RFI_25-0166_Legacy_System_Refresh_Market_Research_Initiative.pdf

RE: Legacy System Refresh Market Research Initiative

RFI 25-0166

Request for Information Project: Legacy Systems Refresh Market Research Initiative

Responses Due: June 30, 2026

Questions: Email Lowela.Goessling@abc.ca.gov by June 19, 2026, to receive a timely response.

mailto:Lowela.Goessling@abc.ca.gov

Contents Introduction, Project Overview and Content

Section A – Department Overview, Environment, and Future Objectives

Section B – Vendor Response Requirements

Section C – Workflow Demonstrations

Invitation to Respond with Information

How to Submit Your Response

Submission Deadline

SECTION A - Department Overview, Environment, and Future Objectives

Organizational Overview

Divisions & Offices

ABC Primary Systems

Objectives

COMMUNICATIONS, DOCUMENTS & REPORTING

Communications

Current Communication Processes

Opportunities for Improved Communications

Document Management

Reporting

ABC CORE PROGRAM OPERATIONS

Core Program Overview

Licensing Program Operations

Summary

License Types

License Categories

License Types

Transaction Types

Key Workflows

Fieldwork and Mobility for Licensing Staff

Enforcement Program Operations

Summary

Key Workflows

Fieldwork and Mobility for Enforcement

Educational Program Operations

Responsible Beverage Service (RBS) Training Program

Fees and Payments

Fees

Payment methods

Public & Licensee Experience

Public Facing Online Services

Unauthenticated Public Access

CURRENT STATE

Systems, Integrations & Technology

Current Systems Supported by ABC

ABC’s IT Environment

Data Migration & Security

Data Migration

Security and Compliance Standards

PROJECT DELIVERY

Methodology

Support

SECTION B – VENDOR QUESTIONS

SECTION C - WORKFLOW DEMONSTRATIONS

Introduction, Project Overview and Content The California Department of Alcoholic Beverage Control (ABC) is currently planning a project to replace several enterprise systems that support its core program activity. ABC has prepared this Vendor Information & Response Packet to share information with vendors about ABC’s operations, objectives, and current state and also gather information about potential solutions from vendors. This effort is a key component of ABC’s ongoing market research, technology modernization planning, and evaluation of potential solutions that can meet the department’s enterprise-wide licensing, enforcement, and public-facing needs. The implementation phase of this project is estimated to begin late 2028 or early 2029.

This packet is organized into three sections:

Section A – Department Overview, Environment, and Future Objectives This section provides vendors with an understanding of ABC’s current operations, challenges, and strategic direction. It includes detailed descriptions of our organizational structure, licensing and enforcement processes, investigative workflows, field operations, document management practices, reporting and analytics needs, public-facing services, technology environment, data migration considerations, and statewide operational objectives.

The information in Section A reflects extensive input from subject-matter experts, program management, and field staff across the department. It is intended to give vendors a clear picture of ABC’s current systems, pain points, constraints, and the capabilities being sought in a future solution.

Referenced attachments and links provide supporting materials, workflow examples, workload summaries, policy references, and technology diagrams to help contextualize ABC’s needs.

Vendors are encouraged to review these materials closely, as they are foundational to understanding the department’s expectations for a modernized system.

This section is extensive to allow vendors insight into some of the complexities of the licensing program and to further illustrate the current state of operations for ABC’s programs. For a quick, high-level view of this section the following content is recommended:

• Overview o ABC Program Overview chart on Page 20 – Overview of organization chart, program, and key workflows.

o Attachment Y: Program Statistics – Provides a sense for the volume of workload across the programs.

o Attachment B: North Star – High-level description of what a successful project would deliver for different stakeholders.

• Licensing Program o Attachment F: License Count and Categories – Provides a sense for the volume and mix of ongoing licenses and illustrates some of the complexity related to the ability to combine licenses.

o Attachments G: Application Process and H: Form List for Application - Lays out the licensing process and the forms required for license application.

• Enforcement Program o Attachment Q: General Complaint Intake and Investigation Workflow – Lays out the workflow for enforcement from receiving a complaint through passing off a request for accusation to the Office of Legal Services.

o Attachment S: Disciplinary Process – Provides workflow for administrative action on licenses.

Section B – Vendor Response Requirements This section outlines the questions and information ABC is requesting from vendors.

Responses will assist the department in understanding the functionality, architecture, technical approach, integration capabilities, implementation methodology, mobility/offline features, security and compliance posture, reporting and analytics capabilities, and overall solution design each vendor can offer.

Vendor responses will also support ABC in planning next steps, validating feasibility of proposed approaches, and conducting early-stage market research, including pricing estimates.

Section C – Workflow Demonstrations This section outlines provides vendors with an opportunity to demonstrate how their proposed solution could support ABC’s core business processes through practical, scenario-based workflows. While Sections A and B focus on describing the department’s operational environment and gathering written solution information, Section C is designed to translate that understanding into action. These demonstrations allow vendors to showcase how their system handles licensing and enforcement activities in a functional, end-to-end manner that reflects ABC’s real-world needs. The workflows presented in this section are intended to help ABC assess usability, process alignment, and solution capabilities in a more applied and interactive format.

These demonstrations will be requested at a later stage, with scheduling to occur between August 5, 2026, and August 15, 2026, and vendors will be contacted by July 31, 2026, to confirm their demonstration date.

Invitation to Respond with Information You are invited to respond with information to assist ABC in identifying a potential solution to replace several enterprise systems that support its core program activity. The intent of this effort is to provide enough information about ABC’s project needs so vendors can effectively evaluate and present potential solutions to ABC with reasonable approximations of fit for the project, timeline, and costs.

How to Submit Your Response

• Review Section A and all attachments in full before responding to Section B. The context provided in Section A is essential to producing accurate, relevant, and actionable responses.

• Review the questions in Section B and organize your response by ID number.

Responses can be given in a easy to read format (Excel, PDF, or Word).

• Clearly identify any assumptions, dependencies, or alternative approaches you believe ABC should consider.

• If any requested information is not available, please note this and provide an explanation or recommended substitute.

Submission Deadline Please submit complete responses to Section B no later than: June 30, 2026.

Responses should be submitted electronically to the point of contact identified in the transmittal communication.

SECTION A - Department Overview, Environment, and Future Objectives

Organizational Overview The ABC is responsible for regulating the manufacture, distribution, and sale of alcoholic beverages in California. ABC ensures a safe, fair, and compliant alcohol industry through licensing, enforcement, legal oversight, and administrative support functions. Approximately 539 staff statewide carry out these responsibilities across multiple divisions and district offices.

ABC’s work spans two primary mission areas:

• Licensing, which evaluates and issues retail, wholesale, and manufacturing licenses;

and

• Enforcement, which supports public safety and industry compliance through inspections, investigations, statewide enforcement programs, and administrative hearings to impose disciplinary actions, as necessary.

The division and office information provided below offers a high-level summary of each area, while detailed operational processes, such as investigations, inspections, application workflows, complaints, evidence management, and administrative hearings, are addressed in subsequent sections of the packet.

ABC’s organizational structure is visually represented in Attachment A – Organizational Chart, which should be referenced alongside this summary for a complete picture of departmental functions.

Divisions & Offices

Enforcement Division The Enforcement Division ensures compliance with California’s alcoholic beverage laws through field operations conducted from 21 district offices statewide. Agents, who are full peace officers, perform investigations, inspections, and public safety operations – often, in collaboration with local, state, and federal partners. This division focuses on day-to-day public safety challenges, regulatory enforcement, industry oversight, and community-based problem solving related to alcohol.

Headquarters Enforcement

The Headquarters Enforcement Unit manages specialized statewide programs, including Targeted Responsibility for Alcohol Connected Emergencies (TRACE), Alcohol Policing Partnership (APP) Program, trade enforcement, recruitment and training, youth-access prevention initiatives, and internal affairs investigations. This unit provides policy guidance and ensures consistency across all enforcement operations.

Licensing Division

The Licensing Division administers more than 70 license types and manages application intake, review, investigation, and issuance from 22 district offices and a centralized headquarters unit. Staff include Program Technicians, Licensing Representatives, and district management, who work with applicants, local governments, and community stakeholders to ensure compliance with statutory and regulatory requirements related to the issuance of alcohol licenses.

Office of Legal Services (OLS)

The primary role of OLS is to provide legal representation for the department’s licensing and enforcement programs in license protests and disciplinary actions respectively, including representation in administrative hearings. Legal support staff in OLS support this primary function through the coordination of subpoenas, and case documentation and also serve as the primary coordinator of Public Records Act (PRA) requests received by the department as a whole.

General Counsel, Law & Policy

This unit oversees ABC’s regulatory frameworks, manages rulemaking, develops industry advisories, and ensures policy clarity and legal consistency across all departmental functions.

The General Counsel also serves as the Director Offices’ legal counsel on disciplinary actions and as such, must remain independent of OLS on the specifics of cases as they are being prosecuted.

Administration Division

The Administration provides the internal infrastructure needed to support ABC’s program operations, including human resources, accounting, budgets, business management, information technology, and enterprise initiatives. This division ensures operational continuity and supports strategic planning and modernization efforts.

Director’s Office

The Director’s Office leads policy development, makes final determinations on administrative discipline of licensees, oversees enforcement and licensing priorities, ensures statewide regulatory compliance, coordinates with government and industry partners, and guides overall strategic direction for the department.

Legislation & Government Affairs

This office monitors, develops, and analyzes legislation affecting ABC’s licensing, enforcement, and public safety responsibilities. It also provides technical assistance to policymakers and coordinates implementation of statutory changes in alignment with the ABC Act.

Public Information Office

The Public Information Office manages external communication with media and public stakeholders, coordinates messaging on sensitive issues, and provides information on departmental activities and public safety initiatives.

Administrative Hearing Office

The Administrative Hearing Office conducts impartial hearings for protested applications, denials, and disciplinary matters. Administrative Law Judges review evidence, conduct proceedings, and issue proposed decisions to the Director for consideration regarding the Department’s final determinations.

ABC Primary Systems ABC’s technology ecosystem is built around a set of applications that together support licensing, enforcement, training, payments, and internal operations. While each system has its own function, several are tightly integrated, particularly those supporting licensing (LSP), training (RBS/Moodle), reporting (LQS/RQS), and the core system of record (ABIS).

These systems include:

• Alcoholic Beverage Information System (ABIS) is the System of Record and sits at the center of ABC’s enterprise systems. It houses authoritative licensing and enforcement data. ABIS has no public-facing user interface.

• Licensing Services Portal (LSP) is a public-facing system that has been developed since 2020 to provide some level of online application and payment for licensing transactions. LSP connects to ABIS via a controlled API layer referred to as eServices.

• Responsible Beverage Services (RBS) Portal was also developed since 2020 and is built on the same technology as LSP. RBS registers and tracks the certification of training provided by approved training providers to all servers of alcohol in the State of California. The RBS Portal also hosts the exam servers must pass to gain certification. The exam functionality is provided via an integration with Moodle.

• Licensing Query System (LQS) provides public-facing license lookup and reporting functionality on the ABC website by pulling data from ABIS at a daily interval.

• Report Query System (RQS) provides internal users with a variety of reports on licensing and enforcement data based on data from ABIS. RQS also uses data from a copy of ABIS data that is refreshed daily.

• Fiserv handles electronic payment for LSP and RBS transactions.

• Laserfiche (eRecords and enforcement forms) stores supporting documents tied to licensing and enforcement workflows. ABC is currently completing the scanning of paper licensing files and is planning to establish some level of integration between ABIS and Laserfiche by the end of 2026. ABC is also considering the utilization of Laserfiche for the establishment of electronic enforcement forms that would be utilized by Agents in the field and capture key data from field activities.

The functionalities of all these systems are within scope of the Legacy System Refresh Project, with the possible exception of the RBS Portal, which has very limited integration with ABIS and can stand alone if the decision is made to focus on core program functionality.

Objectives ABC’s primary business drivers for replacing its current systems (ABIS, LSP, RQS, LQS, BizMod, and RBS) stem from significant functional gaps, structural weaknesses, and operational burdens that prevent the department from delivering the modern, digital licensing services expected by the public and required by ABC’s own workforce. Today’s enterprise system is incomplete: most workflows remain paper-based, online services cover less than half of ABC transactions, and staff rely heavily on spreadsheets, email attachments, and manual data entry to compensate for missing functionality. These workarounds have produced inconsistent statewide operations, limited visibility into the workload, and limited ability to track or manage program performance. Critically, two high-risk issues, poor data integrity and lack of system stability or redundancy, pose substantial operational risk and make both reporting and decision-making unreliable.

The system is not easily scaled to support new license types or mandated changes, and ABC struggles to meet legislative reporting needs due to fragmented, inaccurate, or inaccessible data. Additionally, online services are scattered across multiple portals (ABIS, LSP, RQS, LQS, RBS), creating a disjointed and confusing experience for applicants, licensees, and internal staff.

To address these challenges, ABC’s objective is to modernize its enterprise information systems to:

• Provide complete, end-to-end digital services for licensing, enforcement, and legal operations;

• Automate internal and external workflows;

• Ensure accurate, well-structured data; and operate on a stable, secure, and scalable cloud platform.

Specifically, a successful solution will:

• Enable applicants to submit all license, permit, and modification transactions online;

• Allow the public to pay electronically for every fee-based service;

• Support the use of GIS-enabled data for internal and external customers;

• Provide ABC staff real-time workload assignments and tracking tools, improve data quality and reporting, and eliminate today’s manual workarounds; and,

• Provide staff working in the field the ability to access and enter information into the system from mobile devices.

From system infrastructure and support perspective, the future system must:

• Deliver high availability, fault tolerance, and resource scalability;

• Improve query efficiency;

• Reduce the number of technologies ABC must maintain; and

• Strengthen business continuity and disaster recovery for all critical and public-facing services.

Ultimately, success means ABC can provide the modern digital licensing experience expected in 2026 and deliver accurate, reliable, and actionable data to effectively manage programs, evaluate performance, and meet statutory responsibilities.

Additional information about how success is defined by key users is captured in Attachment B – North Star.

COMMUNICATIONS, DOCUMENTS & REPORTING

Communications

Current Communication Processes Except for communication with servers utilizing the RBS Portal, where their email address is the primary contact option, ABC’s communication with its stakeholders is largely paper-based, expensive, and slow. This section walks through the current communication processes by audience that may be within scope of the LSR Project and the key areas for improvement envisioned.

• Existing Licensees - The mailing address collected at the time of application (or as updated since) continues to be the primary method by which ABC contacts existing licensees for standard licensing business processes or industry advisories.

o License Renewal - The most extensive effort is mailing related to license renewals. At a minimum there are two: the renewal notice and the delivery of the new license. However, late notices can increase the volume.

Additional mailings could be triggered if notifications need to be made related to holds on the renewal of a license based on non-compliance with tax laws.

o Industry Advisories – When there is information that needs to be shared across all or a substantial subset of existing licensees, an industry advisory may be issued. All Industry Advisories are posted on the website, released on social media, and sent to ABC’s email subscriber list. If these processes are insufficient given the importance of the advisory – mailings could be initiated for all licensees or a subset that is impacted. If the change is not urgent or is related to a change occurring more than a year out, a notification can be included in the renewal notice process. Finally, if an issue is urgent, Agents may visit licensed premises to communicate the changes and check compliance – this approach has been employed several times over the last few years for public health related issues.

o Specific Issue - To the extent there is a specific issue or reason to reach out to a licensee – staff may look to see if there is a phone number or email associated with the license in the system. Of course, for most licensees, there is contact information on the internet that would provide an avenue for contacting someone at the business and working your way to the appropriate person.

o Enforcement - ABC’s current enforcement communication model is predominantly paper-based, reactive, and tied to field activities such as IMPACT inspections and Minor Decoy operations, where Agents must complete triplicate or carbon-copy forms on site and either leave them at the premises or mail them to the licensee after the activity. The primary method for notifying licensees of violations (whether informal notifications of violations, or a formal accusation) is the use of mail.

• License Applicants – The majority of communication with license applications will happen over the phone and via email during the licensing investigation.

Official notices or forms that cannot be emailed, will be mailed. There is no functionality to provide automated notifications to applicants during the application process. All updates on status are made from email or phone contact initiated by one of the parties.

• Local Government Agencies – Local law enforcement and planning departments are ABC’s partners in the evaluation of license applications.

o Permanent License Applications Notification - When ABC receives an original application for any license or an application for transfer of any license, it must immediately mail a written notice consisting of a copy of the application (Attachment C – Application for ABC License (ABC-

211) generated out of ABIS) to:

The sheriff, chief of police, and district attorney of the locality where the premises are located.

The city or county planning director (whichever has jurisdiction).

The board of supervisors of the county if the premises are in an unincorporated area.

The city council or other governing body of the city if the premises are in an incorporated area.

o Zoning Confirmation – Applicants are required to submit a Zoning Affidavit

(ABC-255) regarding zoning information. ABC staff verifies the information submitted with the local planning department via phone call or email.

o One-day licenses – Applicants for one-day licenses are required to secure local law enforcement approval for their proposed event. If there is any reason to question the authenticity of the approval or if enforcement staff have any concerns with the event, ABC staff may call or email the local law enforcement agency to verify or discuss the event.

Opportunities for Improved Communications ABC intends for the LSR Project to deliver functionality that will significantly reduce postage costs, increase the speed of critical communication, provide applicants greater https://www.abc.ca.gov/wp-content/uploads/forms/ABC-255.pdf transparency regarding the status of their application, and create a much better record of communications between ABC and its stakeholders. ABC recognizes that the lynchpin to any effort is the initial curation and ongoing maintenance of contact information for licensees, local government agencies, and applicants. ABC anticipates this will require ABC to develop:

• A process for gathering electronic contact information that is to be used for official communication with licensees and applicants and securing agreement that this form of communication can be used as formal notification from the department to the licensee or applicant.

• A process for effectively maintaining the contact information for licensees over time – facilitating timely updates to ensure effective delivery of information to the correct persons.

• A process for identifying, storing, and maintaining the accuracy of the local government agency contacts for each process that requires communication to these local partners.

Within the envisioned enterprise system, ABC envisions that the following processes may add significant value:

• Application status – Workflow triggers in the application process that will update the status of the application in a way that can be communicated to the applicant via email, an update within an online portal, or both.

• Local Government Notifications – The ability to have workflow triggered communications to local government agencies to either deliver notification or verify their approval of information submitted by applicants.

• Communication documentation – The ability to incorporate messaging within the system, so electronic conversations between ABC staff and applicants or licensees can be captured and associated with the license.

• Industry Advisories or Notifications – The ability to efficiently execute mass messaging to all licensees or a targeted subset of licensees using attributes of the license such as location, license type, license category, or license status.

• Enforcement notifications – To the extent a notification that is currently mailed can be sent electronically and also stored in the system, ABC would like to implement such a process. Primary candidates would receive notification letters or copies of inspection forms that result from Minor Decoy Operations and IMPACT inspections respectively, and the delivery of the informal communication regarding observed violations – the Notice of Violation.

• Internal Reporting and Notifications – There are a number of opportunities to create either workflow triggered or periodic notifications to licensing and enforcement staff and management to create much greater visibility and accountability regarding workload and timelines. These can include periodic reports on outstanding investigations, aging reports for open applications, ageing and priority reports on complaints, etc.

Attachment D – Communication Inventory lists some of the communications that would be significant opportunities for improvement and their estimated volume.

Document Management Document management across ABC is currently distributed across multiple systems, shared drives, email, and legacy applications, resulting in fragmented storage practices and limited visibility into document status. Staff manage a high and growing volume of records, including operational documents, licensing and agent files, administrative forms, correspondence, and program-specific reports. Retention and disposition are largely manual and inconsistent, as staff often lack clear guidance on record classifications and retention timelines.

License Files ABC is in the process of transitioning paper licensing files into digital format within LaserFiche, a content management and business process automation platform. This large-scale conversion project is ongoing, and is scheduled to be completed by June 30, 2027, with approximately 15 million images created and stored. All files related to active licenses and those that are inactive but still within retention requirements, will need to be retained in their digital format and be accessible from whatever enterprise system is implemented. The type of documentation retained in the license file is expected to evolve as more of the information retained is collected through online application services rather than the submission of paper documents or emailed forms that are then scanned or uploaded to the digital licensing file.

Document Approvals eSignature needs continue to expand, especially for approval workflows and forms requiring multi-party signatures from applicants or licensees. Today, ABC uses Adobe Sign to collect electronic signatures; however, usage varies across programs, and workflows are not standardized.

Public Records Act (PRA) Requests

The PRA process requires staff to search multiple repositories, manually review and redact documents, and coordinate responses without centralized tracking, contributing to delays. Redaction functionality is a significant current need; today, it is handled manually with various stand-alone tools, creating inefficiencies and risk. ABC is actively procuring a SaaS solution to establish a centralized public records request management system designed to streamline the PRA process, provide workflow management, and enable integrated redaction within the platform. It is currently unclear if PRA processes and associated redaction functionality would be within the scope of the LSR Project or if this need will be met by the current efforts in development.

Overall, the historical environment for document management of program files has been paper-based, labor-intensive, difficult to standardize, and presented challenges in terms of consistency, compliance, version control, and security. Although current efforts are underway to improve these practices, it is expected that the document management capabilities of the system put into production as a result of the LSR Project may define and even replace much of even the more recently developed document management functionality for ABC’s license files.

Reporting ABC’s current reporting environment is highly manual, fragmented across systems, relying heavily on historical, after-the-fact reports that provide fixed, non-interactive summaries of licensing processing times, backlogs, application volumes, enforcement activity, violation rates, and staff workloads. Many of these reports are generated through ABIS and RQS, with additional tracking in SharePoint logs, binders, spreadsheets, and locally maintained files, resulting in inconsistent data capture and heavy reliance on staff expertise for interpretation.

Critical reporting obligations include processing times, enforcement activity, disciplinary actions, and legislatively mandated information such as licensing counts, as required under Business and Professions Code §23055, along with high-demand internal metrics such as accusation tracking, complaint processing, district workloads, violation history, license conditions, and census-tract-based licensing compliance. Consumers of these reports span licensing staff, district offices, enforcement leadership, executive management, legislative affairs, and external partners such as law enforcement, industry attorneys, consultants, and grant-related local law enforcement agencies.

Another emerging reporting need is the ability to accurately track, maintain, and report on special license categories created by new legislation. These licenses often include unique statutory conditions, such as limits on the number of licenses, restrictions tied to specific census tracts, and ongoing compliance or eligibility criteria that must be monitored over time. Licensing currently lacks a reliable method to capture, validate, and report on these legislatively authorized licenses, which has created challenges in demonstrating compliance with statutory caps, geographic eligibility rules, and legislative reporting requirements. A future system must support structured tracking, geospatial validation, and reporting of these license types to ensure consistent statewide administration and transparency.

The department faces significant challenges: data is scattered across systems, many workflows rely on paper or duplicative data entry, case tracking lacks automated triggers or alerts, and staff cannot easily visualize operational bottlenecks, track license conditions, monitor statute-of-limitations risks, or view geographic complaint patterns.

Enforcement teams struggle with limited ability to track evidence, inspection activity, and complaint outcomes in a unified system, and licensing staff cannot readily see where an application is in the process or what tasks remain. Moreover, ABC lacks the capability to produce the types of real-time, easily consumable dashboards/reports or cross-cutting analytics needed to respond quickly to legislative inquiries, monitor statewide workload, or identify emerging trends. These limitations directly contributed to past challenges in fulfilling legislatively requested reports, including those tied to census-tract-restricted license allocations.

To overcome these gaps, ABC seeks modern analytics capabilities that deliver:

• Integrated, real-time visibility across licensing, enforcement, and administrative functions;

• Executive-level dashboards;

• Workload, backlog, and timeliness scorecards;

• Ad-hoc self-service reporting;

• Predictive modeling to forecast caseloads and identify bottlenecks;

• Automated alerts for deadlines and statute-of-limitations risks;

• Geospatial validation;

• Reporting for special license categories created under new legislation, including license types restricted to specified census tracts or subject to unique statutory conditions; and

• Ability to perform geographic, trend, and density analyses for both internal and legislative use.

Staff envision a system capable of:

• Consolidating licensing, enforcement, inspection, evidence, and complaint data, enabling drill-downs by district, agent, license type, census tract, or geographic radius;

• Integration with mobile field tools;

• Mapping capabilities;

• Transparent tracking of legislatively created license categories; and

• Improved reporting to partners and grant agencies.

Altogether, ABC aims to move from a reactive, paper-heavy environment to a modern, analytics-driven operation that supports data-informed decision-making, efficient workload management, and rapid response to internal, public, and legislative information needs.

ABC CORE PROGRAM OPERATIONS

Core Program Overview The chart below provides a high-level overview of the primary functions performed at ABC in support of the core programs of licensing, enforcement, and education. The chart is followed by a summary of each of the primary organizational units. Taken together, these two sections are intended to provide an overlay of the organization chart to the operation of the programs ABC’s enterprise systems support.

ABC PROGRAM OVERVIEW

OPERATIONAL PROGRAM SUPPORT

Administration Division

Human Resources Business Management Financial Management Information Technology Enterprise Initiatives/Training

CORE PROGRAM OPERATIONS

ORGANIZATIONAL LEADERSHIP AND OUTREACH

Director’s Office General Counsel/Law and Policy Legislation and Governmental Affairs Headquarters Enforcement Public Information Office Collectively, these units develop and implement operational and program policy, collaborate and communicate with key stakeholders within state and local governments and the public, and provide leadership to the department and within the industry in service of accomplishing ABC’s mission.

Licensing Licensing Division

Transaction Types:

• New licensee/new premises

• Transfers – change of licensee or premises

• Changes in ownership or premises

• One day authorizations

Key Work:

• Investigating applicants (the person)

• Investigating premises (the location)

• Addressing public concerns/protests

Office of Legal Services and Administrative Hearing Office

• Protest and license appeal hearings

Education Administration Division Headquarters Enforcement Enforcement Division Public Information Office

Responsible Beverage Service (RBS) Licensee Education on Alcohol and Drugs Education-focused inspections Industry Advisories

Enforcement Enforcement Division

Key Work:

• Compliance inspections (no periodic requirement or quota)

• Investigating complaints:

o Sales to minors o Problem premises (public safety) o Trade violations

• Major events (sporting events, music festivals, etc.)

• Targeted operations:

o Minor Decoy/Shoulder Tap o Undercover (e.g. narcotics, prostitution, stolen property)

• On-view (patrol-like observation based)

Key results of enforcement work:

• Notice of violation (non-disciplinary)

• Letter of Warning

• Accusation (violation forwarded to OLS)

Office of Legal Services

• Accusation process - documentation of violations, notifications

• Settlement negotiations

• Administrative hearings before AHO

• Appeal hearings before ABC Appeals Board

Administrative Hearing Office

• Administrative hearings – proposed decision on discipline

Director’s Office with support from General Counsel

• Adopt or modify AHO proposed decision

Licensing Program Operations

Summary The Licensing Division of ABC is responsible for processing applications for licenses to sell, manufacture, or distribute alcoholic beverages and for administering all ongoing licensing requirements once a license has been issued. License applications are required for the issuance of new licenses, the transfer of existing licenses, and modifications to current licenses. Many applications require thorough investigation into the suitability of the applicant and the proposed premises. Licensing representatives conduct these investigations and prepare detailed reports based on their findings. At the conclusion of the investigation, licensing representatives may recommend approval, conditional approval, or denial of the proposed license.

The Division also oversees the ongoing maintenance of existing licenses. This includes the annual renewal process, which involves issuing statutorily required renewal notices and generating updated licenses with revised expiration dates. Licensees who fail to renew on time incur penalty fees that must be paid before a renewed license can be issued. The Division additionally processes a variety of licensee requests, including corporate updates, condition modifications, premises expansions, and minor business detail changes such as address or DBA updates.

In addition to permanent licenses issued to ongoing businesses, the program administers one-day licenses for nonprofit events and catering authorizations for events ranging from large-scale festivals to private gatherings. Through the issuance of these licenses, the Licensing Division establishes the operational parameters for each licensee, determined by license type and any conditions imposed to address community concerns such as traffic, noise, or hours of operation.

Application and renewal fees collected by the division constitute the primary revenue source for the ABC Fund, providing approximately 96 percent of the department’s annual budget. (Attachment E – Renewal Fee Construction)

Key statistics include (numbers as of June 30, 2025 or for the 2024-25 fiscal year):

Key Licensing Program Statistics (2024-25 fiscal year)

High-level Licensing Program Statistics Active permanent licensed premises (as of June 30, 2025) 93,385 Permanent License Applications Received 9,333 Priority License Applications Received 1,034 Applications Protested 217 Licensing Hearings Held 30 Applications Withdrawn 907

Applications Recommended for Denial 23 Applications Issued 8,424 Daily and Catering Authorizations 40,403

Permanent License Transaction Types Application Type General Non-

General Total

Originals 406 3,224 3,630 Transfers 2,421 2,561 4,982

Person to Person 1,602 2,080 3,682 Premises to Premises 110 331 441 Double Transfer 709 150 859

Change 328 410 738 Member Transfer 67 115 182 Stock Transfer 249 161 410 Other Changes 12 117 129

Total 3,155 6,178 9,333 One-Day Licenses

Daily License (non-profits) 25,975 Catering Authorizations 14,428 Event Authorizations 503

Licensing Program Capacity District Offices 21 Licensing Program Staffing 186

Managers and Supervisors 46 Licensing Representatives 83 Program Technicians 54 Others 3

License Types Background on License Types With some narrow exceptions, it is illegal to manufacture, distribute, or sell alcoholic beverages in the State of California without a license issued by the ABC. Given the historical regulatory approach to alcohol, and the vast variety and ever evolving range of business models involving alcohol-related businesses in California, the provision of license privileges through ABC’s Licensing Program has become relatively complicated.

The following factors contribute to the number of license types offered and the degree of complexity related to the licensing program requirements that dictate who can operate what and where.

General regulatory approach (with exceptions) – Due to the regulatory approach referred to as “tied house”, generally a licensee is not allowed to have a material ownership stake in licensed businesses in more than one of those three tiers (manufacturing, distribution, retail) of the industry. As such, who owns each licensed business is important to investigate, track, and refer to in subsequent application investigations.

Variety of business models - There are specific business models involving alcohol that fall outside of the most common ones (bars, restaurants, stores) that are authorized through specific statutory language. Given the need to speak specifically to business models as diverse as fishing boats, to bed and breakfasts, to tasting rooms for manufacturers, a significant number of specific license types have been established that ultimately end up having a relatively low number of licenses issued.

Ability to, and prohibition against, combining license types - A single licensed premises may need a combination of several license types in order to receive the necessary privileges to operate the licensee’s business plan. Further, depending on their primary license type, they may secure duplicate licenses to expand their capacity, may be prohibited from securing certain other license types, and may be limited in terms of the type or number of other licenses they could hold for other premises.

License count limitations – For some license types, the number of licenses that can be issued is limited by population of the county or census track – with some geographically-defined, count-limited exceptions. These limitations create additional processes for securing exceptions for some license types, and an annual lottery system administered by ABC for others.

All the factors listed above contribute to the complexity of the business requirements of the licensing-related workflows to be addressed in the LSR Project. Currently, many of the considerations described are addressed through staff investigation of ownership structures, knowledge or reference to licensing policies, and manual tracking of license count limitations.

License Categories ABC administers over 70 permanent license types subject to annual renewal. These license types are categorized in a variety of ways that are reflective of their relationship to rules about the privileges they provide and how they can or cannot be combined with others. Key categorizations include:

Master vs Secondary – This distinction is primarily relevant when there are multiple license types issued to one premises.

• Master – The primary license type must be a type that can be issued on its own and typically is the one associated with the primary business model.

Within ABIS the primary license type is used to count and categorize a license that has multiple license types associated with it.

• Secondary – There are several license types that cannot be issued on their own – all of these will always be considered secondary when issued.

Retail vs Non-Retail – All permanent licenses are categorized under one of these two labels. Licensing investigation requirements differ between these two categories due the difference in assumed impact on the community around the licensed premises (e.g. reduced neighborhood notifications for non-retail).

• Retail - Retail licenses are those whose primary business model is the sale of alcohol to the end consumer. Retail licenses are further categorized by where the alcohol is typically consumed:

o On-sale – Sales are primarily made for the purpose of consumption on the premises (bars, restaurants, clubs).

o Off-sale – Sales are primarily made for consumption off premises (grocery stores, liquor stores)

• Non-retail - All licenses not identified as retail are categorized as non-retail. These are typically manufacturers, importers, wholesalers/distributers but this category includes some license types that are primarily for retail purposes but are a secondary license to a traditional non-retail license type. Exceptions have been made to tied-house laws that provide some non-retail licenses with retail privileges under certain conditions and limitations.

Duplicate licenses (retail) – Duplicate licenses are required when a licensee maintains more than one room on the premises that will have a fixed bar to sell distilled spirits. For large facilities, such as stadiums, arenas, and amusement parks, a licensee will apply for a duplicate license at each dispensing point where distilled spirits will be sold.

Duplicate/Branch (non-retail) – The term duplicate is also used for some manufacturers (non-retail) to hold a retail-focused branch. These licenses are investigated as a non-retail application but operate a retail business model. Non-retail duplicates must be associated to a master manufacturing license but can be located separate from the master license’s physical premises. ABIS does not have a separate distinction for duplicates – they are issued under the master manufacturing license type that are associated with and receive their own license number. There is a limit on the number of duplicates each manufacturer can hold. Their existence as one of a limited number of duplicates associated with another license is noted manually in ABIS.

General – In California’s alcohol regulation parlance the term general refers to a retail license that provides the privilege to sell distilled spirits, beer, and wine. In most cases, the key distinction is the additional privilege related to distilled spirits. The number of general licenses that can be issued is limited based on county population. This scarcity of general licenses results in the need for an annual lottery system for applicants (referred to as Priority) and a healthy secondary market for the transfer of existing general licenses – often at prices well in excess of the application fee ABC charges.

License Types Although ABC administers over 70 different license types, just four license types make up 74 percent of the 93,385 licensed premises in California.

Most Common License Types

License Type Number of

Licenses as of June 30, 2025

Type 20 – Off-Sale Beer and Wine 13,651 Type 21 – Off-Sale General 14,469 Type 40 - On-Sale Beer and Wine – Eating Place 25,112 Type 47 – On-Sale General – Eating Place 16,378

Not surprisingly, these four types represent stores and restaurants. If the next four most common license types are added to the list, 88 percent of total licenses are included.

License Type Number of

Licenses as of June 30, 2025

Type 02 – Winegrower 6,874 Type 17 – Beer and Wine Wholesaler 2,821 Type 48 – On-Sale General – Public Premises 2,423 Type 42 – On-Sale Beer and Wine – Public Premises 1,290

This list includes the two most common non-retail license types and the two types commonly characterized as bars. The term “Public Premises” means it is limited to ages 21 and over – a bar or club.

For a comprehensive list of the categorization and volume of each license type see Attachment F – License Count and Categories.

A catalog of license types can be viewed here.

https://www.abc.ca.gov/licensing/license-types/

Transaction Types Original Original applications are those for a new permanent license. Licensing investigations into original applications involve investigation suitability of both the applicant and the proposed premises.

Transfers Licenses can be transferred between people and between premises. As such, there are three primary types of transfers: 1) person-to-person, premises-to-premises, and double transfer (i.e. person-to-person and premises-to-premises). The licensing investigations that occur for transfers is focused on the component(s) that is changing – e.g. the investigation for a double transfer would be the same as that for an Original application, but a person-to-person transfer would only involve the investigation of the new licensee(s). General licenses are capped based on county population, so they often have significant value on the secondary market and will almost always be sold and transferred rather than cancelled by a license holder going out of business.

Changes Changes refer to requests that involve an existing license, and the license number will remain the same. Given ABC is responsible for ensuring the suitability of people and places licensed to run alcohol-related business, it is important for ABC to evaluate changes to the people or place to which licenses are issued. As such, there are a variety of application processes related to changes being made to either of these areas of concern.

• Ownership/management - Due to tied-house restrictions and the requirements to evaluate the background of people who own and operate licensed businesses, applicants need to apply to make changes to their ownership or management personnel.

• Premises – Due to ABC’s responsibility to evaluate the suitability of a premises within its community and the obligation to ensure the surrounding community has an opportunity to weigh in on significant changes, licensees must apply for approval to significantly modify their licensed premises.

Temporary Licenses One-day licenses (first three bullets below) provide flexibility for temporary events at locations that are either not licensed or licensed differently than a particular event requires. Operating permits allow for license privileges to be exercised while application processes are in progress, under certain conditions.

• Daily-license – Eligible non-profit organizations can obtain license authority for events they host. May require local law enforcement approval.

• Catering Authorization – Licensees with catering privileges must apply for catering authorization for each specific catering event. May require local law enforcement approval.

• Event Authorization – Some license types provide the ability for a limited number of events that can occur in an area directly outside, adjacent to the premises of their permanent license.

• Temporary…