Reference Number: 
CTAS-2117

Distilleries for the manufacture of intoxicating liquors can be permitted in counties in two ways: (1) by voter referendum; or (2) without a voter referendum, if either of the following circumstances exist:

(A) Both retail package sales and consumption of alcoholic beverages on the premises have been approved through voter referendum of the voters in any jurisdiction(s) located within the county; or

(B) The county is included in the Tennessee River resort district and retail package sales have been approved through voter referendum of the voters in any jurisdiction(s) located within the county.

Distilleries By Referendum

Tenn. Code Ann. § 57-2-103 generally governs the manufacture of intoxicating liquors in Tennessee.  Under that statute, the manufacture of intoxicating liquors is permitted in any county where the majority of voters have, by referendum, approved a resolution permitting it within the county.  Tenn. Code Ann. § 57-2-103(a) - (c)

Tenn. Code Ann. § 57-2-103(a) - (c) sets forth the procedure that is followed to determine whether such a referendum may be presented to the voters.  If 10% of the qualified voters in a county sign a petition to present the question whether the manufacture of liquor will be permitted within a county, the county commission must call an election on the question.  Tenn. Code Ann. § 57-2-103(a) - (b).  If a majority of the votes are cast in favor of the question, then the manufacture of liquor is permitted within that county.  Tenn. Code Ann. § 57-2-103(c).

Distilleries Without Referendum

However, another procedure is set forth in Tenn. Code Ann. § 57-2-103(d).  Notwithstanding subsections (a) - (c), it is lawful to manufacture intoxicating liquors or intoxicating drinks, or both, without a referendum approving such manufacturing, within the boundaries of the unincorporated areas of any county if:

(A) Both retail package sales and consumption of alcoholic beverages on the premises have been approved through voter referendum of the voters in any jurisdiction(s) located within the county; or

(B) The county is included in the Tennessee River resort district and retail package sales have been approved through voter referendum of the voters in any jurisdiction(s) located within the county.

Tenn. Code Ann. § 57-2-103(d)(1)(B).

Resolution to Prohibit Distilleries

Notwithstanding subdivision (d)(1), the county legislative body of any such county may adopt a resolution to remove the unincorporated areas of the county from the application of subsection (d) subject to certain restrictions.  The county mayor must notify the Alcoholic Beverage Commission if such action is taken and approved by the county legislative body.  Tenn. Code Ann. § 57-2-103(d)(2)(A).

This action may be taken by the county legislative body pursuant to subdivision (d)(2)(A) until a written notification is filed with the county mayor by any person as an official notice that the person intends to pursue all lawful avenues to manufacture intoxicating liquors or intoxicating drinks, or both, within the unincorporated areas of the county.  Once the notice is filed, no action may be taken by the county legislative body unless such interest is withdrawn or the person's application to manufacture such intoxicating liquors or intoxicating drinks, or both, is denied by the state or federal government.  Tenn. Code Ann. § 57-2-103(d)(2)(B).  NOTE: Pursuant to Public Chapter 445, a written notification as described above may not be filed with the county mayor until at least 45 days after July 1, 2013.

If a county adopts a resolution pursuant to subdivision (d)(2)(A), the county may at a later date adopt a resolution reversing such action.  The county mayor must notify the Alcoholic Beverage Commission if such action is taken and approved.  Tenn. Code Ann. § 57-2-103(d)(2)(c).