discussed the process of applying for the grants. Discussed some ways on how the grants were spent on education programs. OOAG conference in VCU of AAGU, one-day seminar of the aging and alcohol.
Open Discussion: No questions, adjourned for lunch.

Overview of Hearing Process

Robert O'Neal, Director of Hearings Division explained the mission: To provide fair and unbiased hearings and related support services to ABC customers, licensees, and citizens in support of the agency mission statement.

Topics for today - What are our functions at ABC? What do we do? How does it affect you? What types of cases do we process? How do these get processed?

Functions - Intake/review cases referred for administrative hearings for all customers (ABC BLEO, citizens, licensees, interested parties), schedule and conduct hearings and informal conferences and provide hearings and appeals support services including legal process preparation, initial decisions, transcripts and hearing transcription, consent settlements, offers in compromise, all appeals support, and all final Board orders.

What do we do? - Process and schedule administrative violations, contested applications, and violations of the Beer and Wine Franchise Acts for administrative hearings. Currently receives and processes about 125 cases per month or about 1,500 cases per year. Four Hearings Officers travel the state to hear cases in the region in which the violation occurred.

What is an ABC Administrative Violation? - It is a violation of one of the rules, laws, or regulations governing conduct and business operation by ABC Licensees. It is NOT a criminal violation, although some criminal cases can also be administrative cases. All of these are on our Web site.

What is a Consent Settlement Offer? - First offense administrative violations can be settled before a hearing based on an offer from the Chief Hearing Officer (see §3 VAC 5-70-210). The licensee decides whether to accept the offer or go to a hearing. If not settled by a consent settlement offer, hearings are set within 30 days or so of the expiration of the consent offer (20 days from the offer date). The licensee may decide to make their own offer to settle directly to the ABC Board.

What is an Offer-in-Compromise? - Offers initiated to the Board by the licensee are called Offers in Compromise. A clerk in Hearings & Appeals processes the offer directly to the ABC Board, bypassing the hearings process. SAC's and Agents are asked for their opinion of the offer before it is considered by the Board.

How do Contested Applications get to a Hearing? - ABC Agents complete a background investigation of applicants and forward the results to the ASAC or SAC for review and approval. If the ASAC /SAC recommends a hearing, then the file and all application paperwork is forwarded Hearings & Appeals staff. If the matter will go to a hearing, then a notice is sent to all parties. Licensee and all parties get at least 10 days notice of a hearing per the APA. Generally, we try to give about 20 days notice.

What happens at the hearing? - Generally, ABC and the licensee get to present evidence to the Hearing Officer about the violation or application. The licensee does not have to be represented by a lawyer (but may be). Both sides may present information/evidence and may question or examine witnesses. All testimony is under oath and transcribed by court reporters. The decision in the case may be announced from the bench. A written decision containing the findings of fact and conclusions of law are released on all cases. Case decisions are usually released within 30 days of the hearing and sent to all parties. The decisions are "initial decisions" - recommendations to the ABC Board. All parties have 30 days to appeal the initial decision to the full ABC Board for an Appeal hearing in Richmond. If the parties are still not satisfied, then an appeal can be filed in the Circuit court in the city, town or county in which the licensee principally conducts business. All parties have 30 days to appeal the decision of a Board appeals hearing to the Circuit court.

What happens AFTER the hearing? - Once the initial hearing is held, a 30-day appeals period elapses. If no appeal is filed, then the Board considers adopting the initial decision. Usually, the licensee has the option to take a suspension period OR pay a civil penalty in exchange for a shorter suspension period.

Hearings and Appeals - Fines and Penalties - Hearings Officers issue decisions to give suspensions, levy civil penalties, costs of investigations, or revoke licenses. Average civil penalty last year was $1,928 and the average suspension period last year was 21.57 days. Repeat offense penalties for allowing underage sale or consumption of alcohol escalate quickly based on the Board's penalty guidelines. Generally, the civil penalty can be no more than $1,000 for 1st offense, $2,500 for 2nd offense and $5000 for 3rd offense. Suspensions and revocations are options available to the Board for serious offenses.

Discussed the process and the length of the process, why it takes so long to get to a hearing. Bound by certain administrative acts.

Wholesale/Retail Supervisor Presentation

Michael Zingraff a regional manager in the Chesapeake/Hampton area for Wholesale/Retail gave an overview of his division. ABC on this date had 330 stores located statewide. The mission of the Wholesale/Retail Division is to control sale of alcohol to prevent the merchandise from getting into the hands of the intoxicated, underage and/or interdicted. Provide excellent customer service and operate efficient stores to reduce costs to maximize profits. Being a state agency, we owe it to the citizens of Virginia to provide a service that would far exceed their already high expectations. A major emphasis on training and monitoring for compliance is of the utmost importance to succeed in this area. Discussed the ID checks and UAB program.

In determining locations for new or relocated retail outlets, ABC has a Real Estate Committee comprising of members of the Wholesale/Retail Division, Property Management and Policy and Analysis. Before a location is determined for a new store location, Policy and Analysis is responsible for measuring the demographics of the area as in population, household incomes, traffic counts, if the area is serviced by other ABC stores, and the impact to the other stores in this general area. The proximity to schools (elementary, high school and colleges) is seriously considered, also. This information is presented to the Real Estate Committee for a vote. If it is decided to proceed, the Property Management Division is responsible for negotiating the lease arrangements and presenting to the committee for approval or disapproval. If approved, the Property Management Division proceeds in executing the lease and receiving approval from the Attorney General's office.

There are two marketing strategies that we use to determine these locations. One is the Market Location Strategy, which encompasses large population areas to include the 95 counties and 40 cities in our state. The other is Rural Location Strategy, which measures service levels in the lower population areas but also encompasses mileage between stores versus the population of the area. An example would be to locate in towns with a population greater than 1,000 with the closest store 15 miles away or a population greater that 1,500 with the closest store 12 miles away. Good planning equals good customer service levels and a better return on the dollar.

Question: How many distribution centers do you have?
- One, out of Richmond.
Question: Out of State wine vs. Virginia Wines why do you only sell VA wine?
- Due to legislation. Direct competition with retailers, we have an advantage, so we only sell Virginia wines.
Question: Do you receive signed orders of interdictions?
- Yes letter of interdictions from local courts.

Revenue that is received, a percent is given to localities to use where they see fit, focusing on issues, education, etc.

Review of Proposed laws and Regulations

Deputy Director Shawn Walker reviewed legislation that is being tracked at the General Assembly:

Creation of a temporary license to the purchaser of an exiting business.
Concealed handguns: prohibits person from carrying into a restaurant.
- Question: Does that pertain to Banquet Licenses?
  - Yes
The ABC subcommittee of the House General Laws committee has been asked to do a study of ABC laws, practices, definitions etc. This study is due before the 2009 session.
A bill has been introduced regarding meeting places and rendezvous at retail licensed premises i.e. drug and street gangs.
The regulation of lewd and disorderly conduct has been signed and is awaiting approval. The federal court said that the definition in the Code was too broad thus the change that we are waiting approval on. At this time ABC cannot enforce the law hopefully this will be cleared up soon.
The Sangria controversy is also being addressed - at this time the law prohibits the mixing of beer and spirits into wine. Legislation has been introduced to correct that law.
Question: Is there a way we can get a copy the current legislative issues?
- We will post on bulletin board the current General Assembly issues.

Open Discussion

Guidelines for what we can or cannot be advertised on the Internet. This falls under electronic media and follows the same guidelines.

Director Monahan mentioned two more initiatives that we are undertaking:

Internet Sales of Wine and Beer, underage people ordering alcohol on line, having it delivered to their home.
Monitoring proper procedures are being followed, proper license and labeling are being followed.
- Question: How many out of state shippers we have licensed?
  - About 600

Shoulder Tap Operation - Looking at UAB stationed in front of retail establishments to try to get an adult to buy alcohol for them. It is a defined procedure, we will not use entrapment, but looking at this operation to deter this option of purchasing for underage.

SACs distributed contact numbers along with e-mail addresses and crimeline phone number.

Shawn Walker - Looking at revamping the banquet license process, would like to get some input on this.

The Director thanked all for their participation and looking forward to the next meeting. The group agreed that they would like to meet twice a year as they found this meeting most informative. Look at six months out. The SACs and Jody Steele will be the contact persons for communication for the council. The Director thanked Ms. Vassar for her support along with SAC Coleman and SAC Brooks for all their work.

The meeting was adjourned at 2:30 p.m.

Follow-up Items to Review

Internet Advertising - need guidelines.
Post current legislative issues on Community Advisory Council web site.
Copy 2008 Coalition Grant to Community Advisory Council.