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Historical Highlights

Following are highlights of Iowa's liquor control system:

Jan. 20, 1920 -

Volstead Act (national prohibition) becomes effective following ratification of the 18th Amendment by the states. (18th Amendment prohibited the 'manufacture, sale, or transportation of intoxicating liquor.')

Feb. 20, 1933 -

U.S. Congress repeals the 18th Amendment and the Volstead Act by approving the 21st Repeal Amendment. Iowa votes in favor of repeal of the 18th Amendment at its ratification convention on July 10, 1933.

Dec. 5, 1933 -

Proclamation 2065 officially replaces the 18th Amendment with the 21st Repeal Amendment; 14 years of national prohibition are ended.

March 8, 1934 -

Iowa becomes one of the original 'control' or 'monopoly' states and assumes direct control over the wholesale and retail distribution of all alcoholic beverages except beer.

Also effective on this date: the general public is required to obtain a special permit from the Liquor Control Commission and to present a special booklet to purchase liquor (repealed May 16, 1963); and, liquor stores are required to be closed on national, state and municipal election days. (Repealed Jan. 1, 1972.)

June 19, 1934 -

Iowa's first retail liquor stores are opened in Des Moines, Marshalltown, Mason City, Atlantic and Oelwein.

July 4, 1963 -

The Class C liquor license is created allowing the sale of alcoholic beverages by the drink for on-premises consumption. Counties have the 'local option' of prohibiting liquor by the drink in their jurisdictions. ('Local option' repealed Jan. 1, 1972.)

Also effective on this date: dram shop liability insurance becomes a precondition to the issuance of on-premises retail liquor licenses and beer permits.

July 1, 1967 -

A special 15 percent licensee tax on liquor and wine replaces the 10% occupational tax, which had been effective since July 4, 1963. The 15 percent tax is paid at the point of purchase on liquor and wine purchased for resale in licensed establishments; the 10 percent occupational tax had been paid on liquor purchased in licensed establishments. (15 percent licensee tax repealed July 1, 1986.)

Jan. 1, 1972 -

Reorganization legislation makes several changes including:

  • Liquor statutes are streamlined from 12 separate chapters in the Iowa Code to one comprehensive chapter known as the 'Iowa Beer and Liquor Control Act.'
  • The Iowa Beer and Liquor Control Department, consisting of a five-member, part-time council and one full-time director, replace Iowa Liquor Commission, consisting of three full-time commissioners.
  • The Beer and Liquor Control Department is empowered to regulate the beer industry.
  • Liquor enforcement agents are transferred from the Beer and Liquor Control Department to the Department of Public Safety.
  • The Class C liquor license becomes a combination on-premises liquor, wine and beer license ending the necessity of license holders to obtain separate city beer permits, state beer permits and state liquor licenses.

May 4, 1972 -

The term 'grocery store' is redefined, allowing gasoline stations that sell a few grocery items to sell beer for off-premises consumption.

July 1, 1973 -

Qualifying license and permit holders are allowed to sell alcoholic beverages on Sundays by obtaining a Sunday sales privilege. Counties are given the 'local option' of prohibiting Sunday sales in their jurisdictions. ('Local option' repealed Aug. 15, 1977.)

May 1, 1979 -

Under a bottle deposit law, the department begins collecting a 5-cent deposit on each bottle of liquor and wine sold to the general public.

July 1, 1980 -

The sale of revenue bonds is authorized for the financing of a new liquor distribution center. A bid opening is held on Aug. 7, 1980 with the successful bidder submitting an interest rate of 6.25 percent on the $4 million sale.

Jan. 7, 1981 -

The department's administrative offices are moved into the new liquor distribution center; the warehouse is moved the following April. It is the first time in more than 30 years that both components are housed within the same facility.

July 1, 1984 -

The Iowa Legislature appropriates funds for 'not less than six new mini stores.' Mini liquor stores are established in Johnston, S.W. Des Moines, Pleasant Hill, Altoona, Eldridge and N.W. Davenport bringing the total number of stores to 220.

July 1, 1985 -

Iowa's wine monopoly is ended and a dual system of wine is created with the issuance of new wholesale and retail wine permits to qualified applicants. Also on this date: license and permit holders are no longer required to break empty liquor, wine and beer bottles.

July 1, 1986 -

  • Beer and Liquor Control Department is replaced by Alcoholic Beverages Division
  • One of nine regulatory divisions of the newly created Department of Commerce.
  • Alcoholic Beverages Division is designated as the sole wholesaler of all alcoholic liquor sold in the state; the liquor inventory is placed under a system of bailment. Wholesale wine sales are placed entirely in the private sector; the division continues retail wine sales in state liquor stores until June 30, 1987.
  • the division prepares to disband its retail operations and begins issuing new off-premises (Class E) liquor licenses to qualified applicants.

Also effective on this date, Iowa's legal drinking age is raised to 21 years. Previous legal drinking ages were:

  • 19 (July 1, 1978 to July 1, 1986) *
  • 18 (July 1, 1973 to July 1, 1978)
  • 19 (July 1, 1972 to July 1, 1973)
  • 21 (prior to July 1, 1972)
    *Did not apply to persons born on or before June 30, 1960.

March 1, 1987 -

221 state retail liquor stores close as 256 licensed private liquor outlets are established in their market areas. During a four-month transition period, state stores continue to close as private outlets are established.

July 1, 1987 -

Iowa's reorganized liquor control system is fully operational. 410 licensed private outlets sell liquor to retail consumers and to on-premises licensees; the Alcoholic Beverages Division wholesales liquor to the private outlets.

July 1, 1988 -

A $300 civil penalty replaces the 14-day suspension, which is imposed for a conviction of Iowa Code section 123.49(2)(h) - selling, giving or otherwise supplying an alcoholic beverage or beer to a person under the legal-drinking age.

Also effective on this date, license fees are lowered for licensed establishments located in areas that meet the definition of an 'unincorporated town.'

July 1, 1989 -

A new Class A beer (brew pub) permit is created to allow holders of Class C and special Class C liquor licenses and Class B beer permits to manufacture beer in their establishments for on-premises consumption. Other legislation effective on this date:

  • Permits the administrator to negotiate and settle tax disputes with beer and wine wholesalers, and establishes a system of administrative appeals regarding these disputes.
  • Establishes a $5,000 civil penalty where Class E liquor licenses are revoked for violation of bootlegging provisions of Iowa Code chapter 123.
  • Establishes a civil penalty up to $1,000 which may be imposed on beer and wine wholesalers who violate provisions of Iowa Code chapter 123.
  • Allows wine wholesalers and vintners to provide coupons and rebates on purchases of wine.
  • Eliminates requirement that ministers, priests and rabbis obtain a special permit to purchase wine for sacramental use.

July 1, 1990 -

New five-day Class C and special Class C liquor licenses and Class B beer permits are created for festivals, fairs and celebrations 'sponsored or authorized' by a local authority. Also on this date: 14-day Class B wine permits are rescinded. Only six- and eight-month and annual Class B wine permits may be issued.

July 1, 1991 -

On-premises Classes A, B and C liquor licensees are allowed to purchase limited quantities of wine (up to one case per wine brand within a 24-hour period) from off-premises Class E liquor licenses who also hold an off-premises Class B wine permit.

July 1, 1992 -

Hours of selling alcoholic beverages on Sundays are lengthened. New Sunday hours are from 8 a.m. to 2 a.m on the following Monday. Previous Sunday hours of sale were:

  • 10 am to midnight (July 1, 1984 to July 1, 1992)
  • Noon to 10 p.m. (Prior to July 1, 1984)

July 1, 1993 -

The division's three-member hearing board is disbanded and a new appeal process is put in place. License holders who are not satisfied with a decision of the division administrator file their appeal directly with the district court. License and permit holders who are not satisfied with a decision of the local authority file their appeal directly with the division administrator.

Other legislation effective on this date:

  • Eliminates requirement that physicians, veterinarians, pharmacists and food manufacturers obtain a special permit to manufacture and sell medicines, food products, toiletries, perfumes and other items containing alcohol.
  • Establishes administrative civil penalties in amounts up to $1,000, which may be imposed for violations of Iowa Code chapter 123; civil penalties imposed by the division are retained for licensee and law enforcement education.
  • Changes time frame (from five to three years) for progressive administrative sanctions imposed against license holders as the result of sales-to-minors (Iowa Code section 123.49) violations.
  • Creates a catering privilege allowing Classes B and C liquor licensees to cater alcoholic beverages as part of a food catering service at private social gatherings.
  • Eliminates OWI Intoxication Notice posting requirement.

July 1, 1994 -

Distilled spirits brokers are licensed by the division for an annual fee of $25. Also effective this date, liquor licensees are allowed to confiscate driver's licenses and Iowa identification cards if the licensee has reasonable belief that the license has been altered, falsified or belongs to another person and is being used to purchase or attempt to purchase alcoholic beverages.

July 1, 1996 -

Reciprocal shipment of wines law is enacted allowing Iowa vintners to ship wine into other states with equal reciprocal shipment privilege laws to individuals 21 and older. Wineries located in other states with equal reciprocal shipment privilege laws may ship not more than 18 liters of wine per month into Iowa to individuals 21 and older. All wine shipments must be for personal use only.

July 1, 1997 -

Iowa Code section 123.47A is repealed. Criminal penalties for sales-to-minors violations by licensees (their employees and agents) are changed from a simple misdemeanor punishable by a $100 fine ($50 for sales to 19- and 20-year-olds) to a serious misdemeanor punishable by a $1,500 fine. When an employee or agent of a liquor licensee commits a violation, the licensee and employee or agent are considered to have committed the violation. Each must pay a $1,500 fine. All sales-to-minors violations receive the same administrative civil penalties, license suspensions and revocations.

May 19, 1998 -

Iowa Code Section 123.49 subsection 2 paragraph h is amended to change a violation for sales of alcohol to minors, from a serious misdemeanor to a simple misdemeanor punishable by a scheduled violation of $100 under section 805.8 as opposed to the previous fine of $500.

May 5, 2000 -

Funding and authority for the tobacco enforcement is appropriated and transferred to the Iowa Alcoholic Beverages Division. Under the authority granted by the Legislature, the Iowa Alcoholic Beverages Division creates the Iowa Pledge Tobacco Education and Enforcement Program.

July 2001 -

The Iowa Alcoholic Beverages Division releases initial results of the Iowa Pledge Tobacco Education and Enforcement Program. Initial data showed that the retail compliance rate following the first year of the Iowa Pledge program was 82% with a non-compliance rate of 18%. The compliance rate was compiled from law enforcement agencies across the state, which conducted compliance checks of Iowa’s tobacco retailers.

May 2005 -

The Division topped $1 Billion in transfers to the general fund in May 2005. Reorganized on July 1, 1987, when the last state liquor store was closed and the state became the exclusive wholesaler of distilled spirits, the Division generated that revenue contribution in a span of less than 18 years.

July 1, 2008 -

The Iowa Smokefree Air Act took effect banning smoking in most public places, including bars and restaurants.

June 30, 2009 -

The Division transferred over $100 million to the general fund for the first time.

March 2010 -

  • Class "A" Micro-Distilled Spirits Permit created, allowing Iowa micro-distilleries to sell their products for off-premises consumption without circumventing the three-tier system.
  • Charity Beer and Wine Auction Permit created, which allows nonprofit entities to hold up to two beer and wine auctions per calendar year.
  • High alcoholic content beer defined as beer which contains more than five percent of alcohol by weight, but not more than twelve percent of alcohol by weight. It also created Class "AA" and Special Class "AA" permits, which allow the holders to manufacture and/or sell high alcoholic content beer.
  • Iowa wine laws changed from reciprocity to direct shipment. Wine manufacturers may now ship product directly to Iowa consumers for personal use. Wineries are subject to obtaining an Iowa license and remitting wine gallonage taxes to the state.

July 1, 2011 -

  • The delivery of alcoholic beverages by licensees and permittees is codified.  
  • ABD is authorized to develop and implement a statewide employee alcohol compliance training program. 
  • The prohibition on the sale of liquor where gasoline is sold is repealed. 
  • Tobacco enforcement duties transfer to the Division from the Department of Health.

July 1, 2013 -

  • Licensees are allowed to purchase a dramshop policy written on an aggregate limit basis that meets the minimum coverage requirements as determined by the ABD.
  • Authorized nonprofit organizations are permitted to auction spirits at a charity auction after receiving a charity beer, spirits and wine auction permit from the division.