May 12, 2004
Re: Beer issues
Your MTAS consultant has asked me to give you an opinion on whether the City may establish the Board of Mayor and Aldermen as the beer board and whether the City may legally limit the number of beer permits issued for establishments in the City. In my opinion, the City may legally establish the Board of Mayor and Aldermen as the beer board and may legally limit the number of beer permits to be issued. Further, it is my opinion that an ordinance establishing the City’s Board as the beer board would be a legal enactment.
Tennessee Code Annotated, § 57-5-106(a), provides in pertinent part:
All incorporated cities [and] towns ... in the state of Tennessee are authorized to pass proper ordinances governing the issuance and revocation or suspension of licenses for the storage, sale, manufacture and/or distribution of beer within the corporate limits of the cities and towns ... and to provide a board of persons before whom such application shall be made ... .
The words “are authorized to” in this section mean the same as “may.” Thus cities and towns may pass ordinances governing issuance of beer permits or they may prohibit the sale of beer altogether. Grubb v. Mayor of Morristown, 203 S.W.2d 593 (Tenn. 1947). Cities and towns that allow the sale of beer may also provide for a beer board other than the governing body of the city or town. Authority delegated by the General Assembly to cities and towns must be exercised by the governing body of the city or town unless the power may be delegated to another person or body. This section specifically authorizes the delegation to “a board of persons” but does not require this delegation. There is also nothing in this section indicating that the “board of persons” could not be the governing body itself.
Acting under this authority, many cities and towns in Tennessee have designated the governing body of the city or town as the beer board. Don Darden can give you a listing of many that have. The designation of the governing body as the beer board has not been ruled illegal by any appellate court in Tennessee, nor to my knowledge by any trial court. Moreover, the state statutes confirm that the governing body may be the beer board. T.C.A. § 57-5-108 (a)(1)(C) provides:
Permits or licenses issued under this chapter by the governmental body of any incorporated city, or by any committee or board created by such governmental body may be revoked or suspended in accordance with this section by the governmental body, committee or board which issued the permit or license.
Therefore the city has the option of letting the Board of Mayor and Aldermen serve as the beer board or of providing for a committee or separate board to do this.
The City may also limit the number of permits to be issued. T.C.A. § 57-5-106(a) gives cities the authority to fix “zones and territories and provide hours of opening and closing and such other rules and regulations as will promote public health, morals and safety as they may by ordinance provide.” In State ex rel. Amvets Post 27 v. Beer Board, 717 S.W.2d 878 (Tenn. 1986), the state Supreme Court held that the extensive authority to regulate beer delegated in this section included the authority to limit the number and location of retail outlets, both for on-premises and off-premises consumption.
Since your city now has a beer board that is separate from the governing body, to allow the governing body to exercise this power, the City would have to repeal the ordinance provisions creating the beer board and replace them with new provisions designating the governing body as the beer board. The ordinance provided by Don Darden appears to accomplish this.
I hope this is helpful. If we may be of further assistance on any matter, please contact us.