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great all right good afternoon everyone we hope that all of you and your families are safe healthy and doing well during this time it's nice to see you all just a reminder we have muted all participants upon your entry to minimize background noise and disturbance but we have opened the chat box at the bottom of your screen as usual please feel free to post your comments or questions here during the presentation and we will be sure to answer your questions accordingly also the guest uh speakers have asked that if you wouldn't mind uh we would like for this one to be very interactive so if you can raise your hand when you have a question please do bring on your videos so that way we can see your faces and make this more interactive we certainly would appreciate that and we think it would be more engaging um also those of you who are new to now's now this is the national association of legal professionals we are the nashville chapter our mission is to engage inspire enhance and promote continued legal education and support through various programs and gift facts if you are interested in nows or becoming a sustaining member please visit us at nows.org or feel free to reach out to jennifer mustain and i jennifer muslin is the president and co-education director and i am the treasurer and co-education director before we begin i do have a few announcements and let me get rid of these little pop-ups on my computer here i apologize about that uh first we would like to invite you back to the next scheduled lunch and learns uh the next currently scheduled lunch and learn will be wednesday september the 16th with ist management and their topic will be forensic data collections again that's september the 16th the following scheduled lnl will be wednesday october the 14th with kelly money at frost brown and todd and her topic uh is to be discussed but her focus will be on covet's effect on and or loss of employee benefits and plan transfers thereof again that's october 14th please be sure to rsvp once those are now announcements are emailed out secondly we will be providing cle certificates for today's attendance if you should need one please email jennifer mustain and she will certainly provide you one via email lastly this presentation is being recorded and will be available for future reference via youtube and facebook if you are interested and that being said i'd like to introduce you to our guest speakers will cheek is the lead partner in waller's alcoholic beverage law team he has experience with licensing and regulatory compliance issues for liquor beer catering and special event licensing through the state of tennessee mr cheek has extensive experience drafting state and local liquor legislations and also represents clients in state actions challenging existing ordinances statutes and regulations rob penson is a member of waller's alcoholic beverage law team with an emphasis on the manufacturing tier his practice includes numerous distilleries wineries and breweries across the u.s assisting his clients with federal and state rules and regulations regarding advertising marketing and commerce rob formed the tennessee distillers guild and played an active role in the formation of the new tennessee whiskey trail it's pretty cool which consists of 30 distilleries across the state willcheek has a blog that you can view it's called last call and you can find that at willcheek.com is that correct will that's correct and then uh mr pinson also has a blog that can be found you just google it and it's called beer bond it's like uh bourbon but with beer so b-e-r-b-o-n and uh his that emphasis is on national topics um and these are both uh waller blogs as well so you can also find them there so once again please do turn on your videos and give us a warm welcome to will teak and rob pinson thank you for being with us thank you guys so um rob and i we met for drinks and talked about what we're going to talk about we figured drinks is the appropriate way to figure out what we're going to talk about since that's what we do we do the lord's work we do liquor licensing for restaurants and bars and hotels and venues and also the really important work for distilleries and breweries that's rob's real specialty i just make things up as i go um so we're going to talk in particular about some of the ways that the pandemic and covid have changed the industry and um i think rob if you want to kick it off and talk a little bit about how it's how it's affected distilleries and their new line of business certainly hello everyone um so you know yes the covid situation certainly kind of threw us off for a loop um fortunately the distilleries out there have been able to um i sure have uh found this kind of unique uh backup plan in the form of hand sanitizer uh hand sanitizer really is just distilled spirits in a way uh mixed with something you know the the the industry calls it a denaturant uh basically something that causes you to be unable to drink it um you know it's not suitable for human consumption and so therefore it's so close to what they do previously that it was pretty easy for them to switch to this new model um you know rob you know uh the other night i got to try out i uh i had a splinter got stuck in my hand and i didn't have any alcohol to sterilize it so i use vodka it works yeah yeah so you know the product they make especially the vodka right the vodka is really just high proof neutral alcohol it's not supposed to really have a flavor although those of us that drink it no it does but it's also a cleaning agent right and it's kind of weird to think about but especially those higher proofs when they make it which is essentially 80 95 alcohol um that's a cleaning agent right that's cleaning alcohol so all you have to do is kind of bring it down to maybe 70 or 80 percent of alcohol add some denaturants some people add you know i've got one client that has lemon oil so actually provides a nice little lemon scent to it um others might add um oh aloe i think aloe is supposed to be a denaturant uh there's very various other options um so it doesn't take any new or more equipment to make hand sanitizer no you don't use the barrels right that you would make bourbon in it's not really it's pointless to age your hand sanitizer um but it was easy for them to make some of them switch completely over to hand sanitizer others just added it still like bourbon vodka gin whatever but they do hand sanitize hand sanitizer on the side too many of them made it actually for contracts like for health care companies or cities or county governments and you know the price was actually it's pretty good right they're not taking advantage of the situation but even just a regular price for this product uh actually means a lot more profit for that distillery why is that rob so there's fewer taxes and i'll get into that a second and then there's no wholesaler margin right so in a traditional real world with like vodka or bourbon you have a three-tier system right i think our last um presentation we did for this there's the manufacturer there's a wholesaler there's the retailer right alcohol kind of has to go through all three um except in limited circumstances well and everybody wants to make a markup everybody wants a fat little markup right so with hand sanitizer it's not technically beverage alcohol you can't consume it so therefore it's not the same thing um so the laws really don't it's actually funny they don't really address it uh you're exempt from taxes on that product and you also don't have to use a wholesaler so you know a distillery in tennessee has to use a wholesaler for product they sell on site at least on paper that hand sanitizer you don't so it's already one markup one margin you know one middleman gone two the taxes there's federal taxes there's state taxes and sometimes there's local taxes on distilled spirits all three of those are exempt in this and those taxes are really high right rob yeah right so basically in your kind of typical bottle of jack daniels you know you there's probably about five or six dollars in that price built in that's just strictly taxes right out of the 20 bucks i show out at a liquor store five bucks is going back to the government yeah at least and that's that's this year where the tax the federal tax rate is like a fifth of what it normally is on a regular year it's probably like eight or nine bucks so it's it's heavily taxed not as much as tobacco uh but it's still heavily taxed so imagine all that tax that had to be paid is now a profit right the distilleries you know actually did pretty well it helped keep them afloat because all their their walk-in sales were gone right all the distilleries up in the pigeon forge gatlinburg area they couldn't have the huge crowd some of them have over a million people a year now they're at nothing so it brings up an unrelated fact does anybody know what's the most visited distillery in the world come on somebody guess go ahead need to unmute nina jimby no not jumping jack daniels daniels daniels rob where is jack daniels rank about seventh right yeah sixth or seventh right so the jack daniels gets somewhere over a quarter million visitors old smokey in gatlinburg logged about 6 million visitors in 2018. 250 000 6 million now now jack daniels is selling the heck out of jack daniels at your local retail liquor store and customers keep buying that stuff old smokey effectively shut down they're not selling nearly as much moonshine in liquor stores you go to some of the smaller distillers like um let's see rob uh name corsair nashville craft yeah corsair distillery so corsair mainly sells its product to restaurants where restaurants are shut down they do a little cocktails to go and consumers are really bulking up on staples things they're comfortable with and the experience of the small distillers is that customers are not seeking out new things they're not trying new things they're sort of in huddle up mode and if you drink whiskey you're buying jack or gem you're not experimenting and trying some of the new whiskies that tennessee distillers are making so their business really dried up their distilleries the tasting rooms are closed and the restaurants that they sell to are closed so it was really tough the rob really did a good job so normally they can't just make hand sanitizer they weren't selling hand sanitizer before they're just making whiskey to drink and you know vodka and other products so the idea that suddenly they could make an alcohol product that you don't drink was pretty crazy and so rob really was out there beating his head against the wall for a while had to get approval tell about all the different approvals you had to get rob yeah so you know first you the first one is uh the the federal licensing agency for for distilleries it's called the ttb um it's the federal alcohol uh its name is way too long to explain here bureau well that's what it's the united states alcohol and tobacco tax and trade bureau so thank you ttb yeah it used to be the bureau of alcohol tobacco and firearms yeah the jack booted thugs that attacked the house and wake up go ahead rob among others um so when you register with the ttb you you can register for beverage alcohol or industrial alcohol right or both well most of our distilleries were just beverage so technically you need to be licensed for industrial alcohol in order to make the hand sanitizer so one thing that we had to do is get the ttb to kind of waive its requirement of look we'll let you because of the pandemic we'll let you uh make this stuff without having the right permits right now but that's not the end then we have to go to the fda the fda regulates things like hand sanitizer and how it's made and what's in it and you know the food and drug administration sorry food and drug administration they were a little bit harder to to to get to bend um and then they then they created a new moving target for a while but they finally said look if you can at least make it i think it's like 70 alcohol and use certain denaturants that are approved right um we'll let you we'll kind of have temporary relief and let you make and sell this stuff you know and um eventually please register right with us but for now just make it because there's a shortage right there's a huge shortage purell and germex i think were the two biggest companies they were running short right no one could find anything at the stores i found a candy flavored hand sanitizer to dollar general one time that was jolly rancher flavored i was like that's not good for kids um probably probably be a little bit of trouble now but uh so the fda was an issue and then it came up later in this in the kind of our story here but it did come up the department of transportation also kind of has its hand in this game because technically hand sanitizers are still like a dangerous product yeah can anybody guess what happens when you stick a match in a truck full of boom right right tina kaboom [Laughter] stuff blows up yeah so uh dot has labeling requirements you might have seen those those kind of tilted square or almost diamond signs on trucks carrying gas and stuff like explosive corrosive harmful can you know flammable stuff like that they the dot that's d.o.t so they have requirements too so they were nice enough to work with the industry to go well at least have you this sheet that says what's here right what's in it it's called the safety data sheet at least have that but will we'll relax our rules too on when you're transporting the stuff so you know the state pretty much followed the feds and all these regards which is very helpful so we didn't have too much kickback from them we had to ask hey you know tennessee alcoholic beverage commission the abc ttb treats this this way is that how you see it right i want to make sure they agreed because we don't want to do something and you know commit a felony on the state level because that's never good so there's so much there's a lot of hurdles and there's still some now right um it's interesting you know so so let me just ask you out there that's watching has uh bought hand sanitizer at a distillery i know i was a big machine wave your hand if you've been to one of the distilleries and bought it nobody huh rob if you bought where'd you buy uh well thankfully i was given um my client sent me a lot so i got it's all sitting over there i don't want to leave the camera screen but i've got a big old pallet of old forge distillery bottles like little 125 millibars i've got 375 milliliter bottles from tennessee distilling government group those are the guys that's a lemon um ol old smoky sent me some um now here's the fun part in fact let me if you if you all don't mind let me go off camera to grab a few bottles because there's something that came up with the fda lately i can still talk while i reach it there's something that says they put denatured in there what that is is it's something that makes it taste bad um it's it's so that two things one it's so that that my kids don't drink it and and enjoy it like like my vodka the other is a little more uh is actually the reason that they make the denature go in it it's to make you not be able to drink it and avoid paying taxes because if you're selling something that could be drank the government wants to collect that five to five bucks on your 20 jack daniels so the government requires you to put this stinky stuff in it so you can't drink it go ahead rob yeah so you know i'll keep it away from the camera does this look like a jar of moonshine or a hand sanitizer right it's hard to tell now you put a little bit closer that camera you'll see it says hand sanitizer on it um the fda recently i guess they they've been blind recently started pitching a fit about distillers using their bot their moonshine bottles right this is a little 125 milliliter thing they're you know they got upset like what what do you mean you're using your bottles that you know that makes it look like you can drink it you shouldn't do that well okay that's nice we understand that issue but there are no bottles out there when this broke in march and april i mean here's all smokies it's at least like a little squirt bottle with a little flip off top no one could get these everyone had these and i've got some bigger bottles from another client but no one could get these you know they had the hand pumps that we all see right those were not around you couldn't find those on amazon or at least for a real price right maybe a hundred dollars a bottle empty but you know that's not very economical so it it i find a little disingenuous that the fda is now saying hey you can't do that that's that's misleading when there was nothing to put it in otherwise yeah that was part of the beauty is distilleries are already making alcohol and they've already got the bottling process and they have the bottles and they have distribution channels why not let them go ahead and make hand sanitizer that was the beauty of it right and it was an emergency right we needed more hand sanitizer desperately hospitals needed it right police departments needed other emergency personnel probably the military needed it so if the urgency was to get out there so fast why are we worried that this is the only thing we can put it in that doesn't make sense to me so this is really funny fun story so another client of mine gave me a bunch of hand sanitizers and other bottles the lemon one and so i had more than i needed right he gave me like 40 bottles so i kept some in the car and every time i'd see a police officer on the side of the road i'd actually pull over and offer to them right like four out of five times they already had what i was giving them which was great so i'm here in franklin it was mainly uh williamson county sheriff's office or state troopers i was seeing um apparently the tennessee distilling guys had already provided it to the police departments to distribute to their members so that was good that was actually kind of very happy and good to see i have a comment that's hilarious i think that is so hysterical and then i also want to follow that up with a question i want to see the other bottles that you have that that first one the little moonshine bottle yeah okay yeah this the old forge it's my guys in pigeon forge there we go do you have more yeah yeah of that same kind or the different bottles you have any that look like jack daniels or uh no hold on yeah there's one more the the lemon one they try and reach one of those yeah okay yeah this one's this is one of the first ones i got so this is the 375 bottle right again what you find behind the cash register at the store um or in rob's back pocket at a utv um again this this is all they had right they had almost literally a million of these so if it's such an emergency why are we not it says not for consumption on here but why are we worried about it being here it's plastic it's not glass you know so it's not breakable um those are i've used up the any other ones that i've had unfortunately but jack daniels created some as well and they used some of their old bottles right some of their smaller bottles and those got distributed um you know it's great we got out there now i don't see an emergency as much right there are you see purell at the stores right uh you see these guys as well but there's at least the supply that's kind of caught up and so a lot of our distillery clients are shifting away from the hand sanitizer they're making some because it's you know it's a decent profit margin but the demand you know for the large batches is not as prevalent hey so i'm going to talk about another big change in the liquor industry that came about that nobody really was going to would have expected clearly distilleries making cleaning products was not something anyone would have predicted and i can't tell you how nobody i know in the liquor industry would have said restaurants will start delivering cocktails but all of a sudden we saw the rules relaxed and it was really interesting how it came about so the first place that allowed alcohol delivery was actually the metro national beer board and um we started talking about it right i guess it was about the end of march and uh there were a group of a bunch of folks like maybe 11 people on a call one day going over how it would work we reached to consensus and i drafted an outline of the steps that would be required and two days later the metro beer board held a special meeting virtually it was the first one of those that i'd seen any government have and they approved an interim emergency rule that allowed at any place with a beer permit to deliver beer or or allow people to pick up beer to go um the state hadn't been talking about it i being the taunt that i am set a copy of the metro rule to the director of the abc and i said are you gonna let the democrats out do you guys um he being a republican appointed a republican hired person and in any event after metro did it i don't know if the state was talking about it before they weren't talking to industry about it at all though but all of a sudden the governor during church on a sunday morning issues an order that says that you can deliver alcohol statewide anyone that has a restaurant or limited service restaurant license could all of a sudden deliver alcohol and there were no rules that were associated with it um and of course you people really got excited about it so i have been contacted does anybody know rose pepper cantina in east nashville wave your hand yeah yeah rose pepper right so andrea that owns rose pepper she's she's you know she's shut down and she there are tons of people that want her margaritas people are jonesing for the margaritas at rose pepper and so she's like how do i sell margaritas and i'm like you can't but why don't you do something fun why don't you just have a cute name and sell the mix and so she did and her cute name was just add tequila ria um and it was a complete margarita and she told you how much tequila to add to it and she sold it by the by a large container so anyway as soon as the governor issued the order just add tequila arenas became margaritas to go and she had people lined up around the corner of the restaurant of course they weren't just picking up the margaritas but the margaritas were really driving traffic and andrew is not the only one at rose pepper that saw traffic pick up tons of our clients were so excited about delivery um and it's been really you know it was a lifeline to an industry that was closed servers weren't making any tips and people were forgetting about restaurants because it just wasn't at their forefront nearly as much but being able to get cocktails in particular being able to get a cocktail delivered to your house was really attractive so we had large clients that were doing it chili's um all the garden concepts were doing it that's uh what else darden olive garden a bunch of our big change hooters was doing it uh and then tons of mom and pops now of course if there's something that's too good to be true government likes to intrude on it and there was this was too good to be true and so sure enough uh the abc looked at the governor's order and turned it sideways and read it like the judges read constitutional law and found some reasons to put some rules on what was going on and so much to andrea's chagrin at rose pepper they banned pitchers of margaritas you could no longer buy large containers because the governor had said something about rob was it servings can sell a serving of alcohol to for delivery or to go yeah it wasn't worded my favorite but yeah it's like a serving to go and then said but wine can be by the bottle right wine could be by the bottle and and i understand so the concept is is there's a restaurants have a license that's called liquor by the drink they can't sell you a bottle of tequila or a bottle of jack daniels now contrary to what the abc allows to go you can buy a picture of margaritas and there's no nothing that says that there's any limit on the size of a drink but for whatever reason the abc put a bunch of restrictions on it and you know they were generally i'm bad mouthing the abc they were generally pretty workable on other things and i was able to negotiate some compromises um on what you could and couldn't deliver but restaurants have really been excited about it the governor's order expired at the end of august uh it's been renewed twice now i can't tell you the number of people that were blowing my phone up with texts like has the governor's site extended as the governor extended because it's really important and alcohol just like with the distilleries doing hand sanitizer alcohol is a real boom to the bottom line at a restaurant so is anyone surprised to learn that that 10 margherita you buy makes more money for the restaurant than the 10 enchilada that you bought did you know that it's a lot higher profit margin um and even though the liquor by the drink taxes are 24.25 in nashville so that ten dollar margarita two dollars and 45 cents roughly gets paid to the tax man but out of that 750 that's left that's a high that's a high profit item um and whereas food might run you know after the servers and you know your rent and food costs and all the other things that go into it you might make twenty to thirty percent on food if you're doing really well you can make fifteen sixty percent off the alcohol so um it's it's a very much a high profit item and as you can guess with restaurants so one of the things you have to think about if your restaurant is closed guess what you're still paying you're not paying your staff your electric bill is probably a little bit less but you're still paying a lot of electricity you got to keep your food frozen you throw out your perishables um but the big one is rent you landlord's still collecting rent and if you owe the bank money you think the bank's saying ah don't worry about it you don't have to pay me didn't didn't your bank do that with your mortgage you just stopped paying rent to your landlord you start paying stop paying your mortgage right no so restaurants had the same thing they have a lot of fixed costs and the larger restaurants have overhead at corporate corporate we saw tons of folks get furloughed like you know entire staffs at giant companies all of a sudden we're out of jobs you know we're dealing with one person that's covering for 15. um so anyway lots of fixed costs so the idea that you could sell even if you're at at 25 of your normal sales anything you can sell helps a little bit and if you could just cover your fixed expenses that's a big deal but the alcohol was real gravy and it also not only was it more profitable but it it was more fun for consumers and i think a lot of the restaurants saw that there's a ton of value in being able to sell alcohol because it's a complete thing you can order if you order mexican food and it comes with a margarita rob you've done that right yes who else is wearing from a restaurant or alcohol wave your hand in front of your camera if you have yeah a couple people so someone someone that uh sorry apollo you're muted you want to turn jennifer on your microphone something's wrong yeah there's something wrong with your microphone jennifer we're seeing you but in it it doesn't say that you're muted you are unmuted let's see i'm just gonna let's see i'm gonna ask to unmute because that might be the trick yeah no there we go say it again what no okay well i'm gonna go ahead i think what she wanted to do was um go over some questions that were posted so i'm going to go ahead and do that so we're going to go back up a little bit and we notice that there was a question from matt litwin and he's at neil and harwell this is for rob and will what are the label requirements for distilling uh distillery making sanitizer sanitizer if any i asked because years ago slash from guns and roses endorsed a vodka with a skull and crossbones on the label fda had kittens and they thought people would confuse poison for the podcast oh god i was like that one yeah i love slash um so you know with a distilled spirit like that the fda technically doesn't really have jurisdiction um there's a memorandum of understanding between the fda and the ttb that says ttb has exclusive jurisdiction over the labels now if something is you know um if there's a contaminant in the product the fda might come in and take over right um something like a poison or or something not allowed uh to be in human consumption items uh they might kick in but otherwise it's on the label that really the only the ttb uh reviews that and something like image imagery like that is not something they take into account they also don't look at trademarks right so if you want the big ones they probably would be like do you have permission from mcdonald's to use their label to use their arches right but if it's a more obscure trademark um let's pick on a client that will and i've been talking about you know redneck riviera is trademarked to john rich so if i wanted to start a redneck river or vodka all of a sudden without permission ttb is not going to catch that um it's not it's not in their purview you know they their other requirements are you know alcohol content the volume what is the product you know it's like a paper class so a vodka right or a whiskey or a rye whiskey or a gin but if you're something else like a moonshine that's technically a distilled spirit specialty so you have to say something like spirits distilled from corn with crappy flavoring right um i pick on some people uh you know but that's it otherwise so the slash thing really the fda can you know jump up and down all they want but they really can't say anything sorry not sorry i think we had thank you for answering that i think we had one more question up at the top so this one actually was referring to you were talking about restaurants sending home alcohol for deliveries and such uh so this question is from gary coyne thank you gary do they put the alcohol and basic plastic cups and deliver the alcohol that way well so the um there were no rules in the governor's order no guidance just said delivery uh the abc uh issued some guidance um and it was common sense um you had to have a sealed container and it was supposed to be designed so that you couldn't so that the driver wouldn't drink it on their way home um not that i would ever do such a thing yeah i'm gonna get two drinks i'm gonna you know one for the ditch and one for home um in any event so uh just like you know distilleries with having you know the proper containers and spritzers and stuff to make hand sanitizer in a bottle it doesn't look like alcohol uh restaurants didn't have tons of containers sitting around to put drinks in they didn't have bottles to put lids on ideally that's what you would expect so most restaurants use the styrofoam or plastic cups and use regular lids like if you bought there you go rob's got one right there but it's got an evil straw hole in top so what did you have to do with that evil straw hole rob what do you do with those tape on it some not all yeah so the requirement from the abc was you could do use the container that rob has not from chick-fil-a i don't think they have alcohol um and and stick some tape over the top of it that was approved by the abc you could also put it in a container i know that i i saw a number of restaurants selling you know milk jugs essentially full of alcohol at some point that became illegal because of the size of the quantity you can only do a single serve the abc defined what single serve was it was 16 ounces and no more than i don't remember three ounces of alcohol or something so they specifically said how much could go into it wine you could sell by the bottle and beer was limited to a standard 16 ounce container unless you had a metro beer permit and the metro beer board allowed you to deliver kegs and growlers if you had a beer permit and wanted to do that so there were lots of rules are really complicated you see a lot of people that don't follow the rules um it was hard for us lawyers to stay on top of it my blog if you if you see it and go back to some of the old stuff i have a post about delivery uh if you want to see why liquor lawyers why there's a full-time job for a liquor lawyer read that post it'll make your pretty little head swim the details the devil is definitely in the details so it definitely makes my pretty little head swim anyway does that answer yo r question it does and i have one more question this question is from myself um for those restaurants that sent and delivered alcohol such as the margaritas that you were referring to did you find any repercussions from those what did you see um that was kind of coming back in a negative aspect well so the abc does these stings for sales to miners and we were really concerned in fact the metro beer board rule does not allow uber drivers and third-party delivery services to deliver beer there were two reasons for that one was being a bunch of democrats they wanted to make sure that this was a jobs bill um and so you you could only use staff of a distillery or your bar or your restaurant to deliver alcohol and we specifically discussed that and whether or not we wanted delivery services to deliver um there was a there's definitely a concern because you know what does the uber driver do for a living card people to make sure they're 21 to buy alcohol right and they're trained on that really well well no they're not and so the industry has definitely been afraid of repercussions of having people who can't lose their job if they deliver alcohol with somebody who's under 21 and california has been stinging that tennessee has not been stinging deliveries as of yet but they have been doing curbside and they turned up a spectacular number of failures the failure rate at curbside was really high so what they do is they get an undercover police officer who's in training typically they call them cadets because cadets typically 19 or 20 and says and orders you know goes up to um rob what's your favorite restaurant that does alcohol i don't i i'll say del frisco's even i don't want to get him in trouble yeah del frisco's did curbside early on so the undercover agent goes up to del frisco's and says i want to get two bud lights in an order of chips and salsa because you had to order food in order to get a delivery of alcohol and i want to take that to go so i don't know exactly how the agents were placing those orders i suspect that they were coming in person or they were calling in anyway they come they pick up their two bed lights and their chips and salsa the person at the delivery head hands them the bag and doesn't think oh i just sold some beer doesn't card the cadet boom there's another agent there standing watching it and says you're you're under arrest and then turns around and cites the restaurant for a violation so the number of places that were failing those stings at curbside was pretty high the first month that the abc was reporting and doing it it went down last month but still there's a significant number of people that are that are selling alcohol to people that are under 21. um and i i am very worried about the delivery model and uber and i'm picking on uber uber's not the only one that delivers alcohol we're getting we're working with uh grocery stores on delivery through instacart so you can get wine and beer with your grocery order uh i know there's been a significant amount of demand uh but of course the instacart people are also their delivery drivers are like other delivery services it's just you know it's a contract gig that you pick up and um you know alcohol sales not your livelihood and your beer permit your liquor license is not your livelihood like it is to a restaurant or a grocery store so anyway there's there's a considerable amount of risk out there and just so folks know if i'm a restaurant or a bar or a hotel and i sell to the abc three times in two years i'm looking at coughing up my liquor license for roughly 30 days we sometimes can get it down to 20. we go in 30 days or even 20 days without a liquor license is really expensive and the expensive part of it is is that if rob goes to del frisco's two weeks in a row and del frisco's does not have his bourbon for him he might forget to go to del frisco's on that third week it might take him a couple of months to remember oh yeah i wonder if del frisco's got their liquor license back maybe i'll try them again the number of customers that forget about their local mexican restaurant or their chilis because they don't have what they want to drink at the bar it's pretty significant so those stings are really important they're they're definitely a public safety issue that's number one uh that's the number one public safety issue that restaurants have with sales alcohol sales miners the second is selling intoxicated persons it's important but when they fail it's a big penalty so anyway does that answer your question all right um you know so there's another delivery there's a lot of delivery options that are out there so breweries in nashville chattanooga memphis knoxville and of all places bristol uh can deliver um those five cities enacted beer laws that allow delivery um and um distilleries analog there's no there's no delivery at the distillery level right rob no sadly not but let's talk about like going into the parking lot sidewalk or streets sure i drink in parking lots sidewalking streets all the time so we um you know folks have been to a typical restaurant and you know that you can sit outside you can get your favorite beverage outside but think about where you you know you typically are dining outside what's almost always around your table it's a railing right you're on a patio that's railed in right so what's happened is that people are realizing that outdoor dining is really is really viewed by a lot of consumers as being a safe way to eat out also restaurants are spacing tables further apart which means they get fewer tables in the same amount of space that's indoors and outdoors so the outdoor space is really at a premium um recognizing that some places i went to a restaurant in east nashville i won't identify it because they're still doing it but they just set up tables out front of the restaurant and down the street on the sidewalk they completely blocked the sidewalk but tina's laughing she's seen that yeah so you know and they're just illegally serving alcohol out there um but the abc has rolled out a process and the governor has waived uh application fees and there's now an expedited process to be able to add to outdoor areas and so we've approved a few a handful of them a lot of them are going in parking lots because if you're at 50 capacity at a restaurant which is what uh davidson county is currently at i think is that statewide right rob 50 um well it's just by city now i think i think anyway if you've got uh room for 100 people inside but you can only have 50 guess what you've got more of think about it real hard here outside what do you have you've got parking spots and so although your parking lot used to fill up at dinner time or lunch time now you actually got some extra parking spots and you got some space and so what restaurants are doing is up front they're adding tented in areas next to the front door and putting tables and chairs and voila you've got outdoor seating where you didn't have any and the abc's got a very streamlined process for being able to add that add that seating to your liquor license uh you still have to deal with the beer boards so tennessee is one of these crazy states we have to get in order to have you know you go up to your bar and you order a glass one or a jack and coke or a miller light that really requires two permits one from the city that's for beer one from the state that's for wine and spirits so every restaurant that's got a full bar has got permit from the state abc and a permit from their local beer board so in order to be able to have a full bar in that tent you've got to go through two different sets of bureaucrats you got to get approved by the abc and approved by the beer board some beer boards have been really easy to work with uh mount juliet we just expanded cracker barrel and by the way we put wine and beer in cracker barrels statewide during the pandemic we're not quite done yet but soon you'll be able to go sit on the front porch in every cracker barrel and get up get a mimosa um but anyway mountain julia just said send us a letter and a map of our site plan of where your tent is and then tell us when you stop serving beer out in the tent um nashville full-blown application take 250 dollars supply all the documents get all the inspections so it's all over the board but nashville is actually looking at legislation to make it easier to do what tina was laughing about which is to stick tables and chairs out on the sidewalk downtown has sidewalk cafe permits nowhere else does metro is going to allow you to be able to put to put seating outside with just minimal uh expansion you just have to file something with i forget who it's with it's over in codes and then allow you to automatically expand it with for uh beer so um cities are doing things to make it easier memphis i love this very early in the pandemic i don't think of memphis as being real business savvy you know their city has a lot of rules they stick to them and you sometimes have to open your wallet to pay somebody to get something done uh but in a bit not a very business friendly very early in the pandemic they bagged meters downtown so they had space for customers to pick up uh to pick up from their favorite restaurants in the downtown areas and more urban areas so cities are doing lots of different things to be able to see that customers can get to restaurants outdoor seating is definitely one of the big ones do we have any more questions and you guys can also raise your hand feel free i see one from tina tina you can go ahead and unmute yourself just a simple question um with all the laws being relaxed did that help them like to what percentage was it just a small percentage that it helped the distilleries and uh i guess the restaurants with the relaxed with the relaxed flaws rob wants to kind of help them a little bit i mean i know it was better than nothing but was it enough to kind of sustain them through this period so the distilleries and the really the only relaxed part was the the hand sanitizer they're not allowed to you know do delivery on their own they're not allowed to uh expand their premises as easily um you know but they're i talked to a few wholesalers and they said you know their the overall sales actually are actually up a little bit which was really interesting um from last year now people like will said people are going to the bigger brands kind of the old faithfuls but overall sales are good restaurant sales were way down right but as a result liquor store sales were way up so those guys are doing well um now you know with the restaurants on these relaxed rules yeah it it didn't make them it didn't make them whole where they were right just having turning 100 tables an hour on a weeknight um get makes you so much more money you know than turning over the 50 you know or even 25 unfortunately that you'd be turning during this coveted time um but yeah for some restaurants those to those delivering to go and pick up sales with alcohol kept them open right or kept them alive you know you hear we hear about these ppp loans that was for the employees right and so they at least paid people but a lot of times they paid people to not do anything because they didn't have anything to do there's you know we don't need servers but one or two to do the to-go orders um percentage i don't know i mean it helped you know maybe 20 or 30 percent just to from zero right because otherwise no one's going to come in for that burger or even those chips unless they can get the drink too um is it i think i've heard from a number of clients that say if i can just make it through the pandemic and not spend my life savings to keep my restaurant or bar afloat i'm going to feel pretty good folks are digging so owners are hurt and so are staff bartenders and servers their gravy that's not their gravy their meat is is tips they make two dollars and something an hour in salary so you know a good a good bartender downtown makes 500 bucks on a on a busy night and they used to be busy five nights a week um it's a lot of income that dries up those are good those are good jobs uh you know you can do sixteen as a bartender in a downtown national bar it's hard work um don't give up your day gig but you know those poor folks have gone to unemployment and they're really glad to be back even though their tips may not be anything like they were before tip your server it's really important owners are not drawing salary the vast majority of my friends that own restaurants are not making anything they were out of pocket paying rent and things when they were closed uh they threw food out they had to buy new food when they reopened uh most of those folks you know they it's not like the restaurant's got a quarter million dollars in savings any extra money that a restaurant makes typically the owners bonus themselves out uh and that's their profit and that's what they really you know that's that's what they pay off their own bills with they've been coming out of pocket from savings to keep the restaurants afloat a vast majority of my friend's own restaurants telling me the same story so being able to make 25 of your normal income by being open you know in limited hours and at limited capacity means that you're not coming out of pocket to pay things and so that's a huge benefit for an owner so that's a good question and speaking of delivery by the way retail liquor stores do delivery and uh yeah so um and there are a lot of retail liquor stores are having a great year anyway go ahead sorry that's okay i didn't mean to interrupt you i thought you were finished but i do see another question if you have time yeah uh this also is from gary coyne why is it that jack daniels is in a dry county are they trying to change this so jack loves the fact that they're in a dry county you know that it makes you think about jack daniels why do you think the county is dry because jack daniels doesn't want you to be able to say that jack daniels is made in a county where you can drink so i i see that as really sort of political jack daniels is in a little town called lynchburg and lynchburg makes its money i mean its biggest taxpayers jack daniels and i suspect that jack daniels probably wink wink nod nod tells the good old county the good old folks that that uh control politics that no we don't really want to sell liquor by the drink now here's the secret jack daniels can sell jack daniels by the glass at its tasting room and they choose not to do that because it's kind of contrary to the story out there that they're in a dry county so they love the lore um you know whiskey in particular but all spirits have stories that go along with them people you know my palate's not so good and after i've had two of them my palate's really not very good but the stories that go behind my spirits i may not be able to tell a good spirit from another as well but i can remember the stories and those stories are really important jack daniels has got some great ones lynchburg what's the population of lynchburg rob on the on the ads 367 or something something like that yeah so that that's 400 trademark that jack daniels did back in the 40s that's the population of lynchburg back in like 1940. lynchburg now's got a couple of thousand people so it's a false advertisement but because it was trademarked jack says well we're just using a trademark it's not a false advertisement lots of laura out there lots of stories jack is in a drive it's in a county where there is no liquor by the drink but i really think that jack would jack would prefer it to be that way so i hope that answers your question thank you and does anyone else have any last minute questions we have about three minutes left of our presentation for today feel raise your hands gary you can go ahead and unmute yourself uh it looks like i can i'll go ahead and unmute you give me just one second if you're pushing the buttons at the same time it might okay while we're working on garrett i'm going to say we're already seeing a long-term change in the way the restaurants are looking at the future restaurants really want to see to go and delivery legalize long-term i've talked to one major restaurant chain they are they have already designed the restaurant of the future uh n w takeout and delivery are sort of an afterthought you know you get it at the bar uh there's a few places where there's signs out front that are curbside pickup only they're they're designing restaurants now this restaurant chain has prototypes of restaurants where the dining room is smaller and they've got a special area that's designed just for pickup and takeout so the pandemic is going to have a lasting impact on a lot of businesses and restaurants are definitely there so you might look at your neighborhood bar in the next three years and go wow the design is completely different i wonder who thought of that it happened during the pandemic gary what's your question actually i've got a comment uh i wanted to ask you guys if you heard this uh did you hear about the guy who fell into a big vat of jack daniels whiskey first responders found him in good spirits [Laughter] i i wanted to be a stand-up comedian once so [Laughter] that was the game that's my joke thank you that's good thank you thank you gary does anyone else have any questions or awesome jokes okay uh do you rob will do you guys have any last-minute comments or anything just want to thank you guys for letting us talk support your neighborhood restaurant order in go visit and when you when you see a server leave them some extra money because it's been really hard on those guys it's been hard on a lot of people but just remember them and rob mentioned the distillery trail it is open for business the vast majority of distilleries are open they're relatively safe they're not crowded places i know i've been getting in my car and i've been driving places look at the uh what's it it's called the tennessee whiskey trail yeah tennessee like tnwitzketrail.com i think this google tennessee whiskey trail and it's at ten whiskey dot com uh it'll be a list of tennessee distilleries you'll be shocked to see how many there are get in your car take a nice drive go visit a distillery stop off at a at a state park and go for a hike have fun all right folks take care well thank you so much will and rob we appreciate you joining us today we hope that you uh are open to scheduling with us again in the future we'd certainly like to have you again uh once again will willcheek has last call it's a blog you can reach there you can view that at willcheek.com and then rob pinson has his blog beerbon and you can just google that and you'll be able to find that thank you again so much for joining us today and we'll see you all next time thank you thank you