Oregon Liquor Control Commission

Alcohol Prohibition in the United States began in 1919 with the passing of the Eighteenth Amendment. In the early 1930s, Oregon Governor Julius Meier appointed a committee, led by Dr. William S. Knox, to study Oregon's options regarding the regulation of alcoholic beverages in the state. In what came to be known as the Knox Report, the committee recommended a system similar to Canada's.

Based on the recommendations in the Knox Report, the Oregon Legislative Assembly held a special session that created the Oregon Liquor Control Commission in 1933, just days after the national repeal of prohibition. Governor Meier signed the Liquor Control Act (also known as the Knox Act) on December 15, 1933. The act gave the state exclusive rights to sell distilled spirits and fortified wine as well as the authority to license private businesses to sell beer and wine by the bottle or glass.

Marijuana Prohibition in the State of Oregon began in 1935 with the passage of the Uniform State Narcotic Drug Act. Possession of small amounts of marijuana was decriminalized in Oregon in 1973. In 1998, the state passed the Oregon Medical Marijuana Act, allowing residents to obtain a Medical Marijuana Patient card and grow or obtain marijuana for personal use for medical purposes. Under that act, patients are allowed to designate caregivers, which allowed for the growth of the Oregon medical marijuana dispensary program. The passage of Measure 91 in 2014 legalized possession of marijuana for recreational personal use and created a regulatory licensing and enforcement structure for commercial sales of marijuana. This bill also legalized the growing of personal marijuana plants at a household, which was unique among the three states which had legalized marijuana at the time (Oregon, Washington, and Colorado.) In 2015, Oregon State Governor Kate Brown signed an emergency bill allowing medical marijuana dispensaries to sell small amounts of marijuana to recreational customers in order provide a legal source of marijuana for recreational purposes while additional statutes and administrative rules were put into place for the recreational marijuana program. This "Early Retail Sales" bill allowed these sales to continue until December 31, 2016. After that time, medical dispensaries were no longer allowed to sell to recreational customers.

Today, Oregon's alcohol regulation program has three major operational programs; the Distilled Spirits Program, the Recreational Marijuana Program, and the Public Safety Program. All three programs are supported by the Administration, Financial Services, and Support Services divisions.

The Distilled Spirits Program oversees the distribution and sale of distilled spirits in the state. The Distilled Spirits division centrally purchases, warehouses and distributes distilled spirits to Oregon's independently operated liquor stores. OLCC's Public Safety Program licenses and regulates businesses in the alcohol industry such as manufacturers, wholesalers, bars, restaurants, grocery and convenience stores.

The Recreational Marijuana Program is exclusively authorized to make recreational marijuana available to consumers and licensed businesses through retail marijuana stores. The program also tracks the growing, transporting, processing and selling of recreational marijuana products.

The Public Safety Program is responsible for licensing and regulating the operation of the liquor and recreational marijuana industry in Oregon.

The OLCC has five regional offices housing aspects of each program. The Portland or "Metro region" office is located in Milwaukie, Oregon (a suburb of Portland) and also operates as the Headquarters for the agency. The remaining regional offices are located in Medford, Salem, Bend, and Eugene. In addition to these regional offices, the agency staffs a number of satellite offices for intake of liquor applications and to house operations for the agency's field inspectors, who report to regional managers at each of their parent regional offices.[8]

A seven-member board of commissioners meets monthly to set OLCC policy and make decisions in areas such as liquor licenses, rules, contested case hearings and appointments of liquor store agents. The governor appoints and the Senate confirms these commissioners for four-year terms. Each commissioner represents a congressional district. A minimum of one seat on the Commission is must be reserved for a representative of the restaurant and hospitality industry.

• Regulatory Operations issues liquor and marijuana licenses, alcohol service permits, and marijuana worker permits. Licenses are required for anyone who manufactures, distributes or sells alcoholic beverages or marijuana in Oregon. Service permits are issued to employees who serve alcohol in restaurants, bars, or other businesses. Marijuana worker permits are issued to marijuana business employees who handle, interact with, track, or secure marijuana items and any person who supervises those activities. Regulatory Operations also promotes compliance with marijuana and liquor laws through education and proactive programs for licensees and permittees. This program also focuses on enforcement efforts geared toward reducing underage drinking and use of marijuana.
• Merchandising Operations has three divisions: Purchasing, Distribution, and Store Operations. The Merchandising Program operates the state's retail liquor business, including supplying the 244 (as of September 2010) retail liquor stores. Oregon has been partially privatized since the 1980s. Oregon retail liquor stores are privately owned by independent small business contractors. The OLCC contracts with the independent business owners to sell Oregonians the distilled beverages they want, while operating a business that is one of the top revenue producers for the state. In fiscal year 2010, the OLCC contributed nearly $172 million to Oregon's general fund, county and city treasuries from the sales of distilled spirits, taxes on beer and wine and other revenue.
• Support Services consists of three divisions: Administration, Administrative Services, and Financial Services. The program provides support and administrative services for OLCC staff and numerous partners.

ORS 471.775 Regulatory specialists have authority as provided under this chapter, ORS chapter 153, ORS 133.005 to 133.400, 133.450, 133.525 to 133.703, 133.721 to 133.739, 161.235, 161.239 and 161.245 and chapter 743, Oregon Laws 1971, to conduct inspections or investigations, make arrests and seizures, aid in prosecutions for offenses, issue criminal citations and citations for violations and otherwise enforce this chapter, ORS 474.005 to 474.095 and 474.115, commission rules and any other laws of this state that the commission considers related to alcoholic liquor, including but not limited to laws regarding the manufacture, importation, transportation, possession, distribution, sale or consumption of alcoholic beverages, the manufacture or use of false identification or the entry of premises licensed to sell alcoholic liquor.[9]

ORS 475B.285 An Oregon Liquor Control Commission regulatory specialist has the authority as provided in ORS 133.005 to 133.400, 133.450, 133.525 to 133.703, 133.721 to 133.739, 161.235, 161.245 and 475B.010 to 475B.395, ORS chapter 153 and chapter 743, Oregon Laws 1971, to conduct inspections and investigations, make seizures, aid in prosecutions for offenses, issue citations for violations and otherwise enforce the provisions of ORS 475B.010 to 475B.395, any rule adopted under ORS 475B.010 to 475B.395 and any other law of this state that charges the commission with a duty, function or power related to marijuana, including enforcing any provision of a law or rule related to individuals who use false identification for purposes of purchasing or possessing a marijuana item or who engage in illegal activity on or near a licensed premises.[10]

Under state statute, the regulatory specialists (inspectors) of the OLCC whether enforcing marijuana or liquor regulations, are considered peace officers when exercising authority over liquor or marijuana related activities and business. This classification includes police officers and officers of the state's Criminal Justice Division. Although this classification and the statutory authority provide OLCC regulatory specialists broad law enforcement authority including the authority to use force, make arrests, issue citations, and seize property, regulatory specialists are prohibited by OLCC Policy from carrying firearms while exercising that authority.

OAR 845-009-0200 Uniform Standards for Minor Decoy Operations (1) Purpose. ORS 471.346 directs the Oregon Liquor Control Commission to develop, through rulemaking, uniform standards for minor decoy operations used to investigate licensees and agents operating stores on behalf of the Commission under 471.750 for violations of the laws of this state prohibiting sales of alcoholic beverages. It is the Oregon Liquor Control Commission's intention that decoy operations are to be an impartial test of a licensee or agent's ability and willingness to obey laws on preventing sale or service of alcoholic beverages to minors.

(2) Uniform standards for minors used in minor decoy operations:

(a) The minor must be under 21 years of age; and

(b) The minor may not use false identification; and

(c) The minor must look under the age of 26 years; and

(d) The minor may not lie about their age.

(3) Uniform standards for operations. In cities with populations of 20,000 or more, minor decoy operations must be conducted on either a random or targeted basis.

(a) "Random" decoy operations. Selection of the agent(s) or licensee(s) to be visited will be done using simple random sampling which ensures to the greatest extent possible that each licensee or agent has an equal chance of being selected. The simple random sampling may be performed using a variety of generally accepted simple random sampling tools, such as a random number table, a random number generator, or other method.

(b) "Targeted" minor decoy operations may be conducted for a single licensee or agent, but may be used only if there is a documented compliance problem with the specific licensee or agent that is the target of the operation.

(4) Uniform standards for coordination with law enforcement agencies. The Oregon Liquor Control Commission will coordinate with law enforcement agencies to ensure, to the greatest extent possible, that:

(a) Law enforcement agencies are informed of the Commission's uniform standards for minor decoy operations; and

(b) Law enforcement agencies provide the Commission with copies of their minor decoy policies;

(c) In order for the Commission to process violation cases in a timely manner, law enforcement agencies will be encouraged to provide the Commission with the results of their minor decoy operation(s).

(5) DEFINITIONS: Documented compliance problem. For purposes of this rule, "documented compliance problem" means:

(a) OLCC or Law Enforcement has received one or more documented complaints about an agent, licensee or license applicant alleging one or more of the following occurred at the retail sales agency or on the licensed premises:

(A) Failed to check, or failed to properly check identification;

(B) Allowed minors in prohibited areas;

(C) Allowed minors to consume alcohol;

(D) Sold alcohol to minors; or

(b) The agent, licensee or license applicant has received one or more citations, or administrative Notice of Warning or Notice of Violation tickets for one or more of the following:

(A) Failed to check, or failed to properly check identification;

(B) Allowed minors in prohibited areas;

(C) Allowed minors to consume alcohol;

(D) Sold alcohol to minors.

(6) Uniform standards for licensees. A licensee using a person under the age of 21 years for the purpose of investigating possible violations by employees of the licensee for sale of alcoholic beverages to a person or persons who are under the age of 21 years must:

(a) Comply with the uniform standards for minors used in minor decoy operations; and

(b) Notify the Director of OLCC's Regulatory Program and the Chief or Sheriff of their local law enforcement agency of the minor decoy's name, date of birth, provide a current photograph of the minor decoy, and the date(s) and location(s) of the minor decoy operation(s) at least 24 hours prior to the use of the minor decoy.

(7) Licensees, service permittees, licensee's employee(s), agents, and agent's employee(s) must immediately return identification presented by the minor decoy upon request of law enforcement or an OLCC representative.