McNally bill would make public names of tax-dodging businesses

At the urging of Knox County Mayor Tim Burchett, Senate Finance Committee Chairman Randy McNally says he will introduce legislation next year to make public the names of businesses that are not paying their taxes, reports the News Sentinel. The move comes after a recent audit showed a Knoxville area hotels owe a total of $475,000 in back taxes.

In a letter to McNally, R-Oak Ridge, former state senator Burchett described a current statute making businesses with tax delinquencies confidential as providing a “loophole” in the state’s open records law.

“We don’t want businesses’ proprietary information, but I think it’s important for citizens to know who isn’t paying their taxes,” Burchett said Friday. “These groups have excluded themselves and that creates a bad situation for mischief to take place.”

The News Sentinel two weeks ago submitted a public records request for the list of tax delinquent hotels after an audit sampling 44 local hotels showed more than half were behind on payments. The county, however, has pointed to a state statute it says prevents them from releasing the business names.

Burchett said he approached McNally because the two share a history of drafting “some of the strongest public records acts in the country” together when Burchett was also a state senator.

McNally said Friday he has already asked the Office of Legal Services to draft a bill that would say “that if the tax is delinquent, then it is not protected by the taxpayer confidentiality law.”

“It seems to me that if a property owner, or a business owner for that matter, can have their name in the paper if they’re delinquent on taxes, then if someone is delinquent on their business tax, that should be open record and be available,” McNally said.

…David Buuck, Knox County’s chief deputy law director, said (Knox County Property Assessor Foster) Arnett had been collecting taxes from the hotels that sent payments but has not followed up with the hotels that did not.

“Now that we know there are some horrendous delinquencies, he’s been advised by our office what he can do and what he should do,” Buuck said.

Buuck said his office sent a memorandum to Arnett early in the audit process informing him he needed to collect the taxes.

Arnett, who spoke to a reporter on Friday, said he supported making delinquent businesses public, but declined to elaborate further. He did not return a follow-up call seeking comment on whether he had received the memo from the law department.