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HB 4113

Liquor: other; discount for specially designated distributors and on-premises licensees; increase. Amends sec. 233 of 1998 PA 58 (MCL 436.1233).

2025-2026 Regular Session Introduced by Joe Aragona and 12 co-sponsors

Raises the discount on uniform prices from 17% to 23% for specially designated distributors and on-premises licensees, reducing LPRF receipts and General Fund transfers.

REFERRED TO COMMITTEE ON REGULATORY AFFAIRS
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Bill Summary · HB 4113

Summary — HB 4113 (Michigan Liquor Control Code amendment)

Status: Passed House (June 4, 2025); referred to Senate Committee on Regulatory Affairs (June 10, 2025).
Statute amended: MCL 436.1233 (section 233 of 1998 PA 58)

Purpose

To increase the discount that specially designated distributors and on‑premises liquor licensees (e.g., bars, restaurants, on‑site sellers) receive off the Michigan Liquor Control Commission’s uniform price for alcoholic liquor — raising the discount from 17% to 23%.

Key provisions

  • Amends MCL 436.1233 to change the licensee/distributor discount off the Commission’s uniform prices from 17% to 23%.
  • Leaves in place the Commission’s authority and pricing rules requiring uniform prices that return a gross profit to the Commission of not less than 51% and not greater than 65%.
  • Retains existing statutory provisions relating to sales of slow‑moving stock (sale at a price approved by the State Administrative Board) and the other provisions of section 233 (including small‑distiller certification provisions already in that section).

Who is affected

  • Directly benefited:
    • Specially designated distributors (licensed to distribute spirits in original package for consumption off premises).
    • On‑premises licensees (bars, restaurants, and other establishments that purchase spirits from the State for on‑site sale/consumption).
  • Fiscal/State impact:
    • Liquor Purchase Revolving Fund (LPRF): higher discount reduces distributor payments into the LPRF.
    • State General Fund: net income from the LPRF is transferred to the General Fund; increasing the discount lowers those year‑end transfers.

Fiscal impact

  • Nonpartisan analyses estimate a substantial General Fund revenue reduction on the order of about $113 million annually (estimates in committee reports range around $112.8M–$113.9M). Examples cited:
    • Senate staff: increase would move the total discount from ~$319.6M to ~$432.4M, reducing transfers by ~$112.8M.
    • House Fiscal Agency: based on FY2022 data, increase would raise the licensee discount by ~ $113.9M, with a comparable revenue loss to the General Fund.
  • No local government fiscal impact identified.

Legislative history / timeline highlights

  • Introduced in early 2025 (sponsored by Rep. Samantha Steckloff in the House).
  • Public committee hearing and testimony taken (May 7, 2025). Committee reported the bill (House committee recommendation without amendment, May 22, 2025).
  • Passed the Michigan House June 4, 2025 (immediate effect given); referred to the Senate Committee on Regulatory Affairs June 10, 2025.
  • Similar measure (HB 4757) passed the House in 2023–24 but received no further action in the Senate.

Stakeholder positions (as reported)

  • Support: Michigan Independent Retailers, Michigan Licensed Beverage Association and various independent retailers and convenience/liquor stores — proponents cite help for small independent retailers facing cost pressures.
  • Opposition: Michigan Liquor Control Commission raised concerns (including fiscal impacts).

Notes

  • The discount was temporarily increased to 23% during a COVID‑era period (July 1, 2020 – July 1, 2021); this bill would make a 23% discount permanent for the covered licensees.

Compiled from official sources — confirm details with the bill’s official record.

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