Laws and regulations about the marketing, sale and consumption of alcohol should be reasonable, consistent and clear.  Everyone would agree with that principle. Yet “Alcohol Regulations Often Problematic” shows how inconsistent, illogical, and ncomprehendable they can be.

Texas Commission

Unfortunately, laws concerning alcohol tend to have grown in a complex and inconsistent way since the repeal of National Prohibition in 1933. The case of the Texas Alcohol Beverage Commission (TABC) is a good example of the problem that exists across the U.S.

The alcohol laws and their interpretations are difficult if not virtually impossible to master. Allen Shivers, who headed the TABC for six years says of the alcohol code: “No one understands it. It’s at least as complicated as the IRS code.” He says that if three experienced TABC agents are given the same facts and situation, “you’d have at least five different interpretations of the Alcohol Beverage Code.”

Examples

The results are frustrating if not unfair to those who are trying to comply with the complex rules. A TABC agent chastised a restaurant owner about a flagrant violation of law. The restaurant’s outdoor tables had umbrellas with wine names and the Italian tricolors. That’s an illegal ad.

“For water carafes, the establishment had carefully removed all the labels from used tequila bottles of a particularly classic design. The agent looked all over the seemingly clear, clean containers, until he spotted a tiny etching of the maker’s logo in the base of the carafe — and ordered all of them banished.” The restaurant owner said the agent carried on like a felony had been committed.

One bar owner had to involve the Texas Parks and Wildlife Department to convince a TABC agent that the fish in his aquarium were not the dangerous piranhas that the agent falsely insisted that they were.

Another bar displayed a banner proclaiming it the winner of a Best of Houston category for serving a particular beer. “That display lasted only until a TABC officer ordered it removed immediately. The apparent violation: the sign mentioned the name of the bar and the beer it served.”

The mission statement of the TABC asserts that the “code is an exercise of the police power of the state for the protection of the welfare, health, peace, temperance and safety of the people of the state.” (Emphasis added.)

The Reality

In reality, the code raises the costs of doing business, leads to higher prices, and reduces choices for the consumers in the state. For example, the law requires that beer must be in certain size containers. Although a 12-ounce can is legal, an 11.67 ounce can — common in much of the world — is not. Thus, consumers needlessly lack access to many beers brewed in Canada, Holland, Belgium New Zealand, Japan and other countries.

A review of the TABC by a state legislative commission used such words as “over regulated,” outdated,” “inefficient,” poorly guided,” and “inconsistent.” The review found problems with everything from the way the agency conducts inspection and levies fines to marketing enforcement practices” that it described as out of touch. The agency actually agreed with the criticisms and the desirability of change.

Provisions

It would be hard for anyone to defend many of the code’s provisions. For example:

• • Assume an underage person attends a party as a Designated Driver (DD) where alcohol is available to other underage people. The DD, who never even touches alcohol can be convicted of illegal possession. The agency argues that the DD could possess alcohol. Of course this discourages designated driving. It also increases the risks of alcohol-related injuries and deaths. And it makes law enforcement much easier because it no longer requires guilt to get convictions.
  • Publicly traded corporations are prohibited from owning liquor stores because of a TABC rule from the 1940’s. It’s doubtful anyone knows why the rule was established.
  • TABC regulations require any business that sells beer and wine to pay 8.25% sales tax. However, if the same establishment also sells any distilled spirits, it must pay a 14% tax on all alcoholic drinks and other sales. Thus, it must pay an effective sales tax of about 16%. This almost doubling in sales taxes is simply because it sells spirits.
  • A winery cannot legally list on its web page the stores that sell its wine.
  • A winery cannot legally give directions to its location over the telephone.
  • No winery can legally accept deliveries of any kind after 5:00 p.m. or on weekends. Of course, this can ruin truckloads of valuable grapes that arrive after 5:00 p.m. on a Friday.
  • The TABC analyzes all new alcohol products. This unnecessarily duplicating a function already performed by federal agencies. This increases costs and needlessly delays the introduction of new products.

It’s clear that many TABC regulations are illogical and counterproductive.

Resources on Alcohol Regulations often Problematic

TABC

TABC. Texas Alcoholic Beverage Code. Austin: TABC, n.d.

____. The Texas Liquor Control Act. Austin, TABC, n.d.

____. Rules and Regulations. Austin: TABC, cont. updated.

____. Newsletter. Austin: TABC, periodical.

____. Texas Peace Officer’s Guide to the Alcoholic Beverage Code. Austin: TABC,1999.

Note

“Alcohol Regulations often Problematic” is based on piece by Scott Nowell. Its title was “With archaic and self-serving laws, reforms don’t come easy for the Texas booze industry.” It appeared in the Houston Post.