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  By: Eltife, et al. S.B. No. 515
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the sale and production of malt liquor, ale, and beer by
  the holder of a brewpub license.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  The legislature finds that:
               (1)  the state is authorized under the Twenty-first
  Amendment of the United States Constitution to promote the public's
  interest in the fair, efficient, and competitive marketing of malt
  liquor, ale, and beer in this state;
               (2)  the United States Supreme Court in Granholm v.
  Heald, 544 U.S. 460 (2005), has recognized that the three-tier
  system of regulating the alcoholic beverage industry is
  unquestionably legitimate;
               (3)  in Granholm, the United States Supreme Court
  further recognized that while the states are entitled to regulate
  the production and sale of liquor within their borders, the right is
  nonetheless subject to the provisions of the Constitution of the
  United States, including the Interstate Commerce Clause, and laws
  regulating the alcoholic beverage industry may not discriminate
  against out-of-state participants or give undue deference to local
  participants and may not ignore other provisions of the
  constitution, including the Supremacy Clause, Commerce Clause, and
  the Privileges and Immunities Clause with its nondiscriminatory
  principles;
               (4)  the state is authorized to promote, market, and
  educate consumers about the emerging small brewing industry;
               (5)  it is in the state's interest to encourage
  entrepreneurial and small business development opportunities in
  the state that will lead to new capital investment in the state,
  create new jobs in the state, and expand the state and local tax
  base; and
               (6)  it is the public policy of the state to exercise
  the police power of the state to protect the welfare, health, peace,
  temperance, and safety of the people of Texas.
         SECTION 2.  Section 20.01, Alcoholic Beverage Code, is
  amended to read as follows:
         Sec. 20.01.  AUTHORIZED ACTIVITIES. The holder of a general
  class B wholesaler's permit may:
               (1)  purchase and import malt and vinous liquors from
  brewers, wineries, rectifiers, and wine manufacturers and wine
  bottlers who are the holders of nonresident seller's permits or
  their agents who are holders of manufacturer's agent permits;
               (2)  purchase malt and vinous liquors from holders of
  brewer's permits, holders of brewpub licenses, or other wholesalers
  in the state;
               (3)  sell the malt and vinous liquors in the original
  containers in which they are received to retailers and wholesalers
  authorized to sell them in this state, including holders of local
  distributor's permits, mixed beverage permits, and daily temporary
  mixed beverage permits;
               (4)  sell the malt and vinous liquors to qualified
  persons outside the state; and
               (5)  sell ale and malt liquor to a holder of a private
  club registration permit.
         SECTION 3.  Subsection (a), Section 64.01, Alcoholic
  Beverage Code, is amended to read as follows:
         (a)  The holder of a general distributor's license may:
               (1)  receive beer in unbroken original packages from
  manufacturers and brewpubs and from general, local, or branch
  distributors;
               (2)  distribute or sell beer in the unbroken original
  packages in which it is received to general, branch, or local
  distributors, to local distributor permittees, to permittees or
  licensees authorized to sell to ultimate consumers, to private club
  registration permittees, to authorized outlets located on any
  installation of the national military establishment, or to
  qualified persons for shipment and consumption outside the state;
  and
               (3)  serve free beer for consumption on the licensed
  premises.
         SECTION 4.  Section 74.03, Alcoholic Beverage Code, is
  amended to read as follows:
         Sec. 74.03.  PRODUCTION LIMIT. The total annual production
  of malt liquor, ale, and beer by a holder of a brewpub license may
  not exceed 10,000 [5,000] barrels for each licensed brewpub
  [established, operated, or maintained by the holder in this state].
         SECTION 5.  Chapter 74, Alcoholic Beverage Code, is amended
  by adding Sections 74.08, 74.09, 74.10, and 74.11 to read as
  follows:
         Sec. 74.08.  SALES BY BREWPUB LICENSE HOLDERS TO RETAILERS.
  (a)  In addition to the activities authorized by Section 74.01, the
  holder of a brewpub license who holds a wine and beer retailer's
  permit and who sells alcoholic beverages manufactured only on the
  brewpub's premises may:
               (1)  sell malt liquor or ale produced under the license
  to those retailers or qualified persons to whom the holder of a
  general class B wholesaler's permit may sell malt liquor or ale
  under Section 20.01; and
               (2)  sell beer produced under the license to:
                     (A)  those retailers to whom the holder of a
  general distributor's license may sell beer under Section 64.01; or
                     (B)  qualified persons to whom the holder of a
  general distributor's license may sell beer for shipment and
  consumption outside the state under Section 64.01.
         (b)  With regard to a sale under Subsection (a)(1), the
  holder of a brewpub license has the same authority and is subject to
  the same requirements that apply to a sale made by the holder of a
  general class B wholesaler's permit.
         (c)  With regard to a sale under Subsection (a)(2), the
  holder of a brewpub license has the same authority and is subject to
  the same requirements that apply to a sale made by the holder of a
  general distributor's license.
         (d)  The total amount of malt liquor, ale, and beer sold
  under this section to persons in this state may not exceed 1,000
  barrels annually for each licensed brewpub location or 2,500
  barrels annually for all brewpubs operated by the same licensee.
         Sec. 74.09.  SALES TO DISTRIBUTORS. (a)  In addition to the
  activities authorized by Section 74.01, the holder of a brewpub
  license may sell beer produced under the license to the holder of a
  general, local, or branch distributor's license.
         (b)  The holder of a brewpub license who sells beer under
  Subsection (a) shall comply with the requirements of Section
  102.51.
         Sec. 74.10.  SALES TO WHOLESALERS. (a)  In addition to the
  activities authorized by Section 74.01, the holder of a brewpub
  license may sell ale and malt liquor to the holder of a local class B
  wholesaler's permit.
         (b)  The holder of a brewpub license who sells ale or malt
  liquor under Subsection (a) shall comply with the requirements of
  Section 102.81.
         Sec. 74.11.  REPORT OF SALES TO RETAILERS. (a)  Not later
  than the 15th day of each month, the holder of a brewpub license
  shall file a report with the commission that contains information
  relating to the sales made by the brewpub to a retailer during the
  preceding calendar month.
         (b)  The commission shall by rule determine the information
  that is required to be reported under this section and the manner in
  which the report must be submitted to the commission. The
  commission may require the report to contain the same information
  reported to the comptroller under Section 151.462, Tax Code.
         SECTION 6.  Subdivision (2), Subsection (d), Section 102.54,
  Alcoholic Beverage Code, is amended to read as follows:
               (2)  "Manufacturer" means a person who holds a license
  issued under Chapter 62, [or] 63, or 74.
         SECTION 7.  Subsection (a), Section 102.55, Alcoholic
  Beverage Code, is amended to read as follows:
         (a)  In this subchapter and Subchapter D, and as the terms
  relate to an agreement between a manufacturer and a distributor
  describing the sales territory in which a distributor may sell the
  beer of a manufacturer:
               (1)  "Brand" means any word, name, group of letters,
  symbol, or trademark or a combination of any word, name, group of
  letters, symbol, or trademark that is adopted and used by a
  manufacturer on a label or on packaging to identify a specific beer
  or malt beverage and to distinguish the beer or malt beverage
  product from the label or packaging of another beer or malt beverage
  produced or marketed by any manufacturer. The term does not include
  the name of the manufacturer unless the name of the manufacturer is
  included in the name of the brand.
               (2)  "Brand extension" means a brand that incorporates
  a brand name or brand logo, or a substantial part of an existing
  brand name or brand logo, of the same manufacturer.
               (3)  "Manufacturer" means a person who holds a license
  issued under Chapter 62, 63, or 74.
         SECTION 8.  Subdivision (4), Section 102.71, Alcoholic
  Beverage Code, is amended to read as follows:
               (4)  "Manufacturer" means those persons licensed under
  Section 62.01, [or] 63.01, or 74.01 [of this code].
         SECTION 9.  Subsection (f), Section 74.01, Alcoholic
  Beverage Code, is repealed.
         SECTION 10.  (a)  Subject to Subsection (b) of this section,
  this Act takes effect immediately if it receives a vote of
  two-thirds of all the members elected to each house, as provided by
  Section 39, Article III, Texas Constitution.  If this Act does not
  receive the vote necessary for immediate effect, this Act takes
  effect September 1, 2013.
         (b)  The changes in law made by this Act take effect only if
  each of the following bills is enacted and becomes law:
               (1)  Senate Bill No. 516, House Bill No. 1764, or
  another similar bill of the 83rd Legislature, Regular Session,
  2013, that allows small brewers to sell ale to retailers;
               (2)  Senate Bill No. 517, House Bill No. 1765, or
  another similar bill of the 83rd Legislature, Regular Session,
  2013, that allows small beer manufacturers to sell beer to
  retailers;
               (3)  Senate Bill No. 518, House Bill No. 1766, or
  another similar bill of the 83rd Legislature, Regular Session,
  2013, that allows small brewers and beer manufacturers to sell beer
  and ale to ultimate consumers; and
               (4)  Senate Bill No. 639, House Bill No. 1538, or
  another similar bill of the 83rd Legislature, Regular Session,
  2013, relating to sales of beer by a manufacturer to a distributor
  and certain agreements between a manufacturer and distributor.