Protests of Original or Renewal TABC Applications

Before March 14, 2018, anyone could file a protest against an application for a TABC license or permit, and the TABC would set the matter for hearing. However, on March 14, 2018 the TABC substantially limited the circumstances in which an application can be protested through its order in Tex. Alcoholic Beverage Comm’n, Renewal Application of Core-Mark Midcontinent, Inc.. In its order granting Core-Mark's renewal permit after one of Core-Mark's competitors protested its renewal application, the TABC stated:

"The Code (referring to the Texas Alcoholic Beverage Code) does not give a member of the general public the right, either an individual or a company, the right to protest all applications for licenses or permits. Instead, the Code provides for discrete circumstances when the public can file a protest. . ."

 

After this change in position, the Texas legislature implemented changes to the Texas Alcoholic Beverage Code specifying which members of the public and/or government officials have standing to protest original and renewal applications. 

The following government officials representing the area where the permit is sought have standing to protest renewal or original applications:

 

  • State senator

  • State representative 

  • Mayor

  • City council member

  • County commissioner

  • County judge

  • Chief of police

  • City marshal

  • City attorney

  • County sheriff

  • County or district attorney

 

​A member of the public may protest an application in the following circumstances:

  • If the member of the public lives within 300ft of the property line of the address where the TABC Permit is sought, an original or renewal application for a Mixed Beverage Permit (MB), Private Club Permit (N), Retail Dealer's On-Premise License (BE), or a Wine and Malt Beverage Retailer's Permit (BG).

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  • In a city with a population of 1.5 million or more, an original or renewal TABC application for a Mixed Beverage Permit (MB) or Wine and Malt Beverage Retailer's Permit (BG) if:

    • (1) a residence, church, school, hospital, day care or social services facility is within 300ft of the property line of the address where the permit is sought; and

    • 75% or more of the permit holder's actual or projected gross revenue comes from the sale of alcohol at the location.

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  • When a sexually oriented business will operate at the premises where the TABC permit is sought:

    • An original application (new location) for a Mixed Beverage Permit (MB), Private Club Permit (N) or Wine and Malt Beverage Retailer's Permit (BG).

    • A renewal application (existing business) for a Mixed Beverage Permit (MB), Private Club Permit (N) or Wine and Malt Beverage Retailer's Permit (BG) if a petition is submitted to the TABC signed by 50% of all resident who reside within 300ft of the property line where the existing business is located.

 

Regardless of whether a government official or member of the public protests a TABC application for either an original or renewal application, the protesting party almost always protests the application under the authority of 11.46(8) of the TABC Code, which states:

"The commission may deny an application for an original or renewal permit if it has reasonable grounds to believe and finds that any of the following circumstances exists: . . . 

(8) the place or manner in which the applicant may conduct the applicant's business warrants the denial of the application for a permit based on the general welfare, health, peace, morals, and safety of the people and on the public sense of decency."

 

11.46(8) of the TABC Code -as well as other similarly worded portions of the Code that apply to specific TABC licenses and permits - is commonly referred to as "Place or Manner." A protesting party almost always bases their argument that the original or renewal TABC application should be denied based on Place or Manner because these sections are a general catchall, giving the protesting party the ability to argue that the application should be denied for virtually any reason they can come up with. 

Also, after a protest has been filed by either a member of the public or a government official, the TABC has to submit the request to docket to the State Office of Administrative Hearings (SOAH) to set the protest for hearing. In the last couple of years, the TABC been known to wait several months, or even over a year in some cases, to set a protest for hearing.  If the application being protested is for a renewal application, the business can continue selling alcohol and operating normally while waiting on the TABC to submit the request to docket with SOAH. 

However, if the application being protested is for an original TABC application, the business cannot sell alcohol while the protest is pending. The delay in setting a a protest for hearing can create situations where a business owner is stuck paying rent for months on end without with the ability to operate their business and generate revenue. 

If your renewal or original TABC permit is protested, you should consult with an attorney with experience litigating TABC protests before SOAH and defending TABC applicants. Here is a link to the TABC website with more information on TABC protests.