Abolish the Texas Alcoholic Beverage Code

The Austin-American Statesman: Taking on the alcohol industry

Supermarket chains and big-box retailers are using a House bill that would modernize the Texas Alcoholic Beverage Commission to challenge the alcohol industry powers that have, for so long, helped shape the state's liquor laws.

[...]

Chuck Courtney of the Texas Retailers Association thinks Hamric's bill does not go far enough. Among the changes retailers want is that distributors be allowed to deliver beer and wine between midnight and 5 a.m., a common delivery time for other products that avoids road traffic and store congestion, Courtney said.

Retailers would also like to see the Legislature strike down a rule that requires their businesses to pay for beer immediately upon delivery. The Texas Alcoholic Beverage Code allows credit to be extended to retailers who buy wine or liquor but not beer. The law is a cash flow boon to beer distributors and unfair to package stores, Courtney said.

Representatives of Kroger, Wal-Mart, H-E-B and retailers groups unsuccessfully pitched these concerns to the House Licensing and Administrative Procedures Committee. When asked about extending credit to beer buyers, Rep. Charlie Geren, the committee's vice chairman, said, "That ain't gonna happen."

"Our goal was to keep this bill about how the agency is run," said Geren, R-Fort Worth. "We're not looking to tear up the three-tiered system."

That system, established 70 years ago, draws clear lines of authority among manufacturers, wholesalers and retailers. Critics say it tilts the balance of power in the $15 billion-a-year industry toward the wholesalers, who control the flow of alcohol through exclusive territories.

[...]

HB 2544 also calls for a long-term study of the Texas Alcoholic Beverage Commission, an agency that in 2004 issued nearly 100,000 licenses to companies that make, distribute or sell alcohol; addressed more than 30,000 criminal and administrative violations within the industry; and collected nearly $170 million in excise and other taxes and fees related to alcohol.

Though the bill does not say it specifically, such a study could open the door to a review or even a rewriting of the Alcoholic Beverage Code, something that hasn't been done since 1977.

The 244-page code has an almost mystically detailed quality to those who are not intimately familiar with it. The code outlines the commission's primary tasks of enforcing liquor laws, issuing licenses and collecting taxes and fees.

The code provides explicit definitions of more than 60 permits and licenses, lays out rules for dry and wet counties and outlines precisely the areas of authority for manufacturers, wholesalers and retailers.

This delineation of these three tiers of the alcohol business was inspired by nationwide fears after the repeal of Prohibition in 1933. Not only did legislatures want to prevent gangsters from consolidating control of legal alcohol; they wanted to keep the major breweries that had waited out 14 years of temperance from returning to a time when they made beer, distributed it and sold it through taverns or "tied houses" they owned.

Copyright 2001-2005 Cox Texas Newspapers, L.P. All rights reserved.

All emphasis is mine.

I always have a very rough idea how far American civilization has regressed. Without ever looking into it, I assume that, for example, there are a number of annoying, cumberson, and business-destroying rules that the companies in the alcohol marketplace have to twist through in order to sell their products. The micromanagement of this industry is just absurd.

Actually getting a glimpse at the actual beast itself after being inspired by this news story just depresses me. Chapters 11 through 75 deal with permits and licenses. Chapters 201 through 206 are on taxes. And of course:

This 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. It shall be liberally construed to accomplish this purpose.

That would be before Chapters 101 through 110, which are on the various punishments applicable if these "for your own good" laws are violated. Nice of 'em to care so much, isn't it?

Posted by Drizzten at May 02, 2005 01:43 PM