The Kleptocratic State of Texas and Alcohol Law

Texas is a kleptocracy and recent legislation shows beer, wine, and spirit wholesalers are funding it.

A decade ago, after what is described as “intense negotiations”, the state of Texas passed a law that allowed Texas distilleries to sell up to two bottles of their products to a consumer every 30 days. That’s not two bottles of each product they made. But two bottles TOTAL to a customer every 30 days.

This is what passes for “free trade” in the Texas alcohol beverage marketplace.

Today, Texas is home to more than 200 distilleries. A decade ago there were roughly 10 distilleries in Texas. No one should be surprised by this growth. When states began giving breweries the right to open brewpubs and self-distribute, the number of breweries in those states exploded. And of course, following the 2005 Granholm v Heald Supreme Court decision deeming discriminatory state bans on out-of-state winery shipping unconstitutional, the number of craft wineries and direct-to-consumer wine sales took off considerably.

It should be no surprise then that Texas distillers would eventually seek to increase the number of bottles they could sell directly to consumers. They know that doing so would make their businesses more viable, increase revenue, and serve to put more Texas craft spirits in the hands of consumers. In fact, the Texas distillers have been asking for an increase to the limit on how much consumers could buy from them for a number of years.

This year a bill was introduced that would allow Texas distillers to sell two bottles of each product they sell to a consumer coming into their tasting room every 30 days. The bill language read like this:

“The holder of a distiller ’s and rectifier ’s permit may not under Subsection (b) sell more than two 750 milliliter bottles or the equivalent of each distilled spirits product the permit holder produces [or the equivalent] to the same consumer within a 30-day period.”