LIQUOR TAX TAB• Manchester: $137,340• Tullahoma: $387,488Source: Coffee County Chancery Court records and the University of Tennessee County Technical Assistance Service
Coffee County Schools has filed a lawsuit against Manchester and Tullahoma, Tenn., to recover more than $500,000 in liquor tax revenue owed to the system going back to the 1980s.
Coffee is among several county school systems across the state seeking the liquor-by-the-drink tax money owed by municipalities where liquor is sold. A state attorney general opinion issued in February sides with county schools in the dispute.
“The money that was paid to the cities of Manchester and Tullahoma was to be distributed partially to Coffee County Schools and that was not done dating back almost 35 years,” said Eric Burch, the attorney hired by the Board of Education to file last month. Burch and board attorney Frank Van Cleave are co-counsel in the suit.
A 15-percent liquor tax is collected on liquor-by-the-drink and wine sales. Half of that revenue is returned to the cities to be split between the government entity and schools systems in the home county, based on average daily attendance percentages in schools.