Restaurant industry voices concern about looming liquor law enforcement

State plans to strictly regulate infused spirits

The Tennessee Alcoholic Beverage Commission plans to strictly enforce, beginning July 1, a state law regulating the infusing of spirits.

And those folks who like their vodka flavored with pineapple — and the restaurant/bar owners who create such concoctions — are very concerned.

“There is no question in my mind this is wrong,” said Shawn Courtney, co-owner of SoBro restaurant and bar Past Perfect.

Known city-wide for its infused vodkas, Past Perfect could see its revenues drop up to 25 percent once it stops offering the distinctive beverages so as to comply with the law, said Courtney (pictured). 

The state law, passed in 2006, bans restaurants from "manufacturing" alcohol infused with food and beverage products, even those infused with non-alcoholic beverages. Relatedly, the "immediate consumption" of a manufactured beverage is not allowed. However, the law has been modestly enforced, if at all, until now.

In an email, Keith Bell, director of the Tennessee Alcoholic Beverage Commission, stressed that “non-manufactured” drinks such as margaritas and mint juleps will be exempt from enforcement.

It is only when a restaurant/bar takes a spirit — typically vodka, but rum and whiskey can work, too — infuses it with plant or animal matter (for example, there is bacon-infused vodka) and allows it to remain suspended for an extended period of time that a “manufacturing” element comes into play.

In the email correspondence, Bell, who began his position in May, offers seven points to bolster the ABC's position. Following are two:

1. “Under the Federal Alcohol Administration Act (FAA Act), rectifying, blending or infusing distilled spirits may only be lawfully done by a person with a TTB (Alcohol and Tobacco Tax and Trade Bureau of the U.S. Department of the Treasury) basic manufacturer's (distillery) permit. (27 United States Code 203(b)).”

2. "There is the requirement/rule in Tennessee that alcoholic beverages be served from their original containers at TABC licensed on-premises LBD restaurants."

Releated to No. 2, Bell sites potential health concerns, as jugs of infused vodka in bars, for example, don’t have labeling, expiration dates, etc.

Rob Pinson, a member at Bone McAllester Norton, said many in the industry disagree that the law applies to restaurants and bars.

“I see where the director is coming from in the strictest sense,” he said. “But the law itself is within a section of the broader law that applies to manufacturers, wholesalers and liquor stores.”

Pinson said there seems to be “inconsistency” between what is defined as infusion and what the commission is exempting from prohibition.

Greg Adkins, president and CEO of the Tennessee Hospitality Association, said the hope is that strict enforcement can be held off until the next legislative session. The THA has been working with the state legislature and, in particular, Sen. Bill Ketron, to address the matter.

“We have made our concerns known,” he said, adding he is hopeful the TABC will loosen its interpretation of the state law.