TABC uses standardized penalty charts to determine sanctions for violations. These charts provide ranges based on the type of violation and whether it is a first, second, or third offense. Understanding how the penalty system works helps you anticipate consequences, evaluate settlement offers, and make informed decisions about contesting citations.
This guide explains the penalty structure, how penalties escalate, and how the penalty-to-fine conversion works.
The Two Penalty Categories
TABC divides violations into two main categories, each with its own penalty schedule.
Public Safety Violations
These are violations that directly threaten public health, safety, or welfare. Examples include:
Sale to a minor (§ 106.03)
Sale to an intoxicated person (§ 101.63)
Permitting a minor to consume alcohol on premises
Breach of the peace
Drug-related violations
Failure to report a breach of the peace
Public safety violations carry the most serious penalties because they involve direct risk to people.
Regulatory Violations
These are violations of technical rules and administrative requirements. Examples include:
Operating during prohibited hours
Failure to maintain proper records
Failure to display permit properly
Unauthorized transfer of permit privileges
Purchasing from unauthorized sources
Failure to report change of officers
Regulatory violations are generally less serious, though repeated violations can still threaten your license.
The Escalating Penalty Structure
TABC penalties escalate based on how many times you have committed the same type of violation. The charts show ranges for first, second, and third offenses.
How Offenses Are Counted
TABC tracks violations within a rolling 36-month period for most offense categories. A first offense in January 2024 becomes your baseline. A second similar offense in August 2025 is treated as a second offense with higher penalties. A third similar offense in March 2026 triggers the highest penalty range and potential cancellation.
After 36 months from a violation, that violation typically no longer counts toward the escalation for new violations.
Sample Public Safety Penalties
The following illustrates typical penalty ranges from TABC’s public safety penalty schedule:
| Violation | First Offense | Second Offense | Third Offense |
|---|---|---|---|
| Sale to minor (§ 106.03) | 8-12 days | 16-24 days | 48 days to cancellation |
| Sale to intoxicated person (§ 101.63) | 8-12 days | 16-24 days | 48 days to cancellation |
| Simple breach of peace (no serious injury or deadly weapon) | 3-5 days | 6-10 days | 18 days to cancellation |
| Aggravated breach of peace (serious injury, death, or deadly weapon) | 25-35 days | Cancellation | Cancellation |
| Failure to report breach of peace | 2-5 days | 4-10 days | 12 days to cancellation |
Note: These are illustrative ranges from TABC’s published schedules. Always verify current penalty charts, as they may be amended.
Sample Regulatory Penalties
Regulatory violations typically carry lighter penalties:
| Violation | First Offense | Second Offense | Third Offense |
|---|---|---|---|
| Sales during prohibited hours | 3-7 days | 7-14 days | 21 days to cancellation |
| Failure to maintain records | Warning to 3 days | 3-7 days | 7-14 days |
| Failure to display permit | Warning | 1-3 days | 3-7 days |
| Unauthorized advertising | 1-5 days | 5-10 days | 15 days to cancellation |
These are illustrative examples. The actual penalty depends on specific circumstances and current TABC rules.
The Penalty-to-Fine Conversion Option
For many violations, TABC allows businesses to pay a civil penalty instead of serving a suspension. This option keeps your business open by converting suspension days into a dollar amount.
The Basic Calculation
Under TABC Rule § 34.1, the standard conversion rate is $300 per day of suspension. A 10-day suspension might convert to a $3,000 civil penalty.
Example calculations:
8-day suspension = $2,400 civil penalty
12-day suspension = $3,600 civil penalty
20-day suspension = $6,000 civil penalty
When Conversion Is Available
Penalty-to-fine conversion is discretionary. TABC is not required to offer it, and certain violations specifically prohibit it.
Conversion is typically available for:
First-time violations of moderate severity.
Violations where the business has a reasonable compliance history.
Situations where settlement is reached through negotiation.
Conversion may not be available for:
Common nuisance violations (specifically prohibited under § 81.005(c)).
Certain emergency hemp product violations under recent emergency rules.
Third offenses where cancellation is the scheduled penalty.
Cases where TABC determines conversion is inappropriate.
Negotiating Conversion
If TABC’s initial settlement offer includes suspension days without a conversion option, you may be able to negotiate. Factors that support conversion include:
Good prior compliance history.
Steps taken to prevent future violations.
Economic hardship evidence.
Mitigating circumstances surrounding the violation.
Your attorney can present these factors during settlement discussions.
Factors That Affect Where You Fall in the Range
The penalty charts show ranges, not fixed amounts. Where your penalty falls within the range depends on aggravating and mitigating circumstances.
Aggravating Factors (Higher in Range)
Prior violations, even if outside the 36-month escalation window.
Severity of harm caused by the violation.
Willful or intentional conduct.
Failure to cooperate with investigation.
Pattern of similar problems.
Attempts to conceal the violation.
Mitigating Factors (Lower in Range)
Clean compliance history.
Immediate corrective action.
Cooperation with investigation.
Employee training and compliance programs in place.
Circumstances beyond your control.
Genuine accident rather than negligence.
TABC considers these factors when determining the specific number of suspension days within the scheduled range.
Settlement vs. Hearing: Impact on Penalties
How you resolve a citation affects what penalty you ultimately face.
Settlement Advantages
When you negotiate a settlement with TABC:
Penalties are often at the lower end of the range.
Penalty-to-fine conversion is more likely to be offered.
Resolution is faster, reducing uncertainty.
Legal costs are typically lower than contested hearing.
Hearing Risks
When you contest a citation at SOAH hearing:
If TABC prevails, penalties may be at the higher end of the range.
You incur hearing preparation costs.
Resolution takes longer.
However, if you win, you pay no penalty.
The decision whether to settle or contest depends on the strength of TABC’s evidence and your available defenses. For clear violations with strong evidence, settlement usually produces better outcomes. For cases with genuine factual disputes or valid defenses, hearing may be worthwhile.
Multiple Violations in One Incident
If a single incident results in multiple violations, penalties may be assessed for each violation. For example, an employee who sells alcohol to a minor during prohibited hours could generate two separate violations:
Sale to minor: 8-12 days for first offense.
Sale during prohibited hours: 3-7 days for first offense.
These could be served consecutively (one after the other) or concurrently (at the same time), depending on negotiation and TABC’s discretion.
Tracking Your Violation History
Your violation history affects every future citation. Understanding your status helps you assess risk.
Check your status by reviewing:
AIMS account violation history.
Any settlement agreements you have signed.
Previous citations, even if settled without suspension.
Remember that violations count even if you paid a civil penalty instead of serving suspension. The penalty conversion does not erase the violation from your record; it only changes how you satisfied the penalty.
Using the Penalty Chart Strategically
When you receive a citation, the penalty chart helps you:
Understand the stakes. Knowing the potential penalty range helps you decide how much to invest in your response.
Evaluate settlement offers. If TABC offers a settlement at the low end of the range with conversion available, that may be reasonable. An offer at the high end of the range may warrant negotiation or contest.
Assess escalation risk. If this is your second offense and the third-offense penalty is cancellation, resolving this citation becomes more critical.
Plan compliance investments. Understanding what violations cost helps justify spending on training, monitoring, and compliance systems.
This article provides general information about TABC penalty schedules and is not legal advice. Penalty schedules are subject to change through TABC rulemaking. Every situation involves unique facts that affect outcomes. If you have received a TABC violation notice, review the current penalty schedule and consult with a qualified Texas attorney who handles TABC administrative matters to understand how the penalties apply to your specific situation.