Houston breweries are crying foul after a decision by the Texas Alcoholic Beverage Commission shuttered their on-site restaurants. Saint Arnold Brewing Company founder and head brewer Brock Wagner shared the news that his brewery's restaurant, which has been open for patio dining since June 1, will be closed after the TABC changed the way it calculates the brewery's revenue.
Effective immediately, all of the beer produced at Saint Arnold — including that which is sold through a third party distributor to bars, restaurants, and retail outlets — counts towards the percentage of the restaurant's revenue that is considered to be from alcohol sales. Previously, only the beer sold at the restaurant counted, which allowed it to keep operating despite Gov. Greg Abbott's order that closed all bars, which the state defined as establishments that generate 51-percent or more of their revenue through alcohol sales.
The change will compel Saint Arnold to lay off 75 employees who would have otherwise worked at the restaurant, Wagner writes, but Saint Arnold remains open for to-go sales of both beer and food.
"Counting the beer we sell to distributors as if it were being sold in the restaurant defies common sense," Wagner said in a statement. "We are calling on the governor to make this easy fix so we can retain the 75 coworkers whose positions will otherwise be eliminated."
Buffalo Bayou Brewing Company founder and CEO Rassul Zarinfar tells CultureMap that he's equally confused by TABC's decision. He says he's meeting with the brewery's attorneys to determine the best way to respond. Currently, Buffalo Bayou has moved all of its restaurant's seating to an outdoor tent, and the restaurant also supplies food to the drive-in movie theater at Sawyer Yards.
"This is a complete blindside and a vastly different interpretation than any reasonable logic can arrive at," Zarinfar says. "If this is true, TABC is literally changing the math in the middle of the game."
The change also has the potential to affect Karbach Brewing Co.'s on-site restaurant, but it has been closed since July 3 after an employee tested positive for COVID-19.
Wagner is calling on brewery supporters to request that Abbott reconsider the decision by contacting the governor's office online. Similarly, the Texas Restaurant Association has a form on its website to lobby for changes that would change the revenue cap from 51-percent to 60-percent, which would allow more bars that also serve food to continue operating for dine-in service.