Waivers allow expanded alcohol delivery during COVID-19 restrictions

More Texas restaurants temporarily may sell alcohol with takeout food and may deliver alcohol directly to customers with food purchases, subject to certain restrictions, after recent waivers of certain requirements in response to hardships faced by the hospitality industry as a result of COVID-19. These waivers follow the expanded alcohol delivery options enacted in 2019 by the 86th Legislature.

On March 18, Gov. Abbott temporarily waived certain restrictions on restaurants providing takeout and delivery of alcohol. On March 19, he issued Executive Order GA-08, which said that “people shall avoid eating and drinking at bars, restaurants or food courts” but that using drive-through, pick-up, and delivery options for food orders was allowed and encouraged. The Texas Alcoholic Beverage Commission (TABC) issued an industry notice on implementing the waiver, which includes several requirements applied to alcohol sales and delivery.

Alcohol takeout and deliveries from restaurants. The governor’s waiver and the suspension by TABC of certain limits on the sale of beer, wine, and liquor allow all restaurants with mixed beverage permits to sell alcohol with takeout food and to deliver alcohol with food orders. Before the waiver, restaurants with mixed beverage permits were prohibited from selling alcohol for takeout, and only those that also held food and beverage certificates could deliver alcohol with food. About 10,000 restaurants held permits or certificates allowing alcohol delivery before the waiver was issued.

The TABC industry notice on implementing the waiver includes requiring permanent food service capabilities at the restaurant selling alcohol for takeout or delivery and requiring that the restaurant be mandated by a governmental entity to end dine-in services due to the coronavirus pandemic. Restaurants may deliver the alcohol themselves, use independent contractors holding a consumer delivery permit authorized by the 86th Legislature, or use a third party that holds an appropriate delivery permit from TABC. Current law, which requires that alcohol delivered to a consumer be in its original container sealed by the beverage manufacturer and that distilled spirits be in containers that are 375 milliliters or less, still applies to alcohol picked up or delivered under the waiver, according to the notice. Questions have been raised about enforcement of these provisions after some restaurants reportedly were selling alcohol that did not adhere to these requirements. At this time, TABC is working to educate restaurants on the rules and reserving penalties for repeat offenders.

Under TABC’s industry notice, alcohol sales remain under the local jurisdiction’s authority, and deliveries may be made only to locations where the delivered type of alcohol is legal and within the county where the restaurant is located or up to two miles beyond the city limits if the restaurant is in a city that crosses county lines. In addition, those conducting the delivery transactions for the restaurant must be at least 21 years old. Those receiving the alcohol delivery cannot be intoxicated and must present proof that they are at least 21 years old.

Recent statutory changes to alcohol delivery. The 86th Legislature expanded alcohol delivery options with two laws that took effect September 1, 2019. SB 1450 by Hancock allowed third-party companies, such as Favor or Instacart, to deliver alcohol to consumers from TABC-permitted businesses such as restaurants, bars, and liquor stores. Under the law, delivery companies must obtain a consumer delivery permit and adhere to requirements in the TABC notice. This includes requirements for drivers to be at least 21 years old and deliveries to be made only to those with proof of being at least 21. As of early April, TABC had issued eight consumer delivery permits, according to the agency. SB 1232 by Creighton expanded the types of alcohol that certain on-premise beer and wine retailers, such as cafes and coffee shops, may deliver to include ale and wine. Under the new law, these establishments can obtain the same local cartage permits used by package stores and others to deliver alcohol.

By Kellie A. Dworaczyk

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