Tag Archives: liquor

TN cities, counties owe millions to schools from mixed drink tax?

The town of Farragut and Knox County have unwittingly run up a more than $1 million tab in tax revenue with the school system, officials with all three agencies learned last week, reports the News Sentinel.

Farragut could owe the school system at least $1.1 million dating back to 1998, according to Knox County Finance Director Chris Caldwell. That figure could be double that, however, as officials are only now investigating just how long the revenue has been unpaid.

Knox County estimates it may owe as much as $350,000.

…The revenue at issue comes from the state’s mixed drinks tax. Restaurants and bars collect the tax and send it to the state Department of Revenue, which then sends half of it back to the municipality in which the businesses are located.

The municipalities keep half and are supposed to earmark the remaining 50 percent for the school system, according to the Department of Revenue.

Although the reasons are not yet clear, Farragut has not been paying its share to the Knox County school system since at least 1998, Smoak said he learned last week.

…Knox County and Farragut are not alone. Municipalities across the state have recently learned they were in violation of the law, and their respective school systems all were unaware, according to the Tennessee Municipal League. (Note: Chattanooga apparently owes $11 million. TFP story HERE.)

“We’re all trying to work with the comptroller’s office to resolve something that’s very complicated,” TML spokeswoman Margaret Mahery said. “It all depends on how you interpret the law. It’s very confusing, and there are very different interpretations out there.”

The state Comptroller’s Office is currently investigating the situation, spokesman Blake Fortenay said.

More on ABC’s Alcohol-Soaked Fruit Flap

A controversy over the state Alcoholic Beverage Commission’s move to ban restaurants from soaking fruits and the like in booze to create a mixed drink (previous post HERE) is getting more attention… and may be left for legislators to resolve.
From WPLN:
The issue centers on who’s allowed to make infusions–where an ingredient like fruit soaks in alcohol to flavor it, often for several days. Tennessee’s ABC says in looking back at a law from 2006, it found that in some cases, making infusions requires a distiller’s license, which restaurants can’t get.
In an email, the commission says despite what some people fear, the rule does not apply to drinks like margaritas or sangria. But Nashville lawyer Will Cheek warns restaurants that infuse liquors don’t want to risk having their license pulled.
“If you’ve got pineapple and fruit sitting in a vat of vodka, you need to be pulling that stuff out–it needs to be gone by July 1st.”
When the Tennessee Hospitality Association sent a letter arguing the commission is misinterpreting the rule, Cheek signed on, representing a couple major restaurant chains. If the commission won’t budge, Cheek says the matter could end up before state lawmakers next year.

And this excerpt from Cari Wade Gervin’s thorough review of the dispute, its history and ramifications:
Bell says he’d be fine with a law change–he says he’s encouraging people to look at newly passed legislation in Iowa that better regulates “Mixed Drinks or Cocktails Not For Immediate Consumption.” But according to the Iowa Alcoholic Beverage Division, that law requires pre-mixed batches of drinks to be disposed of within 72 hours if not consumed. Bars are also required to keep records–for three years–detailing when each and every batch is made and disposed of, along with the recipe, the ingredients, and the names of the person who made the batch and the person who disposed of it.
We asked Sohn if this seemed like a practical solution. She laughed loudly.
“Yeah, no,” Sohn says. “It would be very wasteful. … If they changed it to that, we probably still wouldn’t bother with infusions.”
Scanlan says he hopes TABC will reconsider its actions, but Bell doesn’t seem inclined to do so.
“I’m going to have to apply the law as it is right now,” Bell says. “I’m pretty certain we’ll start issuing citations sometime in the next few weeks.”


See also a Chattanooga Free Press editorial, opining that “the fun police are back, and this time they have their sights set on making sure that you won’t be able to sit back and enjoy a house-infused liquor at your favorite restaurant or neighborhood bar.”

Revised Supermarket Wine Bill Would Let Liquor Stores Open on Sunday

NASHVILLE, Tenn. (AP) — Tennessee liquor stores would be allowed to be open for business on Sundays under changes to a supermarket wine bill adopted by the Senate Finance Committee on Tuesday.
The panel voted to make several changes to the measure seeking to allow cities and governments to hold referendums on whether to permit supermarkets and convenience stores to sell wine.
The changes included ending a ban on liquor stores operating on Sundays and holidays, and linking supermarket wine sales to the hours they are currently allowed to sell beer. The measure would also allow liquor stores to begin selling items like snacks, beer and ice in 2014, regardless of whether a city or county had approved supermarket wine sales.
The panel delayed a final vote on the bill for a week so members could have time to think about the changes. The companion bill has failed in a House committee, but supporters hope it can be revived either this year or next.
The Sunday liquor sales provision was the most contested element of the bill, with its approval coming down to a single vote.
All six votes in favor of Sunday liquor sales came from Republicans, while two GOP members sided with all three Democrats on the panel voting against it.
“I know the blue laws are outdated, but there’s something wrong about selling a bottle of whiskey on a Sunday morning,” said Democratic Sen. Douglas Henry of Nashville.
Sen. Bill Ketron, R-Murfreesboro and the bill’s main sponsor, noted that under the bill, liquor store hours would be limited to noon until 11 p.m. on Sundays.
Republican Sen. Doug Overbey lauded Ketron for having “labored long and hard in this vineyard,” but argued for taking a week to contemplate the many changes made to the original legislation.
Fellow Republican Sen. Ferrell Haile of Gallatin said he was worried about the range of changes to the original bill.
“I don’t want to vote against wine in grocery stores because I think our constituents are looking for this,” he said. “But there are all kinds of warning signs here to me that I’m concerned about our younger people and availability in the convenience markets that they go to.”
Republican Rep. Jon Lundberg of Bristol, the main House sponsor of the bill, said he was unaware of any move to resurrect his version of the bill this year, but questioned why the Senate was trying to add so many elements beyond a local referendum to the measure.
“It’s real simple, it’s an up-or-down, yes-no vote, on whether they want to have wine sales in grocery stores,” Lundberg said. “The opposition is trying to make it vastly more complex than it is.

Pigeon Forge Approves Liquor-by-the-Drink (again)

PIGEON FORGE, Tenn. (AP) — Voters in Pigeon Forge have again approved liquor by the drink. This time, the margin was 154 votes.
The Mountain Press (http://bit.ly/ZtC0Uc ) reported Ken Maples, who led the pro-liquor initiative, said the election Thursday validated the choice voters initially made on Nov. 6.
Results of that referendum were thrown out by a court over confusion about who was allowed to vote. The question was on a crowded general election ballot, headed by the presidential race.
Jess Davis, who is co-chairman of Concerned Churches and Citizens of Pigeon Forge, said his group was disappointed in the outcome and might contest the results.
The Sevier County Election Commission meets March 21 to certify the vote.

Pro-liquor Forces Outspend Antis in Pigeon Forge

PIGEON FORGE, Tenn. (AP) — Proponents of liquor by the drink in Pigeon Forge are vastly outspending a group trying to defeat the issue as it comes back for another vote.
The Mountain Press (http://bit.ly/13Vud7j ) reported proponent group Forging Ahead filed documents showing it had received nearly $27,000 between Jan. 1 and Feb. 26.
Concerned Churches and Citizens of Pigeon Forge reported it had about $3,400 in donations.
Voters narrowly approved a liquor referendum in November, but it was overturned after complaints that people who live outside the city were allowed to vote.
On Thursday, Pigeon Forge voters will again choose whether to allow restaurant liquor sales.

Ketron: ‘The Liquor Lobby is Starting to Fall Apart’

State Sen. Bill Ketron predicts the liquor lobby will “come to the table” next week and start negotiating details in his wine-in-grocery-stores bill as it gains momentum more than four years after he initiated it, according to the Murfreesboro Daily News Journal.
“I think the liquor lobby is starting to fall apart,” Ketron said after Friday morning’s Chamber of Commerce Capitol Connection breakfast.
Ketron, R-Murfreesboro, said he expects to talk to liquor industry lobbyists to negotiate amendments allowing package stores to sell more items than liquor, wine and lottery tickets.
“It’ll be opening up to allow them to sell whatever they want to sell,” Ketron said. “It’ll open it up to allow them to purchase more than one store.”
Liquor store proprietors in Tennessee are limited to one store. But Ketron said he knows of one liquor store owner in Gatlinburg who wants to purchase four other stores there.
“Why should he be restricted to one if the other four want to sell?” Ketron said.
The bill goes to the Senate Finance Committee next and the full House Local Government Committee.

Liquor PACs Gave $364K to Legislator Campaigns Last Election Cycle

By Erik Schelzig, Associated Press
NASHVILLE, Tenn. — Contributions totaling more than $364,000 have poured into lawmakers’ campaign accounts over the past two years from liquor wholesalers, package stores and the beer industry — three groups that have traditionally opposed changing state law to allow wine to be sold in supermarkets.
An Associated Press analysis of campaign finance data shows that six of the 11 members of the Senate Finance Committee, which is scheduled to take up a bill Tuesday to hold local referendums on whether to expand wine sales, received a combined $38,000 from the three political action committees. Republican Senate Majority Leader Mark Norris of Collierville alone received $13,000. (Note: The vote was postponed until next week.)
The remaining five members of the Senate panel received no contributions from the three groups.
Norris, who voted against the measure when it eked out of the Senate State and Local Government Committee by a one-vote margin last week, did not immediately return a message seeking comment.

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Bill Restricting EBT Cards Clears Senate Committee

News release from Senate Republican Caucus:
NASHVILLE, Tenn. — State Senator Jim Tracy’s (R-Shelbyville) bill to curb abuse of purchases made through Electronic Benefit Transaction (EBT) cards used by recipients of the Temporary Assistance to Needy Families (TANF) program sailed through the Senate Health and Welfare Committee today. Senate Bill 244 prohibits use of a welfare recipient’s EBT card in liquor stores, adult cabarets and casinos or gambling facilities.
“It is outrageous that these benefit cards, which are meant to help feed families with children in times of desperate need, are reported to have been misused for purchases like alcohol, gambling and adult cabarets,” said Senator Tracy. “Tennessee law should make it perfectly clear that we will not tolerate this fraudulent use of taxpayer money.”
The legislation comes after a report was released last summer by the Beacon Center of Tennessee, which uncovered numerous examples of abuse by welfare recipients. The Center reported one transaction at a liquor store totaling $790.
Under the bill, welfare recipients who use EBT benefits at liquor stores, adult cabarets, or gambling establishments would be subject to disqualification from the program as permitted by federal law and also would have those misused benefits recouped by the Tennessee Department of Human Services. The legislation also prescribes civil penalties to businesses that sell those products and accept EBT benefits as payment in violation of the law. The fine for a violation by the seller would be $1000 for the first violation, $2500 for the second violation within five years, and $5000 for a third or subsequent violation within five years.
In addition, the bill bans the use of EBT benefits at an ATM located inside a liquor store, adult cabaret, casino or gambling establishment.
“I’m proud to sponsor this bill and help reform the welfare system in Tennessee,” said Senator Tracy. “We need to continue to make sure that taxpayer money is used appropriately and I applaud the Department of Human Services for working with me on this bill.”
“Many taxpayers struggle to make ends meet and to pay their taxes,” added Beacon Center CEO Justin Owen. “The selfish misuse of the welfare system undermines those who truly need and utilize temporary assistance lawfully and causes widespread public distrust in government services. Taxpayers should not tolerate it.”

Note: Previous post (noting the easure is scaled back from the original version HERE.

Sevier Election Commission Wants Election Investigation

PIGEON FORGE, Tenn. (AP) — The Sevier County Election Commission has voted to ask the district attorney’s office to investigate people who improperly cast ballots in a problematic liquor-by-the-drink referendum.
Commissioners made the decision Thursday after earlier attributing voting mistakes to poll worker confusion. The referendum came on the same day as the general election, which produced the largest turnout ever in the county. Nearly 300 people who did not live in Pigeon Forge were allowed to vote on the liquor issue.
A judge tossed the election results, and the commission has scheduled a revote for March 14.
The Mountain Press (http://bit.ly/WmQMKN ) reported Election Commission member Darrell Whitchurch made the motion to send the names to prosecutor Jimmy Dunn. He said if anyone is attempting fraud from either side, they should be prosecuted.

Battle Lines Drawn for Another Pigeon Forge Liquor Vote

When Pigeon Forge votes yet again on liquor by the drink, the News Sentinel reports that opponents plan a very different campaign, while supporters plan to concentrate on getting the vote out.
And the anti-liquor group Concerned Churches and Citizens of Pigeon Forge says it wants to find an independent agency to monitor the election.
The Sevier County Election Commission voted on Thursday to set March 14 for the new referendum.
Liquor by the drink was approved on Nov. 6, but that referendum was voided by Chancellor Telford Forgety after a lawsuit brought by CCCPF. Liquor was defeated in referendums in 2009 and 2011. On Nov. 6, it passed by 100 votes, but nearly 300 votes were cast by people who were ineligible to vote in the referendum because they were not residents of or owners of property in Pigeon Forge. The election commission ultimately admitted that the results vote were “incurably uncertain.”
“We are going to rephrase our message,” said CCCPF Chairman Jess Davis. Besides campaigning against liquor by the drink, he said, “we are going point out that it was our city officials that got us into this mess.”
Davis was referring to a request in March by the Pigeon Forge City Commission to the state Legislature to override the normal two-year vote between referendums on the same issue, and add the liquor question to the Nov. 6 election. The bill was handled by lawmakers from outside Sevier County and approved.