Whining for Wine in My Tennessee Grocery: Update

By - July 22, 2013 | Alcoholic Beverage Law | Email Will Cheek

Tennessee wine drinkers demand to know. Where is wine in my grocery store?

We hear it all the time from wine consumers, from Nashville to Chattanooga, from Memphis to Knoxville, when can I buy wine with groceries?

Wine in groceries has been a political hot potato in the Tennessee Legislature for years. But in 2013, the groundwork may have been laid for a new law to legalize wine in groceries.

The Beasties Boys are on message in their 1998 single “Body Movin'”

Like a bottle of Chateau Neuf Du Pap
I’m fine like wine when I start to rap

Here’s the Cliff Notes summary. In Tennessee, it is illegal to sell wine anywhere other than licensed retail liquor stores. Tennessee state law prohibits liquor stores from selling anything except wine, spirits, lottery tickets and cashing checks. Tennessee law prohibits owning more than one liquor store, and until recently, prohibited out of state ownership of liquor stores.

These rules make it impossible for wine to be sold in grocery stores.

Legalizing the sale of wine in grocery stores requires changing state law. With the vast majority of Tennessee residents in favor of selling wine in groceries, folks ask, why hasn’t the law been changed.

Politics.

Good news for wine in grocery store advocates is that the proposed law is further along than it has ever been in the Tennessee legislature. Political pundits predict that the wine law may come up for a vote on the Tennessee Senate floor relatively early in the legislative session.

Wine in groceries has died in prior years in committee, a time-honored way to kill laws in Tennessee. We blogged about the fate of wine in the state house here.

Who knows what will happen, but as we see things, wine in groceries is better positioned than ever.

Tennessee Dinosaurs Beware: No Paper Returns for Sales & Use Tax Beginning October 1, 2013

By - July 17, 2013 | Alcoholic Beverage Law | Email Will Cheek

Taxes and tax returns are the bane of existence for many Tennessee restaurants, bars, hotels and venues. The high rate on Tennessee liquor taxes adds insult to injury.

We suspect that a new rule requiring electronic filing for sales tax returns will be like pouring salt in the wound for owners that have not embraced the digital revolution.

Starting October 1, 2013, the Tennessee Department of Revenue will no longer accept paper sales and use tax returns. Your check will no longer be welcome. All sales and use returns must be filed electronically and paid for electronically.

We expect the digital requirement to apply to Tennessee liquor-by-the-drink taxes in the very near future.

More details are at the link: Revenue Electronic Sales Use Filing Requirements (00941519).

Billy Joel captures the sentiment in his 1977 hit “Movin’ Out”

You can pay Uncle Sam with overtime
Is that all you get for your money?

Can I Serve Wine, Beer or Drinks to Customers at My Spa, Art Gallery or Retail Store in Tennessee?

By - July 16, 2013 | Alcoholic Beverage Law | Email Will Cheek

Depends. We are fans of the definition of “Depends” at the Urban Dictionary:

1 Padded undergarments used to minimise discomfort and embarrassment of sufferers from weak bladders.
2 May also be used during intense moments of laughter. 
 

Many folks think that if they are not charging for a glass of wine, ale or whiskey, they do not need a liquor license from the State of Tennessee. Many folks are wrong.

When you are serving “free” alcohol to the public in connection with the sale of goods or services at your business, the Tennessee Alcoholic Beverage Commission most likely will say you need a liquor license. Or you need a licensed caterer to serve the drinks for you.

Serving “complimentary” wine or champagne during a haircut, spa treatment or nail pedicure is illegal in Tennessee. The alcoholic beverage is included in the cost of the services. You are selling alcohol without a liquor license.

The sale of alcohol without a license is a felony in Tennessee.

Tennessee liquor laws are not as clear about complimentary drinks at free marketing events.

It is legal to have friends over to a party at your house for a ballgame, baby shower or other social gathering. This is a private party.

But if you are selling or marketing something when serving alcohol, its not really a private party. If invitations are transferrable or anyone that shows up can attend and swill a free glass of wine, it is unlikely the Tennessee Alcoholic Beverage Commission will call it a private party.

If your business is not hosting a private party, you probably need a liquor license or a licensed caterer to serve booze.  Even free booze.

Art galleries in Tennessee passed a law that allows complimentary service of wine:

Any art gallery that does not sell food or beverages and that receives ninety percent (90%) of its revenue from the sale of artwork may serve wine to patrons of such art gallery without a charge. Such art gallery shall not serve wine to a patron who is intoxicated or believed to be intoxicated. Notwithstanding any other provision of law to the contrary, any art gallery permitted to serve wine under this section shall not be required to pay any fees or taxes related to the privilege of serving wine. TCA 57-4-105.

For other retailers, perhaps the biggest concern is insurance. We suspect that an insurer will deny a claim for a business illegally serving wine. For example, your business would not have insurance if a customer has a drunk driving or other incident.

This could easily put your business out of business.

 

Are Liquor Licenses of the Future Bound for Tennessee?

By - July 01, 2013 | Alcoholic Beverage Law | Email Will Cheek

We got a glimpse of the future of liquor licensing at the 2013 Annual Meeting of the National Conference of State Liquor Administrators. Our California Compatriot and Licensing Wizard Extraordinaire Mike Brewer lead a panel that spotlighted new liquor licenses to facilitate innovation among restaurateurs and other purveyors of beer, wine and spirits.

One of the hottest trends making its way around the world is sky dining. Diners are seated around a table with chefs in the middle and then hoisted high into the air by a crane. Learn more here.

Bel-Hawa-Sawa-resized

So how exactly does one obtain a liquor license for a premises dangled high above the ground at a different place each night?

Remarkably, Tennessee may be a trendsetter on this question, at least for wine and spirits. We suspect a caterer can simply file a notice of catered event for sky dining, although being licensed for beer could be more challenging, depending on the city.

Don’t expect sky dining to appear at the foot of Beale Street or over the Cumberland River any time soon – we understand that the first planned US event will be in Las Vegas.

Here is a list of other trends in search of a legal way to serve alcoholic beverages:

Food trucks

Pop up restaurants

Pop up concert venues

Spas

Clothing, jewelry and other high end stores

Tupperware wine parties

Self serve drink machines like IPourIt and Wine Station

Smart device ordering at venues

Our personal favorite are apps that allow you to order a drink at a concert, game or other event on  your phone. Its not quite like Star Trek – you cannot reach into your phone to retrieve a frosty beverage – yet – but your drink is either delivered to you or you are notified when you can stop by a counter to retrieve your drink. Best of all, most apps allow for on-line payment. Just show your ID.

Serving wine at high end retail stores is a pressing issue. Many retail stores offer liquor without liquor licenses. High end clothing and jewelry retailers have been lubricating wallets with liquor for years. Most think that if there is no charge for the alcohol, a liquor license is not needed.

Not so in most states. Liquor poured to make you spend money generally requires a liquor license.

Pouring without a license is dangerous for a business. Not only are the owners allowing the sale of liquor without a license, insurance may refuse to cover any loses resulting form the illegal sale of alcohol. If a customer has a liquor-related car accident after the event, the business may be on the hook for hundreds of thousands of dollars, or more. Without any insurance.

In Tennessee, it is possible to hire a licensed caterer to serve liquor, but Tennessee law prohibits serving free drinks. It is a catch 22.

All these new trends remind us of punk-rockers The Offspring and their 2012 single:

So the end’s what you make it
And that’s what you’re looking for
This is the future
The future is now