Is there an annual gallon limit on a Texas winery's direct sales under section 16.01(d)?

Plain-English summary

The Texas Agriculture Commissioner asked the Attorney General a narrow question about a 1993 addition to the wine law. Section 16.01 of the Alcoholic Beverage Code lists what a holder of a winery permit may do. A new subsection (d) let a winery sell wine to consumers for on- or off-premises drinking, and give away free wine, but only if the winery sat in a city that spanned three or more counties, included a county with at least 500,000 people, and had an international airport within its limits. The Commissioner wanted to know whether a winery selling under subsection (d) was capped at a certain number of gallons per year.

The office said no. Elsewhere in the same section, subsection (a)(4) let a winery sell unbroken packages for off-premises use up to 25,000 gallons a year, and subsection (b) (also added in 1993) let a winery make and label up to 50 gallons a year for an adult's personal use, expressly counting that toward the (a)(4) total. Subsection (d) carried no such number and was not tied to the (a)(4) cap. Because the legislature plainly knew how to link a provision to the 25,000-gallon limit (it did exactly that for subsection (b)) and chose not to for subsection (d), the office concluded the (a)(4) cap did not apply to subsection (d). Finding no other source of a gallon limit in the Alcoholic Beverage Code or elsewhere, the office concluded a winery selling under subsection (d) faced no annual gallonage limit at all, for either on- or off-premises consumption.

Currency note

This opinion was issued in 1994. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

The Alcoholic Beverage Code's winery-permit provisions have been amended repeatedly since 1994, and Texas has broadened direct winery sales generally. The subsection labels and gallon figures here describe section 16.01 as it stood in 1994. Read this page for the office's reading of how the subsections fit together, and verify the current winery-permit statute before relying on any specific number.

What the opinion meant for those who asked

For wineries qualifying under subsection (d): The opinion concluded a winery selling under subsection (d) was not held to any annual gallon ceiling on its sales to consumers, on-premises or off. The 25,000-gallon cap that applied to subsection (a)(4) package sales did not carry over.

For the Department of Agriculture and alcohol regulators: The opinion treated the absence of a gallon figure in subsection (d), set against the legislature's express link of subsection (b) to the (a)(4) cap, as deliberate. It read subsection (d) as a standalone authorization with no gallonage limit.

Common questions

Did a winery selling under section 16.01(d) have an annual gallon limit?
No. The office concluded there was no gallonage limit on subsection (d) sales, for either on-premises or off-premises consumption.

Didn't the 25,000-gallon limit in subsection (a)(4) apply?
The office found no basis to read the (a)(4) cap into subsection (d). The 25,000-gallon limit governed (a)(4)'s own off-premises package sales.

Why did the legislature's treatment of subsection (b) matter?
Because subsection (b) expressly counted its 50-gallon personal-use wine toward the (a)(4) total, showing the legislature knew how to tie a provision to that cap. The office reasoned that its silence on subsection (d) meant the cap did not apply there.

Which wineries could use subsection (d)?
Only a winery in a city that was located in three or more counties (at least one with a population of 500,000 or more) and had all or part of an international airport within its boundaries.

Background and statutory framework

The question was one of statutory structure. Section 16.01 of the Alcoholic Beverage Code defined the activities open to a winery permit holder, and direct sales to consumers were tightly drawn. Subsection (a)(4) allowed sales of unbroken packages for off-premises consumption "in an amount not to exceed 25,000 gallons annually." Subsection (b), added in 1993, allowed a permit holder to "manufacture and label wine for an adult in an amount not to exceed 50 gallons annually for the personal use of the adult," and provided that the wine produced under it was included in the annual total that could be sold under subsection (a)(4). Subsection (d), the provision at issue and also added in 1993 (Acts 1993, 73d Leg., ch. 934, § 27, effective September 1, 1993), let a qualifying winery sell wine to ultimate consumers for on- or off-premises consumption and dispense free wine, conditioned on the winery's location in a multi-county city with a large-population county and an international airport.

The office applied a familiar reading principle: where the legislature has expressly attached one provision to a limit and left another silent, the silence is treated as intentional. Subsection (b) was tied to the (a)(4) gallonage cap in so many words; subsection (d) was not. Had the legislature meant subsection (d) to share the 25,000-gallon ceiling, the office reasoned, it would have said so as it did for subsection (b). Finding no link in the text and no other basis in the Alcoholic Beverage Code or other law for a gallon limit on subsection (d) sales, the office concluded there was none.

Citations

Statutory provisions discussed:

• Alcoholic Beverage Code § 16.01 (authorized activities of winery permit holders), including subsection (a)(4) (25,000-gallon off-premises package limit), subsection (b) (50-gallon personal-use wine, counted toward the (a)(4) total), and subsection (d) (sales by wineries in a qualifying multi-county airport city)
• Acts 1993, 73d Leg., ch. 934, § 27 (enacting subsection (d), effective September 1, 1993)

Source

• Landing page: https://www.texasattorneygeneral.gov/opinions/dan-morales/dm-0306
• Original PDF: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/1994/dm0306.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain — the linked PDF is authoritative.

Office of the Attorney General
State of Texas

DAN MORALES
ATTORNEY GENERAL

December 2, 1994

Honorable Rick Perry
Commissioner
Texas Department of Agriculture
P.O. Box 12847
Austin, Texas 78711-2847

Opinion No. DM-306

Re: Whether there is a gallonage limit on sales by a winery permit holder under subsection (d), section 16.01 of the Alcoholic Beverage Code (RQ-583)

Dear Mr. Perry:

You ask about subsection (d) of section 16.01 of the Alcoholic Beverage Code, which subsection was added in 1993. Acts 1993, 73d Leg., ch. 934, § 27 (eff. Sept. 1, 1993). Section 16.01 pertains to authorized activities of holders of winery permits. Subsection (d) thereof provides:

The holder of a winery permit may sell wine to ultimate consumers for consumption on or off winery premises and dispense free wine for consumption on or off the winery premises if the winery is located in a city that:

(1) is located in three or more counties, at least one of which has a population of 500,000 or more; and

(2) has within its boundaries all or part of an international airport.

Your specific question is whether the holder of a winery permit acting under subsection (d) is "subject to any limitation on the number of gallons of wine that may be sold annually for either on-premises or off-premises consumption." Apart from the authorization in subsection (d), winery permit holders' permitted activities are rather limited. The only other authority we find for a winery permit holder's sale of wine directly to ultimate consumers in this state is in subsection (a)(4) of section 16.01, which provision restricts such sales to "unbroken packages for off-premises consumption in an amount not to exceed 25,000 gallons annually." We note too that subsection (b) of the section, like subsection (d), added in 1993, allows a permit holder to "manufacture and label wine for an adult in an amount not to exceed 50 gallons annually for the personal use of the adult," and further, provides that the "amount of wine produced under this subsection is included in the annual total amount that may be sold by the holder under Subsection (a)(4)."

You suggest that the subsection (a)(4) 25,000 gallon annual limit might also be applied under subsection (d), the provision at issue here, for sales for off-premises consumption at least. We find no basis for applying the subsection (a)(4) limit to subsection (d), especially as the legislature has made express in the case of subsection (b), quoted supra, its intent to tie that provision to the subsection (a)(4) gallonage limitation. Had the legislature intended to tie subsection (d) to the subsection (a)(4) gallonage limit, we think it would have done so expressly.

Nor do we find any other basis in the Alcoholic Beverage Code or other law for a gallonage limit on subsection (d) sales for either on- or off-premises consumption. Accordingly, we conclude that there is none.

SUMMARY

There is no gallonage limit on sales, for either on- or off-premises consumption, by a winery permit holder under subsection (d) of section 16.01 of the Alcoholic Beverage Code.

DAN MORALES
Attorney General of Texas

JORGE VEGA
First Assistant Attorney General

DREW T. DURHAM
Deputy Attorney General for Criminal Justice

JAVIER AGUILAR
Special Assistant Attorney General

RENEA HICKS
State Solicitor

SARAH J. SHIRLEY
Chair, Opinion Committee

Prepared by William M. Walker
Assistant Attorney General