Chattanooga stiffs schools on liquor tax for decade, won't repay in full

CHATTANOOGA, Tenn. (AP) -- Some Hamilton County school board members are asking how the city of Chattanooga went nearly 10 years without paying the schools' share of liquor-by-the-drink taxes.

The Chattanooga Times Free Press reports the shortfall totals $11.4 million, which could have paid for nearly an entire elementary school, more teachers or pay raises.

Hamilton County Schools Superintendent Rick Smith says the discovery was made earlier this year by district finance officials and they spoke to Chattanooga Mayor Andy Berke before he took office.

The city doesn't plan to repay the entire amount, but has begun making amends.

The city's 2014 budget includes $1 million in liquor-by-the-drink taxes and Berke has proposed donating a former public housing complex and giving the school system $500,000 to start an early childhood education center.

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