News & Insights
Jun 29, 2020
Tennessee Gov. Bill Lee has extended the executive order allowing drive-through, carryout and delivery of beer, wine and spirits for restaurants. Read Executive Order 50 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.
Unlike many states, Lee is extending the privilege two months (to August 29), which brings welcome certainty to an industry battered by the pandemic.
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.
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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