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Taxing question: Sullivan commissioners may vote to hold Nov. 3 liquor referendum at Feb. 20 meeting

Rick Wagner • Jan 16, 2020 at 11:00 PM

BLOUNTVILLE — Would you like to be able to sip mixed drinks at a restaurant or bar in non-city Sullivan County or Bluff City by early next year?

And regardless of that answer, would you want or tolerate those sales because of the alcohol tax revenue they would generate for education?

Voters of non-city Sullivan County and Bluff City would vote in November whether those localities would get liquor by the drink in 2021 under a resolution introduced for first reading by Sullivan County Commissioner Hershel Glover of the Bluff City area at the end of Thursday’s commission meeting.

No vote was taken on the first reading of the resolution, which was not on the agenda. However, the commission did vote 22-0 with two absent to approve a Glovers resolution on first reading and on the previously published agenda. It accepted a Ballad Health donation of $153,175 for a full body scanner and $80,000 to renovate the Sullivan County jail in preparation to place the scanner there.

It will be used to keep drugs and other contraband out of the facility by scanning incoming inmates and visitors. The scanner is part of the Certificate of Public Advantage that Ballad proposed with the plan to merge Wellmont Health System and Mountain States Health Alliance into Ballad.

The Sullivan County Sheriff’s Office will take over maintenance costs of the equipment after the first year, which is covered by the manufacturer.

In other action, Commissioner Hunter Locke of Kingsport withdrew his first-reading resolution for the county to buy commissioners, the county attorney and county mayor cell phones and cell phone plans for official use. County Attorney Dan Street recently told commissioners their private phones would be subject to Freedom of Information and public records queries of any county business conducted on the personal devices.

WHY LIQUOR BY THE DRINK?

“It’s something that we need to do. It’s time. We’re losing a lot of revenue,” Glover said of liquor by the drink. Commissioner Dwight King of Piney Flats added that the District 5 area represented by him and Glover includes Boone Lake, South Holston Lake and the U.S. Highways 19E-11E intersection between Bristol, Tennessee, and Johnson City — areas Glover said were ripe for new hotels, restaurants and other businesses to generate jobs and tax revenues if liquor by the drink passed. However, he said it would benefit all non-city areas of the county and Bluff City.

“We’ve got to find a way in Sullivan County to generate revenue,” Glover said of the county, which he said loses revenue to Kingsport, Bristol, Johnson City and Southwest Virginia localities with liquor by the drink. He said liquor-serving businesses could draw from whichever of the two proposed casinos might open at the Pinnacle development in Bristol, Tennessee, or the old Bristol Mall in Bristol, Virginia.

HOW WOULD VOTE WORK?

If the commission votes by a two-thirds majority or at least 16-8 at the Feb. 21 meeting, a liquor by the drink referendum would go on the Tuesday, Nov. 3, ballot that also includes the U.S. presidential race and the race for U.S. Senate and U.S. House seats.

If voters approved the referendum in that election, Glover said liquor by the drink applications likely would be taken in early 2021. Street said the Tennessee Alcoholic Beverage Commission would issue those permits, not the Sullivan County Beverage Board, which handles on-premises beer licenses. Street said that businesses outside Bristol and Kingsport and Johnson City’s small sliver of the county that wanted could apply for a state license to sell liquor, mixed drinks and wine.

King predicted a “major restaurant” for eastern Sullivan County and said the owner of Pardner’s Restaurant, a barbecue eatery in Piney Flats, would like to add alcohol, and he predicted a hotel that could cater to Bristol Motor Speedway visitors twice a year and fishing and boating enthusiasts on the two lakes would be a great market for alcohol sales beyond the current on-premises consumption beer sales.

Commissioner Todd Broughton of Bloomingdale said commissioners needed to remember their vote next month would not be supporting or opposing liquor by the drink but would simply be letting voters make the final decision on the matter, and Commissioner Joyce Neal Crosswhite of Blountville said voting to allow the referendum was not the same as promoting drinking alcohol.

HOW WOULD TAX MONEY BE SPLIT?

Glover and Street said that revenues from the 15 percent liquor and mixed drink tax would be collected by retail sellers and remitted straight to revenue officials in Nashville. There, it would be split in half, with 50 percent of it earmarked for education use and the other 50 percent going back to the locality where it was collected.

Of that locality money, half would go to the general fund of the local government and the other half to the local school systems, based on their proportional share of students. That means of every dollar from the 15 percent tax, the state would get 50 cents, the county coffers 25 cents and the other 25 cents would be split among county, Kingsport, Bristol and Johnson City schools.

Street after the meeting said he was unsure but thought Bluff City would get the local share of liquor by the drink sales in that town, where voters would be included in the county referendum because it is smaller than 10,000 residents.

Glover said the town needs money because it is losing about $375,000 a year because of the end of speed cameras on 11E, plus business losses from the closing of Bluff City Middle after a new middle school consolidating three schools opened in eastern Sullivan County. Glover said he had no revenue estimate, when asked by Commissioner Andrew Cross of Bristol, but some revenue is more than none.

Glover said Johnson County passed liquor by the drink last year and other counties are considering it this year besides Sullivan.

 

 

 

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