Johnson City evaluates allowing distilleries, beer delivery

David Floyd • Updated Jun 18, 2020 at 5:50 PM

At the request of a Nashville attorney, Johnson City is looking into allowing distilleries to operate in city limits, where liquor manufacturing is currently prohibited.

During an agenda review meeting Monday at City Hall, city commissioners gave staff the green light to put together proposed alterations to Title 8 of the city’s municipal code, which governs alcohol in the city, and take a deep dive into where the establishments would be permitted in the city’s zoning code.

Johnson City attorney Sunny Sandos told commissioners that she and staff in the development services department have received phone calls from an attorney with Gullett, Sandford, Robinson & Martin PLLC, who represents a distiller. Sandos said the attorney did not disclose the identity of the client to the city.

City staff have also looked into allowing beer delivery on an ongoing basis, something that was permitted in an emergency order approved by the city commission near the onset of the novel coronavirus (COVID-19) outbreak. That order expired on May 31.

Currently, City Manager Pete Peterson said liquor stores and restaurants, which must derive at least 50% of their delivery sales from food, can already deliver alcohol in accordance with state law, but places that manufacture and sell alcohol only are prohibited by local laws to deliver.

The state of Tennessee does not regulate the sale of beer below 8% alcohol content, which makes delivery of those products a local decision.

Since many other establishments can already deliver, Peterson said a couple of local businesses that sell beer but not food have asked city officials to reconsider its rules.

After reaching out to attorneys for the Tennessee Alcoholic Beverages Commission, Sandos said it appears that, as long as establishments don’t hold a TABC license, meaning they’re not manufacturing or selling a product that has higher than 8% alcohol content, the city can create a separate license allowing for deliveries from those businesses.

Sandos said staff are currently figuring out how that would work. She noted any new allowances for beer delivery would ultimately apply to a small number of places — those that aren’t restaurants and don’t have a TABC license.

Commissioner Larry Calhoun said he didn’t feel strongly about the changes, but said that it would level the playing field for businesses.

“If it helps our businesses instead of just hurting businesses, I think it makes sense,” he said.

Offering a justification for pushing forward on the alterations, Peterson said Monday it’s “absolutely stupid” to allow people to drink at a bar or restaurant and then drive home if it’s going to be illegal for them to drive.

“If you want to, at least in theory if not in practical application, reduce the number of intoxicated drivers, let them deliver beer to their house,” Peterson said.

John Henritze, the owner of JRH Brewing in Johnson City, said that when the city temporarily changed its alcohol ordinance for beer deliveries during its safer-at-home order, the allowance was helpful, even if it didn’t produce the same degree of business the establishment was seeing before the outbreak.

Henritze said delivery sales trailed off as time went on and businesses began reopening.