Schools cheated out of liquor-by-the-drink tax revenue

Schools cheated out of liquor-by-the-drink tax revenue (Image 1)

Several Tennessee school districts are asking how they could have been cheated out of hundreds of thousands of dollars of their share of the liquor-by-the drink tax.

Robertson County is one of the districts impacted.  School officials told News 2 they recently became aware they've not received their portion of the tax from the city of Springfield since 1999, when the liquor-by-the drink referendum passed.

Since then Springfield has received $415,106.47 in liquor-by-the drink tax revenue. According to school officials, half of that amount, or $207,553.24, should have gone to schools but didn't.

The problem is not unique to Robertson County. 

The Sumner County School District is owed an estimated $1.5 million from Gallatin, Hendersonville and Portland.

The big question is how cities went decades without paying schools their share of the liquor-by-the drink tax.

News 2 sat down with Springfield City Manager, Paul Nutting, who said apparently the law wasn't very clear.  The city was never made aware it owed part of the tax to schools, according to Nutting.

“If we owe the money we will pay it,” Nutting said.

The city and school district are working together to figure out a payment plan that will lessen the impact to the city's budget.

Jim Bellis, Communications Coordinator for Robertson County Schools, said the issue is ongoing and they're also trying to determine if money is also owed by the cities of White House and Orlinda.

Business owners collect the tax then send a portion of their sales to the state, which sends half of the money back to the individual cities.

A spokesman for the Tennessee Municipal League, which works with the Tennessee General Assembly on behalf of city governments, said they are aware of the issue.

It is unclear how many districts are impacted.

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