More than 90 bars, restaurants and packaged liquor stores were caught off guard late last week, when agents from the city-parish Alcoholic Beverage and Gaming Control office descended on their establishments and suspended their liquor licenses.
The move came as the result of a new ordinance, backed by Mayor Sharon Weston Broome’s administration and approved in January by the Metro Council, allowing the city-parish to suspend the liquor license of any establishment that is 90 days late paying its sales tax.
In the past, an establishment could basically go almost a full calendar year without paying sales tax before its liquor license was in jeopardy, as was the case with the now-defunct bars of former Metro Council member John Delgado. City-parish officials say the situation was costing Baton Rouge millions of dollars every year, as many of the delinquent taxes were never collected from establishments that ultimately went out of business.
Under the new law, some 93 establishments—nearly 10% of all those in the parish with a liquor license—were late paying their January 2019 sales tax bill or had an outstanding tax liability from a previous year, according to Tiffany Delapasse, revenue manager for the city-parish department of revenue and finance. ABC officers suspended their licenses in raids on June 13 and June 14.
Delapasse says those businesses had plenty of time and adequate notice to pay, noting January sales taxes were not due until the end of February. Then, notices were sent to all delinquent businesses in April, reminding them the new law would result in the suspension of their liquor license if the taxes were not paid within 90 days of the due date, which was May 30.
In early June, the names of those that still had not paid were turned over to ABC. Delapasse says most of the businesses have since paid their bills and had their license restored and that the process was fair.
Not everyone agrees. Metro Councilman Matt Watson, for one, says he has a lot of questions about the way businesses were notified, how much warning they had and why at least one restaurant temporarily lost its license as the result of a clerical error that failed to record a tax payment the establishment made in 2017.
He was planning to meet with city-parish officials this morning to discuss what he believes is the problematic execution of an otherwise good and much-needed local law.
“The ordinance is fine,” he says. “It’s the rollout I have trouble with.”
Daily Report talked to two local establishments among those whose license was suspended. Neither wanted to speak on the record. But they say they were not given adequate warning by the finance department.
Delapasse says the department will continue to make sure businesses are given adequate warning if they’re delinquent on their taxes. She adds that establishments that haven’t paid their February sales taxes, which were due in late March, by the 90-day deadline of June 30 will be getting a visit from the ABC in July.