By Wilson H.B. No. 3555
76R9141 CAG-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the regulation of the manufacture, distribution, sale,
1-3 use, possession, and transportation of alcoholic beverages in the
1-4 state; providing a penalty.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Section 5.50, Alcoholic Beverage Code, is amended
1-7 by adding Subsection (e) to read as follows:
1-8 (e) For the purposes of Subsection (b), the term "the
1-9 legislative appropriation to the commission for the regulation of
1-10 alcoholic beverages" does not include:
1-11 (1) any amount appropriated to pay judgments,
1-12 attorney's fees, settlements, or any expenditure by the commission
1-13 arising out of an action in which the commission is alleged to
1-14 have:
1-15 (A) been negligent or discriminatory in an
1-16 action taken or omission made by the commission;
1-17 (B) violated the commission's employment
1-18 policies; or
1-19 (C) wrongfully terminated a commission employee;
1-20 or
1-21 (2) any amount of money appropriated to be paid to or
1-22 expended on a commission employee or other commission personnel who
1-23 are performing an action or service that is not specifically
1-24 related to the enforcement of this code.
2-1 SECTION 2. Section 11.09, Alcoholic Beverage Code, is
2-2 amended to read as follows:
2-3 Sec. 11.09. EXPIRATION OR SUSPENSION OF PERMIT. (a) A
2-4 permit issued under this code expires one year after the date it is
2-5 issued except as otherwise provided by this code.
2-6 (b) A secondary permit that requires the holder of the
2-7 permit to first obtain another permit, including a late hours
2-8 permit or temporary permit, expires on the same date the basic or
2-9 primary permit expires. The commission may not prorate or refund
2-10 any part of the fee for the secondary permit if the application of
2-11 this section results in the expiration of the permit in less than
2-12 one year.
2-13 (c) An action by the commission resulting in the suspension
2-14 of a basic or primary permit also acts to suspend any secondary
2-15 permit held by the holder of the basic or primary permit.
2-16 SECTION 3. Subchapter A, Chapter 11, Alcoholic Beverage
2-17 Code, is amended by adding Section 11.091 to read as follows:
2-18 Sec. 11.091. NOTIFICATION OF EXPIRED OR SUSPENDED PERMIT;
2-19 LIABILITY FOR UNAUTHORIZED SALE. (a) The commission shall verify
2-20 that the holder of an expired or suspended retail permit is not
2-21 operating in violation of this code. The verification, including
2-22 any inspection of the premises by commission personnel, must occur
2-23 within a reasonable time after the date the permit expires or is
2-24 suspended.
2-25 (b) The commission shall promptly notify each wholesaler, as
2-26 that term is ordinarily used and understood in Section 102.01, who
2-27 regularly supplies retailers in the geographic area that the
3-1 holder's retail permit has expired or has been suspended.
3-2 (c) A wholesaler may not be charged with or be held liable
3-3 for a violation of this code relating to the sale of alcoholic
3-4 beverages to a non-permitted premise if the commission has not
3-5 notified the wholesaler under Subsection (b).
3-6 (d) This section does not apply if the holder of a retail
3-7 permit has timely filed a renewal application and is operating
3-8 during the pendency of the renewal application subject to this code
3-9 and the regulations of the commission.
3-10 SECTION 4. Subchapter C, Chapter 11, Alcoholic Beverage
3-11 Code, is amended by adding Sections 11.72 and 11.73 to read as
3-12 follows:
3-13 Sec. 11.72. AFFIRMATION OF COMPLIANCE. A person who holds a
3-14 permit under Chapter 19, 20, 21, or 23 may not be held liable for
3-15 selling or delivering an alcoholic beverage to a retailer not
3-16 authorized to purchase and receive the alcoholic beverage if the
3-17 permit holder:
3-18 (1) reasonably believes that the retailer is
3-19 authorized to purchase and receive that type of alcoholic beverage;
3-20 and
3-21 (2) obtains from the retailer at the time of delivery
3-22 a written affirmation, which may be printed or stamped on a sales
3-23 invoice evidencing the sale or delivery of alcoholic beverages by
3-24 the permit holder, that the retailer is authorized to purchase and
3-25 receive the type of alcoholic beverage sold and delivered by the
3-26 permit holder.
3-27 Sec. 11.73. DISCIPLINE FOR ACTIONS OF AGENT. The commission
4-1 or administrator may suspend or revoke the permit of a person who
4-2 is represented by the holder of an agent's permit as described by
4-3 Section 35.01 or otherwise discipline the person based on an act or
4-4 omission of the holder of an agent's permit only if an individual
4-5 employed by the person in a supervisory position:
4-6 (1) was directly involved in the act or omission of
4-7 the holder of an agent's permit;
4-8 (2) had notice or knowledge of the act or omission;
4-9 and
4-10 (3) failed to take reasonable steps to prevent the act
4-11 or omission.
4-12 SECTION 5. Section 24.07, Alcoholic Beverage Code, is
4-13 amended to read as follows:
4-14 Sec. 24.07. WHEN LICENSE ALSO HELD: HOURS OF SALE, ETC. A
4-15 holder of a wine only package store permit who also holds a retail
4-16 dealer's off-premise license for the same location may remain open
4-17 and sell ale, wine, vinous liquors, and beer, for off-premises
4-18 consumption only, on any day and during the same hours that the
4-19 holder of a wine and beer retailer's permit may sell ale, beer, and
4-20 wine, except that he may not sell wine or vinous liquor containing
4-21 more than 17 [14] percent alcohol by volume on a Sunday or after 10
4-22 p.m. on any day.
4-23 SECTION 6. Section 25.01, Alcoholic Beverage Code, is amended
4-24 to read as follows:
4-25 Sec. 25.01. AUTHORIZED ACTIVITIES. The holder of a wine and
4-26 beer retailer's permit may sell:
4-27 (1) for consumption on or off the premises where sold,
5-1 but not for resale, wine containing not more than 17 percent
5-2 alcohol by volume and [,] beer[,] and malt liquors containing
5-3 alcohol in excess of one-half of one percent by volume and not more
5-4 than 14 percent by volume; and
5-5 (2) for consumption on the premises traditional port
5-6 or sherry containing alcohol in excess of one-half of one percent
5-7 by volume and not more than 24 percent by volume.
5-8 SECTION 7. Section 25.09, Alcoholic Beverage Code, is
5-9 amended to read as follows:
5-10 Sec. 25.09. POSSESSION OF CERTAIN BEVERAGES PROHIBITED. No
5-11 wine and beer retailer's permittee, nor officer of the permittee,
5-12 may possess [distilled spirits or liquor containing alcohol in
5-13 excess of 14 percent by volume] on the licensed premises any
5-14 alcoholic beverage the permitee is not authorized to sell.
5-15 SECTION 8. Section 26.01, Alcoholic Beverage Code, is
5-16 amended to read as follows:
5-17 Sec. 26.01. AUTHORIZED ACTIVITIES. The holder of a wine and
5-18 beer retailer's off-premise permit may sell for off-premises
5-19 consumption only, but not for resale, wine containing not more than
5-20 17 percent alcohol by volume and [,] beer[,] and malt liquors
5-21 containing alcohol in excess of one-half of one percent by volume
5-22 but not more than 14 percent by volume.
5-23 SECTION 9. Section 27.01, Alcoholic Beverage Code, is
5-24 amended to read as follows:
5-25 Sec. 27.01. AUTHORIZED ACTIVITIES. The holder of a
5-26 temporary wine and beer retailer's permit may sell for consumption
5-27 on or off the premises where sold, but not for resale, wine
6-1 containing not more than 17 percent alcohol by volume and[,]
6-2 beer[,] and malt liquors containing alcohol in excess of one-half
6-3 of one percent by volume but not more than 14 percent by volume.
6-4 The permit does not authorize the sale of those beverages outside
6-5 the county for which it is issued.
6-6 SECTION 10. Section 27.11, Alcoholic Beverage Code, is
6-7 amended to read as follows:
6-8 Sec. 27.11. AUTHORIZED ACTIVITIES. The holder of a special
6-9 three-day wine and beer permit may sell for consumption on the
6-10 premises for which the permit is issued, but not for resale, wine
6-11 containing not more than 17 percent alcohol by volume and[,]
6-12 beer[,] and malt liquors containing alcohol in excess of one-half
6-13 of one percent by volume but not more than 14 percent by volume.
6-14 SECTION 11. Section 42.01(a), Alcoholic Beverage Code, is
6-15 amended to read as follows:
6-16 (a) The holder of a private carrier permit who is also a
6-17 holder of a brewer's, distiller's and rectifier's, winery,
6-18 wholesaler's, class B wholesaler's, or wine bottler's permit may
6-19 transport liquor from the place of purchase to his place of
6-20 business and from the place of sale or distribution to the
6-21 purchaser in vehicles owned or leased in good faith by the holder,
6-22 or in a vehicle owned or leased by the holder of a permit issued
6-23 under Chapter 35, if the transportation is for a lawful purpose.
6-24 SECTION 12. Section 61.03, Alcoholic Beverage Code, is
6-25 amended to read as follows:
6-26 Sec. 61.03. [DURATION AND] EXPIRATION OR SUSPENSION OF
6-27 LICENSE. (a) Except as provided by Subsection (b), a [No] license
7-1 may not be issued for a term longer than one year. Any license
7-2 except a branch, importer's, importer's carrier's, or temporary
7-3 license expires one year after the date on which it is issued.
7-4 (b) A secondary license which requires the holder of the
7-5 license to first obtain another license, including a late hours
7-6 license or temporary license, expires on the same date the basic or
7-7 primary license expires. The commission may not prorate or refund
7-8 any part of the fee for the secondary license if the application of
7-9 this section results in the expiration of the license in less than
7-10 one year.
7-11 (c) An action by the commission resulting in the suspension
7-12 of a basic or primary license also acts to suspend any secondary
7-13 license held by the holder of the basic or primary license.
7-14 SECTION 13. Subchapter A, Chapter 61, Alcoholic Beverage
7-15 Code, is amended by adding Section 61.031 to read as follows:
7-16 Sec. 61.031. NOTIFICATION OF EXPIRED OR SUSPENDED LICENSE;
7-17 LIABILITY FOR UNAUTHORIZED SALE. (a) The commission shall verify
7-18 that the holder of an expired or suspended retail license is not
7-19 operating in violation of this code. The verification, including
7-20 any inspection of the premises by commission personnel, must occur
7-21 within a reasonable time after the date the license expires or is
7-22 suspended.
7-23 (b) The commission shall promptly notify each wholesaler, as
7-24 that term is ordinarily used and understood in Section 102.01, who
7-25 regularly supplies retailers in the geographic area that the
7-26 holder's retail license has expired or has been suspended.
7-27 (c) A wholesaler may not be charged with or be held liable
8-1 for a violation of this code relating to the sale of alcoholic
8-2 beverages to an unlicensed premise if the commission has not
8-3 notified the wholesaler under Subsection (b).
8-4 (d) This section does not apply if the holder of a retail
8-5 license has timely filed a renewal application and is operating
8-6 during the pendency of the renewal application subject to this code
8-7 and the regulations of the commission.
8-8 SECTION 14. Subchapter C, Chapter 61, Alcoholic Beverage
8-9 Code, is amended by adding Sections 61.86 and 61.87 to read as
8-10 follows:
8-11 Sec. 61.86. AFFIRMATION OF COMPLIANCE. A person who holds a
8-12 license under Chapter 64, 65, or 66 may not be held liable for
8-13 selling or delivering an alcoholic beverage to a retailer not
8-14 authorized to purchase and receive the alcoholic beverage if the
8-15 license holder:
8-16 (1) reasonably believes that the retailer is
8-17 authorized to purchase and receive that type of alcoholic beverage;
8-18 and
8-19 (2) obtains from the retailer at the time of delivery
8-20 a written affirmation, which may be printed or stamped on a sales
8-21 invoice evidencing the sale or delivery of alcoholic beverages by
8-22 the license holder, that the retailer is authorized to purchase and
8-23 receive the type of alcoholic beverage sold and delivered by the
8-24 license holder.
8-25 Sec. 61.87. DISCIPLINE FOR ACTIONS OF AGENT. The commission
8-26 or administrator may suspend or revoke the license of a person who
8-27 is the employer of or represented by the holder of an agent's beer
9-1 license as described by Section 73.01 or otherwise discipline the
9-2 person based on an act or omission of the holder of the agent's
9-3 beer license only if an individual employed by the person in a
9-4 supervisory position:
9-5 (1) was directly involved in the act or omission of
9-6 the holder of the agent's beer license;
9-7 (2) had notice or knowledge of the act or omission;
9-8 and
9-9 (3) failed to take reasonable steps to prevent the act
9-10 or omission.
9-11 SECTION 15. Section 71.04, Alcoholic Beverage Code, is
9-12 amended to read as follows:
9-13 Sec. 71.04. POSSESSION OF CERTAIN BEVERAGES PROHIBITED. No
9-14 retail dealer's off-premise licensee, nor [his] officer of the
9-15 licensee, may possess [liquor containing alcohol in excess of 14
9-16 percent by volume] on the licensed premises any alcoholic beverage
9-17 the licensee is not authorized to sell.
9-18 SECTION 16. Section 102.07, Alcoholic Beverage Code, is
9-19 amended by amending Subsection (a) and adding Subsection (g) to
9-20 read as follows:
9-21 (a) Except as provided in Subsections (b), [and] (d), and
9-22 (g) [of this section], no person who owns or has an interest in the
9-23 business of a distiller, brewer, rectifier, wholesaler, class B
9-24 wholesaler, winery, or wine bottler, nor the agent, servant, or
9-25 employee of such a person, may:
9-26 (1) own or have a direct or indirect interest in the
9-27 business, premises, equipment, or fixtures of a retailer;
10-1 (2) furnish, give, or lend any money, service, or
10-2 thing of value to a retailer;
10-3 (3) guarantee a financial obligation of a retailer;
10-4 (4) make or offer to enter an agreement, condition, or
10-5 system which will in effect amount to the shipment and delivery of
10-6 alcoholic beverages on consignment;
10-7 (5) furnish, give, rent, lend, or sell to a retail
10-8 dealer any equipment, fixtures, or supplies to be used in selling
10-9 or dispensing alcoholic beverages, except that alcoholic beverages
10-10 may be packaged in combination with other items if the package is
10-11 designed to be delivered intact to the ultimate consumer and the
10-12 additional items have no value or benefit to the retailer other
10-13 than that of having the potential of attracting purchases and
10-14 promoting sales;
10-15 (6) pay or make an allowance to a retailer for a
10-16 special advertising or distribution service;
10-17 (7) allow an excessive discount to a retailer; or
10-18 (8) offer a prize, premium, gift, or similar
10-19 inducement to a retailer or to the agent, servant, or employee of a
10-20 retailer.
10-21 (g) Subsection (a) does not prohibit a permittee covered
10-22 under Subsection (a) from prearranging or preannouncing a
10-23 promotional activity otherwise permitted by this code with a
10-24 retailer about a promotional activity to be held on the retailer's
10-25 premises. A holder of wholesaler's or class B wholesaler's permit
10-26 may prearrange a promotional activity only for distilled spirits or
10-27 wine. A permittee may not:
11-1 (1) preannounce a promotion to a consumer, if the
11-2 permittee is the holder of a wholesaler's or class B wholesaler's
11-3 permit; or
11-4 (2) preannounce the purchase of wine or distilled
11-5 spirits to a consumer.
11-6 SECTION 17. Section 102.72, Alcoholic Beverage Code, is
11-7 amended by adding Subsections (d) and (e) to read as follows:
11-8 (d) A manufacturer or distributor may file a copy of any
11-9 agreement entered into under this subchapter with the commission.
11-10 (e) An agreement entered into, renewed, or amended under
11-11 this subchapter after September 1, 1999, shall contain, on the
11-12 front page of the agreement, information on whether any portion of
11-13 the agreement is subject to arbitration or subject to Chapter 26,
11-14 Business & Commerce Code.
11-15 SECTION 18. Section 107.07(f), Alcoholic Beverage Code, is
11-16 amended to read as follows:
11-17 (f) A [Any] person in the business of selling alcoholic
11-18 beverages in another state or country commits an offense if the
11-19 person [who] ships or causes to be shipped any alcoholic beverage
11-20 directly to any Texas resident under this section [is in violation
11-21 of this code]. An offense under this subsection is a Class A
11-22 misdemeanor unless it is shown at the trial of the offense that the
11-23 person shipped an alcoholic beverage or caused an alcoholic
11-24 beverage to be shipped after the person received written notice
11-25 from the commission that the person was violating this subsection,
11-26 in which event the offense is a state jail felony.
11-27 SECTION 19. Sections 251.14(a) and (e), Alcoholic Beverage
12-1 Code, are amended to read as follows:
12-2 (a) In the ballot issues prescribed in this section, "wine"
12-3 is limited to vinous beverages that do not contain more than 17
12-4 [14] percent alcohol by volume and includes malt beverages that do
12-5 not exceed that alcohol content. For local option purposes, those
12-6 beverages, sold and dispensed to the public in unbroken, sealed,
12-7 individual containers, are a separate and distinct type of
12-8 alcoholic beverage.
12-9 (e) In areas where the sale of beverages containing alcohol
12-10 not in excess of 17 [14] percent by volume has been legalized, and
12-11 those of higher alcoholic content are prohibited, the ballot shall
12-12 be prepared to permit voting for or against one of the following
12-13 issues in any prohibitory election:
12-14 (1) "The legal sale of beer for off-premise
12-15 consumption only."
12-16 (2) "The legal sale of beer."
12-17 (3) "The legal sale of beer and wine for off-premise
12-18 consumption only."
12-19 (4) "The legal sale of beer and wine."
12-20 SECTION 20. Subchapter D, Chapter 251, Alcoholic Beverage
12-21 Code, is amended by adding Section 251.81 to read as follows:
12-22 Sec. 251.81. SALE OF WINE. (a) If the sale of wine was
12-23 approved in an area by a local option election, other than a local
12-24 option election that approved the sale of all alcoholic beverages,
12-25 before September 1, 1999, an alcoholic beverage license or permit
12-26 holder may not sell in that area wine containing more than 14
12-27 percent alcohol by volume unless a subsequent local option election
13-1 approves the sale of wine or wine and other alcoholic beverages.
13-2 (b) The commission shall, on the face of each alcoholic
13-3 beverage license or permit, indicate whether the holder may sell
13-4 wine and, if the license or permit holder may sell wine, whether
13-5 the holder may sell wine up to 14 percent alcohol or 17 percent
13-6 alcohol by volume.
13-7 SECTION 21. Sections 22.09 and 24.08, Alcoholic Beverage
13-8 Code, are repealed.
13-9 SECTION 22. Sections 11.72 and 61.86, Alcoholic Beverage
13-10 Code, as added by this Act, apply only to a sale or delivery of an
13-11 alcoholic beverage on or after the effective date of this Act.
13-12 SECTION 23. Sections 11.73 and 61.87, Alcoholic Beverage
13-13 Code, as added by this Act, apply only to an act or omission of the
13-14 holder of an agent's permit under Chapter 35, Alcoholic Beverage
13-15 Code, or of an agent's beer license under Chapter 73, Alcoholic
13-16 Beverage Code, that occurs on or after the effective date of this
13-17 Act.
13-18 SECTION 24. (a) The change in law made to Section 107.07,
13-19 Alcoholic Beverage Code, by this Act applies only to an offense
13-20 committed on or after the effective date of this Act. For purposes
13-21 of this section, an offense is committed before the effective date
13-22 of this Act if any element of the offense occurs before the
13-23 effective date.
13-24 (b) An offense committed before the effective date of this
13-25 Act is covered by the law in effect when the offense was committed,
13-26 and the former law is continued in effect for that purpose.
13-27 SECTION 25. This Act takes effect September 1, 1999.
14-1 SECTION 26. The importance of this legislation and the
14-2 crowded condition of the calendars in both houses create an
14-3 emergency and an imperative public necessity that the
14-4 constitutional rule requiring bills to be read on three several
14-5 days in each house be suspended, and this rule is hereby suspended.