Battle in the Texas legislature over which alcoholic beverages can be sold in grocery stores

AUSTIN (KXAN) – A new Texas bill, if passed, would allow convenience stores and grocery stores to sell popular spirit-based ready-to-drink (RTD) cocktails and seltzers. Under current laws in Texas, these beverages are permitted only to be sold in liquor stores.

Current state law states alcohol products can be sold in grocery and convenience stores if they are under 17% alcohol by volume (ABV), but anything containing a spirit cannot be sold at those locations. That means beer, wine and malt beverages may be sold at these stores, but some popular ready-to-drink cocktails – such as High Noon hard seltzer which contains 4.5% ABV – may not. 

“[Consumers] come to our stores and just don't understand why they can't buy this particular spirit-based product when it's the same or less alcohol by volume. And again, we can legally sell [products with] up to 17% right now,” said Paul Hardin, CEO of the Texas Food and Fuel Association.   

There are currently around 3,200 liquor stores in Texas. If the bill – HB2200, filed by Texas Rep. Justin Holland (R- Rockwall) – passes, the distribution channel will open up to around 30,000 outlets, Hardin said. 

“[What] we're doing is trying to change the logic for consumer choice, market freedom and distribution,” Hardin said. “Alcohol is alcohol is alcohol, and we just don't see why we can't sell spirit-based RTDs in convenience stores and grocery stores in Texas,” he continued. 

Premixed cocktails or seltzers have grown in popularity in recent years. The drinks were the fastest-growing spirit category in 2022 in terms of revenue – up 35.8% in 2022, according to the Distilled Spirits Council of the U.S.

“It's a positive fiscal note for the state of Texas of about $160 million over the biennium,” Hardin said. 

Currently, 25 states allow spirit-based premixed cocktails in grocery stores and convenience stores alongside beer and wine. 

“Texas is usually the leader when it comes to market freedom,” Hardin said. “We're sorely lagging behind in this particular area." 

Hardin said there are several businesses he is aware of that want to get these types of products on shelves but don’t want to release them until legislation like this passes. 

“This will pass in the state of Texas, whether it's this session or next,” he continued.

Opposition to HB2200

HB2200 has bipartisan support, but there is some opposition, Hardin said. 

“HB2200 misleads consumers and puts children in danger by calling spirit coolers something that they are not,” the Texas Package Association tweeted Friday. This tweet featured an image of two High Noon seltzers. 

The organization also tweeted a photo of boxes of mixed drink beverages placed under children's toys in a store with the caption: “HB2200 misleads buyers and puts Texas youth in danger.” 

The Distilled Spirits Council of the U.S. posits these drinks are no more harmful than beverages already available in convenience and grocery stores.

“Texas is one of many states taking a closer look at this issue to ensure that producers of spirits-based RTDs are being treated fairly, recognizing that treating beverages differently based off of the myth that some alcohol is 'softer' than others sends a dangerous message to consumers,” it said in a release. 

KXAN's Sam Stark reached out to the Texas Package Association and will update this story once he hears back.