City of Revelstoke

Council Report
File No.: 3360-20, ZON 2015-09

To:

His Worship Mayor McKee and Members of City Council

From:

Dean Strachan, MCIP, RPP

Manager of Development Services

Date:

January 15, 2016

Subject:

Zoning Bylaw Text Amendment Craft Distillery, 521 1st Street West

RECOMMENDATION:
THAT the application to amend the Zoning Bylaw to add Craft Distillery as a defined use
with parking requirements and add the use to the Central Business District (C1) zone as
a permitted use be approved.
THAT Zoning Bylaw Text Amendment Bylaw No. 2101 be read a First and Second time
and staff be directed to schedule a Public Hearing.
CAO Comments:
Approved for Council consideration. AC
Background:
The application for a Text Amendment to the Zoning Bylaw to add Craft Distillery as a defined
primary use in the C1 zoning district. The applicant has applied for the purpose of locating a
Craft Distillery in the building currently occupied by Mt. Begbie Brewery on the property 521 1st
Street West (see Figure 1). Mt. Begbie Brewery will be relocating their operation on completion
of their new facility on Oak Drive. The subject property has an Official Community Plan (OCP)
designation of T50- High Street Mixed Use (see Figure 2) and is zoned C1 Central Business
District (see Figure 3).
The applicant has indicated the proposed craft distillery would produce no more than 50,000
liters of product per year and would include a retail store front component. The applicant has
provided a summary business plan describing their operation and market (see Figure 4).
The proposed definition for Craft Distillery is derived from the Provincial regulations for this type
of operation including the annual product limitation of not more than 50,000 liters per year. The
licensing agreement that the applicant would be required to enter into with the Liquor
Distribution Branch for a Craft Distillery has been attached for reference in regards to the rules
and regulations that would apply (see Figure 5). The proposed definition to be added to the
Zoning Bylaw would reference the Provincial Regulations and would include the maximum

City of Revelstoke
Council Report
volume regulation. The proposed vehicle parking requirement would be the same as that for
microbreweries, 1 per 100 square meters (see Figure 6). The application form has been
attached for reference (see Figure 7).
If Council approves the Zoning Bylaw Text Amendment application, grants First and Second
Readings to Zoning Bylaw No. 2101 and approves scheduling of a Public Hearing, neighbouring
property owners and occupants within 100m of the subject property would then be sent a notice
of the Public Hearing along with an information package. Ads notifying the community of the
Public Hearing would also be placed in the newspaper.
Options / discussion:
The proposed Craft Distillery would be an attraction adding a feature to the community for both
locals and tourists. It is anticipated that the proposed business would positively add to the
diversity and vibrancy of the downtown. The proposed business would also generate a made in
Revelstoke product adding to the promotion of Revelstoke outside of the community.
As the Province defines and regulates Craft Distillery operations it is proposed that the definition
added to the Zoning Bylaw not repeat these regulations but instead reference to the Provincial
Regulations. To assist with context and clarity as to the extent of the operation the maximum
annual production volume of 50,000 liters is proposed to be included.
The proposed parking regulation is the same as that for microbreweries as the functioning of the
two types of operations are similar in there is both a manufacturing component and retail/tasting
component.
If Council does not support the application proceeding, the applicant would be notified and the
files would be closed.
Financial / Risk Implications:
No financial or risk implications are anticipated from the proposed recommendation.
Others Consulted:
The following City of Revelstoke Departments received referrals for the subject application:
Engineering, Operations, Building, Parks, Recreation & Culture, RCMP and Fire Rescue
Services. No comments or concerns were received.
Attachments:
Figure 1 Context Map
Figure 2 Official Community Plan Designation Map
Figure 3 Zoning District Map
Figure 4 Proposed Business Overview from Applicant
Figure 5 Provincial Liquor Control and Licensing Branch, Craft Distillery Agreement
Figure 6 Zoning Bylaw Amendment Bylaw No. 2101

City of Revelstoke
Council Report
Figure 7 Zoning Bylaw Text Amendment Application

Respectfully submitted,

Dean Strachan, MCIP, RPP

Manager of Development Services

620

Figure 1

Context Map
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Official Community
Plan
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Land Use Designation
Map
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Figure
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SD - M3

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Figure 3

Zoning Districtc t Map

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Figure 4

Business Overview - Text Amendment and City Building Permit December 2015
Composed by Gareth Jones

This confidential Business Plan may not be reproduced or communicated in whole or in part
without consent of Gareth Jones.
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1

Jones Distilling Business Overview for Text Amendment &

Building Permit
Concept.
Jones Distilling has a strategy based on the relentless pursuit of
outstanding products & service using ecologically sound methods
to ensure the very best products for our customers. Jones
Distilling Ltd. will initially produce ultra-premium Vodka & Gin
adding Whisky in the medium term (minimum of 3 4 years after
initial production starts)1. The products will be extensively
marketed both nationally & internationally with the main effort
being direct sales to customers.
The business is totally committed to sourcing the very best
ingredients & providing peace of mind that everything produced
comes with the assurance of complete traceability throughout the
supply chain & an unquestionable integrity in sourcing &
manufacture.
In the short term the business will focus on production and spirit
sales with a tasting room. This will provide a focal point for local
sales, provide a venue for gin evenings and distillery tours. This
will be developed into a bar as sales support re-investment. The
aspiration to provide Revelstoke an unique bar which local people
can feel ownership and enhances the Revelstoke town centre.
This is to be the only distillery in the area as as such has to be part
of the fabric of the town.
Example Craft Distilleries. Okanagan Spirits

Over time, as the brand is established and a customer base is

based on Kelowna Main Street. Long Table
based in Vancouver.
developed, planning will start on opening a restaurant. The
aspiration is to create a fine dining restaurant. It will only source
local organic ingredients and the menu will reflect the seasons.
Ideally, in the long term, the restaurant will strive for a Michelin Star. If achieved this will make the restaurant
a gastronomic destination regionally.

Industry Context.
Alcohol sales within Canada were $20.5Bn in 2014/15, of this $4.8Bn (23.3% market share) was Spirits with
an average annual growth rate of 2.1% over the last decade. Within Spirits the largest growth in 2014/15
was Gin (2.9%) followed by Whisky (2.3%). This accounted for 91.5M litres being consumed within Canada
(2014/15) or 5.3 litres per capita2 . There is a continuation of the shift towards premium products within the
domestic market3 & dominates the liquor market with 36.3% share of total liquor volume4.

The Craft Distillery Industry.

This is an embryonic & lucrative market in a growing economy. The current trend away from large
manufacturers shows no sign of abatement. This increasing number of entrepreneurs & and small regional
Distilleries presents an opportunity for Jones Distilling to penetrate the market. The products will be
positioned very carefully. They will be of ultra-premium quality to ensure customer satisfaction, supported by
1

This is driven by a legal requirement that Whisky is casked for a minimum of 3 years.

Data from Statistics Canada

Euromonitor International: Spirits in Canada Report Dated June 2015

Market Realist Demand for Expensive Liquor is Growing Dated 25 Mar 2015

! of ! 3
2

impeccable customer service. As Jones Distilling prospers & grows these communities will continue to
benefit from both the value created by Jones
Distilling & its behaviour as a corporate citizen.

Location.

Distiller

Jones Distilling will be the only Craft Distillery5

located in Revelstoke. It will be based in the town
centre, opposite Coopers Food and CKCR EZ
Radio (link to location). This is a commercial zone,
which currently supports Mt Begbie Brewery after
the closure of a car dealership. The location has
access to a population of over 8,000 people in the
town and over 1.1 million visitors to the community
and 2.75 million in potential passing trade6. This is
the ideal location allowing for tourists, passing
trade and people traveling through on the TransCanada Highway. It has all the criteria to be be
great for a Craft Distillery, Tasting Room, Bar and
ultimately a restaurant.

Town Centre

Summary.
This is a unique opportunity to create and build a sustainable brand and the first ever distillery located in the
vibrant & growing town of Revelstoke. Jones Distilling will take raw ingredients and turn them into a
sophisticated high prestige product. This business is starting in an industry which is still embryonic and has
strong potential to continue the growth which has been seen in the last decade. Moreover it will provide,
initially, a tasting room then bar ideally located in the town centre. This is a great pre or post meal drink
destination for local dinners. Finally, the aspiration, is to create a fine dining location which will become
regionally known and a destination for any food lover.

This is a legal definition. Within BC the key points are production of not more than 50,000 litres p/a of finished product for sale with all
ingredients sourced from within BC.
5

Revelstoke Quick Facts - Summer 2013. (link)

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3

Privacy Act if a request is made to the LDB for such information.

25.

You consent to the exchange of any information related to your storage, sale and delivery of
Product with entities that may have need of this information for the operation of their own
programs including but not limited to the Liquor Control and Licensing Branch, and provincial
Consumer Taxation Branch and will execute any further documents necessary to allow such
exchange to occur.

General
26.

This Agreement is governed by, and is to be interpreted and construed in accordance with the
laws applicable in British Columbia.

27.

You must comply with the Reporting Requirements and Procedures as revised from time to
time as applicable to your type of manufacturing facility.

28.

You must comply with all Applicable Laws, and any other applicable laws, statutes, regulations,
bylaws, orders, directives, policies and procedures of general application imposed by the LDB
or its General Manager, or by any other governmental authority (federal, provincial or
municipal) which affects the importation, transport, manufacture, storage, sale, delivery or
consumption of liquor or in any way related to the performance of the services you provide.

29.

This Agreement and its terms and conditions which authorize you to sell and deliver Product
reflect current government policies applicable to your type of manufacturing facility.
Government policies, however, may be changed without prior notice to you. Should such
policies change, all or part of the terms and conditions in this Agreement may be revoked or
unilaterally changed by the LDB to reflect the then current policies in place. You will be
notified of changes in the terms and conditions that affect your type of manufacturing facility in
due course. You acknowledge that these changes may occur and agree to either adhere to
any revised terms and conditions, or that this Agreement will be terminated, all without any
claim against the LDB for losses such revisions or termination may cause you.

30.

Any trust funds, debts or amounts owed by you to the LDB, howsoever arising, will survive the
termination of this Agreement and any other sections of this Agreement which, by their terms or
nature are intended to survive the termination of this Agreement will continue in force
indefinitely, even after this Agreement ends.

31.

You acknowledge that should you cease to meet the criteria set out in Appendix C for
classification as a Craft Distillery at any time, this Agreement is terminated at that time, but
provided you are still a Licensed Distillery manufacturing Liquor, you may be classified by the
LDB as a Commercial Distillery from that time onwards. From the time your status changes
and thereafter, the LDBs Commercial Distillery Agreement or any replacement agreement
thereto will apply to your operations. From the date of your status change you are not
permitted to make direct sales and/or delivery of your Product to Wholesale Customers or
Hospitality Customers other than to your distillery store authorized under your Manufacturer
On-site Store Endorsement. You agree to pay to the LDB any mark-up owing for sales to
Wholesale Customers or Hospitality Customers and for sales made after the date of your
status change. If your status changes, you agree to adhere to the terms and conditions for a
Commercial Distillery Agreement or any replacement agreement, all without any claim against
the LDB for any losses arising from the reclassification status.

32.

If any term or condition of this Agreement cannot be enforced, the provision is to be

considered separate and removable from this Agreement.

LDB Craft Distillery Sales Agreement

5

33.

You must not assign any of your rights under this Agreement without the LDBs prior written
consent, but the LDB may assign all or any part of this Agreement without your consent.

34.

A waiver of any term or breach of this Agreement is effective only if it is writing and signed by
or on behalf of, the waiving party and is not a waiver of any other term or breach.

35.

This Agreement and its Appendices (Appendix A Reporting Requirements and Procedures,
Appendix B Definitions, Appendix C Definition of Craft Distillery, Appendix D Overview of
Reporting Requirements and Procedures on a Transitioning Craft Distillery with Annual
Production Level from 50,001 to 100,001) form the entire agreement between the parties and
should a conflict arise between the wording of this Agreement and the wording in the
Appendices, the wording of this Agreement will take precedence.

36.

Any communications related to this Agreement (including any notice provisions) may be made
by prepaid mail (assuming no work stoppage by Canada Post), hand-delivered, by facsimile or
e-mail as follows:
to the LDB, addressed to:
Chief Financial Officer, Finance, LDB
2625 Rupert Street
Vancouver, BC V5M 3T5
Facsimile: (604) 252-3175
Email: regemail@bcldb.com

to the Manufacturer, addressed to:

Name
Position
Address
Phone
Facsimile
E-mail
37.

Any notice mailed will be treated as if received on the fifth business day after the date of mailing.
Any notice received by facsimile or e-mail, will be treated as received on the same day of
sending if received before 4:00 pm, or on the next business day, if received after 4:00 pm.

38.

Notwithstanding the date of execution and delivery of this Agreement, this Agreement will be
effective as of the day you are licensed by the Liquor Control and Licensing Branch to
manufacture Products covered by this Agreement.

LDB Craft Distillery Sales Agreement

6

39.

This Agreement may be entered into by a separate copy of this Agreement being executed by,
or on behalf of, each party and that executed copy being delivered to the other party by a
method provided for in Section 36.

Agreed to by the parties:

Province of British Columbia as represented by the Liquor Distribution Branch
Signature
Name
Title
Date

Manufacturer
Manufacturer Name

______________________

Authorized Signatory (1) ______________________

______________________
Print Name

Title

______________________

Date

______________________

Authorized Signatory (2) ______________________

______________________
Print Name

Title

______________________

Date

______________________

LDB Craft Distillery Sales Agreement

7

APPENDIX A
Craft Distillery Reporting Requirements and Procedures
Appendix A
Craft Distillery - Reporting Requirements and Procedures

1.

Introduction

The purpose of this document is to describe the reporting requirements of the British Columbia
Liquor Distribution Branch (LDB) with regard to operating a Craft Distillery in British Columbia.
This document also serves as Appendix A to the Craft Distillery Agreement (Agreement).
Provisions in the Agreement require adherence to the requirements set out in this document.
The definitions in the Agreement will apply to this document unless indicated otherwise.
Any questions regarding the information in this Appendix should be directed to:
Liquor Distribution Branch
Finance Department, Data Management
2625 Rupert Street
Vancouver, BC
V5M 3T5
Or by Email: ldbdatam@bcldb.com
Phone: 604- 252-3170

2.

Craft Distillery Reporting

As a Craft Distillery, you are required to report information on your sales of your packaged
beverage alcohol to your customers in British Columbia.

2.1

Why report

The LDB requires you as Craft Distillery to report information on your sales of your packaged
beverage alcohol to your customers in British Columbia (the Sales Reports) in order to fulfill the
LDBs reporting and revenue collection responsibilities to the Provincial Government.
LDB and the Provincial Government use the information you provide for monitoring, reporting, and
financial control purposes.

2.2

When to report

It is important that you report your sales in a timely manner. LDB reporting is done based on
Financial (Fiscal) Year calendar which is different from a calendar year:
-

Fiscal year begins on April 1 and ends on March 31 of the following year,
Each fiscal year is comprised of 12 fiscal periods,
Each fiscal period is based on 4-5 full weeks (except last period which always ends on
March 31), and
Each fiscal week spreads from Sunday through Saturday.
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APPENDIX A
Craft Distillery Reporting Requirements and Procedures
A current copy of the Financial (Fiscal) Year calendar can be found here: www.bcldb.com/directsales-web-reporting-user-guides.
You are required to report to the LDB on your sales-related activities for each week ending
Saturday. LDB must receive your Sales Reports no later than first business day of the week
following each week of sales.
The reporting process includes filling in the sales documents, compiling the documents into a
batch, and submitting the batch for processing.
If you did not process any sales or returns in any given week, or plan to temporarily cease sales
operations for a longer period, please email Data Management at the LDB Finance department.

2.3

What to report

2.3.1 General Rules on Sales Reporting

The rules listed below are applicable to reporting sales to all customer types. Rules specific to
individual customer groups are listed in the sections 2.3.2 through 2.3.4.
1.

You are required to report sales of packaged beverage alcohol by your Distillery to your
Wholesale Customers and Hospitality Customers.

2.

Do not include your sales to the BC Government Liquor Stores and LDB Distribution
Centres.

3.

Do not report your sales outside of British Columbia. You must however keep all the records
related to all sales and dispositions of your products for annual filing of the Packaged
Product Movement Summary attached as Exhibit B (Product Movement Summary) and
possible audit.

4.

Report your sales of packaged Product from your Manufacturer On-site Store Endorsement
at the Wholesale Price as sales to the Manufacturer On-site Store. Do not report your sales
made to final consumers from your on-site store.

5.

When transferring product to your Distillery lounge or special event areas operated under
endorsements to your Manufacturers Licence, reports the transfer as a sale to
Manufacturers On-site Store (i.e. Wholesale Customer) at the Wholesale Price providing
your reporting store number as a customer number. Do not report your sales made to final
consumers from those endorsements. Further explanations on how to report sales to your
on-site store will be found in section 2.3.2.

6.

Sales to Ships Chandlers should not be reported as they are treated as export shipments out
of British Columbia.

7.

Any packaged beverage alcohol you use for promotion, tasting or provide to your employees
or customers must be purchased from your on-site store or other authorized retailer. If the
product for sampling and tasting was taken from your Distillery inventory, it must be reported
by the Distillery as a sale to your Manufacturers On-site Store.
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APPENDIX A
Craft Distillery Reporting Requirements and Procedures
8.

Please note that your product SKUs must be registered and the LDB Established Retail
Price and Wholesale Price set up by the LDB before you can start selling these products.
You should not process any sales until the pricing is completed by the LDB. Please contact
LDB Purchasing department (or such other department that the LDB may advise from time
to time) on how to register your products.

9.

All sales must be reported in selling units as per LDB product registration. If a product is
registered and priced as a 2-pack (e.g. two-bottle gift set) then for each unit sold, the
quantity reported must be 1 and price per unit must be per a 2-pack set.

10.

Container recycling fee is included in the Wholesale Price.

11.

You must collect a container deposit on all your sales to Wholesale Customers and
Hospitality Customers as per the rate schedule established by the container stewardship
organizations effective on the date of transaction. Please see the Container Deposit
Schedule currently in effect: www.bcldb.com/direct-sales-web-reporting-user-guides. The
container deposit will be transferred to the container stewardship organization on your
behalf.

12.

At the end of each month, you will be invoiced by the LDB for container deposits and
recycling fees based on sales you reported and container type and unit configuration
registered in the LDB system. You must pay the LDB immediately on receipt of such
invoice.

13.

The reporting is done by creating sales documents and compiling these sales documents
into a batch before submission. You can include documents from prior periods into a batch
but cannot report sales for future dates.

14.

Please refer to the Exhibit A for the taxes and price applicable to each customer type.

Please refer to the next sections for reporting requirements on sales to specific types of
customers.

2.3.2 Reporting Wholesale Sales of packaged Products to your Manufacturer

On-site Store
You must report to the LDB all sales/returns of products to your on-site store operated under your
Manufacturer On-site Store Endorsement.
Your Distillery must have registered for and received a PST (Provincial Sales Tax) registration
number to be able to sell products from your endorsement areas.
Report as sales to your Manufacturer On-site Store the following:
Products sold through your on-site store,
Products sold to your lounge or special event endorsement area,
Products sold at farmers markets to retail customers,
Products you have used for tasting and sampling or given to your employees, and
Products sold to Special Occasion Licensees only if your Distillery has an on-site store
endorsement area.
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APPENDIX A
Craft Distillery Reporting Requirements and Procedures
If the sales price within a reporting period had not changed, you can report net sales (sales net of
returns) for the period by product SKU on a single sales document. Alternatively, you can report
each sale and return transaction individually by customer as you process them.
The following information is required for online reporting:
- Transaction Date the date when the wholesale sale or return occurred.
If you report all net (value of sales less returns) wholesale sales on a single document,
use can use the last day of the reporting week as a transaction date. The date defines
the price being in effect for all transactions reported on this document.
- Transaction Number (Invoice Number) - a reference number that uniquely identifies the
wholesale sale or return document.
- Customer Type use MOS Manufacturer On-site Store.
- LDB Payment Type Cash.
- Customer Number use your reporting store number. For example, if you report your
sales as a store number 999, select a customer number 999 to report your retail sales
from your on-site store.
- LDB Product number - (SKU) and description.
- Price Wholesale Price per selling unit excluding taxes effective on date of the
transaction.
- Quantity - sold in selling units as per the product registration.
- Container Deposits - Container deposit you collected. Please note that the LDB online
reporting system will calculate the deposit amount but you may want to compare it with
the amount you collected to identify any errors.

2.3.3 Reporting Sales and Returns to/from Wholesale Customers except

sales your on-site store
The Wholesale Customers Liquor Control and Licensing Branch (LCLB)-issued licence number
must be valid and customer must be eligible to purchase alcohol for resale on the date of the sale.
1.
2.

3.

The Wholesale Customers that you sell your products to must have registered for and
received a PST (Provincial Sales Tax) registration number.
Each individual sale or return must be reported on a separate document, indicating the
Wholesale Customer licence number or LDB issued store number assigned to the
Wholesale Customer.
The reporting must be completed using the Wholesale Price and tax effective on the date of
the sale.

The following information is required for online reporting for Wholesale sales:

Transaction Date the date when the original sale occurred. The date defines the price
being in effect for all transactions reported on this document.

Transaction Number (Invoice Number) a reference number that uniquely identifies

the sale or return document.

Customer Type - (e.g. Licensee Retail Store, Rural Agency Store etc.) based on the
information in Exhibit A.

Customer Number a Wholesale Customers license number assigned by the LCLB, or

a store number for Rural Agency Store as assigned by the LDB.
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APPENDIX A
Craft Distillery Reporting Requirements and Procedures

Name and address of the customer.

LDB Payment Type Cash.
LDB Product Number - (SKU) and description.
Price - Wholesale Price effective on the date of the transaction.
Quantity - sold, in selling units as per the product registration.
Container Deposits - container deposits you collected. Please note that the LDB online
reporting system will calculate the deposit amount owed based on the sales reported but
you may want to compare with the amount you collected to identify any errors.

2.3.4 Reporting Sales and Returns to/from Hospitality Customers

1.

The Hospitality Customers BC LCLB-issued licence number must be valid and customer
must be eligible to purchase alcohol for resale on the date of the sale.

2.

The Hospitality Customer must have registered for and received a PST (Provincial Sales
Tax) registration number.

3.

Each individual sale (sales order) must be reported on a separate document, indicating the
Hospitality Customer licence number.

4.

The sale and reporting must be complete using the LDB Established Retail Price and
applicable sales taxes effective on the date of the sale.

The following information is required for online reporting:

Transaction Date the date when the original sale occurred. The date defines the price
being in effect for all transactions reported on this document.

Transaction Number (Invoice Number) a reference number that uniquely identifies

the sale or return document.

Customer Number the Hospitality Customers license number assigned by the LCLB.

2.4

Name and address of the customer.

Customer Type Hospitality (LIC).
LDB Payment Type Cash.
LDB Product Number - (SKU) and description.
Price - LDB Established Retail Price as of the date of transaction.
Quantity - sold, in selling units as per the product registration.
Container Deposits - container deposits you collected. Please note that the LDB online
reporting system will calculate the deposit amount owed based on the sales reported but
you may want to compare it with the amount you collected to identify any errors.

How to Report

Unless you have been authorized by the LDB to report in another manner, all reporting must be
done online through the Internet via the LDB application used for reporting called Direct Sales
Web Reporting (DSWR).
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APPENDIX A
Craft Distillery Reporting Requirements and Procedures
DSWR is a very simple and intuitive application that uses a secured gateway built by the Provincial
Government to grant business and individuals on-line access to various Provincial Government
services.
LDB has developed very comprehensive user manuals for DSWR system that are available here:
www.bcldb.com/direct-sales-web-reporting-user-guides
The application can be accessed from the following page:
http://www.bcldb.com/doing-business-ldb/direct-sales-reporting
For any new Distillery, shortly after the signing of your Agreement, you:

will be assigned a LDB Store Number (3- or 4- digit number) to use when reporting;

will be offered to schedule an optional web-based training session on using the DSWR
reporting application.

will receive by email the full package of instructions on how to register, access, and use
the DSWR application; and

Please note that you need to apply for a BCEID account through www.bceid.ca to start reporting.
The registration process may take up to 4 weeks, so please apply in advance to avoid delays.
If you are using a bookkeeping service to assist you with reporting and filing, you need to register
your company as well as your representatives for BCEID first, and then grant your representatives
permissions to use online services on your behalf.

2.5

Alternative Reporting Options

LDB offers an alternative reporting system if your organization uses a computerized system to
process sales and returns and you need an effective tool to report a significant number of
transactions. This system will allow you to upload your file in a LDB-specified .CSV format to the
LDB server. You may need to make changes to your system to enable it to produce the file in the
format according to the .CSV specification the LDB provides. Please contact LDB Data
Management to obtain the upload file specification and further instructions.

3.

Product Movement Summary

3.1

Purpose

As a Distillery, you are required to report, on an annual basis, the movement of your packaged
beverage alcohol in the province. The form Product Movement Summary is attached as Exhibit
B to these Reporting Requirements and Procedures. This report is used by the LDB to ensure that
your Product is duly accounted for. Any unaccounted for Product will be dealt with as set out in
the Product Losses section of this Agreement, as further explained below

3.2

Report Completion

3.2.1 Generally
For the Period The annual period covered is April 1 to the following March 31. Enter
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APPENDIX A
Craft Distillery Reporting Requirements and Procedures
the appropriate year. If your Distillery is a new manufacturer, the reporting period is from
the date you began your operations to March 31.
Unit of Measure - Litres.

3.2.2 For each Type of Product you report, you need to complete the
following details:
Opening Inventory Report the total litres of packaged beverage alcohol you store in
your Licensed Establishment including your on-site store endorsement as at the
beginning of business on April 1 (the start of your 12 month reporting period.)
Production Report the total litres of packaged beverage alcohol you produced at your
manufacturing facility during the 12 months ending March 31.
Product Returns Report the total litres of packaged beverage alcohol any of your
customers returned to you. For the subsequent disposition of the returned product,
include these movements of your inventory in the appropriate columns of the report (for
example: include it in the Breakage, defective reported to CRA column if you destroyed
it and declared such destruction to the Canada Revenue Agency (CRA) or included it in
Total shipments in British Columbia if you resold it.)
Total Additions - This is a calculated total arrived at by adding the 2 columns
Production and Product Returns
Total Product Available - This is a calculated total arrived at by adding the 2 columns
Opening Inventory and Total additions.
Shipments to Other Provinces - Report the total litres of packaged beverage alcohol
you shipped outside of British Columbia but within Canada. For example, you would
include any shipments you made to the Alberta Gaming and Liquor Commission in this
total. Ensure you include the litres you physically shipped to the other Canadian
provinces during the 12 month reporting period which may not necessarily be the same
as the volume you sold during the same time period (as is the case when product is held
in other provinces on a consigned basis.)
Shipments Out of Canada - Report the total litres of packaged beverage alcohol you
physically shipped out of Canada during the 12 months covered by the report.
Note: Any sales made in British Columbia to Ship Chandlers during the 12 months
covered by the Report should be included in the shipments out of Canada column.
Total Product Available in BC - This is calculated by deducting the volume reported as
Shipments to other Provinces and Shipments out of Canada from the volume reported
as Total Product Available.
Total Shipments in British Columbia Report the total litres of packaged beverage
alcohol you physically shipped to your authorized British Columbia customers (including
any shipments made to the BC Liquor Distribution Branch) during the 12 months covered
by the Report.
Total Other Deductions - Report any packaged beverage alcohol you wrote off either
by destroying or through breakage or inventory count adjustments. You must complete
the individual sub-column as appropriate.
o LDB exempted deductions: If an unusual event occurs at the manufacturing
facility or its warehouses which results in the loss of packaged beverage alcohol,
such as a major forklift accident in the warehouse or shelving collapsed, the LDB
A-7

APPENDIX A
Craft Distillery Reporting Requirements and Procedures
will consider exempting these deductions from mark-up. However, each exemption
must be approved by the LDB in writing.
o CRA claimed deductions: If you reported any of the destroyed packaged
beverage alcohol to the Canada Revenue Agency (CRA) to claim back the excise
duties you paid, you must separately report the volume in this field.
o Other breakage, adjustments & write-offs: Report the total litres of Other
Breakage, Adjustments & Write-offs not included in Total Shipments in BC (BC
Sales).
o Total Deductions: This is a calculated sum of Breakage Defective Allowed by
CRA, BC LDB and Other Breakage, Adjustments & Write-offs.
Closing Inventory Calculated - This is calculated by deducting the Total shipments in
British Columbia (BC Sales) and Total Other Deductions from the Total Product
Available in BC column of the Report.
Closing Inventory Physical - You are required to physically count the inventory
(packaged beverage alcohol) you have on hand in your Licensed Establishment including
your on-site store endorsement area. The inventory that you physically counted
(converted to litres) should be reported in the Closing Inventory Physical column of the
Product Movement Summary report.
Ensure you retain the inventory count sheets which record the inventory physically
counted on March 31 along with the Craft Distillerys inventory records.
Difference This is calculated by deducting the Closing Inventory Calculated total
from the Closing Inventory Physical total reported on the Product Movement Summary
report.
Self-Assessment Calculation This portion of the Product Movement Summary report
calculates the Total Deductions Subject to Mark-up. If you calculate a positive balance,
you will owe the LDB mark-up because your non-sale deductions from inventory exceed
the shrinkage allowance. The purpose of this factor is to take into account an acceptable
volume of packaged beverage alcohol that may be consumed or written-off in the
province due to normal manufacturing and warehousing activities. By allowing for a
Shrinkage Allowance a Craft Distillery does not have to fully document each instance of
breakage/destruction which may occur. However, to the extent that a Craft Distillery
cannot account for some movements of its packaged beverage alcohol during the 12
months covered by the Product Movement Report, and these unaccounted for
movements of inventory exceeds the shrinkage allowance, the LDB will invoice the Craft
Distillery to recover the mark-up value of the excess volume of the unaccounted
movement of inventory.

3.3

Other

The completed Product Movement Report and your listing of warehouse locations including your
on-site store endorsement area must be sent to the LDB by June 30th to the attention of following
address:
BC Liquor Distribution Branch
Attention: Finance Department Revenue Division
2625 Rupert Street
Vancouver, BC V5M 3T5
Or Email to: LDBrama@bcldb.com
A-8

APPENDIX A
Craft Distillery Reporting Requirements and Procedures
The LDB regularly audits the Product Movement Summary report it receives from the Craft
Distilleries. If you are selected for an audit, the LDB will normally contact you in advance and
make arrangements for the audit.

4.

Annual Production Reporting

You are required to report total Annual Production or the combined Annual Production of all
Licensed Distilleries under common ownership or management of Product to LDB in litres
immediately following the calendar year for which the Annual Production is to be reported.
The completed Annual Production report in Exhibit C must be sent to the LDB by January 31 to the
attention of the following address:
BC Liquor Distribution Branch
Attention: Finance Department Regulatory Division
2625 Rupert Street
Vancouver, BC V5M 3T5
Or Email to: regulatory.inventory@bcldb.com

5.

Collection and payment for Beverage Container Deposits and

Container Recycling Fees to LDB

In accordance with the provincial Ministry of Environments Recycling Regulation, most containers
which hold ready-to-serve beverages are subject to a refundable container deposit. The
Recycling Regulation also requires manufacturers or their agents to be part of an approved
stewardship plan that ensures containers are collected and recycled.
In British Columbia, there are two stewardship agencies that manage beverage container
stewardship plans on behalf of the industry. Encorp Pacific Ltd. ("Encorp") is the stewardship
agency for all non-refillable containers except cans. Brewers Distributor Limited ("BDL") is the
stewardship agency for cans and refillable bottles. Each of these two agencies operates a
collection and recycling system and determines the amount of the container recycling fees
("CRFs") that are required to pay for the costs of their systems. In the normal course of business,
Encorp and BDL review the CRFs and make adjustments as necessary.
In order to streamline the administration of the two stewardship plans, the LDB has agreed to
consolidate the collection of container deposits and CRFs on product sales and remit them to
Encorp and BDL for funding of their stewardship plans. This relieves manufacturers from the
burden of making individual payments to the two stewardship agencies. This does not apply to
refillable bottles as BDL collects container deposits and CRFs directly from the manufacturers of
these containers.
When you sell beverage alcohol, you must collect CRFs (included in the LDB Established Retail
Price), and container deposits on your packaged product.
Please see the Container Deposit Schedule currently in effect: www.bcldb.com/direct-sales-webreporting-user-guides. Encorp and BDL change the CRF fees from time to time and when they
do, the LDB will update the schedule with the new rates.
A-9

APPENDIX A
Craft Distillery Reporting Requirements and Procedures
In order to provide these funds to Encorp and/or BDL, each month the LDB will invoice your
Craft Distillery for the CRFs (plus applicable taxes) and container deposits based on your sales
reports.
You are required by this Agreement to pay the invoices in a timely manner according to the
payment terms stated on the LDB invoice. Failure to do so will result in suspension or termination
of your Agreement.

6.

Craft Distillery Records

As a manufacturer producing and handling packaged beverage alcohol in British Columbia, you
are required to maintain adequate business records that clearly demonstrate your ability to
account for all the beverage alcohol you handle.
At a minimum, the records you maintain and retain need to be sufficient so that any reasonable
third party reviewing your records can determine the following regarding your packaged beverage
alcohol:
- The amount you currently store anywhere in British Columbia, including identifying the
specific warehouses or locations where your product is stored including in your Licensed
Establishment and on-site store endorsement area. As a Craft Distillery, you are required
to physically count your inventory at the close of business on March 31 each year. Also,
you are required to retain your physical count sheets that clearly identify the product you
counted at each of your warehouse locations.
- The amount you produced in your craft distillery.
- The amount a third party bottled on your behalf.
- Your records need to be sufficient so that you can reasonably demonstrate that your
entire product is produced using 100% BC agricultural inputs.
- The amount you used for promotional, tasting or sampling purposes.
- The amount you disposed of for quality control purposes, breakage or general
destruction.
- The amount that you shipped out of British Columbia including sufficient documentation to
clearly evidence that this product physically left British Columbia.
- The amount that you sold to your authorized customers in British Columbia.
All the records referred to above must be retained at your Craft Distillerys office(s) in
British Columbia. These records must be kept for a period of not less than seven years
following the end of each calendar year.
You must make all your records available if any authorized representative of the LDB conducts
an inspection or audit; including allowing access to any premise wherein your packaged
beverage alcohol is stored.
If the inspection or audits referred to above disclose a breach of the Agreement, you must pay
the costs and expenses of the inspection or audit and any payments assessed as due and
owing, as determined by the LDB using reasonable audit standards.
Please note that your Craft Distillery is solely responsible for collection and remittance of all
provincial and federal taxes, levies and fees imposed by the current provincial, municipal,
federal or other regulations unless the terms of the Agreement state otherwise.

A-10

Exhibit A Customer Types and Pricing

The Table below provides the applicable customer types, pricing and tax to be collected on your
sales, reported and remitted to the LDB.

Customer type

Code

Descriptor

Pricing

TAX

Manufacturer
on site
Hospitality

MOS

GST

Licensee

Wholesale
Price
LDB
Established
Retail Price
Wholesale
Price
Wholesale
Price
Wholesale
Price

Licensee Retail LRS

Store
Rural Agency RAS
Store
Grocery
GRC

R
A
G

A-11

GST

GST
GST
GST

Self-Assessment Calculation

Production
2

Product
Returns
5

G =5
6

Breakage,
Total shipped
defective,
in B.C.
reported to CRA
7

Other

H = 6+7

I = F-G-H

Physical

Closing inventory

Total Other
Deductions Calculated

Total Other Deductions

K = I-J

Difference

3 Only the portion of Excise tax exemptions reported and permitted for breakage/defective product is to be included.

2 If an unusual event occurs at the spirit manufacturer or its warehouses which results in the loss of packaged
product, such as a major forklift accident in the warehouse or shelving collapsed,
the LDB will consider exempting these deductions from markup.
However, each exemption must be approved by the LDB in writing.

A-12

Equals: LDB Shrinkage Allowance

Multiply by: LDB Allowance

Total Product Available in B.C. - Include the balance of Column F

Less : Closing inventory (column J)
Less: LDB exempted deductions (Note 2)
Less: CRA permitted deductions - destruction/defective (Note 3)
Equals: Total calculated product moved in B.C.

LDB Shrinkage Allowance Calculation

0.50%

(liters)

Prepared by:

subsequent shipment of this packaged product may be recorded under columns D or E if shipped out of B.C. or in
Column 6 if shipped within B.C.

Spirits

F = C-D-E

B.C. Sales

Total shipments in B.C.

Notes:
1 If column K is negative, this means there is an error in the schedule. Accordingly the
LDB does not provide a markup benefit for such errors. If Column K is positive, we recommend you
review the schedule for possible errors. If no error is found, this means there is some unaccounted movement of
product; and accordingly subject to LDB markup.

Total Product
Available in B.C.

4 All product packaged by the reporting spirit manufacturer must be included in this schedule. For example: If bulk
product is packaged on a contract basis for a 3rd party, this production must be included under column 1. The
$

Shipments to Shipments out

other Provinces
of Canada

Total Shipments out of B.C.

Equals: Total markup due to the LDB

C =A+B

Total Product
Available

(All amounts in liters)

For the Period: April 1, 2010 to March 31, 2011

Packaged Product Movement Summary - BC Spirit Manufacturer

Spirit Manufacturer

Multiply by : Average markup per liter

Less: LDB Shrinkage Allowance - calculated below

LDB exempted deductions (Note 2)
CRA reported deductions - breakage/defective (Note 3)
Equals: Total deductions subject to markup

(liters)

Spirits

B = 1+2

Total additions

Total Additions

Total other deductions - Include the balance of Column H

Plus: Inventory difference - Include Column K balance only if
Equals: Total

Spirit

Column reference:

Type of product
(Note 4)

Opening
Inventory

Company:_______________________________________

Exhibit B Annual Product Movement Summary

Exhibit C Annual Production Report

A-13

Exhibit C - Monthly Production Report

Distillery
For the month ending __________ , year __________

Example

BCLDB SKU #

Container Size

Case
Configuration

Cases Bottled
In Month

Total Litres
Bottled

123456

.750ml

12 x.750ml

50

50 x 12 x .750
= 450 L

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
19
20
Total Litres

(Please input number in column B of the Annual Production Report in the corresponding month)

A-14

APPENDIX B
Craft Distillery - Definitions
Appendix B
Craft Distillery - Definitions

In this Agreement:
a) Agreement means this agreement and the attached Appendices;
b) Annual Production means the total litres of Product manufactured by a Licensed
Manufacturer in any calendar year as further described in Appendix C;
c) Applicable Laws means the Liquor Distribution Act, Liquor Control and Licensing Act
and the Excise Act and any regulations under those statutes and includes any
amendment or replacement of those statutes and regulations from time to time;
d) Excise Documents means any documents required under the Excise Act or its
Regulations;
e) Hospitality Customer means:
i.
a Caterer being a person holding a caterers licence or a licensee whose licence
contains a catering endorsement, issued under the Applicable Laws,
ii.
any business which operates an establishment which has been issued a liquor
primary licence, a liquor primary club licence, a food primary licence or similar
license under Applicable Laws, and
iii.
any holder of a manufacturers licence for its business conducted under a
lounge or special event endorsement issued under the Applicable Laws;
b) LDB Established Retail Price means the retail price set by the LDB for Product to be
sold to Hospitality Customers;
f) Licensed Establishment means your place or premises within which is any area
where liquor is manufactured or served;
g) Lost Product means Product:
i.
which was under your possession or control,
ii.
which is in excess of the allowable shrinkage set for your manufacturing facility
type as set out in the Reporting Requirements and Procedures, and
iii.
which cannot be accounted for by you;
h) Manufacturer Licence means a distillery licence issued under Applicable Laws;
i) Manufacturer On-site Store Endorsement means the endorsement on your distillery
licence which allows you to operate an on-site retail store;
j) Product means liquor manufactured by you at your Licensed Establishment to its final,
finished, saleable state intended for consumption, whether in bulk or packaged form,
ready for purchase as further defined in Appendix C;
k) Records means the records necessary for your type and size of business, as a
prudent business operator, which would enable you to account for your Product, how it
was produced, and how it is disposed of, including those records described in the
Reporting Requirements and Procedures;
l) Reporting Requirements and Procedures means the reporting requirements and
procedures attached as Appendix A to this Agreement;
m) Sales Reports means the reports you are required to make about your sales of
Product to Wholesale Customers and Hospitality Customers as described in the
Reporting Requirements and Procedures;
B-1

APPENDIX B
Craft Distillery - Definitions
n) "Special Occasion Licensee" means a licensee issued a special occasion licence under
Applicable Laws;
o) "Transitioning Craft Distillery" is a category of Craft Distillery that has Annual
Production of Product as set out in Appendix C and Appendix D exceeds 50,000 litres
but is less than 100,000 litres;
p) Warehouse means any and all warehouses and other locations where your Product is
stored prior to being sold;
q) Wholesale Customer means:
i.
Licensee Retail Store as licensed under the Applicable Laws,
ii.
Rural Agency Store being the agency store as defined under Applicable Laws,
iii.
your retail store operated under your Manufacturer On-site Store Endorsement,
and
iv.
as a holder of a Manufacturers Licence its business conducted under its
distillery lounge or special event endorsement issued under the Applicable
Laws; and
r) Wholesale Price means the LDB wholesale price applicable to a Wholesale
Customer.

B-2

APPENDIX C
Craft Distillery Criteria

Appendix C
Craft Distillery - Criteria

To be a Craft Distillery, as a British Columbia Licensed Manufacturer:

1)

All of your Product* is fermented and distilled at your Licensed Establishment using 100%
BC agricultural inputs.

2)

Your total annual production of Product is:

a)
less than 50,001 litres per year and therefore mark-up free/no remittance. If your
Licensed Establishment is under common ownership and/or common management
with other licensed establishments with distillery licences, the combined production of
all distilleries will be used to determine compliance with the 50,000 litres production
limit. In order for one to qualify for a Craft Distillery that is mark-up free/no remittance
designation, all distilleries under common ownership and /or common management**
must meet the criteria. Your Products must be produced utilizing traditional distilled
spirit making techniques. Production of spirit cooler products or other highly processed
products are not permitted. The use of neutral grain spirits in the production of any
Products is not permitted; or
b)
greater than 50,000 litres per year but less than 100,001 litres and therefore a
Transitioning Craft Distillery and mark-up/ remittance will be paid in accordance with
the rates set out in Appendix D. If your Licensed Establishment is under common
ownership and/or common management with other licensed establishments with
distillery licences, the combined production of all distilleries will be used to determine
compliance with the Transitioning Craft Distillery production limit. In order for one to
qualify for a Transitioning Craft Distillery, all distilleries under common ownership and
/or common management** must meet the criteria. Your Products must be produced
utilizing traditional distilled spirit making techniques. Production of spirit cooler
products or other highly processed products are not permitted. The use of neutral
grain spirits in the production of any Products is not permitted.

3)

Licensed establishments producing liquor that do not meet the above criteria for a Craft
Distillery will be classified as a Commercial Distillery subject to the terms and conditions of
the LDBs agreement with Commercial Distilleries.

The LDB retains the right, in its sole discretion, to determine if a licensed establishment with a
distillery license meets the criteria for a Craft Distillery including a Transitioning Craft Distillery.
Product means the Liquor manufactured by you at your Licensed Establishment to its final,
finished, saleable state intended for consumption, whether in bulk or packaged form, ready for
purchase.
** Common ownership and/or common management, in relation to two or more licensed
establishments with distillery licences means:
Any shareholder holds 20% or more of the common shares of each licensed establishment
with a distillery licence and/or;
The licensed establishments have common directors and/or officers who collectively hold
50% of the votes at any directors meetings or who share two or more senior employees
who direct the licensed establishments distillery business and/or;
A licensed establishment with a distillery licence owns shares in another licensed
establishment with a distillery licence.
*

C-1

APPENDIX D
Transitioning Craft Distillery
Appendix D
Overview of Reporting Requirements and Procedures on a Transitioning Craft Distillery
(with Annual Production level from 50,001 to 100,001)

You will be required to report your Annual Production volume of the Product for each calendar year
(January 1 through December 31) by January 31 of following year. Once your Licensed
Establishments Annual Production of Product exceeds 50,000 litres per year but under 100,001
litres per year, your distillery will be a Transitioning Craft Distillery. Reported sales will be a subject
to a mark-up, based on your Annual Production category, effective on April 1 immediately following
the report of Annual Production. If your Licensed Establishment is under common ownership
and/or common management with other licensed establishments with distillery licences, the
combined production of all distilleries will be used to determine the mark-up rate. Your Licensed
Establishment has to continue meeting all conditions applicable to the Craft Distillery status in order
to qualify for mark-up exemption or reduced mark-up on sales of your Products.
Please note the following major changes in your sales process and reporting when your Licensed
Establishment ceases to qualify to be fully mark-up exempt but still qualifies as a Transitioning
Craft Distillery:
1.

You will have to collect the full LDB mark-up on sales to your Wholesale Customers and
Hospitality Customers;

2.

Sales to Special Occasion Licensees may only be done through your Manufacturer On-site
Store Endorsement (a Wholesale Customer);

3.

You will have to remit proceeds of your weekly sales to Wholesale Customers and
Hospitality Customers, including container deposit amounts to LDB (LDB will open a bank
account and provide deposit slips for your weekly deposits);

4.

LDB will pay you the duty-paid cost of the product on all reported sales.

LDB will reimburse you any amount owing to you which reflects the difference between the markup deposited by you on all reported sales and the mark-up due to the LDB. The details of the
reporting requirements will be provided to you at the time you qualify as a Transitioning Craft
Distillery, or at any time earlier at your request.
Mark-up rates in effect as of April 1, 2015.
Mark-up Rates for Craft Distilleries
Craft Distillery Annual
LDB Mark-up for Craft
Production (litres)
Distilleries
Up to 50,000
0%
50,001 - 60,000
21%
60,001 - 70,000
41%
70,001 - 80,000
62%
80,001 - 90,000
83%
90,001 - 100,000
103%
If Annual Production is over 100,000 litres then you would be a Commercial Distillery and the
mark-up would be 124%.

D-1

FIGURE 8
CITY OF REVELSTOKE
BYLAW NO. 2101

Being a Bylaw to Amend Zoning Bylaw No. 1264, 1984

WHEREAS the Council of the City of Revelstoke, Province of British Columbia,

deem it necessary to amend the City of Revelstoke Zoning Bylaw No. 1264,
1984, to include Craft Distillery as a defined, permitted use in Central Business
District - C1 zoning district.
NOW THEREFORE the Council of the City of Revelstoke, Province of British
Columbia in open meeting assembled enacts as follows:
1. THAT Bylaw No. 1264, 1984 be amended by adding and revising the
following subsections:
8.1

CENTRAL BUSINESS DISTRICT (C1)

8.1.1 Uses Permitted
(1)

The following general commercial and service uses:

(v) Craft Distillery

12.4

Required Off-Street Parking

12.4.C Commercial Uses
(12) Craft Distillery

SCHEDULE B

1 per 100 square meters

DEFINITIONS

Craft Distillery means a commercial operation manufacturing

and selling liquor with a maximum annual production of 50,000
liters and licensed by the Liquor Control and Licensing Branch.
2. THAT a Public Hearing was held pursuant to the Local Government Act.
3. THAT this Bylaw may be cited for all purposes as the Zoning
Amendment Bylaw No. 2101.
4. THAT this Bylaw shall take effect upon the date of its adoption by Council.
READ A FIRST TIME THIS ____ DAY OF __________, 2016.
READ A SECOND TIME THIS ____ DAY OF __________, 2016.
PUBLIC HEARING HELD THIS ____ DAY OF __________, 2016.
READ A THIRD TIME THIS ____ DAY OF __________, 2016.

Zoning Amendment Bylaw 2101

Page |2

APPROVED BY THE MINISTRY OF TRANSPORTATION AND

INFRASTRUCTURE, PURSUANT TO THE TRANSPORTATION ACT, ON THE
____ DAY OF __________, 2016.
___________________________________________
Minister of Transportation and Infrastructure

ADOPTED BY CITY COUNCIL THIS ____ DAY OF __________, 2016.

Director of Corporate Administration

Certified a true copy, this

Mayor

day of

Figure 7