               EATTOBNEYGENERAL
                      OFTEXAS



                    September j, 1961

Honorable Coke R. Stevenson, Jr. Opinion No. W-1126
Administrator
Texas Liquor Control Board       Re:  Whether any provisions
Austin, Texas                         of H. B. 533, 57th
                                      Legisl'Btureis uncon-
                                      stitutionalas violative
                                      of Article XVI, Section
                                      20 of the Texas Con-
Dear Mr. Stevenson:                   stitution.
         You have requested an opinion as to whether any pro-
vision of H. B, 533, passed by the Regular Session of the 57th
Legislatureviolates Article XVI, Section 20 of the Constitution
of Texas. H. B. 533 contains five principal provisions,to-wit:
         1. It creates a new class of wholesale permits.
         2.  It permits the holder of a manufacturer'slicense
to obtain a brewer's permit upon applicationand payment of
the required fee.
        3. It provides that a person who has been the holder
of a brewer's or manufacturer'spermit for a certain location
shall not be denied a renewal of such license solely because
the location is within an area which has been subsequently
voted lldry"as to the sale of beer or ale by locaL option.
The holder of such a ermit in a Wry" area is authoriaedby
the bill to do all th% gs which a holder of such a permit is
authorisedto do under any provision of the Liquor Control
Act except to sell beer or ale contrary to the local option
prohibition.
         4. It provides that, under certain cire&stances,
a person may hold a manufacturer'sor brewer'8 license fbr
a number of years without actually~engagingin the m&ifaizture
of beer and ale at the licensed location, if the permittee
meets certain requirementsconcerningthe beginning of con-
struction of a brewing or manufacturingplant at the licensed
location.
         5. It permits Texas manufacturersand brewers to
brew, package, label, and ship beer and ale which do not meet
Honorable Coke R, Stevenson,Jr,# Page 2    (W-1126)


a Texas specificationfor alcoholic content, packaging or
labeling to other states for sale in those states.
         Article XVI, Section 20 of the Constitutionof Texas
provides that the open saloon is prohibitedand delegates to
the Legislaturethe power to regulate the manufacture,sale,
possession and transportationof intoxicatingliquors. It
requires the Legislatureto enact local option laws which
"shall contain provisionsfor voting on the sale of intoxi-
cating liquors of va~fous types and various alcoholic content."
(Emphasisadded) It also provides in See, (e) that:
             "In all counties, Justice's precincts or
        incorporatedtowns or cities wherein the sale
        of intoxicatingliquors have been prohibited
        by local option elections held under the laws
        of the State of Texas and in force at the time
        of the taking effect of Section 20, Article
        XVI of the Constitutionof Texas, it shall con-
        tinue to be unlati to manufacture,sell, barter,
        or exehange in any such county, $ustfce's precinct
        or   incorporated       tcmn or  city, any spirftuous,
        vinous or malt liquors or medicated bitters cap-
        able of producing intoxicationor any other in-
        toxicants       whatsoever,    for beverage purposes, un-
        leas and until a majority of the qualified voters
        in such county or political subdivisionthereof
        voting in an election held for such purpose shall
        determine such to be lawful D 0 0" (Emphasisadded.)
         When H. B, 533 is laid along side the constitutional
provisions it becomes apparent that the first portion thereof
which establishesa new class of wholesaler'spermits is au-
thorized by the constitutionalprovision authorizingthe Legis-
lature to regulate the sale, manufacture,possession and trans-
portation of intoxicatingliquors.
         Likewise, it becomes ap arent that the next provision
of the act which authorizesa hofder of a manufacturer'slicense
to obtain a brewer's permit is also within the legislativepower
to create classes of permits and set up the criteria by which
one may obtain such permit.
         The next portion of the act purports to authorize the
holder of a Brewer's Permit or Manufacturer'sLicense for a
location within an area which has, aubsequentto the date he
obtained the permit, voted against the sale of beer and ale
Honorable Coke R. Stevenson, Jr., Page 3 (WW-1126)


to continue to manufactureand brew such products within the
YrcIryf'
      area and to exercise all the powers of such a permit
holder except the power to sell beer and ale in violation of
the local o tion election, In Opinion No, WW-89 this office
considered8. B. 225, Acts of the 55th Legislature,1957,
which purported to grant tQ the holder of a Manufacturer's
License the right to continue operations at the same location
although the area in which the manufacturingplant was located
had been voted "dry" as to the sale of hi% product., We held
that S. B. 225 was an act regulating the manufactureof in-
toxicating liquor by allowing such manufacturewithin certain
areas and as such that it was clearly within the authority
granted by the Constitution. We went on to point out, how-
ever, that S. B. 225, at first glance, seemed to authorize
the sale of intoxicatingliquor in an area which had assumed,
by reason of a local option election, a "dry" status as to
his product, because it said that it authorizedthe manufacturer
to "do all things which a manufacturer18 authorizedto do under
any other provision of the Texas Liquor Control Act, including
but not limited to manufacture,possession,storage, packaging
and transportationto areas where the sale of beer is legal."
But we pointed out that this provision of the bill did not
authorize the sale of beer in a dry area because the Legis-
lature did not have the power to grant such authority in an
area that is "dry" as a result of a local option election.
In H. B. 533, however, this problem is not present because the
act itself % ecificallydenies to the holder of a brewer's or
manufacturerPa permit who is located in a **dry"area the right
to sell beer or ale contrary to said local option prohibition.
This provision is, therefore,not in violation of the consti-
tutional provision of Article XVI, Section 20. It should be
pointed out that Article XVIl Section 20(c) would not have
any effect on holders of any permits or licenses under con-
siderationhere because the license or permit would not have
been granted in the first instance until the ~areahad been
voted "wet" in a local option election subsequentto the
adoption of Article XVI, Section 20,
         The provision of H. B. 533 which allows Texas brewers
and manufacturersto manufactureproducts which do not meet
the alcoholic content, packaging or labeling specifications
of Texas for sale outside of Texas is authorizedby the consti-
tutional provision allowing the Legislatureto regulate the
manufactureand sale of alcoholic beverages.
         The provisions allowing persons to hold brewer's or
manufacturer'slicense without actually engaging in the brew-
ing or manufactureof alcoholic beverages is also controlled
Honorable Coke R. Stevenson,Jr., Page 4     (WW-1126)


by the same constitutionalprovigiQn and is not contrary to
Section XVI of Article 20 of the Texas Constitution.

                          SUMMARY
              H, B. 533.passedby the Regular Session
         of the 57th Legislaturedoes not violate the
         provisions of Article XVI, Section 20, Consti-
         tution of Texas,
                                    Very truly yours,
                                    WILL WILSON
                                    Attorney General of Texas




SRW/br
                                    ByJzzdi
                                      Assi&nt   Attorney General


APPROVED:
OPINION COMMITTEE:
W. V. Geppert, Chairman
Riley Eugene Fletcher
F. William Colburn
Dwain Erwin
Marvin Thomas
REVIEWED FOR THE ATTORNEY GENERAL
BY: Howard W. Mays
