Before you really get invested in developing your bar or restaurant, you need to understand the four core areas of your business that the TABC has to qualify before it will issue you a Texas liquor license:
Business Concept
Location
Ownership
Financial Investment
In our last blog, we went through Business Concept. We discussed who needs a liquor license and different types of permits. You can read all about Business Concept here.
In this blog, we will discuss location. This is where we most often see applicants run into problems that can cause lengthy delays or ultimately prevent the issuance of a liquor license.
Can you get the specific liquor license your business needs at your specific location?
That’s what you need to know before you start spending money.
It seems like a simple question, but there are actually quite a few layers you have to go through to confirm that the sale of alcohol is legal at your location, and, if it is, whether there are any conditions that need to be met before you can get a liquor license. So many people make assumptions here and find themselves in a big, expensive mess.
Maybe the most important takeaway from this blog is this: the city and the county in which your business is or will be located must approve your TABC application before you can even submit it to the TABC for consideration. Let me say that again. The city and the county each must approve your TABC application before you can submit it to the TABC.
If the city refuses to certify your application, the TABC will not accept it. If the county refuses to certify your application, the TABC will not accept it. Cities and counties are gatekeepers. You will not be able to get a Texas liquor license without their prior approval.
So, what does each of the city and county require to certify your liquor license? It depends on the city, and it depends on the county. This is why the process is so hard -- many cities and counties have unique requirements.
Cities and counties are really certifying two layers – first, their certifications tell the TABC that the sale of alcohol is legal at your specific location – this is the wet/dry status. Second, they are confirming for the TABC that you have satisfied any local requirements imposed by the city or the county.
Wet/Dry Status
One of the important things to know when you are scouting a location for your bar or restaurant is that there are wet and dry areas in Texas. If you’ve lived in Texas for any amount of time, you probably are already familiar with this. You may, for example, have had to drive to the next county to find a liquor store or had to become a “member” of a restaurant before you could have a drink there.
Let’s talk about what you need to know as a bar or restaurant owner applying for a liquor license.
We generally refer to areas where it is illegal to sell alcohol as dry areas. Areas where the sale of alcohol is legal are “wet”. An area is “partially wet,” if some types of alcohol sales are legal and others are not. In other words, some permits are available and some are not. I use the term “wet/dry status” to describe whether, and to what extent, the sale of alcohol is legal in a specific area or at a specific location.
Texas law actually doesn’t prohibit the sale of alcoholic beverages anywhere.
Instead, it gives cities, counties, and precincts (which are divisions within counties) the ability to hold what’s called a local option election to decide whether to restrict the sale of alcoholic beverages in their local communities. With each of these local governmental units having the authority to choose their specific wet/dry status, we have an incredibly complicated patchwork of wet/dry statuses across Texas.
Because most of Texas is now wet or partially wet, wet/dry status doesn’t typically create a problem. But, when it does, it is a big one. You can’t apply for new wet/dry status like you can for rezoning, for example. There has to be an election.
The TABC publishes a spreadsheet that lists the wet/dry status by county and then by the cities and precincts within each county. We are linking to the spreadsheet here and mentioning it in case you come across it as you are looking for information online. We don’t recommend relying on it. We actually looked up our hometown on it for this blog so we could provide an example, but found it outdated. The TABC does not guarantee the information in the spreadsheet. They instead refer you to the city secretary and county clerk, who have the final say. And that, of course, is the process we recommend.
You can also find helpful historical information regarding what TABC permits have existed at specific addresses in the TABC’s Public Inquiry database. We will be taking an in-depth look at the helpful information that you can find here in an upcoming blog. Knowing that a bar previously existed at your specific address, though not a guarantee, is a good indicator that you won’t have an issue with the city or county certifying your location.
Identify Protected Places
After we check the TABC History, we generally like to take a quick look to see if any protected places jump out -- schools, child care or daycare facilities, churches, and hospitals.
Texas law gives cities and counties the authority to prohibit at least some liquor licenses from being issued near each of these. Almost all of them take advantage of this option.
If you find anything that could possibly be within 300 feet, it’s worth taking a closer look.
Schools & Day Cares. If you have a public or private school within 300 feet, you will most likely need a variance from the city to proceed. If you are in the same proximity to a child care or daycare facility, the same restriction applies, unless you have a Food and Beverage Certificate.
You also need to check for alcohol-free zones. These zones extend out 1,000 feet around public or private schools and are put in place at request of the school. So, that means these can be different from school to school within the same city. If you have a school within 1,000 feet, and your alcohol proceeds will not exceed 50% of your total, you are again in the clear. If not, this is something to ask the city about or perhaps look up on their website. The City of Dallas, for example, has maps online that identify alcohol-free zones.
Churches & Hospitals. When it comes to churches and hospitals, we are only concerned about the ones as close as 300 feet.
If you find that there is a church or hospital within 300 feet, you will likely need a variance from the city before you can proceed, unless it happens to be a close call. If it is a close call, it is possible to relocate your front door to meet the 300-feet requirement. (The measurement here is from door to door, whereas for schools it is from property line to property line.)
Again, if you identify any Protected Place that prohibits the permit that you want at your location, that’s not necessarily the end of the road for getting an alcoholic beverage permit there. However, know that you may need to get a variance from the city, or county if you are not located in the city limits. Know that that process takes time. And know that you cannot move forward with your TABC application until you get this sorted out with the city or the county.
City Requirements
Okay now, that we have done a little research, and figured out who our neighbors are, let’s talk about what you will need from your city and how to get it.
Earlier we said that you need the city to certify or sign off on your TABC application, specifically you need the signature of the city secretary.
You could just plan to take your application to the city secretary’s office when you are ready to apply for your liquor license. But, you run the risk of leaving it there for a week only to find out there is a step you missed and have to backtrack. Here’s how to figure out what you need to know upfront about (1) whether there are any issues with your location and (2) what the city’s process is for certifying applications.
Dallas, Fort Worth, Austin, San Antonio & Houston
The big Texas cities generally have specific processes in place that involve little human interaction. You can find these online. We have also linked them below. It’s often hard to get someone on the phone in these cities, but the information provided will get you started. Look for upcoming city-specific guides on how to get your city certification in these cities.
Everywhere Else
Now, what if you are in a smaller city? We find that in smaller cities, while they might not have instructions on their website, it’s pretty easy to get someone on the phone.
Contact the City Secretary’s office and ask to speak to the person who processes TABC application certifications. Once you get the right person on the phone, we generally like to start out with an open-ended question, simply asking them to explain the process for getting the TABC application certified. They might give you a complete run down. If not, here are some questions we ask to make sure we have all the information we need to make sure we submit what they need to certify the application:
Where, exactly, do you drop off the TABC application, or what email address do you send it to?
Are there any documents that must be submitted along with the application? If yes, where can you find those documents online?
Before you bring your TABC application to the city, does it need to have either the County or Comptroller certification already completed?
Are there any fees that need to be paid prior to your submission? Any fees that need to be paid at the time of submission or later? How do they accept payment?
How long does it take for the city to review and certify an application?
Does the application go through any other departments or offices besides the City Secretary’s office? How long does it typically take to get through each of these offices?
Can you get the contact information for people who might also be handling your application throughout the process?
Knowing this information empowers you to check on your application periodically to make sure there aren’t any issues and that it’s moving forward. It helps you understand the process. You also want to see if you can get information about your specific location. Here are more questions to help you figure that out:
Will the city representative look up your location for you and let you know if there are any city issues with getting a liquor license there or that would prevent them from certifying your TABC application?
Is it legal to sell alcohol for on-premises consumption at this address?
Is your specific permit type legal at this location? Does it have to be a restaurant (in other words, is a Food and Beverage Certificate required)?
For this location, would the city require any special permits, such as a special use permit or a conditional use permit, before it would certify the TABC application? If yes, what is required and what is the process for getting the required permit?
As you probably know, your liquor license is only one of several regulatory approvals that you will need to open your bar or restaurant, and most of them will come from the city. That might be a change in zoning, a certificate of occupancy, a health department permit, and other permits or approvals. We aren’t going to get into how to accomplish any city permitting or approvals, but keep these requirements in mind as they could hold up your TABC application from getting certified.
County Requirements
After we’ve visited with the city, our next call is usually to the county. In general, getting a county certification on your TABC application is an easy process if your location is within the city limits. If you are outside the city limits, the county may have the authority to regulate in some respects in the same way as a city would.
If you are outside the city limits of any city, we generally ask the county questions exactly as if it were a city. In other words, go back to our explanation of what to ask the city, and ask the county all of those questions. When you are outside the city limits, the county can sometimes act like a city and may impose special requirements that it would leave to a city, if you were in the city limits.
Whether you are in or out of the city limits, take the information you have gathered.
Is there anything you need to do before the county will certify your TABC application? How long will that take? Add it to your timeline. Should you get the county certification before or after the city? How long will it take? Add that to your timeline.
PRO TIP: Do not use the AIMS-generated city and county certifications. (AIMS is the TABC’s online application system.) They are presented to you at the end of the AIMS application process. That means you could spend literally hours (and potentially lots of money) working toward your TABC license/permit approval only to find out that there is a show-stopping city issue. Don’t be that person. Grab the TABC Required Certifications form and take control of the process at the beginning.
Between the city and the county certifications, you should have a general idea of whether you can get the TABC permit you want at your specific location and how long your TABC application will take to get certified and thus be able to create an overall timeline.
Owner of Property
Before we wrap up on location, there’s one minor issue worth noting. It’s about the owner of your property.
The TABC will ask you to disclose the full legal name of the owner of your property, plus additional information as needed to confirm identity.
Why does the TABC care who the owner is? They are tasked with ensuring that your business in no way violates Texas’s three tiered-system that generally prohibits people from holding or profiting from interests in more than one tier. In other words, if your landlord owns breweries (part of the manufacturing tier), that landlord cannot also own property that he or she leases to a bar (part of the retail tier).
Again, we list this as a minor issue because it rarely comes up. But it is good to be aware of this because sometimes landlords aren’t excited about providing information for you to give the TABC (name, employer ID number, etc.). You may even try to include in your lease a provision requiring your landlord to provide this information in a timely manner.
That’s it! By doing a quick check with the property owner and confirming with your city and county that you don’t have an issue with wet/dry status, a protected place, or a city regulation, you will be well on your way to confirming that the TABC can issue a Texas liquor license at your specific location. Remember – the most foolproof way to get that confirmation from the city and county is by requesting the city and county certifications upfront.
Still have questions about the location of your bar or restaurant? Need help finding information on your city or county’s TABC liquor license requirements? Book a consultation with Ashley.
Disclaimer: Nothing in our articles or on our website is legal advice and should not be taken as such. Please address all legal questions to your counsel.
