Section R82-2-308 - Consignment Inventory Package Agencies(1) This rule is made pursuant to Section 32B-2-202, which authorizes the Commission to make rules governing package agencies.(2) Purpose. At the discretion of the Department, liquor may be provided by the Department to a Type 2 and Type 3 Package Agency for sale on consignment pursuant to Subsection 32B-2-605(5). This rule provides the procedures for such consignment sales.(3) Application of the rule. (a) Consignment Inventory. (i) The initial amount of consignment inventory furnished to the Package Agency shall be established by the Department.(ii) The consignment inventory amount shall be posted to the Department's accounting system as "Consignment Inventory Account."(iii) The consignment inventory amount shall be stated in the Department's contract with the Package Agency.(iv) Any adjustment to the consignment inventory amount shall be done using a transfer, shipment, or payment of money. A copy of the transfer, adjusting shipment, or evidence of payment shall be included in the Package Agency's file.(v) The consignment inventory amount may be adjusted from time to time based on the Package Agency's monthly average sales. Any adjustment shall be made by a properly executed amendment to the Department's contract with the Package Agency. In the event 12-month average sales are lower than the Package Agency's current consignment amount the Department may lower the consignment amount. If the consignment amount is to be reduced the Package Agency must pay for the difference through cash payment or returned inventory. Any adjustment to the consignment amount will be handled through a contract amendment or a new contract.(b) Payments. (i) Agencies receiving shipments or transfers are required to have an Automated Clearing House (ACH) payment system set up with the Department.(ii) Statements showing unpaid debts and applied credits will be generated and emailed to the agencies on each Thursday after credit card payments have been posted that Wednesday to reflect credit card payments received. Ordered liquor inventory will reflect 30 days to pay from the order date, instead of being due upon order. This generated weekly statement will reflect payments received against the oldest outstanding invoices first. Payments received over those previous statement balances will be credited chronologically against ordered inventory due after previous statements. It is the agent's responsibility to review the statement and contact the Department with any discrepancies before the payment date.(iii) Agents may, in advance of the Department drawing payments via ACH, remit payment to the Department on balances due from outstanding invoices which have not received enough credit card payments or other payments to cover those outstanding balances. Payment will be for the statement total. If no other payment has been received by the due date, payment will be automatically drawn through the ACH process on the due date unless prior arrangements have been made between the agent and the Department.(iv) Insufficient funds, returned checks, and unpaid balances from a previous statement are past due. The Department may assess the legal rate of interest on the amount owed and the Package Agency may be referred to the Commission for possible termination of the contract and closure.(v) Any delivery discrepancies shall be resolved using the LQ9 form. Debits or credits shall be issued based on proper completion and submission of the LQ9 form to the Department. Payment shall be made in accordance with the Package Agency's statement by the due date whether or not any discrepancies have been resolved.(c) Transfers. (i) Transfers, up or down, shall be adjusted to the Package Agency's payment due the Department.(ii) Transfers in to the Package Agency will add to the amount owed to the Department.(iii) Transfers out will subtract from the amount owed to the Department on the next check due to the Department.(d) Credit and Debit Card Credits.(i) Credit for credit and debit cards processed at the Package Agency will be posted to the Package Agency's statement.(ii) It is the agent's responsibility to mail in their settlement report and individual receipts to the Department to receive credit.(e) Audits. (i) The Department shall audit the Package Agency at least once each fiscal year, but may conduct additional audits if deemed necessary.(ii) The Package Agency is subject to a Department audit at any time.Utah Admin. Code R82-2-308
Adopted by Utah State Bulletin Number 2020-05, effective 2/25/2020Amended by Utah State Bulletin Number 2021-24, effective 12/1/2021Amended by Utah State Bulletin Number 2022-24, effective 12/1/2022Amended by Utah State Bulletin Number 2024-01, effective 12/22/2023