Whether it was house made sangria or cucumber flavored vodka, prior to 2015 restaurants and hotels made their own alcoholic beverage products for many years. The industry term for these products is infusions. In 2013 the Tennessee Alcoholic Beverage Commission took a keener interest in the practice of creating infusions and sought to prohibit the practice. The theory at the time was that creating infused products was actually manufacturing and a liquor by the drink establishment was not eligible to hold a manufacturers license. The Tennessee Hospitality and Tourism Association wrote a series of memos to the TABC defending the activity and asking for the practice to be allowed. Although the TABC did not change course to permit the practice, they did work with the industry to create legislation that would allow infusions under certain circumstances.
Thus in 2014 the Tennessee General Assembly passed legislation that allowed restaurants to create infused alcoholic beverages as long as they complied with a list of requirements. Those requirements included requirements that the product be stored in a food safe container and labeled with the date and time that the infusion was produced, the recipe title and ingredients, and the name of the person who prepared the infusion. It also limited the shelf life of infusions to 10 days so that an establishment had to throw out an infusion after 10 days.
The requirements of the infusion law were so onerous that many establishments simply stopped producing infusions. After a new director arrived at the TABC last year, the TnHTA found a new opportunity to revisit the practice of creating infusions. With the assent of the TABC, the Tennessee General Assembly passed a law last year that deleted all the recordkeeping and expiration provisions in the infusion law as those provisions have not proven to improve safety or otherwise benefit the public. Under the law passed this year, a licensee that makes infusions must now only keep records on what products are contained in the infusion. There is no longer any limit on how long an establishment can keep an infusion on the shelf. The TnHTA believes this is a major victory for creating a business friendly and common sense regulatory system for alcoholic beverages.
Related to infusions, but regulated slightly differently, are products called bitters. Prior to 2013 bitters were sold in grocery stores and purchased through regular grocery wholesalers. In 2013, the TABC classified bitters as alcoholic beverage products and limited their sales to retail liquor stores. In the TnHTA bill that changed the process for infusions, the Tennessee General Assembly also reclassified bitters. The bill inserted provisions to restore some bitters as non-beverage products that can be sold in other places besides liquor stores. Under the provisions of the bill, products that receive a non-beverage product designation from the federal Tax and Trade Bureau (TTB) may be distributed outside the alcoholic beverage distribution channels. This bill should allow for bitters products to resume their place in grocery store shelves.
The bill took effect on May 9.