SB 349 Summary

• Allows the Liquor and Cannabis Control Commission to establish reduced gross profit margins (32.5% instead of 51-65%) for spirits produced by qualified small distillers using Michigan-grown grain as at least 40% of the base distillate, effective January 1, 2021.

• Requires small distillers to apply annually by February 1 to the Department of Agriculture and Rural Development for "qualified small distiller" certification, with the department verifying the Michigan grain sourcing requirement.

• Imposes penalties for falsifying information to the department or commission, including misdemeanor charges (up to 1 year imprisonment or $3,000 fine) and requiring repayment of the difference between reduced and standard profit margins.

• Establishes record-keeping requirements for qualified small distillers regarding distilled grain transactions, with authorization for the department and commission to audit records during business hours.

• Defines "distilled grain" to include barley, oats, corn, potatoes, fruits, sugar beets, honey, and other grains, and requires annual reporting by the Department of Agriculture and Rural Development to the commission on certified qualified small distillers.