85R10172 JAM-D

By: Frullo H.B. No. 2101

A BILL TO BE ENTITLED

AN ACT

relating to the issuance of a food and beverage certificate to holders of certain alcoholic beverage permits and licenses.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 25.13, Alcoholic Beverage Code, is amended by amending Subsections (a), (b), and (d) and adding Subsections (a-1), (b-1), and (f) to read as follows:

(a) In this section:

(1) "Premises" means the designated physical address of the wine and beer retailer's permit and includes all areas at the address where the permit holder may sell or deliver alcoholic beverages for immediate consumption.

(2) "Sexually oriented business" has the meaning assigned by Section 243.002, Local Government Code.

(a-1) A holder of a wine and beer retailer's permit may be issued a food and beverage certificate by the commission if the commission finds that the total receipts from the sale of alcoholic beverages for the premises are 50 percent or less of the total receipts for [food service is the primary business being operated on] the premises [by the permittee].

(b) An applicant for or holder of a food and beverage certificate shall have food service facilities for the preparation and service of multiple entrees for on-premises consumption.

(b-1) The commission shall adopt rules as necessary to assure that the holder of a food and beverage certificate maintains food service [as the primary business] on the premises for which a food and beverage certificate has been issued. The commission may exempt permittees who are concessionaires in public entertainment venues such as sports stadiums and convention centers from Subsection (b) [the requirement that food service be the primary business on the premises].

(d) A certificate issued under this section expires on the expiration of the primary wine and beer retailer's permit. A certificate may be canceled at any time if the commission finds that the holder of the certificate is in violation of Subsection (a-1) or (b) or a rule adopted under Subsection (b-1) [not operating primarily as a food service establishment. For the purposes of this section, it shall be presumed that a permittee is not primarily operating as a food service establishment if alcohol sales are in excess of 50 percent of the gross receipts of the premises]. The commission [may impose a fine not to exceed $5,000 on the holder of a food and beverage certificate not operating as a food service establishment and] may, upon finding that the permittee knowingly operated under a food and beverage certificate while not complying with this section or a rule adopted under Subsection (b-1), cancel the permittee's wine and beer retailer's permit.

(f) A food and beverage certificate may not be issued or maintained for a premises on which a sexually oriented business is operated.

SECTION 2. Section 28.18, Alcoholic Beverage Code, is amended by amending Subsections (a), (b), (d), and (e) and adding Subsections (a-1), (b-1), and (g) to read as follows:

(a) In this section:

(1) "Premises" means the designated physical address of the mixed beverage permit and includes all areas at the address where the permit holder may sell or deliver alcoholic beverages for immediate consumption.

(2) "Sexually oriented business" has the meaning assigned by Section 243.002, Local Government Code.

(a-1) A holder of a mixed beverage permit may be issued a food and beverage certificate by the commission if the commission finds that the total [gross] receipts from the sale of alcoholic [of mixed] beverages [sold] by the holder are 50 percent or less of the total [gross] receipts from the premises.

(b) An applicant for or holder of a food and beverage certificate shall have food service facilities for the preparation and service of multiple entrees for on-premises consumption.

(b-1) The commission shall adopt rules as necessary to assure that the holder of a food and beverage certificate maintains food service on the premises for which a food and beverage certificate has been issued.

(d) On receipt of an application for a renewal of a mixed beverage permit by a holder who also holds a food and beverage certificate, the commission [shall request certification by the comptroller to determine whether the holder is in compliance with Subsection (a). In determining compliance with Subsection (a), the comptroller] shall compare the permittee's total [gross] receipts from the sale of alcoholic beverages with the total receipts [tax reports with the permittee's sales tax reports] for the premises. If the commission [comptroller] does not certify that the holder is in compliance with Subsection (a-1) [(a)], the commission may not renew the certificate. The holder of a mixed beverage permit who is denied the renewal of a food and beverage certificate may request reconsideration of the nonrenewal by the commission not later than the 30th day after the date the commission denies the renewal. If the permit holder requests reconsideration of the nonrenewal of the certificate, the permit holder shall provide additional information to the commission. Chapter 2001, Government Code, does not apply to a request for reconsideration under this section.

(e) A certificate issued under this section expires on the expiration of the primary mixed beverage permit. A holder of a mixed beverage permit who is denied renewal of a certificate may not apply for a new certificate until the day after the first anniversary of the determination of the commission [comptroller] under Subsection (d).

(g) A food and beverage certificate may not be issued or maintained for a premises on which a sexually oriented business is operated.

SECTION 3. Section 32.23, Alcoholic Beverage Code, is amended by amending Subsections (a), (b), (d), and (e) and adding Subsections (a-1), (b-1), and (g) to read as follows:

(a) In this section:

(1) "Premises" means the designated physical address of the private club registration permit and includes all areas at the address where the permit holder may serve or deliver alcoholic beverages for immediate consumption.

(2) "Sexually oriented business" has the meaning assigned by Section 243.002, Local Government Code.

(a-1) A holder of a private club registration permit may be issued a food and beverage certificate by the commission if the commission finds that the total [gross] receipts from the service of alcoholic [mixed] beverages [served] by the holder are 50 percent or less of the total [gross] receipts from the premises.

(b) An applicant for or holder of a food and beverage certificate shall have food service facilities for the preparation and service of multiple entrees for on-premises consumption.

(b-1) The commission shall adopt rules as necessary to assure that the holder of a food and beverage certificate maintains food service on the premises for which a food and beverage certificate has been issued.

(d) On receipt of an application for a renewal of a private club registration permit by a holder who also holds a food and beverage certificate, the commission [shall request certification by the comptroller to determine whether the holder is in compliance with Subsection (a). In determining compliance with Subsection (a), the comptroller] shall compare the permittee's total [gross] receipts from the service of alcoholic beverages with the total receipts [tax reports with the permittee's sales tax reports] for the premises. If the commission [comptroller] does not certify that the holder is in compliance with Subsection (a-1) [(a)], the commission may not renew the certificate. The holder of a private club registration permit who is denied the renewal of a food and beverage certificate may request reconsideration of the nonrenewal by the commission not later than the 30th day after the date the commission denies the renewal. If the permit holder requests reconsideration of the nonrenewal of the certificate, the permit holder shall provide additional information to the commission. Chapter 2001, Government Code, does not apply to a request for reconsideration under this section.

(e) A certificate expires on the expiration of the primary private club registration permit. A holder of a private club registration permit who is denied renewal of a certificate may not apply for a new certificate until the day after the first anniversary of the determination of the commission [comptroller] under Subsection (d).

(g) A food and beverage certificate may not be issued or maintained for a premises on which a sexually oriented business is operated.

SECTION 4. Section 69.16, Alcoholic Beverage Code, is amended by amending Subsections (a), (b), and (d) and adding Subsections (a-1), (b-1), and (f) to read as follows:

(a) In this section:

(1) "Premises" means the designated physical address of the retail dealer's on-premise license and includes all areas at the address where the license holder may sell or deliver alcoholic beverages for immediate consumption.

(2) "Sexually oriented business" has the meaning assigned by Section 243.002, Local Government Code.

(a-1) A holder of a retail dealer's on-premise license may be issued a food and beverage certificate by the commission if the commission finds that the total receipts from the sale of alcoholic beverages for the premises are 50 percent or less of the total receipts for [food service is the primary business being operated on] the premises [by the permittee].

(b) An applicant for or holder of a food and beverage certificate shall have food service facilities for the preparation and service of multiple entrees for on-premises consumption.

(b-1) The commission shall adopt rules as necessary to assure that the holder of a food and beverage certificate maintains food service [as the primary business] on the premises for which a food and beverage certificate has been issued. The commission may exempt licensees [permittees] who are concessionaires in public entertainment venues such as sports stadiums and convention centers from Subsection (b) [the requirement that food service be the primary business on the premises].

(d) A certificate issued under this section expires on the expiration of the primary retail dealer's on-premise license. A certificate may be canceled at any time if the commission finds that the holder of the certificate is in violation of Subsection (a-1) or (b) or a rule adopted under Subsection (b-1) [not operating primarily as a food service establishment. For the purposes of this section, it shall be presumed that a permittee is not primarily operating as a food service establishment if alcohol sales are in excess of 50 percent of the gross receipts of the premises]. The commission [may impose a fine not to exceed $5,000 on the holder of a food and beverage certificate not operating as a food service establishment and] may, upon finding that the licensee [permittee] knowingly operated under a food and beverage certificate while not complying with this section or a rule adopted under Subsection (b-1), cancel the licensee's retail dealer's on-premise license.

(f) A food and beverage certificate may not be issued or maintained for a premises on which a sexually oriented business is operated.

SECTION 5. (a) As soon as practicable after the effective date of this Act, the Texas Alcoholic Beverage Commission shall adopt the rules necessary to implement this Act.

(b) The changes in law made by this Act apply only to an application for a food and beverage certificate that is filed on or after the effective date of the rules adopted under Subsection (a) of this section.

SECTION 6. This Act takes effect September 1, 2017.