BEFORE THE DEPARTMENT OF REVENUE

OF THE STATE OF MONTANA

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TO: All Concerned Persons

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1. On December 21, 2006, the department published MAR Notice No. 42-2-770 regarding the proposed adoption and amendment of the above-stated rules at page 3044 of the 2006 Montana Administrative Register, issue no. 24.

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2. A public hearing was held on January 16, 2007, to consider the proposed adoption and amendment. Oral and written testimony was received and is summarized as follows along with the response of the department:

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COMMENT NO. 1: Pam Langley, Montana Beer and Wine Distributors Association, stated they support the rules as proposed and believe the new language will provide better guidance to the industry for the necessary recordkeeping.

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RESPONSE NO. 1: The department thanks the Montana Beer and Wine Distributors Association for their support of these rules.

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COMMENT NO. 2: Mark Staples, representing the Montana Tavern Association, requested an additional amendment to ARM 42.13.101(7) in order to clarify that the issuance of a written reprimand for a first offense only applies if the licensee were to commit the same offense during the same year.

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RESPONSE NO. 2: The department concurs with Mr. Staples request and has amended the rule to reflect this change as shown below.

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3. As a result of the comments received the department amends ARM 42.13.101 with the following changes, new material underlined, stricken material interlined:

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42.13.101 COMPLIANCE WITH LAWS AND RULES (1) through (6) remain as proposed.

(7) Mitigating circumstances in the case of sale to a minor could result in a reprimand for the first offense under Title 16, MCA, within the most current three-year period if the licensee has provided alcoholic beverage service training acceptable to the department to all of its employees and reinforces that training with each employee at least every two years. The licensee must demonstrate that the person who made the sale to a minor has completed alcoholic beverage service training prior to the department considering issuance of a reprimand. A written reprimand will be considered a first offense for the application of the progressive penalty schedule only if the licensee commits the same offense again within one year. The written reprimand in lieu of a violation shall be available only one time per licensee.

(8) through (11) remain as proposed.

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AUTH: 16-1-303, MCA

IMP: 16-3-301, 16-4-406, 16-6-305, 16-6-314, MCA

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4. Therefore, the department amends ARM 42.13.101 with the amendments listed above, adopts New Rule I (ARM 42.13.210), II (ARM 42.13.802), III (ARM 42.13.803), IV (ARM 42.13.804), V (ARM 42.13.805), and amends ARM 42.13.111, 42.13.221, and 42.13.222 as proposed.

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5. An electronic copy of this Adoption Notice is available through the department's site on the World Wide Web at www.mt.gov/revenue, under "for your reference"; "DOR administrative rules"; and "upcoming events and proposed rule changes." The department strives to make the electronic copy of this Adoption Notice conform to the official version of the Notice, as printed in the Montana Administrative Register, but advises all concerned persons that in the event of a discrepancy between the official printed text of the Notice and the electronic version of the Notice, only the official printed text will be considered. In addition, although the department strives to keep its web site accessible at all times, concerned persons should be aware that the web site may be unavailable during some periods, due to system maintenance or technical problems.

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/s/ Cleo Anderson������������������������������������������������� /s/ Dan R. Bucks

CLEO ANDERSON��������������������������������������������� DAN R. BUCKS

Rule Reviewer�������������������������������������������������������Director of Revenue

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Certified to Secretary of State April 2, 2007