published Thursday, July 24th, 2014

Liquor taxes agreement 'stinks,' Hamilton County Commissioner Joe Graham says

After Hamilton County Schools officials celebrated what they felt was a win for the system and City Council members had patted themselves on the backs for settling the liquor taxes lawsuit, one county commissioner tried to bring the $11.7 million agreement to a halt.

On Wednesday, Commissioner Joe Graham claimed the school system was the one losing out and the school's attorney should have negotiated further on the liquor-by-the-drink settlement. It requires Chattanooga to pay nearly $12 million over the next five years and gives the school system the former Poss Homes site and the North River YMCA swimming pool -- a total deal worth about $14.5 million.

The school board's part of the settlement is to repay $1.5 million in overdue stormwater fees in the same five-year period and continue paying those fees as they accumulate, between $300,000 and $400,000 a year. This agreement hadn't been required under the past administration.

"This whole agreement stinks," Graham piped up. "I guess Mayor Berke needs to change his statement to 'Mayor Andy Berke, the attorney, cha-ching.'"

The mayor's office said the decision to reach out to the school system -- a week before a scheduled hearing -- and settle the lawsuit is a win for city taxpayers and for schoolchildren.

While the settlement nearly mirrors an offer that the administration originally scoffed at, Berke's chief of staff, Travis McDonough, said this time schools officials made it clear their intention is to build a new track and field for Howard School on the nearly 20-acre Poss Homes site, and the school system agreed to pay its stormwater fees.

"It made [the offer] more attractive to the city," he said.

Graham, who is running for re-election, lost the argument at Wednesday's commission meeting to defer the settlement for a week to study it further. And while other commissioners said they also thought the school board could have negotiated a better deal, they voted 8-1 to approve the settlement.

School board attorney Scott Bennett said this deal is 10 times better than the original offer from the mayor's office and gives the school system nearly everything it asked for.

It's been nearly a year of back-and-forth gridlock over $11.7 million Chattanooga owes the local school system, and school officials sued the city in April when they claimed talks with Berke were getting nowhere. Berke then offered to pay nearly $12 million, but balked when school officials asked the city to settle more debt going back three decades.

The current settlement is now final after Hamilton County Chancellor Jeffrey Atherton signs off on it.

Contact staff writer Joy Lukachick at jlukachick@timesfree press.com or 423-757-6659.

about Joy Lukachick Smith...

Joy Lukachick Smith is the city government reporter for the Chattanooga Times Free Press. Since 2009, she's covered crime and court systems in North Georgia and rural Tennessee, landed an exclusive in-prison interview with a former cop convicted of killing his wife, exposed impropriety in an FBI-led, child-sex online sting and exposed corruption in government agencies. Earlier this year, Smith won the Malcolm Law Memorial Award for Investigative Reporting. She also won first place in ...

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