Surety Bond Encyclopedia

Distilled Spirits Consumption on Premises Bond - Madison, GA in Georgia

Brief Summary

A Madison pouring license lasts one calendar year and is not renewed. You file a new application by December 15 to keep serving in January, so the bond, the insurance and the tax paperwork all need to be current each time. Getting the bond lined up early keeps it from becoming the last missing piece of that application.

The City of Madison, Georgia licenses the sale of distilled spirits by the drink for consumption on the premises under Chapter 6, Article III of its Code of Ordinances. This bond is posted by the licensee in favor of the City of Madison. Confirm the current bond amount and bond form with the Madison city clerk before the bond is issued, since the amount is set by the city.

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How to Apply for a Distilled Spirits Consumption on Premises Bond:

Confirm the current bond amount and bond form with the City of Madison city clerk.
Have the legal name of the licensee exactly as it will appear on the city pouring license application.
Complete the bond application and review the premium quote.
Have the bond executed naming the City of Madison, Georgia as obligee.
Submit the bond with the in person pouring license application, along with the completed state license form.
Repeat the process for each calendar year, with the new application due on or before December 15.

Detailed Information About the Georgia Distilled Spirits Consumption on Premises Bond:

A new application every year

Most applicants assume a Madison pouring license renews. It does not. Sec. 6-303 says a pouring license is valid only for the calendar year shown on it and is not renewed. A licensee who wants to keep operating must make a new application for the next year on or before December 15 of the preceding year. Plan the bond around that cycle.

Who can apply

Sec. 6-302 makes it unlawful to sell alcoholic beverages for consumption on the premises without complying with Article III. Under Sec. 6-303, applications for alcohol or beer and wine pouring licenses may be made only for restaurants within the city, on forms the city provides, and must be presented in person. Sec. 6-342 has separate provisions for temporary licenses, private clubs, caterers and the arts and entertainment district. The city clerk grants or denies the application, gives written notice of a denial within 30 days, and a denial can be appealed to the mayor and council within 10 days.

What the bond does

The bond is a promise to the City of Madison, backed by a surety company, that the licensee will meet its obligations to the city under the pouring license. If the licensee fails to do so, the city can make a claim on the bond, and the surety pays and then looks to the licensee for repayment. The city sets the bond amount and form, so confirm both with the city clerk before the bond is issued.

Financial responsibility, insurance and taxes

Sec. 6-305 requires applicants to show financial responsibility at application and periodically after that when the city asks. The list includes financial statements or a sworn CPA certification, liability insurance of at least $1,000,000 per occurrence and $2,000,000 aggregate with a company listed on U.S. Treasury Circular 570, proof of ownership or lease of the restaurant, and proof that food sales are 50 percent or more of total gross sales with annual food sales above $150,000. Applicants also provide certified copies of their monthly state sales and use tax reports for the prior year and an affidavit that all state and local excise taxes were charged and paid. Sec. 6-316 sets the city excise tax on distilled spirits at $0.22 per liter.

The state license is separate

A retail consumption dealer also needs a Georgia Department of Revenue consumption on premises license, and Sec. 6-303 calls for the completed state license form with its attachments as part of the city application.

Eligibility and Requirements for a Georgia Distilled Spirits Consumption on Premises Bond:

City of Madison, Georgia named as obligee.
Restaurant eligibility under Sec. 6-303, with food sales of 50 percent or more of gross sales and above $150,000 a year under Sec. 6-305.
Liability insurance of at least $1,000,000 per occurrence and $2,000,000 aggregate from a Treasury Circular 570 listed company.
Affidavit that all state and local excise taxes were charged and paid the prior year.
Georgia Department of Revenue consumption on premises license.

Georgia Distilled Spirits Consumption on Premises Bond FAQs:

How much is the Madison distilled spirits consumption on premises bond?

The amount is set by the City of Madison. Confirm the current amount and the bond form with the city clerk before the bond is issued so it matches what the city will accept.

Does my pouring license renew automatically?

No. Sec. 6-303 makes each pouring license valid only for the calendar year shown on it. To keep operating, you file a new application on or before December 15 of the preceding year.

Can a bar without a kitchen get this license?

Sec. 6-303 limits pouring license applications to restaurants. Sec. 6-305 also requires food sales of 50 percent or more of total gross sales and annual food sales above $150,000. Separate rules in Sec. 6-342 cover temporary licenses, private clubs, caterers and the arts and entertainment district.

Does the bond replace the liability insurance requirement?

No. Sec. 6-305 separately requires liability insurance of at least $1,000,000 per occurrence and $2,000,000 aggregate. The bond protects the city, while the insurance covers claims from injuries and damage.

Do I still need a state license?

Yes. The Georgia Department of Revenue issues the consumption on premises license, and Madison asks for the completed state license form with its attachments as part of the city application.