16-4-204. Transfer -- catering endorsement for all-beverages licensees -- competitive bidding -- rulemaking. (1) (a) Except as provided in subsection (3), a license may be transferred to a new owner and to a location outside the quota area where the license is currently located only when the following criteria are met:

(i) the total number of all-beverages licenses in the current quota area exceeded the quota for that area by at least 25% in the most recent census prescribed in 16-4-502;

(ii) the total number of all-beverages licenses in the quota area to which the license would be transferred, exclusive of those issued under 16-4-209(1)(a) and (1)(b), did not exceed that area's quota in the most recent census prescribed in 16-4-502:

(A) by more than 33%; or

(B) in an incorporated city of more than 10,000 inhabitants and within 5 miles of its corporate limits, by more than 43%; and

(iii) the department finds, after a public hearing, that the public convenience and necessity would be served by a transfer.

(b) A license transferred pursuant to subsection (1)(a) that was issued pursuant to a competitive bidding process is not eligible to offer gambling under Title 23, chapter 5, part 3, 5, or 6.

(2) When the department determines that a license may be transferred from one quota area to another under subsection (1), the department shall use a competitive bidding process as provided in 16-4-430 to determine the party afforded the opportunity to purchase and transfer a license.

(3) A license within an incorporated quota area may be transferred to a new owner and to a new unincorporated location within the same county on application to and with consent of the department when the total number of all-beverages licenses in the current quota area, exclusive of those issued under 16-4-209(1)(a) and (1)(b), exceeds the quota for that area by at least 25% in the most recent census and will not fall below that level because of the transfer.

(4) A license issued under 16-4-209(1)(a) may not be transferred to a location outside the quota area and the exterior boundaries of the Montana Indian reservation for which it was originally issued.

(5) (a) Any all-beverages licensee is, on the approval and in the discretion of the department, entitled to a catering endorsement to the licensee's all-beverages license to allow the catering and sale of alcoholic beverages to persons attending a special event on premises not otherwise licensed for the sale of alcoholic beverages for on-premises consumption. Except as provided in subsection (5)(k) of this section, the alcoholic beverages must be consumed on the premises where the event is held.

(b) An application for a catering endorsement and an annual fee of $250 must be submitted to the department for its approval.

(c) An all-beverages license issued under 16-4-201 to a guest ranch is, on the approval and in the discretion of the department, entitled to a guest ranch catering endorsement to the licensee's all-beverages license to allow the catering and sale of alcoholic beverages to persons attending an event on the guest ranch other than at the licensed premises. These events do not need to be special events. The alcoholic beverages must be consumed where the event is held.

(d) With the exception of a guest ranch catering endorsement, an all-beverages licensee who holds a catering endorsement may not cater an event in which the licensee or the concessionaire of the licensee is the sponsor. The catered event must be within 100 miles of the licensee's licensed premises measured in a straight line from the nearest entrance of the licensed premises to the nearest boundary of the catered event.

(e) Except as provided in subsection (5)(i), the storage of alcoholic beverages may occur on the premises of the catered event 1 day prior to the catered event until 1 day following the conclusion of the catered event if the alcoholic beverages are in a secured location that prevents access by anyone other than the licensee or the licensee's employees.

(f) With the exception of a guest ranch catering endorsement, the licensee shall notify the local law enforcement agency that has jurisdiction over the premises where the catered event is to be held. A local government may charge a fee of $35.

(g) The sale of alcoholic beverages pursuant to a catering endorsement is subject to the provisions of 16-6-103.

(h) The sale of alcoholic beverages pursuant to a catering endorsement is subject to the provisions of 16-3-306, unless entities named in 16-3-306 give their written approval.

(i) A licensee may sell and serve liquor, beer, and wine in the grandstands and bleacher area of the premises, as well as from a booth, stand, or other fixed placed on the premises when the catered event is held on the premises of a county fairground, public sports arena, or Montana university as defined in 16-4-112. If the licensee has a written agreement with the state of Montana, a political subdivision of the state, or a Montana university to sell and serve liquor, beer, and wine for multiple catered events at the premises, the licensee may store liquor, beer, and wine to be used for the catered events on the premises of the fairground, public sports arena, or Montana university for the length of the written agreement if the liquor, beer, and wine can be stored in a secure location that prevents access by anyone other than the licensee or the licensee's employees. Each catered event held at the premises is subject to the requirement in subsection (5)(f) and must be individually reported to the department.

(j) A licensee may not share revenue from the sale of alcoholic beverages with the sponsor of the catered event unless the sponsor is the state of Montana, a political subdivision of the state, a Montana university as provided in 16-4-112, or a qualified entity under section 501(c) of the Internal Revenue Code, 26 U.S.C. 501(c), as amended.

(k) A distiller licensed under 16-4-312 may apply to the department to sponsor a catered event with a licensee with a catering endorsement under this subsection (5) that allows for the sale of liquor in original packaging for off-premises consumption at a liquor manufacturing industry-specific event. The department may only approve six of these events per year.

(6) The department may adopt rules to implement this section.