AAIAC

The Alliance of Alcohol Industry Attorneys & Consultants is a select organization of alcoholic beverage licensing and compliance professionals.

Will Tennessee make alcohol delivery permanent for restaurants?

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Jan 25, 2021

Tennessee state Rep. Bob Ramsey has introduced state legislation that makes delivery of alcoholic beverages by restaurants, hotels and other liquor by the drink licensees “permanent” — at least for three years. Download a copy of the legislation here. Upon a quick reading, the legislation appears to be modeled after Governor Lee’s emergency orders that legalized delivery during the pandemic

We hear Stevie Wonder’s catchy refrain:

Ooh baby, here I am

Signed, sealed, delivered, I'm yours, I'm yours

There is one notable departure from emergency delivery of alcohol. The legislation attempts to shield license holders from all “conduct” of a third-party delivery service driver. This would appear to be an effort to allow license holders to escape fines and suspensions for drivers delivering alcohol to minors and intoxicated persons, for example.

The proposed legislation does not contain any penalties for drivers that deliver to minors or otherwise violate liquor laws. Keep in mind that most restaurant delivery services do not hold any license with the ABC and are not required to provide any training to drivers for the delivery of alcohol. The ABC and beer boards do not have direct jurisdiction over these delivery services and their drivers.

The legislation also does not correct an apparent deficiency in the law for sale to minor stings using web and app ordering services. To place an order for alcohol, ordering services universally require a click-through that the individual placing the order is 21 or over. As we understand current law, an under-age law enforcement officer cannot lie about their age. An under-age cadet cannot legally place an on-line order for delivery of alcohol, preventing law enforcement from conducting routine age-compliance checks.

Stay tuned for more about the delivery bill and other legislation by subscribing to Last Call.

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Tennessee extends alcohol carryout and delivery through February 27

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Dec 26, 2020

Tennessee Gov. Bill Lee has extended the executive order allowing carryout and delivery of beer, wine and spirits for restaurants.

Restaurants, limited-service restaurants and wine-only restaurants can continue to sell carryout and deliver alcoholic beverages and beer. There is no additional license or permission needed to deliver.

Lee extended the privilege through to 11:59 pm February 27, which brings welcome certainty to an industry battered by the pandemic.

Lee continued the state of emergency for the longest amount of time under state law.  Health departments in Davidson, Hamilton, Knox, Madison, Shelby and Sullivan counties will retain the discretion to implement local restrictions, including mask requirements and capacity limitations.

Lee also extended remote notarization and witnessing of documents, and allowed government meetings to take place electronically, subject to certain transparency safeguards. This means beer boards and the ABC can continue to meet via Zoom and WebEx.

We urge folks to keep hustling during these difficult times and check Last Call for updates. The Tennessee ABC has posted FAQs about carry out and delivery here

Here is our summary of the rules of engagement for to-go, curbside, drive-through and delivery:

Alcohol must be delivered with food. At least one item of food must be sold in every order containing alcohol. The amount of food required is not specified, but given the emergency nature of this order, we encourage restaurants not to play games and count lime slices as food, for example.

Licensees are still required to be responsible. Restaurants can set rules, such as one entrée per two single-serving margaritas. You can always require that customers order a meal or set a minimum dollar amount of food for deliveries.

You can deliver cocktails! As long as the package has a secure lid, we read the order as allowing delivery of margaritas, cocktails and other mixed drinks.

Alcohol must be packaged in a container or bottle with a secure lid or cap. We read this rule to mean that the container must be closed. Closed is not the same as sealed. For example, a lid screwed on the top of a plastic jug is closed. Alcohol does not have to be sealed, meaning you do not have to attach seals like you would find on commercial products at grocery stores.

The ABC advises restaurants to “cover containers in a reasonable manner that would require the consumer to unpackage them for consumption.” For example, we believe a styrofoam container with a lid that does not have a straw hole will work. If all your lids have straw holes, tape the straw holes.

Bottles and cans of beer and wine can be delivered. This includes regular-sized wine bottles. No bottles of spirits or liquor.

Single serving packages only. Although beer and wine by the bottle may be sold, no other multi-serving containers are allowed. For purposes of single servings, the ABC says no more than 16 oz. of beer, 9 oz. of wine or 4 oz. of spirits in a container with not more than 16 ounces of total liquid.

No more carafes of sangria or pitchers of margaritas to-go. You can sell multiple single-serving containers with a meal, although we continue to recommend moderation under this emergency order.

Mini bottles of spirits present a conundrum. State law prohibits the sale of spirits by the bottle. However, Governor Lee’s order specifically authorizes “single servings of alcoholic beverages.”

In our humble opinion, Executive Order 30 allows a restaurant to deliver mini bottles of spirits, provided it is clear that the mini bottle is intended for a single serving. We advise folks to securely tape or otherwise attach a mini bottle of spirits to the mixer. That way, it is abundantly clear that the two items - the container and the mini bottle - are intended to be a single serving. Do not play games and toss 12 mini bottles of tequila in a bag and consider yourself in compliance with the order.

The executive order only applies to full-service restaurants, wine-only restaurants and limited service restaurants. Hotels, caterers, premier-type tourist resorts, convention centers and other special license types cannot deliver or sell alcohol to-go under the executive order.

Get your beer here. Restaurants do not need permission from their local beer board to deliver under the Governor’s order.

If you are a brewery, hotel or other business that does not hold a restaurant license, you can register with your local beer board to deliver beer in in Bristol, Chattanooga, Knoxville, Memphis and Nashville. These local beer boards have specifically authorized carryout and delivery of regular beer. There are broader rights for beer-only delivery and growlers are fine in these cities and any other city that has specifically authorized carryout and delivery of beer. Read more about beer delivery here.

Mandatory carding for deliveries. You must card. Sales cannot be made to under 21 or intoxicated persons.

Drivers do not have to physically touch an identification to verify age. Because orders are most likely paid in advance, online or via phone, there is no need for drivers to risk potential contamination and make physical content with the customer. Have the customer hold their own ID out for the driver to read. Or better yet, read it through a glass storm window.

That said, drivers need to ensure that they properly ID. We encourage Redbox carding and closer scrutiny of all Redbox IDs.

Drivers must be at least 21 years of age and have a valid driver’s license.

Delivery services can deliver your alcohol. Restaurants can use their own employees or third-party delivery services such as Postmates and Uber Eats to deliver alcohol. Delivery personnel are not required to have server permit cards or any special qualifications.

With a third-party delivery service, you should ensure that delivery personnel are properly trained for carding. Some delivery services are not set up to require carding.

Keep in mind that if you are using a third-party delivery service, your restaurant remains liable for sales to minors, intoxicated persons or the violation of any other law.  A restaurant will not be able to avoid liability by saying “the Uber driver did it.”

Restaurants must post a sign with the following notice: “No driver shall consume any alcoholic beverage or beer or possess an open container of alcoholic beverage or beer while operating a motor vehicle in this state.” Although the order is not clear, we advise folks to post the sign on the wall, with your liquor license.

Carryout and delivery of alcohol are limited to current operating hours, which is not defined. We advise folks to adhere to the normal sales hours for beer and alcoholic beverages.

Curbside and drive-through. The order does not specifically address curbside and drive-through, but given the intent of the order, we believe it is OK to deliver drinks curbside and through drive-through windows.

Do not stage alcohol pick up outside.Restaurants cannot stage multiple alcohol deliveries at tables outside the restaurant’s licensed premises. We understand that it is convenient for multiple orders to be brought out for immediate pickup at curbside. Although this is okay for food, alcohol must stay inside the restaurant until the customer or delivery service arrives for pickup. A licensed patio is fine for staging. But not your parking lot.

Alcohol must come from the restaurant’s inventory. A restaurant cannot buy or deliver alcohol from a retail liquor store, food store or another restaurant. You must purchase your alcohol from a wholesaler.

Collect sales tax. Restaurants do not collect the 15% liquor by the drink tax for all wine and spirits sold to-go or for delivery, including bottles and cans of beer, wine and single-serve cocktails. You do have to collect sales tax. Here is the post from Revenue. (link to attached). If you have more tax questions, see our post here.

Delivery applies to restaurants statewide, but we urge folks to exercise discretion and not deliver to dry towns and counties. We suspect that the Governor did not intend for delivery to areas that have not approved of liquor-by-the-drink.

Restaurants with dining privileges can serve alcohol for on-premise consumption. Just like a regular patron dining at a table, restaurants can serve alcohol to customers that are waiting to pick up carryout, provided that the restaurant’s dining room can legally be open. Tennessee restaurants were allowed to reopen for dining beginning April 27, except for the six counties in the state within independent health departments (Chattanooga – Hamilton, Jackson – Madison, Kingsport & Bristol – Sullivan, Knoxville – Knox, Memphis – Shelby and Nashville – Davidson), which are allowed to establish their own rules for reopening. In these cities, you currently cannot pour a beer or drink while guests wait on to-go orders.

Drinks must be ordered at the restaurant and cannot be taken off-premises. Either you order your drink to go - or for consumption at the restaurant.

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Metro Nashville makes beer delivery permanent

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Nov 9, 2020

Nashville's Metro Council passed legislation that makes the delivery of beer a permanent option for holders of an “On-Premises” or “On/Off Premises” beer permit.

We find ourselves humming the classic Adam and the Ants tune:

stand and deliver

your money or your life

The Metro Beer Board will begin taking applications on November 19. We understand that the application process is streamlined and staff can grant temporary approval. Applicants will have to pay a $250 application fee, plus $100 annually, which is pro-rated on a calendar basis for the first year.

Consistent with the emergency beer delivery regulation enacted at the outset of the pandemic, the Metro Beer Board has a pending Rule that will require that employees make all deliveries. During the outset of the pandemic, we saw beer delivery by employees as being pro-jobs, at a time when many hospitality industry workers were laid off.

Unlike state-wide emergency alcohol delivery, permit holders cannot use third-party delivery services such as GrubHub, Postmates, DoorDash and UberEats.

Of note, the Metro Beer Board was the first in the state to enact emergency beer delivery. Metro Nashville becomes the first Tennessee city to make beer delivery permanent.

Below are the complete regulations:

SECTION V – Delivery / Curbside Permits

Section 5.01 – Delivery / Curbside Permits

A. These following rules apply to existing holders of permits of “on” or “on/off” sale permits (a “Permittee”) issued by the Metro Nashville Beer Permit Board.  This Regulation does not apply to holders of off-sale permits.

B. Subject to all federal, state and local laws, a Permittee holding an “on” or “on/off” sale permit may make off-premise sales and deliver beer subject to this rule.

C. Prior to any off-premises sales being conducted, the Permittee must submit an application accompanied by a two hundred fifty dollar ($250) application fee for a delivery / curbside permit. Applicants may contact the Beer Board staff by phone: 615-862-6751, via e-mail at This email address is being protected from spambots. You need JavaScript enabled to view it. or apply online.  The applicant must provide the following:

Name of the Permittee Physical Address of the Permittee Person to Contact E-mail Address Phone Number On or on/off Premise Beer Permit Number

D. Upon providing the information above, and obtaining final approval by the Beer Board, the permit holder may make off-premise sales and deliver beer pursuant to these rules and subject to any applicable federal, state, and local laws. 

E. Only employees of the Permittee may deliver beer.

F. Employees conducting deliveries must be at least 21 years of age.

G. At the point of delivery, the employee conducting the delivery must inspect the purchaser’s valid identification to determine whether the purchaser is an adult and is not intoxicated, pursuant to T.C.A. § 57-5-301(a)(1).

H. The Permittee shall be strictly liable for all sales to persons under the age of 21 or to intoxicated persons, pursuant to Tennessee state law.

I. Beer to be delivered must be in commercially sealed containers.

J. These rules are limited to “beer” as defined in M.C.L. 7.08.010.

RULE 3.04 RESTRICTIONS ON DRIVE-THROUGH OR DELIVERY WINDOWS

Beer may be sold through any drive-through or delivery window or by curb service only by those retail establishments possessing a delivery/curbside permit. 

RULE 3.05 RESTRICTIONS ON DELIVERIES

A permittee may deliver beer from a business establishment to the home or any other location of the consumer where the sale and delivery of beer and/or other goods are made simultaneously at the location of the consumer, so long as the permittee possesses a delivery/curbside permit.

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How to card minors for alcohol sales in Tennessee

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Sep 24, 2020

We have seen a steady uptick in citations for sales to minors from the Tennessee ABC and beer boards across the state. We encourage folks to re-focus training efforts on carding and to adopt the program we call “Red Box ID.” 

Here are two samples of Tennessee under 21 drivers licenses.

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Under 21 drivers licenses have a big red box around the photo - hence the name “Red Box ID.” 

Problem is, Red Box IDs have a defect. The licenses do not expire when the driver turns 21. Under 21 licenses with Red Box ID can be valid for years after the driver turns 21. 

Red Box Carding.

The good news is that Red Box IDs do not require math for carding.

The date the person turns 21 is written in the red box around the photograph. In the first sample, Nick turns 21 on 02/11/2021.

Viola - no math!  Don’t serve Nick.

Law enforcement almost universally uses real Tennessee drivers licenses in sale to minor stings.  In all likelihood, your server or clerk will be presented a Red Box ID when the ABC or Beer Board visits.

Make sure your staff is properly trained to focus on Red Box IDs - read the date in the red box.

Ask the customer’s age. 

We also recommend that servers, bartenders and clerks ask the guest “How old are you?”

Undercover officers, such as an ABC agent, may avoid answering the question. It is unlikely that the officer will lie. Ask the question again, if the person is evasive. Refuse the sale if the person will not tell the correct age.

Secondary card. 

Do not allow staff to sell to anyone with a Red Box ID.  Although servers, bartenders and clerks should card the patron, consider requiring a manager or senior staff member approve all sales involving Red Box ID. 

Double-checking the ID for under 21 drivers licenses significantly decreases the chance that an establishment will serve a minor. This includes confidential informants acting on behalf of the ABC, beer boards or police.

ABC enforcement. 

The ABC has recently begun issuing administrative citations to servers and cashiers that fail age compliance checks.  The ABC has been fining servers and cashiers $250.

The ABC reported at the September meeting that 16 servers had been fined $250.

We welcome this change in policy.  Business owners are strictly liable for sales to minors.  Placing more responsibility on the server or cashier puts more significance on the need to effectively card.  All too often, we see a terminated staff member walk across the street to get rehired at a competitor, while the business owner is paying expensive fines or serving a suspension of its beer permit or ABC liquor license.

ABC law enforcement reported 130 minor compliance checks and 28 citations for sales to minors at the September ABC meeting. This also reflects a 78% passage rate, industry-wide. The following were reported per license:

92 LBD

20 sold

78% passage rate

18 liquor stores

7 sold

61% passage rate

20 WIGS

1 sold

98% passage rate

ABC law enforcement reported 130 minor compliance checks and 28 citations for sales to minors at the September ABC meeting. This also reflects a 78% passage rate, industry-wide. The following were reported per license:

92 LBD

20 sold

78% passage rate

18 liquor stores

7 sold

61% passage rate

20 WIGS

1 sold

98% passage rate

The ABC has also been targeting curbside sales by restaurants and bars. So far, we have not heard of any delivery compliance checks, but suspect we will see delivery citations forthwith.

All this law enforcement makes us think of Officer by The Pharcyde:

Oh please don't pull me over officer please

I'm discombobulated (What)

Discombobulated (What)

Discombobulated malfunctioned faded

F-a-d-e-d

I can't believe it's me

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Fox eats crow over Mayors handling of downtown bar closures

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Sep 18, 2020

We have heard a steady stream of queries from bar owners about potential lawsuits over the city’s handling of health orders during COVID-19.

Recently retracted news from a local Fox News affiliate reported that the Mayor’s office withheld important health information.

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Contradictory information concerning whether the Mayor, in fact, withheld any information quickly emerged.

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It certainly looks like Nate Rau covered the story back in early August.  Although the Mayor’s office may have wanted to conceal information, the news was public less than a week after the e-mails in the Fox 17 news report.

That said, there are lawsuits proceeding and bars are obviously free to pursue legal recourse against the city. We personally question whether the city should have imposed different limitations on occupancy for bars and restaurants after it became clear that closing the bars did not resolve social distancing problems on lower Broadway. Socially irresponsible crowds packed downtown restaurants.

Whether this rises to the level of meriting a lawsuit – we are not certain.

In our humble opinion, bars and restaurants should be treated equally: distance tables, require patrons to stay seated, and mandatory masks when patrons enter, leave and walk to the restroom. And the city should have effective enforcement measures to make sure there is a level playing field - including use of the beer board.

In any event, we wish restaurant, bar, hotel and venue owners the best as you navigate these difficult times.

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Waller liquor team welcomes Emme Craig

News & Insights

Dec 31, 1969

Related Posts

We want to hear from you.

SEND US A MESSAGE

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How to expand your restaurant to include additional exterior space

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Jul 31, 2020

During COVID-19, outdoor seating at restaurants is a popular option among diners. We have been working with several owners to expand their premises to include additional exterior space during the pandemic.

In order to legally serve beer, wine and spirits in added exterior space, you will need to file an amendment application with the Tennessee ABC and consult with your local beer board. In Nashville, the Metro Beer Board requires an application and payment of the $250 fee.

The ABC has a streamlined process for the expansion application. See details in the attached press release.

Governor Lee waived the $300 application fee for the expansion, by Executive Order 55.  The ABC does not require a separate application to remove the expansion space - at the end of the season or after the pandemic has concluded, whenever that might be.

We have also been working with clients interested in converting from a limited service restaurant license to a full-service restaurant license. Nashville is using the ABC license type to close bars. This allows your establishment to stay open during this and future COVID spikes.

We applaud Tennessee restaurant and bar owners as they continue to improvise and innovate during these difficult times.

The beerded lady reminds us of a timely tune, "Heroes" by David Bowie:

Though nothing will drive them away

We can beat them, just for one day

We can be heroes, just for one day

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10 P.M. closing time for all Nashville bars and restaurants

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Jul 24, 2020

Chief Medical Director of Health Michael C. Caldwell issued an order closing dining rooms at all food service establishments at 10 p.m. each evening, beginning this Friday, July 24, 2020. 

Mayor Cooper announced the new closing time earlier in the week, citing crowding on Lower Broad.

This means that restaurants and bars, including restaurants and bars at hotels, must close at 10 p.m.  We got clarification that the order applies to hotels, and any other food service establishment located inside a larger facility.

The order specifies that “all customers shall be off-premise and the premise closed to the public at 10 p.m.”  This doesn’t mean that 10 p.m. is last call - everyone needs to be out the door by 10 p.m. 

Attached is a copy of the order.

After 10 p.m., restaurants and bars are limited to takeout, drive through, curbside and off-premise delivery of food.  No alcohol after 10 pm.  

Limited service license holders and beer only permittees are closed through July 31, 2020.  Read more at our post here

Semisonic seems apt:

Closing time

One last call for alcohol so finish your whiskey or beer.

Closing time

You don't have to go home but you can't stay here

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How does the sales tax holiday work for restaurants and bars?

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Jul 23, 2020

Beginning 12:01 a.m. on Friday, Aug. 7 and ending 11:59 p.m. on Sunday, Aug. 9, Tennesseans can enjoy food and drink at their favorite restaurant -- without paying sales tax.  We have been hearing lots of questions:

What types of businesses are included? Are liquor by the drink taxes exempt?  How do I file my tax return for sales without taxes? 

The law specifically applies to the retail sale of food and drink by restaurants and limited service restaurants, as defined in state law.  The holiday does not apply to hotels, premier type tourist resorts, caterers and other special license types.  The holiday also does not apply to breweries, distilleries and beer bars, unless the establishment holds a restaurant or limited service license.  And no holiday for wine and beer sales at groceries, C Stores and liquor stores.

Look at your license on the wall.  If the license says restaurant or limited service license, the sales tax holiday applies to your sales.  If it does not, you must collect and pay over sales tax.  Samples of restaurant and limited service licenses are at the links.

Failure to pay taxes means that you could be liable for back taxes, plus penalties and interest.

What’s in a name?  For the tax-free holiday weekend, the name says it all:  Sales Tax Holiday. 

Just like the name implies, the holiday only applies to sales tax.  You must collect and pay over liquor by the drink taxes.

Because this is the first sales tax holiday for restaurants, please take some time to ensure that you properly fill out the sales tax return.  List exempt sales for the holiday on your sales tax return at Schedule A, Line 10.  See this sample return

All this talk of holidays has us humming one of our favorite yuletide carols: Holiday in Cambodia by the Dead Kennedys.

It's a holiday in Cambodia

It's tough, kid, but it's life

It's a holiday in Cambodia

Don't forget to pack a wife

As a bonus, sales of apparel are tax exempt. Sell all your hats, shirts, boxers - you name it.

Apparel sales are tax exempt  Friday, July 31 through Sunday, August 2 and Friday, Aug. 7 through Sunday, Aug. 9. Yes, breweries, distilleries and wineries qualify for the sales tax exemption for apparel.

My daughter Ella is looking forward to showing off her Whiskey Defender shirt featuring Nelson's Greenbrier distillery cat Sugar Maple. Forget the high school dress code, right?

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Nashville bars shuttered, restaurants reduced to 50% capacity and bar seating closed

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Jul 2, 2020

Metro Nashville has issued clarifying guidance for re-entering revised Phase Two, which begins July 3, 2020.

Citing the spike in cases reported after the Memorial Day holiday, Mayor Cooper intends to prevent a new outbreak from large crowds celebrating the Fourth of July in Nashville’s Lower Broad.

Dr. Alex Jahangir, head of the Metro Coronavirus Task Force, reported that public health workers have detected at least 30 new infections of Nashville residents across 10 different bars over the past week. Media reports that several Nashville restaurants and bars have closed in the last few days because of COVID-positive staff. In an effort to further discourage large gatherings, Mayor Cooper asked the Nashville Convention and Visitors Corporation to cancel its fireworks display on Saturday evening.

The revised Metro guidance is clear. If you hold a Limited Service License, you are closed beginning July 3 through July 31. Bars can provide curbside or delivery of food and alcohol.

If you hold a Restaurant License, you can stay open at the lesser of 50% capacity or maximum occupancy with social distancing. Bar seating at restaurants is closed. Live entertainment is allowed, with a 15 foot buffer or a plexiglass or similar barrier. Pool tables, darts and other amusements are closed until July 31.

We read the order as allowing guests to be seated at tables in bar areas - just no one sitting at the bar. Guests seated at tables in bar areas must have a server. There can be no guest interaction with the bartender.

Beer bars - bars that only sell beer and not wine or spirits - must also be closed. Sorry Santa’s Pub.

A copy of the Health Director's order is here

If bars reopen on August 1, closing time will be 10 pm and all patrons will be required to be seated. Bars can feature live entertainment, with a 15 foot buffer or a plexiglass or similar barrier. Pool tables, darts and other amusements are closed until July 31.

We encourage bar owners to implement policies to enforce the no standing rule and modifications to to live entertainment, which include sanitizing between performers.

It looks like closing time for restaurants will also be 10 pm, starting July 17. 

Metro Nashville originally said that bars will be closed for 14 days. With no clear definition of what constitutes a bar, many owners were left scratching their heads trying to decide if they should lay off staff and lose out on much-needed revenue over the long holiday weekend.

Many bar owners were plowing forward and planning on pushing food sales, to remain open as restaurants.  While some bars have sufficient food service to justify staying open as a restaurant, we suspect that more-nefarious owners might have been tempted to game the system. 

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Pennsylvania Cocktails-To-Go Guidelines

Gov. Wolf signed HB 327 allowing licensed hotels and restaurants to start selling mixed drinks-to-go, EFFECTIVE IMMEDIATELY.  Here are some important parameters to be aware of: Mixed drinks can be sold from 7am – 11pm, daily (Sundays only with a Sunday Sales Permit). The mixed drink must be sold in a container with a secure lid.  If there is a ...

The post Pennsylvania Cocktails-To-Go Guidelines appeared first on Flaherty & O'Hara.

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Tennessee extends alcohol carryout and delivery through May 29

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Tennessee extends alcohol carryout and delivery through May 29

Apr 29, 2020

Tennessee Gov. Bill Lee extended the executive order allowing drive-through, carryout and delivery of beer, wine and spirits for restaurants. Read Executive Order 30 here

Restaurants, limited-service restaurants and wine-only restaurants can continue to sell carryout and deliver alcoholic beverages and beer. There is no additional license or permission needed to deliver.

We urge folks to keep hustling during these difficult times and check Last Call for updates. The Tennessee ABC has posted FAQs here.

Here is our summary of the rules of engagement for to-go, curbside, drive-through and delivery:

Alcohol must be delivered with food. At least one item of food must be sold in every order containing alcohol. The amount of food required is not specified, but given the emergency nature of this order, we encourage restaurants not to play games and count lime slices as food, for example.

Licensees are still required to be responsible. Restaurants can set rules, such as one entrée per two single-serving margaritas. You can always require that customers order a meal or set a minimum dollar amount of food for deliveries.

You can deliver cocktails! As long as the package has a secure lid, we read the order as allowing delivery of margaritas, cocktails and other mixed drinks.

Alcohol must be packaged in a container or bottle with a secure lid or cap. We read this rule to mean that the container must be closed. Closed is not the same as sealed. For example, a lid screwed on the top of a plastic jug is closed. Alcohol does not have to be sealed, meaning you do not have to attach seals like you would find on commercial products at grocery stores.

The ABC advises restaurants to “cover containers in a reasonable manner that would require the consumer to unpackage them for consumption.” For example, we believe a styrofoam container with a lid that does not have a straw hole will work. If all your lids have straw holes, tape the straw holes.

Bottles and cans of beer and wine can be delivered. This includes regular-sized wine bottles. No bottles of spirits or liquor.

Single serving packages only. Although beer and wine by the bottle may be sold, no other multi-serving containers are allowed. For purposes of single servings, the ABC says no more than 16 oz. of beer, 9 oz. of wine or 4 oz. of spirits in a container with not more than 16 ounces of total liquid.

No more carafes of sangria or pitchers of margaritas to-go. You can sell multiple single-serving containers with a meal, although we continue to recommend moderation under this emergency order.

Mini bottles of spirits present a conundrum. State law prohibits the sale of spirits by the bottle. However, Governor Lee’s order specifically authorizes “single servings of alcoholic beverages.”

In our humble opinion, Executive Order 30 allows a restaurant to deliver mini bottles of spirits, provided it is clear that the mini bottle is intended for a single serving. We advise folks to securely tape or otherwise attach a mini bottle of spirits to the mixer. That way, it is abundantly clear that the two items - the container and the mini bottle - are intended to be a single serving. Do not play games and toss 12 mini bottles of tequila in a bag and consider yourself in compliance with the order.

The executive order only applies to full-service restaurants, wine-only restaurants and limited service restaurants. Hotels, caterers, premier-type tourist resorts, convention centers and other special license types cannot deliver or sell alcohol to-go under the executive order.

Get your beer here. Restaurants do not need permission from their local beer board to deliver under the Governor’s order.

If you are a brewery, hotel or other business that does not hold a restaurant license, you can register with your local beer board to deliver beer in in Bristol, Chattanooga, Knoxville, Memphis and Nashville. These local beer boards have specifically authorized carryout and delivery of regular beer. There are broader rights for beer-only delivery and growlers are fine in these cities and any other city that has specifically authorized carryout and delivery of beer. Read more about beer delivery here.

Mandatory carding for deliveries. You must card. Sales cannot be made to under 21 or intoxicated persons.

Drivers do not have to physically touch an identification to verify age. Because orders are most likely paid in advance, online or via phone, there is no need for drivers to risk potential contamination and make physical content with the customer. Have the customer hold their own ID out for the driver to read. Or better yet, read it through a glass storm window.

That said, drivers need to ensure that they properly ID. We encourage Redbox carding and closer scrutiny of all Redbox IDs.

Drivers must be at least 21 years of age and have a valid driver’s license.

Delivery services can deliver your alcohol. Restaurants can use their own employees or third-party delivery services such as Postmates and Uber Eats to deliver alcohol. Delivery personnel are not required to have server permit cards or any special qualifications.

With a third-party delivery service, you should ensure that delivery personnel are properly trained for carding. Some delivery services are not set up to require carding.

Keep in mind that if you are using a third-party delivery service, your restaurant remains liable for sales to minors, intoxicated persons or the violation of any other law.  A restaurant will not be able to avoid liability by saying “the Uber driver did it.”

Restaurants must post a sign with the following notice: “No driver shall consume any alcoholic beverage or beer or possess an open container of alcoholic beverage or beer while operating a motor vehicle in this state.” Although the order is not clear, we advise folks to post the sign on the wall, with your liquor license.

Carryout and delivery of alcohol are limited to current operating hours, which is not defined. We advise folks to adhere to the normal sales hours for beer and alcoholic beverages.

Curbside and drive-through. The order does not specifically address curbside and drive-through, but given the intent of the order, we believe it is OK to deliver drinks curbside and through drive-through windows.

Do not stage alcohol pick up outside.Restaurants cannot stage multiple alcohol deliveries at tables outside the restaurant’s licensed premises. We understand that it is convenient for multiple orders to be brought out for immediate pickup at curbside. Although this is okay for food, alcohol must stay inside the restaurant until the customer or delivery service arrives for pickup. A licensed patio is fine for staging. But not your parking lot.

Alcohol must come from the restaurant’s inventory. A restaurant cannot buy or deliver alcohol from a retail liquor store, food store or another restaurant. You must purchase your alcohol from a wholesaler.

Collect sales tax. Restaurants do not collect the 15% liquor by the drink tax for all wine and spirits sold to-go or for delivery, including bottles and cans of beer, wine and single-serve cocktails. You do have to collect sales tax. Here is the post from Revenue. (link to attached). If you have more tax questions, see our post here.

Delivery applies to restaurants statewide, but we urge folks to exercise discretion and not deliver to dry towns and counties. We suspect that the Governor did not intend for delivery to areas that have not approved of liquor-by-the-drink.

Restaurants with dining privileges can serve alcohol for on-premise consumption. Just like a regular patron dining at a table, restaurants can serve alcohol to customers that are waiting to pick up carryout, provided that the restaurant’s dining room can legally be open. Tennessee restaurants were allowed to reopen for dining beginning April 27, except for the six counties in the state within independent health departments (Chattanooga – Hamilton, Jackson – Madison, Kingsport & Bristol – Sullivan, Knoxville – Knox, Memphis – Shelby and Nashville – Davidson), which are allowed to establish their own rules for reopening. In these cities, you currently cannot pour a beer or drink while guests wait on to-go orders.

The Order expires on May 29, 2020. The Governor may extend delivery privileges, but for now, the Order expires by its own terms at midnight on May 29.

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Tennessee Pledge to Reopen Restaurants

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Tennessee Pledge to Reopen Restaurants

Apr 29, 2020

The Governor’s Economic Recovery Group issued Tennessee Pledge, "a plan to help Tennesseans return to work in a safe environment, restore their livelihoods and reboot our state’s economy."

Restaurants are expected to follow the guidelines in the pledge. The pledge is mandatory for limited service restaurants, as specified in Executive Order 30.

Here is a copy of the Tennessee Pledge Guidelines for Restaurants

This is our summary of the guidelines for re-opening:

1. Screen employees for COVID-19 symptoms. Ask all employees:

Have you been in close contact with a confirmed case of COVID-19? Are you experiencing a cough, shortness of breath, or sore throat? Have you had a fever in the last 48 hours? Have you had new loss of taste or smell? Have you had vomiting or diarrhea in the last 24 hours?

2. Temperature screen all employees on a daily basis. 

Best practice: temperatures on site with a no-touch thermometer each day upon arrival. At a minimum, employees take their own temperatures before arriving. Normal temperature should not exceed 100.4 degrees Fahrenheit.

3. Any employee that answers yes to any of the screening questions or is running a fever, must leave the premises and seek medical care and/or COVID-19 testing.

4. Employees are to stay home when feeling ill, when exposed to COVID-19, or if diagnosed with COVID-19. Employees that are particularly vulnerable to COVID-19 due to age or underlying conditions are encouraged to stay home

5. Implement workplace cleaning and disinfection practices, according to CDC guidelines, with regular sanitization of high-touch surfaces at least every two hours.

6. Mitigate exposure in the workplace by implementing social distancing guidelines and modify scheduling. Further is safer, per the guidelines.

7. Employees must wear masks or cloth face covering (but not N-95 or medical masks).

8. Restaurant employees must wear gloves.

9. Provide ServSafe COVID-19 training for all food handlers as soon as possible

10. Plan for potential COVID-19 cases, and work with local health department officials when needed (e.g., monitor and trace COVID-19 cases, deep clean facilities).

11. Make employees aware of the provisions of the federal Families First Coronavirus Response Act, which allows for paid sick leave and expanded family and medical leave for COVID-19.

12. Update employee policies for COVID-19.  Staff should sign the policy, and the policy should be posted.

13. Limit self-service options (customer samples, communal packaging, food/beverages, etc.)

14. Post extensive signage on health policies to educate staff and guests about COVID-19 best practices, including the attached.

Specific guidelines for restaurants.

• Limit the number of customers in the restaurant to 50% of seating capacity

• Tables should be spaced at least 6 feet apart

• Limit tables to no more than 6 guests per table

• Mark any indoor or outdoor waiting area so that social distancing standards are met

(options can include a text system to alert guests of available seating, an intercom

system, or only one member of a party being allowed to wait in the waiting area)

• Bar areas should remain closed

• Live music should not be permitted

• Screen customers for illness upon their entry into the restaurant:

            Best practice: Temperature checks for every customer.

            Minimum: Question customers regarding COVID-19 symptoms:

                        Have you been in close contact with a confirmed case of COVID-19?

                        Are you experiencing a cough, shortness of breath, or sore throat?

                        Have you had a fever in the last 48 hours?

• Place hand sanitizer stations in restaurant lobby and bathrooms, as well as cashier stations

• Sanitize all front-of-house contact surfaces including door handles, screens, phones,

pens, keyboards and other areas of hand contact every two hours, at a minimum

• Use menus that are disposable or sanitized between each use

• Use rolled silverware/napkins stored in sealed bins (gloves should be used by staff while rolling silverware in designated sanitary areas)

• Sanitize all tabletop items, including condiments, after each table turns (or use disposables)

• Sanitize chairs, especially where contact occurs, after each table turns

• Do not offer self-serve buffets, condiments on a counter for use by multiple tables, or beverage station re-use

Although the pledge mandates that bar areas remain closed, many restaurants have set up their bars for carry out and delivery. As long as social distancing and other precautions are employed, we do not see this as violating the pledge.

Stay tuned for more guidelines.

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Restaurants and Bars Shift Their Business Models, Prepare for Reopening

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Restaurants and Bars Shift Their Business Models, Prepare for Reopening

Apr 28, 2020

Welcome to PointByPoint, conversations, interviews and legal commentary for today's business professionals, brought to you by Waller.

Restaurants, bars, entertainment venues and tasting rooms have closed their doors as a result of “stay at home” orders. These businesses have rapidly shifted their business models in order to generate revenue and keep employees working – food and alcohol delivery, curbside pickup, and more. Will Cheek and Rob Pinson, leaders of the firm’s alcoholic beverage team, discuss the changes in licensing and regulations, what’s ahead for restaurants, bars, distilleries and other hospitality clients, and practical considerations as they contemplate the future of their businesses.

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TTB rolls out new rules for distilleries, wineries and breweries

TTB rolls out new rules for distilleries, wineries and breweries TTB rolls out new rules for distilleries, wineries and breweries

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TTB rolls out new rules for distilleries, wineries and breweries

Apr 27, 2020

The federal Alcohol and Tobacco Tax and Trade Bureau, fondly known as TTB, issued final rules that contain a few game-changers for the alcoholic beverage manufacturing industry.

We are particularly fond of the greater flexibility offered to distilleries. Distilleries can now count the years bourbon or whisky are aged in used barrels.  Previously, a whisky or bourbon could only list the number of years aged in new oak barrels.

“You can innovate, but not get punished for aging in an unconventional barrel,” observed Waller’s whisky lawyer to the stars, Rob Pinson.

Under the new rules, whisky aged for 4 years in new barrels, and an additional 3 years in used rye barrels, can be called 7-year-old whisky.  Previously, it was 4-year old-whisky.

The most controversial proposal did not make the final cut.  TTB did not attempt to define what constitutes an “oak barrel.”

In the past, we understand that industry member posed lots of questions about barrels:  Can I use square barrels?  Can I use 35-gallon barrels?  Does the barrel have to bulge in the center? TTB did not limit the type of barrels by specifying the shape and size of barrels used for aging.

In another nod to innovation, distilleries now have more stylistic freedom for labeling. In the past, the front label had to contain all of the information required by TTB. Now, a distillery can put a simple bold logo on the front, for example, with the required label information on the side or back of the bottle.  This will enable greater creative flexibility in graphic design, and potentially with bottle design.

Another big plus for the industry is doubling the threshold for errors in determining the proof for spirits. Distilleries generally add water as a final finishing phase of the distillation process. This is generally done right before bottling.

TTB previously required that the amount of alcohol in the bottle - say 80 proof (which equates to 40% alcohol) - had to be within 0.15% of the amount of alcohol stated on the label.

TTB audits distilleries and tests for the accuracy of alcoholic content. If a batch of spirits was off more than 0.15%, TTB often requires that the distillery dump the entire batch, reproof the spirits and re-bottle. What a pain.

Now distilleries have twice the margin of error when proofing. We see this as a big boost for the industry, while not having any impact for consumers. Even the most polished palate probably cannot detect a difference of 0.15% in alcoholic content.

On a personal note, we are looking forward to continued innovation for vodka. Castle & Key has quickly become our favorite, shaken over ice. Previously, the definition of vodka required that the spirit be “without distinctive character, aroma, taste or color.” 

Castle & Key has complex but subtle mash notes that make cocktail hour quite delightful. We look forward to distilleries crafting more innovative vodkas for our happy hours.

For those that are having trouble sleeping during the coronavirus pandemic, here is a complete copy of the TTB rules

Federal licensing expert Rob Pinson provides a handy summary below.  Keep cocktailing.

The TTB recently released final regulations related to Alcoholic Beverage Labeling and Advertising.  Here is a quick timeline for these new final regulations:

11/28/2018 - Proposed Rule issued 4/1/2020 - Final Regulations issued 5/4/2020 - Effective date of new regulations

The final regulations address some issues currently and defers others for further consideration.  Overall, they provide greater flexibility for the industry.  There were 1,143 total comments, with over 700 of those expressing opposition to the proposed definition of a barrel as a 50-gallon cylindrical container.

Brief Summary of Changes

Doubles to +/- 0.3% the tolerance applicable to alcohol content statements on distilled spirits labels Removes the current prohibition against age statements on pretty much all classes of distilled spirits except vodka Removes prohibition on use of term “strong” and other similar indications of strength for malt beverages Removes limitation on how producers “count” the number of distillations when making “Distilled      times” claims

What TTB Is Not Changing

Definition of “oak barrel” - they are confirming different shapes and sizes are permitted Setting restrictions on cross-commodity terms, including homophones of class/type Setting restrictions on disclosing components of intermediate products or listing ingredients in order of predominance Requiring the age statement for spirits to only include the initial barrel; age can include subsequent barrels Requiring whiskey that meets more than one specific type to be labeled as such - for example, straight bourbon whiskey vs. bourbon whiskey Incorporate interaction between TTB and FDA when product is deemed “adulterated” by FDA and/or “mislabeled” by TTB

Specific Changes - All Commodities

Clarifies which products do and do not meet FAA definitions of wine, spirits or malt beverage and which labeling regime applies to them Confirms that product exported outside of US in bond does not need to meet FAA labeling requirements Personalized Labels (as opposed to private labels) Incorporates prior guidance into regulations; allows producer to submit template label and not get each private label approved Cannot discuss alcoholic beverage or characteristics of alcoholic beverage in personalized portion; remainder of label must have bare minimum Examples are provided Advertisements - modifies existing rule requiring publication of name and street address (city and state only) of industry member running an advertisement to permit websites, email or phone number in lieu of street address

Specific Changes - Wine Only

Removes citrus wine class and combines it with fruit wine (since citrus is a fruit, of course!) Allows vintage dates on wine that is imported in bulk Provides that all wine must meet standard of “natural wine”; more about cleaning up existing regulations

Specific Changes - Spirits Only

Definition of “distilled spirits” does not include products containing less than 0.5% ABV ** Will not establish definition of “oak barrel”; confirms current language allows for different shapes and sizes Clarifies requirement for statements of age and origin for imported products Will not require disclosure of intermediate ingredients on labels nor require listing of ingredients in order of predominance ** Liberalizes placement of key brand label information (brand name, class/type, alcohol content) to be on any side of bottle as long as it is in the same “field of vision”; net contents can be on any label now instead of only be allowed on front label Keeps ‘bottled in bond’ requirements with change for gin to allow paraffin-lined or unlined barrels; vodka retains paraffin-lined requirement ** Increases alcohol content tolerance from +/- 0.15%  ABV to +/- 0.30% ABV Allows age statements for all spirits except neutral spirits and vodka ** Confirms that multiple barrels can be used for “age counting” as long as initial barrel requirements are met - for example, as long as new charred oak barrel used for straight bourbon whiskey, you can age in used barrels after initial requirement and count time spent in used barrels in the age statement on the label ** Allows distilleries to count all distillations, including each plate distillation, when listing the number of times product is distilled; number may be understated but not overstated Creates new “agave spirits” class, of which tequila and mescal are a part; removes need to submit formula; at least 51% of mash must be agave and up to 49% can be sugar ** Revises vodka definition to remove the “without distinctive character, aroma, taste or color” and be distinguished by its specific production standard - no aging and limited sugar and citric acid Country of Origin - Since Customs & Border Patrol (“CBP”) already has regulations on listing the country of origin, the TTB is removing its similar requirements for distilled spirits and referring to CBP’s requirements ** Makes optional the use of a more specific type name when a class name also applies - for example, not required to use the ‘straight’ for bourbon whiskey even though it qualifies Defers creating a standard of identity for absinthe, but does remove the lab testing requirement for products made with wormwood

Specific Changes - Malt Beverages Only

Permits brewers to also add ABW information on label as long as it is together with ABV Removes restrictions on “draft” or “draught” on labels Removes restrictions on “strong”, “full strength”, “extra strength”, etc. on labels
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Gov. Lee leaves Tennessee delivery and curbside alcohol in limbo

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Gov. Lee leaves Tennessee delivery and curbside alcohol in limbo

Apr 24, 2020

With Governor Lee’s order allowing curbside and delivery of alcohol set to expire at midnight April 30, we were expecting to see an extension of these privileges in connection with new guidelines for re-opening restaurants.

We have the guidelines, but no mention of alcohol delivery and curbside service. The governor could still extend these privileges, but so far, he has not. Governor Lee said the state is releasing additional guidelines next week. We may see language regarding alcohol delivery at that point.

At yesterday’s Tennessee ABC meeting, the ABC requested that the Governor’s Economic Recovery Group extend carryout and delivery for an additional 30 days and that the privileges be reviewed on a rolling 30-day basis. The ABC recommendation is Tennessee-wide; not just for areas that may still be experiencing local restrictions when the statewide Stay-At-Home order is lifted. 

ABC Director Russell Thomas has already conveyed the message to ERG Chair Mark Ezell. Read the message here. We applaud the Commission for being proactive and supporting this option to help keep restaurants afloat.

Tennessee Pledge Guidelines for Restaurants

Here is a summary of the guidelines for re-opening:

1. Screen employees for COVID-19 symptoms. Ask all employees:

Have you been in close contact with a confirmed case of COVID-19? Are you experiencing a cough, shortness of breath, or sore throat? Have you had a fever in the last 48 hours? Have you had new loss of taste or smell? Have you had vomiting or diarrhea in the last 24 hours?

2. Temperature screen all employees on a daily basis. 

Best practice: temperatures on site with a no-touch thermometer each day upon arrival. At a minimum, employees take their own temperatures before arriving. Normal temperature should not exceed 100.4 degrees Fahrenheit.

3. Any employee that answers yes to any of the screening questions or is running a fever, must leave the premises and seek medical care and/or COVID-19 testing.

4. Employees are to stay home when feeling ill, when exposed to COVID-19, or if diagnosed with COVID-19. Employees that are particularly vulnerable to COVID-19 due to age or underlying conditions are encouraged to stay home

5. Implement workplace cleaning and disinfection practices, according to CDC guidelines, with regular sanitization of high-touch surfaces at least every two hours.

6. Mitigate exposure in the workplace by implementing social distancing guidelines and modify scheduling. Further is safer, per the guidelines.

6. Employees must wear masks or cloth face covering (but not N-95 or medical masks).

7. Restaurant employees must wear gloves.

8. Provide ServSafe COVID-19 training for all food handlers as soon as possible

9. Plan for potential COVID-19 cases, and work with local health department officials

when needed (e.g., monitor and trace COVID-19 cases, deep clean facilities).

10. Make employees aware of the provisions of the federal Families First Coronavirus Response Act, which allows for paid sick leave and expanded family and medical leave for COVID-19.

11. Update employee policies for COVID-19.  Staff should sign the policy, and the policy

should be posted.

12. Limit self-service options (customer samples, communal packaging, food/beverages, etc.)

13. Post extensive signage on health policies to educate staff and guests about COVID-19 best practices, including the attached.

Specific guidelines for restaurants.

• Limit the number of customers in the restaurant to 50% of seating capacity

• Tables should be spaced at least 6 feet apart

• Limit tables to no more than 6 guests per table

• Mark any indoor or outdoor waiting area so that social distancing standards are met

(options can include a text system to alert guests of available seating, an intercom

system, or only one member of a party being allowed to wait in the waiting area)

• Bar areas should remain closed

• Live music should not be permitted

• Screen customers for illness upon their entry into the restaurant:

            Best practice: Temperature checks for every customer.

            Minimum: Question customers regarding COVID-19 symptoms:

                        Have you been in close contact with a confirmed case of COVID-19?

                        Are you experiencing a cough, shortness of breath, or sore throat?

                        Have you had a fever in the last 48 hours?

• Place hand sanitizer stations in restaurant lobby and bathrooms, as well as cashier stations

• Sanitize all front-of-house contact surfaces including door handles, screens, phones,

pens, keyboards and other areas of hand contact every two hours, at a minimum

• Use menus that are disposable or sanitized between each use

• Use rolled silverware/napkins stored in sealed bins (gloves should be used by staff while rolling silverware in designated sanitary areas)

• Sanitize all tabletop items, including condiments, after each table turns (or use disposables)

• Sanitize chairs, especially where contact occurs, after each table turns

• Do not offer self-serve buffets, condiments on a counter for use by multiple tables, or beverage station re-use

Stay tuned for more guidelines and updates on delviery.

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Mayor Cooper approves continued take-out for beer - but no word on delivery in Tennessee

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Mayor Cooper approves continued take-out for beer - but no word on delivery in Tennessee

Apr 23, 2020

Metro Nashville Mayor John Cooper announced a detailed plan for the staged reopening of restaurants, bars and music venues, as soon as May 1. The real question is: will anyone reopen their dining room on May 1st? You can read the entire Roadmap here.

Initial reactions do not look good if you are in the market for a sitdown meal on May 1.  We only found one restaurant planning to open its dining room on May 1, based upon inquiries we made within the first couple of hours of release of the Mayor’s Roadmap. 

A silver lining is take-out. The first three of the four phases specifically references take-out “alcohol” sales.  The order also specifically authorizes the sale of alcohol at tables.  We think that only applies to take-out beer. Use of the term alcohol is unfortunate.

The Roadmap does not mention delivery. The Metro Beer Board has authorized delivery of beer until May 31, with proper authorization from the Beer Board, but delivery is officially in limbo at the moment. 

The big question is:  Will Governor Lee extend delivery of all alcohol beyond midnight April 30, when his order authorizing alcohol delivery expires. We hear guidance may be forthcoming Friday April 24.

Not only does Gov. Lee’s power apply to the entire state, we believe that only Gov. Lee or the state legislature has the authority to be able to authorize delivery of wine, spirits and high gravity beer. Individual cities have power to regulate beer, but no authority to regulate the sale of wine and spirits at restaurants, bars and other venues.

Although the Roadmap specifically refers to the word “alcohol,” we see the Roadmap as only authorizing take-out of beer.

Beginning May 1, dining rooms at restaurants and “bars serving food from a menu” can open:

At half-capacity Physical distancing in kitchens and dining rooms Screen all employees daily for temperature and respiratory symptoms Employees with 100.4 fever or higher must leave immediately Employees with any symptoms of illness must be tested and stay at home until negative test results Create policies that make it possible for employees to isolate and quarantine Clean facilities Explicit guidelines to maintain hygiene Cloth face masks for employees, but not required for patrons Bar areas to remain closed No live music No self-service or shared condiments

Phase 3 adds these requirements, which appear to be left out of Phase 1, perhaps by oversight:

Require that restaurants clean all surfaces after single use by patron Recommend use of disposable menus

Bars, entertainment and cultural venues cannot reopen until Phase 3. “This includes museums, tours, attractions, bowling alleys, movie theaters.” At half-capacity. Live music is also permitted in Phase 3 for restaurants and bars serving food.

In order to initiate the reopening plan, the city will be required to meet the following criteria:

    •  Proof of a decline or flat cases of COVID-19 over a 14-day period

    •   Adequate testing and PPE capacity in the region

    •   A robust public health infrastructure to conduct contact tracing cases

Mayor Cooper confirmed that the decision to reopen will be data driven, as opposed to date determinative. When Nashville’s Safer at Home order expires on May 1, Metro health officials will evaluate case data and other metrics collected over the past 14 days to determine if there has been a positive, stable improvement necessary to begin Phase One of the reopening plan.

We understand that yesterday's spike in Covid cases was the result of significant increases in the amount of people tested, and that the 14 day period did not restart. We see more testing as a good thing .

Stay tuned for more news as this story develops. 

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When will Tennessee's bars, restaurants be open for business? Here's our educated guess

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When will Tennessee's bars, restaurants be open for business? Here's our educated guess

Apr 17, 2020

This post is out of date. Look for specifics about reopening at our newer posts at Last Call. 

There has been plenty of speculation about what the new normal will be for dining out after stay-at-home orders are lifted. 

California took the lead in providing some guidance for restaurants. At a press conference on April 14, California Governor Gavin Newsom discussed what the new normal will look like for dining in a restaurant.  As Yoda might say, “Normal, it will be not.”

Precautionary measures include:

Checking customer temperatures Waiters wearing masks and gloves Reducing tables by 50% Disposable menus

Governor Newsome called these “likely scenarios” once stay-at-home orders are lifted.

The California approach may serve as a model to other states trying to navigate the transition to reopening economies.

Tennessee has yet to weigh in on the new normal for restaurants. There are ongoing questions—such as whether continued delivery of alcohol by restaurants will be permitted to continue.

Count on this: the new normal will look different from what we are all used to, and guidance is sure to change as the situation evolves.

The $64,000 Question: When Will Restaurants Open?

Recent Vanderbilt Department of Health Policy coronavirus modeling for Tennessee  and federal guidelines provide insight into the timeline and new normal for Tennessee bars and restaurants. Vanderbilt modeling includes projections for coronavirus peaks under three scenarios: additional reduction, status quo and lifting of social distancing measures.

Image title

Under the status quo scenario, projected hospitalizations in Tennessee peak mid-June.  Status quo means stay-at-home is in place at least through mid-June.

Under federal Guidelines for Opening up America Again, criteria for opening states or regions include:

a downward trajectory of symptoms and either positive tests or documented cases within a 14-day period ; and hospital treatment without crisis care and testing for at-risk workers in the healthcare industry.

Based on the Vanderbilt model, let’s presume that mid-June is June 15. Let’s also presume that the number of people testing positive for COVID-19 tracks the rate of hospitalization.

Federal guidelines require a 14-day period where the number of cases declines. Doing a little math - yes we know math is dangerous for liquor lawyers - 14 days from June 15 is June 29. 

Restaurants will not open until June 29, based on the Vanderbilt projections. All this is guesswork at this point, but June 29 is a long, long time to wait and reopen to 50 percent capacity.

The good news is that other modelling shows Tennessee’s hospitalization peak occurred April 16. We have been tracking the Washington Institute for Health Metrics and Evaluation’s metrics here. But April 30 sounds aggressive for reopening.

Guidelines for Opening up America Again

According to federal Guidelines for Opening up America Again, the reopening of restaurants will involve strict protocols for physical distancing. 

The guidelines include three phases of opening, along with suggested criteria for states or regions to meet to move into phase one initially and from each phase into the next.

The amount of social distancing is not specified and we are skeptical about sporting venues, movie theaters and places of worship reopening in Phase One.

Bars do not reopen until Phase Two under the federal guidelines. 

Guidance for restaurants and bars under each phase are highlighted below.

Phase One

Must satisfy criteria for required 14-day period. Large venues (including sit-down dining, sporting venues, movie theaters) may resume operation under “strict physical distancing protocols.” Bars remain closed.

Phase Two

Must satisfy criteria again for required 14-day period and show no evidence of rebound. Large venues operate with “moderate physical distancing protocols.” Bars may reopen, with limited occupancy.

Phase Three

Must satisfy criteria again for required 14-day period and show no evidence of rebound. Large venues operate with “limited physical distancing protocols.” Bar occupancy may increase.

These phases may be implemented statewide or by county, at Governor Lee’s discretion.

Stay tuned as we learn more about “the new normal.”

How about a little John Hiatt and Back to Normal?

I'm back to normal

(He's going over her)

I'm back to normal

(With his thermometer)

I'm back to normal

(She's getting normal)

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Flaherty & O’Hara Statement on the Coronavirus

Flaherty & O’Hara attorneys and staff are working from home in response to the coronavirus. Although we aren’t physically in our offices, we have remote access and procedures in place to ensure our business continues to be fully functional. Our focus remains keeping our employees safe, while maximizing our ability to meet our clients’ needs without interruption. As we navigate ...

The post Flaherty & O’Hara Statement on the Coronavirus appeared first on Flaherty & O'Hara.

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No COVID-19 tax holiday for sales and liquor by the drink taxes

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No COVID-19 tax holiday for sales and liquor by the drink taxes

Apr 13, 2020

We keep hearing this question from industry members. 

“I do not have to pay sales and liquor by the drink taxes under the Governor’s executive order, do I?”

Not true. All sales and liquor by the drink taxes collected in March, April and subsequent months must be paid over to the state.  If you do not pay the taxes, expect a nastygram like this.

There is one important caveat. 

Wine, spirits and high gravity beer sold to-go or delivered during the COVID-19 pandemic are not subject to liquor by the drink taxes.  The rationale is that to-go and delivery sales are not for on-premises consumption, and therefore, should not be subject to the 15% on-premises tax. All alcoholic beverage sales to go or for delivery are subject to sales tax. 

All this talk of driving around with alcohol reminds us of Meat Loaf’s hit “Paradise by the Dashboard Light”

Well, I remember every little thing

As if it happened only yesterday

Parking by the lake and there was not another car in sight

It is possible that the state will declare a tax holiday, but at this time, make sure you are paying your sales and liquor by the drink taxes as they come due. There is personal liability for these taxes and you do not want to be personally liable.

For the record, liquor and grocery stores do not pay the 15% tax on wine and spirits. They do pay sales tax.

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