On Sunday, September 1, just in time for Labor Day, breweries across the state toasted to a long-awaited landmark moment: The Beer-to-Go law finally went into effect, allowing Texas craft brewers to sell beer directly to customers.
Before Governor Greg Abbott signed House Bill 1545 in June, breweries had the right to sell on-site but were prohibited from selling beer to go. (Wineries and distilleries have long been allowed to sell on-site.) With Abbot’s signature, Texas became the 50th state to legalize the arrangement for breweries, shifting the Texas Alcoholic Beverage Commission, the appointed public agency charged with regulating and taxing booze in the state for the last 84 years, into the 21st century.
With 820 new laws spawned by the 86th session of the Texas Legislature, few inspired the sort of sudsy kumbaya that was seen in the Texas Senate when the bill passed unanimously, ushering in a new standard for Texas’ independent breweries. The bill’s Republican co-sponsor, Senator Dawn Buckingham of Lakeway, summed up the legislation, which was attached to the TABC sunset review, on the Senate floor back in May. “This amendment is more than just about selling beer to go,” Buckingham said, crediting Representative Eddie Rodriguez of Austin, her Democratic counterpart in the House. “It is about job creation, economic development, tourism, and support for entrepreneurship—issues that I know that are important to every one of you.”
The success of Beer-to-Go largely reflects the growing influence of Texas’ craft beer community, which extends to hundreds of specialty brewers in cities large and small, most of whom are part of the Texas Craft Brewers Guild, the nonprofit trade group that represents more than 250 small-to-medium sized breweries statewide. Combined, according to the national Brewers Association, small, independent brewers in Texas—individual businesses that produce 6 million barrels of beer or fewer per year—accounted for an economic impact of $4.5 billion in 2016.
Yet, prior to this month, only licensed brewpubs—a retail designation for smaller brewers that typically serve food—were allowed to package and sell their beer on-site. Now manufacturer breweries—licensed breweries with much higher production levels—can also sell their taproom products for takeaway.
“Until recently, Texas really was an antagonistic place in terms of craft brewing,” said Adam DeBower, a founder at Austin Beerworks. “In 2017, we got our asses handed to us, and our members lost some rights,” he said, referring to a bill that left many craft breweries at the mercy of distributors and required some independent brewers to pay for unneeded delivery services. DeBower, who also serves on the Brewers Guild legislative committee, helped launch CraftPAC, a lobbying arm which last year donated about $100,000 to candidates on both sides of the aisle.
And yet, the new Beer-to-Go rule was nearly derailed by Texas’ powerful wholesale beer distributors, whose millions of dollars in donations to various races, as well as Governor Abbott’s campaign coffers, easily dwarfs CraftPAC. The Beer Alliance and Wholesale Beer Distributors, both in Texas, opposed Rodriguez’s original legislation, which stalled in committee. In turn, Rodriguez explains, he brought together the Beer Alliance and the Craft Brewers Guild to hammer out a compromise bill that he successfully added to the TABC sunset provisions, and was ultimately passed on a voice vote in the House. “Timing is everything in the Legislature,” Rodriguez said. “I worked the floor very hard to make sure we had the votes. It’s a very Texas thing to want to help small businesses.”
At the center of this year’s feud was Texas’ archaic “three-tier” system, which since the end of Prohibition had curtailed the ability of brewers to sell their wares directly to the public. Rick Donley, the Beer Alliance president, was pleased that the compromise bill kept that system intact, as well as maintaining the strict limits on sales by craft brewers. (Manufacturers can only sell a maximum of 5,000 barrels annually directly at their breweries, whether to-go or for onsite consumption.) These provisions were central reasons for the change of heart, he said: “We have peace in the valley.”
As of Labor Day weekend, DeBower and his colleagues statewide seemed prepared to let bygones be bygones. There were parties in Dallas, Houston, and Austin celebrating what in some corners was called Texas Craft Beer Independence Day. At Holler Brewing, a relative newcomer in Houston, owner John Holler brought in the Austin-based mobile canning operation American Canning to package a few of his favorite offerings, including Dollar Pils Y’all and Czech My Phone. “Until now, we just distributed draft beer in kegs, so this is the first time we’re selling cans,” Holler said. “That’s a big deal for us. Most of our business is taproom business, so if we can increase sales, that money goes right in the till.”
At Community Brewing in Dallas, marketing director Corey Dickinson says Beer-to-Go will be a game-changer for his outfit as well. Community just installed a new crowler-filler behind the bar, which will allow the brewery to fill oversized cans that are favorites among beer nerds. The company hopes to attract customers by offering sales of limited-release brews not sold in stores. As importantly, Dickinson says, the law brings Texas into line with states with an established craft-beer tourism trade, such as Colorado and California.
“This is going to open a lot of doors for a lot of breweries in Texas,” he said.