A new health directive issued by the Shelby County Health Department on July 24 opens the door for restaurants in the county to be closed if they cannot show more than 50% of their revenue comes from the sale of food.

The directive — one in a series of regulations to address the coronavirus pandemic — also prohibits the sale of alcohol in all restaurants after 10 p.m. and all bar seating. It goes into effect at midnight July 26.

Bars take their case to court; no ruling issued on Monday

Limited-service restaurants were closed on July 8. These are establishments where 50% or more of revenue comes from alcohol. Some filed a lawsuit seeking a temporary restraining order in federal court; one of the lawsuits was heard July 20, but there was no ruling. Another is set for July 27.

An argument in the lawsuit was that the law was unfairly applied. The example often used was that Beale Street establishments that sold more alcohol than food were allowed to remain open because they get a full-service license as establishments in a historic district.

Plaintiffs’ attorney Robert Spence argued that COVID-19 does not recognize historic districts. He said the law was unfairly applied and thus a 14th Amendment violation.

Full-service restaurants are those that have food sales that exceed 50%. When restaurants apply for a license with the state, they’re asked to provide their food and alcohol sales numbers and that’s how the Tennessee Alcoholic beverage Commission determines which license to issue. It’s less expensive to obtain a full-service license than a limited-service license.

The new Health Department directive says businesses can be asked to prove that their food sales make them a legitimate full-service restaurant. It reads:

“Please be prepared to provide 1) the most recent sales numbers that were provided to the Commission for license renewals or sales number for year-to date sales and 2) a “food affidavit” by an owner of the establishment attesting that the numbers submitted are correct.”

Injunction hearing for closed bars rescheduled

Nick Scott is the owner of Alchemy and one of the plaintiffs in the lawsuit that was heard July 20. He believes the new rule isn’t backed by enforcement.

“After hearing what they argued in court, saying they don’t have the manpower for anything, I don’t see how they can issue this,” Scott said.

“How can they enforce anything? I think they’re backpedaling. If they think they need to shut all of us down, then they need to shut all of us down. I think that would level the playing field.”

Rules for restaurants remaining open are: No standing room or seating at a physical bar; alcohol may only be served with food and to customers who are seated at a table; food service at a table for each customer/group should not exceed two hours.

Curb-side, drive-thru or delivery services may continue, but sales of alcoholic beverages must end at 10 p.m. All restaurants must close at 10 p.m., though guests in the restaurant at that time may stay until 10:30 p.m. They can’t be served food or beverages after 10 p.m.

Only staff needed to close, open, clean, or operate curb-side/delivery services are allowed in restaurants between 10:30 p.m. and 5 a.m. Curb-side, drive-thru and delivery service can continue (except for alcoholic beverages) after 10 p.m. 

Music has to be kept at a low enough decibel level to permit conversation and dancing is not permitted at restaurants.

“It doesn’t affect me at all, but the idea of not delivering alcohol to someone’s home after 10 p.m. doesn’t make any sense to me,” said Kelly English, owner of The Second Line and Restaurant Iris.

“They’re already home.”