Liquor regulators acknowledge Rangers haven't cleared them

After state liquor regulators got hit with a complaint last year that it violated its own rules when it served alcohol without a permit at a state convention, the Texas Alcoholic Beverage Commission said it conducted a thorough investigation, determined no permits were needed and then forwarded its findings to the Texas Rangers.

The Rangers, in turn, decided no further action was warranted, TABC officials claimed.

That story fell apart on Friday.

The Texas Alcoholic Beverage Commission now acknowledges the Rangers never got the investigative report, and the Ranger who interacted with the agency called the agency’s assertion a “mistake.” Meanwhile, a newly-obtained internal email discussing the liquor service at the convention raises new questions about whether rules were broken.

“I told you in error that we had sent a report to the Rangers once our investigation was complete,” TABC spokesman Chris Porter said in an email Friday. “Rather, the matter was discussed over the phone between the Rangers and Captain Andy Peña, our internal investigator.”

The Texas Ranger in question, Billy Mims, was asked if he was surprised to hear that the TABC was claiming the Rangers had gotten the report and decided no further action was needed.

“I think it was a mistake on their part,” he told The Texas Tribune. Mims said he discussed the allegations with TABC officials but never got the investigative report. “Currently I am not looking at the allegations,” he added.

The TABC played host during a meeting of the National Conference of State Liquor Administrators late last year at the Radisson Hotel in Austin. Not long after the convention, a former TABC lieutenant, Darryl Darnell, filed a complaint with the agency, alleging Executive Director Sherry Cook ran afoul of state liquor laws when she failed to get a permit to sell alcohol before TABC made it available in a hospitality suite at the hotel.

TABC investigated itself and determined that no rules were broken. In a Jan. 5 internal report, investigator Peña, who reports to Cook, said there was “no merit” to the allegations. The reason: the beverages served in the hospitality room were “free to anyone of legal drinking age wishing to consume” them, he concluded. If the drinks are free to the public, no permit is needed, officials say. 

Darnell said he believes the investigation was a whitewash and cites an internal email from Cook, who discussed the fee charged to conference participants — and what that fee covered. 

The $200 fee “will include all meals (breakfast, lunch, dinner, breads), banquet and hospitality room.” Cook wrote to the conference planners a few weeks before the event. The hospitality room is where the liquor was served.

Darnell, now a Williamson County deputy constable, said the internal report was “written in such a way that it relieves the agency of any culpability.

“Once you start collecting a fee and you write your advertisement in such a way that leads people to believe you got to pay to get in, then how can you turn around and say that it was free?" Darnell said. "Whether they elected to waive the fee for some or not, they led people to believe they had to pay to get into the hospitality room." 

Porter, the agency spokesman, declined comment on the investigation beyond his emailed acknowledgment that he goofed by saying the Texas Rangers had been given the agency’s investigative report to the Rangers.

The flap comes a day after the Tribune reported that TABC had spend tens of thousands of dollars on out-of-state travel to NCSLA conferences, where liquor flows freely and industry lobbyists schmooze the regulators who oversee their clients’ businesses. Critics say the conferences put on by the NCSLA, funded in large part by the liquor industry, waste precious tax dollars and raise questions about regulators’ cozy ties to the industry.

In a written statement, Porter said the conferences allow TABC leaders to “to meet with peers from across the country as well as members of the alcoholic beverage industry,”

“Together, they can discuss important developments which affect all stakeholders, such as new technologies, federal regulations, and best practices,” he said. “Other states pay careful attention to issues in Texas, such as state laws, industry policies, and lawsuits. For this reason, TABC is frequently called upon to participate at NCSLA.”

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Top TABC brass took a trip to San Diego in the summer of 2015, which was depicted in a humorous illustration officials created during work hours at the agency. It portrays agency director Sherry Cook, licensing chief Amy Harrison, a TABC analyst and an agency contractor riding in a plane while holding or guzzling from bottles of Lone Star Beer.