TBA Law Blog

Posted by: Katharine Heriges on May 8, 2019
In five separate lawsuits, the Tennessee Supreme Court held today that cities with their own school systems are not required to share with counties the tax proceeds the cities receive from the sale of liquor-by-the-drink. For over 30 years, cities that have approved the sale of liquor-by-the-drink have kept their portion of the tax proceeds, without sharing with the counties. Five Tennessee counties — Blount, Bradley, Coffee, Sullivan and Washington — claimed that Tennessee statutes required the cities to share a portion of those tax proceeds with the county schools. The TSC found that the General Assembly amended the liquor tax laws several times over the past decades, but it chose not to amend the laws on the cities’ responsibilities as to distributing the liquor tax proceeds.