By Yarbrough                                    H.B. No. 2787

      75R8196 PAM-F                           

                                A BILL TO BE ENTITLED

 1-1                                   AN ACT

 1-2     relating to combining privileges of certain retail off-premises

 1-3     alcoholic beverage permits.

 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-5           SECTION 1.  Sections 11.49(b), (c), and (d), Alcoholic

 1-6     Beverage Code, are amended to read as follows:

 1-7           (b)(1)  Subject to the approval of the commission or the

 1-8     administrator, and except as provided in Subsection (c) of this

 1-9     section, an applicant for a permit or license may designate a

1-10     portion of the grounds, buildings, vehicles, and appurtenances to

1-11     be excluded from the licensed premises.  (2)  If such a designation

1-12     has been made and approved as to the holder of a license or permit

1-13     authorizing the sale of alcoholic beverages at retail or as to a

1-14     private club registration permit, the sharing of space, employees,

1-15     business facilities, and services with another business entity

1-16     (including the permittee's lessor, which, if a corporation, may be

1-17     a domestic or foreign corporation, but excluding a business entity

1-18     holding any type of winery permit, a manufacturer's license, or a

1-19     general, local, or branch distributor's license), does not

1-20     constitute a subterfuge or surrender of exclusive control in

1-21     violation of Section 109.53 of this code or the use or display of

1-22     the license for the benefit of another in violation of Subdivision

1-23     (15) of Subsection (a) of Section 61.71 of this code.  This

1-24     subsection shall not apply to original or renewal package store

 2-1     permits, wine and beer only package store permits, local

 2-2     distributor's permits, or any type of wholesaler's permits.

 2-3           (c)  An applicant for an original or renewal package store

 2-4     permit, wine and beer only package store permit, local

 2-5     distributor's permit, or any type of wholesaler's permit may not

 2-6     take advantage of the right conferred by Subsection (b) of this

 2-7     section except as permitted in Section 11.50 or 109.53 of this

 2-8     code.

 2-9           (d)  Any holder of a package store, wine and beer only

2-10     package store, wholesaler's, or local distributor's permit

2-11     [permittee] who is injured in the holder's [his] business or

2-12     property by another person (other than a person in the person's

2-13     [his]  capacity as the holder of a wine and beer retailer's permit,

2-14     wine and beer retailer's off-premise permit, private club

2-15     registration permit, or mixed beverage permit or any person in the

2-16     capacity of lessor of the holder of such a permit) by reason of

2-17     anything prohibited in this section or Section 109.53 of this code

2-18     is entitled to the same remedies available to a package store

2-19     permittee under Section 109.53 of this code.  Except for actions

2-20     brought against a person in the person's [his] capacity as the

2-21     holder of or as the lessor of the holder of a wine and beer

2-22     retailer's permit, wine and beer retailer's off-premise permit,

2-23     mixed beverage permit, or private club registration permit, the

2-24     statute of limitations for any action brought under this section or

2-25     Section 109.53 of this code for any cause of action arising after

2-26     the effective date of this Act is four years unless a false

2-27     affidavit has been filed with the commission in which event the

 3-1     statute of limitations is 10 years for all purposes.

 3-2           SECTION 2.  Section 11.61(b), Alcoholic Beverage Code, is

 3-3     amended to read as follows:

 3-4           (b)  The commission or administrator may suspend for not more

 3-5     than 60 days or cancel an original or renewal permit if it is

 3-6     found, after notice and hearing, that any of the following is true:

 3-7                 (1)  the permittee has been finally convicted of a

 3-8     violation of this code;

 3-9                 (2)  the permittee violated a provision of this code or

3-10     a rule of the commission;

3-11                 (3)  the permittee was finally convicted of a felony

3-12     while holding an original or renewal permit;

3-13                 (4)  the permittee made a false or misleading statement

3-14     in connection with the permittee's [his] original or renewal

3-15     application, either in the formal application itself or in any

3-16     other written instrument relating to the application submitted to

3-17     the commission, its officers, or employees;

3-18                 (5)  the permittee is indebted to the state for taxes,

3-19     fees, or payment of penalties imposed by this code, by a rule of

3-20     the commission, or by Chapter 183, Tax Code;

3-21                 (6)  the permittee is not of good moral character or

3-22     the permittee's [his] reputation for being a peaceable and

3-23     law-abiding citizen in the community where the permittee [he]

3-24     resides is bad;

3-25                 (7)  the place or manner in which the permittee

3-26     conducts the permittee's [his] business warrants the cancellation

3-27     or suspension of the permit based on the general welfare, health,

 4-1     peace, morals, and safety of the people and on the public sense of

 4-2     decency;

 4-3                 (8)  the permittee is not maintaining an acceptable

 4-4     bond;

 4-5                 (9)  the permittee maintains a noisy, lewd, disorderly,

 4-6     or unsanitary establishment or has supplied impure or otherwise

 4-7     deleterious beverages;

 4-8                 (10)  the permittee is insolvent or mentally or

 4-9     physically unable to carry on the management of the permittee's

4-10     [his] establishment;

4-11                 (11)  the permittee is in the habit of using alcoholic

4-12     beverages to excess;

4-13                 (12)  the permittee knowingly misrepresented to a

4-14     customer or the public any liquor sold by the permittee [him];

4-15                 (13)  the permittee was intoxicated on the licensed

4-16     premises;

4-17                 (14)  the permittee sold or delivered an alcoholic

4-18     beverage to an intoxicated person;

4-19                 (15)  the permittee possessed on the licensed premises

4-20     an alcoholic beverage that the permittee [he] was not authorized by

4-21     the permittee's [his] permit to purchase and sell;

4-22                 (16)  a package store or wine and beer only package

4-23     store permittee transported or shipped liquor, or caused it to be

4-24     transported or shipped, into a dry state or a dry area within this

4-25     state;

4-26                 (17)  the permittee is residentially domiciled with a

4-27     person who has a financial interest in an establishment engaged in

 5-1     the business of selling beer at retail, other than a mixed beverage

 5-2     establishment, except as authorized by Section 22.06, 24.05, or

 5-3     102.05 of this code;

 5-4                 (18)  the permittee is residentially domiciled with a

 5-5     person whose permit or license was cancelled for cause within the

 5-6     12-month period preceding the permittee's [his] own application;

 5-7                 (19)  the permittee is not a citizen of the United

 5-8     States or has not been a citizen of Texas for a period of one year

 5-9     immediately preceding the filing of the permittee's [his]

5-10     application, unless the permittee [he] was issued an original or

5-11     renewal permit on or before September 1, 1948, and has been a

5-12     United States citizen at some time; or

5-13                 (20)  the permittee permitted a person to open a

5-14     container of alcoholic beverage or possess an open container of

5-15     alcoholic beverage on the licensed premises unless a mixed beverage

5-16     permit has been issued for the premises.

5-17           SECTION 3.  Section 22.01, Alcoholic Beverage Code, is

5-18     amended to read as follows:

5-19           Sec. 22.01.  AUTHORIZED ACTIVITIES. (a)  The holder of a

5-20     package store permit may:

5-21                 (1)  purchase liquor in this state from the holder of a

5-22     winery, wholesaler's, class B wholesaler's, or wine bottler's

5-23     permit and purchase beer from the holder of a distributor's

5-24     license;

5-25                 (2)  sell liquor in unbroken original containers on or

5-26     from the holder's [his] licensed premises at retail to consumers

5-27     for off-premises consumption only and not for the purpose of

 6-1     resale, except that if the permittee is a hotel, the permittee may

 6-2     deliver unbroken packages of liquor to bona fide guests of the

 6-3     hotel in their rooms for consumption in their rooms;

 6-4                 (3)  sell malt and vinous liquors in original

 6-5     containers of not less than six ounces; [and]

 6-6                 (4)  sell liquor to holders of airline beverage permits

 6-7     as provided in Section 34.05 of this code; and

 6-8                 (5)  sell beer in lawful, original containers to

 6-9     consumers, but not for resale and not to be opened or consumed on

6-10     or near the premises where sold.

6-11           (b)  The sale of beer by the holder of a package store permit

6-12     is subject to the same restrictions and penalties governing the

6-13     sale of liquor with regard to:

6-14                 (1)  hours of sale and delivery;

6-15                 (2)  sale and delivery on Sunday;

6-16                 (3)  sale and delivery to minors;

6-17                 (4)  employment of minors;

6-18                 (5)  blinds and barriers; and

6-19                 (6)  advertising.

6-20           SECTION 4.  Section 22.02, Alcoholic Beverage Code, is

6-21     amended to read as follows:

6-22           Sec. 22.02.  FEE. The annual state fee for a package store

6-23     permit is $560 [$500].

6-24           SECTION 5.  Section 22.03(a), Alcoholic Beverage Code, is

6-25     amended to read as follows:

6-26           (a)  The holder of a package store permit or wine and beer

6-27     only package store permit issued for a location within a city or

 7-1     town or within two miles of the corporate limits of a city or town,

 7-2     who also holds a local cartage permit, may make deliveries of and

 7-3     collections for alcoholic beverages off the premises in areas where

 7-4     the sale of the beverages is legal.  The permittee must travel by

 7-5     the most direct route and may make deliveries and collections only

 7-6     within the city or town or within two miles of its corporate

 7-7     limits, and only in response to bona fide orders placed by the

 7-8     customer, either in person at the premises, in writing, by mail, or

 7-9     by telegraph or telephone.  This section shall not be construed as

7-10     preventing a holder of a package store permit or wine and beer only

7-11     package store permit from delivering alcoholic beverages to the

7-12     holder of a carrier's permit for transportation to persons

7-13     authorized to purchase the beverages.

7-14           SECTION 6.  Chapter 24, Alcoholic Beverage Code, is amended

7-15     to read as follows:

7-16            CHAPTER 24.  WINE AND BEER ONLY PACKAGE STORE PERMIT

7-17           Sec. 24.01.  AUTHORIZED ACTIVITIES.  The holder of a wine and

7-18     beer only package store permit may:

7-19                 (1)  purchase ale, wine, and vinous liquors in this

7-20     state from the holder of a winery, wine bottler's, wholesaler's or

7-21     class B wholesaler's permit; [and]

7-22                 (2)  purchase beer in lawful, original containers from

7-23     the holder of a distributor's license; and

7-24                 (3)  sell those beverages to consumers at retail on or

7-25     from the licensed premises in unbroken original containers of not

7-26     less than six ounces for off-premises consumption only and not for

7-27     the purpose of resale.

 8-1           Sec. 24.02.  FEE. The annual state fee for a wine and beer

 8-2     only package store permit is $135 [$75].

 8-3           Sec. 24.03.  DELIVERIES AND COLLECTIONS.  The holder of a

 8-4     wine and beer only package store permit may make deliveries to and

 8-5     collections from customers as provided in Section 22.03 of this

 8-6     code.

 8-7           Sec. 24.04.  DESIGNATION OF PLACE OF STORAGE.  The owner of

 8-8     more than one wine and beer only package store who is also the

 8-9     holder of a local cartage permit may designate one of the owner's

8-10     [his]  places of business as a place of storage.  The owner [He]

8-11     may transfer alcoholic beverages to and from the owner's [his]

8-12     place of  storage and the owner's [his] other stores in the same

8-13     county, subject to rules prescribed by the commission.

8-14           Sec. 24.05.  PROHIBITED INTERESTS.  (a)  No person who holds

8-15     a wine and beer only package store permit or owns an interest in a

8-16     wine and beer only package store may have a direct or indirect

8-17     interest  in any of the following:

8-18                 (1)  a manufacturer's or general, branch, or local

8-19     distributor's license;

8-20                 (2)  the business of any of the licenses listed in

8-21     Subdivision (1) of this subsection.

8-22           (b)  A person may hold both a wine and beer only package

8-23     store permit and a retail dealer's off-premise license.

8-24           (c)  A person may not hold a wine and beer retailer's or wine

8-25     and beer retailer's off-premise permit at the same location where

8-26     the person holds a wine and beer only package store permit.

8-27           [Sec. 24.06.  VIOLATION WHEN LICENSE ALSO HELD.  If a person

 9-1     holding a wine only package store permit who also holds a retail

 9-2     dealer's off-premise license for the same location violates a

 9-3     provision of this code or a rule or regulation of the commission,

 9-4     the violation is a ground for the suspension or cancellation of

 9-5     both the wine only package store permit and the retail dealer's

 9-6     off-premise license for the premises where the violation was

 9-7     committed.]

 9-8           Sec. 24.07.  [WHEN LICENSE ALSO HELD:]  HOURS OF SALE, ETC.

 9-9     (a)  A holder of a wine and beer only package store permit [who

9-10     also holds a retail dealer's off-premise license for the same

9-11     location] may remain open and sell ale, wine, vinous liquors, and

9-12     beer, for off-premises consumption only, on any day and during the

9-13     same hours that the holder of a wine and beer retailer's permit may

9-14     sell ale, beer, and wine, except that the holder [he] may not sell

9-15     wine or vinous liquor containing more than 14 percent alcohol by

9-16     volume on a Sunday or after 10 p.m. on any day.

9-17           (b)  The sale of beer by the holder of a wine and beer only

9-18     package store permit is subject to the same restrictions and

9-19     penalties governing the sale of liquor with regard to:

9-20                 (1)  delivery on Sunday;

9-21                 (2)  blinds and barriers; and

9-22                 (3)  advertising.

9-23           Sec. 24.08.  LIMIT ON SINGLE TRANSACTION. A wine and beer

9-24     only package store permittee may not sell more than five gallons of

9-25     ale, wine, and vinous liquors in a single transaction.

9-26           Sec. 24.09.  OPENING CONTAINERS PROHIBITED.  No person may

9-27     break or open a container of liquor or beer or possess an opened

 10-1    container of liquor or beer on the premises of a wine and beer only

 10-2    package store.

 10-3          Sec. 24.10.  BEVERAGE FROM OPENED CONTAINER.  No person may

 10-4    sell, barter, exchange, deliver, or give away a drink of alcoholic

 10-5    beverage from a container that has for any reason been opened or

 10-6    broken on the premises of a wine and beer only package store.

 10-7          Sec. 24.11.  BREACH OF PEACE.  The commission or

 10-8    administrator may suspend or cancel a wine and beer only package

 10-9    store permit after giving the permittee notice and the opportunity

10-10    to show compliance with all requirements of law for the retention

10-11    of the permit if it finds that a breach of the peace has occurred

10-12    on the licensed premises or on premises under the control of the

10-13    permittee and that the breach of the peace was not beyond the

10-14    control of the permittee and resulted from the permittee's [his]

10-15    improper supervision of persons permitted to be on the licensed

10-16    premises or on premises under the permittee's [his] control.

10-17          SECTION 7.  Section 43.01(b), Alcoholic Beverage Code, is

10-18    amended to read as follows:

10-19          (b)  A package store, wine and beer only package store, or

10-20    local distributor's permittee who also holds a local cartage permit

10-21    may transfer alcoholic beverages in accordance with Sections 22.08,

10-22    23.04, and 24.04 of this code.

10-23          SECTION 8.  Section 43.04, Alcoholic Beverage Code, is

10-24    amended to read as follows:

10-25          Sec. 43.04.  ELIGIBILITY FOR PERMIT.  The commission may

10-26    issue a local cartage permit to a warehouse or transfer company or

10-27    to a holder of a package store, wine and beer only package store,

 11-1    or local distributor's permit.

 11-2          SECTION 9.  Section 43.07, Alcoholic Beverage Code, is

 11-3    amended to read as follows:

 11-4          Sec. 43.07.  VIOLATION OF CODE, RULE.  If a holder of a local

 11-5    cartage permit who also holds a package store permit or wine and

 11-6    beer only package store permit violates any provision of this code

 11-7    or any rule or regulation of the commission, the violation is a

 11-8    ground for the suspension or cancellation of any or all permits or

 11-9    licenses held by that person for the premises where the offense was

11-10    committed.

11-11          SECTION 10.  Section 64.05, Alcoholic Beverage Code, is

11-12    amended to read as follows:

11-13          Sec. 64.05.  PERSONS INELIGIBLE FOR LICENSE.  A general

11-14    distributor's license may not be issued to a person who is the

11-15    holder of a package store permit or a wine and beer only package

11-16    store permit.

11-17          SECTION 11.  Section 65.05, Alcoholic Beverage Code, is

11-18    amended to read as follows:

11-19          Sec. 65.05.  PERSONS INELIGIBLE FOR LICENSE.  A local

11-20    distributor's license may not be issued to any person who is the

11-21    holder of a package store permit or a wine and beer only package

11-22    store permit.

11-23          SECTION 12.  Section 66.04, Alcoholic Beverage Code, is

11-24    amended to read as follows:

11-25          Sec. 66.04.  PERSONS INELIGIBLE FOR LICENSE.  A branch

11-26    distributor's license may not be issued to a person who holds a

11-27    package store permit or a wine and beer only package store permit,

 12-1    or to a person who does not meet the qualifications to be issued an

 12-2    original general distributor's license.

 12-3          SECTION 13.  Section 71.04, Alcoholic Beverage Code, is

 12-4    amended to read as follows:

 12-5          Sec. 71.04.  POSSESSION OF CERTAIN BEVERAGES PROHIBITED.  The

 12-6    holder of a [No] retail dealer's off-premise license or the

 12-7    holder's agent, employee, or [licensee, nor his] officer, may not

 12-8    possess [liquor containing alcohol in excess of 14 percent by

 12-9    volume] on the licensed premises any alcoholic beverage that is not

12-10    authorized to be purchased and sold by the holder.

12-11          SECTION 14.  Section 102.03(b), Alcoholic Beverage Code, is

12-12    amended to read as follows:

12-13          (b)  No holder of a permit named in Subsection (a) of this

12-14    section may directly or indirectly, or through a subsidiary,

12-15    affiliate, agent, employee, officer, director, or firm member, own

12-16    an interest of any kind in the premises where the holder of a

12-17    package store [permittee], wine and beer only package store

12-18    [permittee],  or mixed beverage permit [permittee] conducts [his]

12-19    business.

12-20          SECTION 15.  Section 102.06, Alcoholic Beverage Code, is

12-21    amended to read as follows:

12-22          Sec. 102.06.  RELATIONSHIP BETWEEN AGENT OR MANUFACTURER'S

12-23    AGENT AND PACKAGE STORE.  No holder of an agent's or manufacturer's

12-24    agent's permit may directly or indirectly have an interest in a

12-25    package store permit or wine and beer only package store permit or

12-26    be residentially domiciled with a person who has a financial

12-27    interest in a package store permit or wine and beer only package

 13-1    store permit.

 13-2          SECTION 16.  Section 102.31(a), Alcoholic Beverage Code, is

 13-3    amended to read as follows:

 13-4          (a)  This section applies to:

 13-5                (1)  the sale of beer or its containers or the original

 13-6    packages in which it is received, packaged, or contained by a

 13-7    holder of a distributor's license [licensee] to a holder of a

 13-8    retail dealer's on-premise or off-premise license or a holder of

 13-9    [licensee,] a wine and beer retailer's [permittee], [or a] wine and

13-10    beer retailer's off-premise, package store, or wine and  beer only

13-11    package store permit [permittee]; and

13-12                (2)  the sale of malt beverages by a local

13-13    distributor's permittee, or by any licensee authorized to sell

13-14    those beverages for resale, to a mixed beverage or daily temporary

13-15    mixed beverage permittee.

13-16          SECTION 17.  Section 102.32(a)(2), Alcoholic Beverage Code,

13-17    is amended to read as follows:

13-18                (2)  "Retailer" means a package store, wine and beer

13-19    only package store, wine and beer retailers, wine and beer

13-20    retailer's off-premise, or mixed beverage permittee, any other

13-21    retailer, or a private club registration permittee.

13-22          SECTION 18.  Section 104.02(b), Alcoholic Beverage Code, is

13-23    amended to read as follows:

13-24          (b)  No person may install or maintain a curtain, hanging,

13-25    sign, or other obstruction that prevents a clear view of the

13-26    interior of a package store or wine and beer only package store,

13-27    except a drug store that holds one of those permits may display

 14-1    drug merchandise notwithstanding this subsection.

 14-2          SECTION 19.  Section 106.09(b), Alcoholic Beverage Code, is

 14-3    amended to read as follows:

 14-4          (b)  A holder of a wine and beer only package store permit

 14-5    may employ a person 16 years old or older to work in any capacity.

 14-6          SECTION 20.  Section 108.52(c), Alcoholic Beverage Code, is

 14-7    amended to read as follows:

 14-8          (c)  Retail licensees and permittees may erect or maintain

 14-9    one sign at each place of business which may read as follows:

14-10                (1)  if a beer retailer, the sign may read "Beer";

14-11                (2)  if an off-premises beer retailer, the sign may

14-12    read "Beer" or "Beer to Go";

14-13                (3)  if a wine and beer retailer, the sign may read

14-14    "Beer," "Beer and Wine," or "Beer, Wine and Ale";

14-15                (4)  if a wine and beer off-premises retailer, the sign

14-16    may read "Beer," "Beer to Go," "Beer and Wine," "Beer and Wine to

14-17    Go," "Beer, Wine and Ale," or "Beer, Wine and Ale to Go";

14-18                (5)  if a package store permittee, the sign may read

14-19    "Package Store," "Liquors," [or] "Wines and Liquors," [and if a

14-20    retail dealer's off-premise license is also held, the sign may read

14-21    "Package Store,"] "Wines, Liquors and Beer," or "Wine, Liquors and

14-22    Beer to Go"; or

14-23                (6)  if a wine and beer only package store permittee,

14-24    the sign may read "Wine," [or] "Wines," [and if a retail dealer's

14-25    off-premise license is also held, the sign may read] "Wines and

14-26    Beer," "Wine and Beer," or "Wine and Beer to Go."

14-27          SECTION 21.  Sections 22.07 and 71.03, Alcoholic Beverage

 15-1    Code, are repealed.

 15-2          SECTION 22.  This Act takes effect September 1, 1997.

 15-3          SECTION 23.  The importance of this legislation and the

 15-4    crowded condition of the calendars in both houses create an

 15-5    emergency and an imperative public necessity that the

 15-6    constitutional rule requiring bills to be read on three several

 15-7    days in each house be suspended, and this rule is hereby suspended.