Wilson County Board of Education filed a lawsuit against the City of Mt. Juliet Thursday for liquor-by-the drink tax dollars.
“We’ve had an issue now for a year-and-a-half or so about the liquor drink tax,” said Board Attorney Mike Jennings during Friday’s board of education meeting. “The mistake a lot of the cities made - they were collecting liquor-by-the-drink taxes and they didn’t know they were supposed to share half of them with the county education system.”
The board reached an agreement with the City of Lebanon, who Jennings said approved paying their back taxes from 1999 until 2013, but the board has not yet reached an agreement with Mt. Juliet.
He said the sticking point with Mt. Juliet is money the city says it’s saved the school system over the years.
“The city says they’ve done some things for the school system over the years that’s saved the schools money and they should get a credit,” said Jennings. “The issue still to be decided is whether any offset’s going to be allowed.”
He said Mt. Juliet owes about $449,000 total.
“We continue to talk with them and we hope to reach an agreement with them,” said Jennings.
He said the school board and the city have agreed to continue negotiations despite the lawsuit.
“We had to file this lawsuit basically to protect our statute of limitations. It is not a lawsuit filed out of animosity, it is a lawsuit filed to protect our rights,” said Jennings.
He said a bill recently signed into law by Gov. Bill Haslam set a deadline of June 1 for a school system to file a lawsuit seeking liquor-by-the-drink tax money in the school system’s home county. After June 1, the school system would have to file in Nashville.
Jennings said it would just make sense to file in Wilson County.
“It’s just all your people are here; all your records are here,” said Jennings. “If it went to a hearing, you’d have to take your witnesses and your records to Nashville, and that doesn’t make a lot of sense.”
The lawsuit was filed in Wilson County Chancery Court, and Mt. Juliet has 30 days to file a response.
But Jennings said he hopes it doesn’t go further.
“We want to look and see what we can do that will work for both parties,” he said.
Digital Content Director Sara McManamy-Johnson contributed to this report.