More bars could become restaurants under new rules adopted by the Texas Alcoholic Beverage Commission (TABC). 

On June 26, Gov. Greg Abbott ordered all bars to close by noon the following day in order to help slow the spread of coronavirus amid a post-reopening surge in cases. Only restaurants earning less than 51 percent of their receipts from the sale of alcoholic beverages could remain open.

To meet that standard and keep their doors open, some bars responded by applying for food and beverage certificates. As of Aug. 14, more than 750 businesses had applied since late June, according to TABC.

But most bars are limited by TABC rules that require applicants to have a commercial-grade kitchen on the premises. The new rules TABC approved Tuesday remove that requirement and also allow bars to count receipts from pre-packaged food sold at the bar as well as food trucks operating on site in order to meet the 51 percent threshold.

“Whenever we can reopen businesses that have been shuttered due to the pandemic, that’s a great day,” said Emily Knight, president and CEO of the Texas Restaurant Association (TRA), which has advocated for the state’s 5,300 bar businesses throughout the coronavirus crisis. “We do think many bar owners will find this advantageous to helping them get their entities back open.”

Knight said overall most Texas restaurants have complied with the governor’s orders limiting dining room capacity, with only 3 percent found in violation last week, and she believes bars will operate under the same standards. 

But businesses operating solely as bars must remain closed per executive order, said Kelsey Streufert, vice president of government relations and advocacy for TRA. Abbott allowed bars to reopen May 22 but ordered them shut down again a little more than a month later as coronavirus cases began spiking statewide.

“TABC doesn’t have any authority to change the governor’s order,” she said. “What they have done is give businesses an opportunity to update their business model recognizing that COVID has changed so much of our lives and of our business models, and open as a restaurant.”

David Naylor, manager at The Modernist, a bar at 516 E. Grayson St., said Tuesday that he and the owners are discussing the rules change and a food truck proprietor has already contacted them.

“But for us … it’s not really what we want to do right now,” Naylor said. “I guess we’re going to be the stubborn ones. We’ve always been wanting to always be a bar and not a restaurant. That’s kind of where the whole issue is right now – why can’t we just be a bar?”

The Modernist is currently selling drinks through curbside service and Naylor said they have to consider the time and cost involved in applying for a license to sell food. “After today’s news, I’m pretty sure the two-week process is going to take months,” he said.

Also on Tuesday, the Texas Bar & Nightclub Alliance (TBNA) released a proposed reopening plan for all bars in the state. The plan includes six principles around occupancy limits, cleanliness, and requiring face masks. 

“Our industry is suffering right now, and every day in which some of our members are closed will be the last day they are ever in business,” said Michael Klein, TBNA founder and president in a statement posted on Facebook. “The current statewide orders are a total farce. Some restaurants are acting like bars and some bars [are] acting like restaurants. You have big-time operators open while neighborhood bars are dying. It’s just a regulatory circus.”

Shari Biediger

Shari Biediger is the business beat reporter at the San Antonio Report.