Tennessee § 57-3-501 - Municipal inspection fee — Maximum amount — Collection of fees.

§ 57-3-501. Municipal inspection fee — Maximum amount — Collection of fees.

A municipality as defined by § 57-3-101 shall have the authority to impose by ordinance an inspection fee upon licensed retailers of alcoholic beverages as defined by § 57-3-101 or upon retail food store wine licensees located within such municipality. If, pursuant to § 57-3-204(d)(7), a manufacturer of high alcohol content beer obtains a retail license to sell its products which are manufactured on the manufacturer's premise, the governing body of the municipality or county in which such a manufacturer is located shall impose by ordinance or resolution, as appropriate, a fifteen-percent inspection fee to inspect the retail store in which such products are sold by the manufacturer. Such inspection fee shall be imposed on the wholesale price of the high alcohol content beer supplied pursuant to § 57-3-204(d)(7)(B) by a wholesaler for those products manufactured and sold by the manufacturer at its retail store as authorized pursuant to § 57-3-204(d)(7). The inspection fees shall not exceed eight percent (8%) of the wholesale price of alcoholic beverages supplied by a wholesaler in municipalities located in counties of this state having a population of less than sixty thousand (60,000), according to the 1960 federal census or any subsequent federal census, or in counties that contain a municipal corporation as defined in § 67-6-103(a)(3)(B)(i), notwithstanding subsection (c) to the contrary. The inspection fees shall not exceed five percent (5%) of the wholesale price of alcoholic beverages supplied by a wholesaler in municipalities located in counties of this state having a population of more than sixty thousand (60,000), according to the 1960 federal census or any subsequent federal census. Any municipality having a metropolitan form of government and a population of over four hundred fifty thousand (450,000), according to the 1990 federal census or any subsequent federal census, which has levied the inspection fees herein authorized may, by ordinance of its legislative body, designate the county clerk as the collector of the fees for the entire metropolitan taxing jurisdiction. Acts 1968, ch. 538, §§ 1, 2; 1969, ch. 87, § 1; T.C.A., § 57-165; Acts 1994, ch. 758, § 1; 1999, ch. 218, § 1; 2011, ch. 448, § 17; 2014, ch. 554, § 7. Compiler's Notes. For tables of population of Tennessee municipalities, and for U.S. decennial populations of Tennessee counties, see Volume 13 and its supplement. Cross-References. Damaged or unaccepted goods, tax liability, § 57-3-109 . Textbooks. Tennessee Jurisprudence, 16 Tenn. Juris., Intoxicating Liquors, §§ 5, 10. NOTES TO DECISIONS 1. Constitutionality. 2. Nature of Fee. 3. Construction with Other Statutes. 4. Liquor by the Drink Establishments. 1. Constitutionality. Since the municipal inspection fee authorized by this section is collected by the wholesaler only after the retailer has purchased and paid for the alcoholic beverages (pursuant to T.C.A. § 57-3-502 ), the fee does not violate the prohibition against import duties of U.S. Const., art. 1, § 10. Memphis Retail Liquor Dealers' Asso. v. Memphis, 547 S.W.2d 244, 1977 Tenn. LEXIS 555 (Tenn. 1977). 2. Nature of Fee. Even though the revenue generated by a municipal inspection fee pursuant to this section far exceeds the cost of inspection, the fee is a regulation and not a tax, for alcoholic beverages are a special activity and the fee imposed is actually part of the regulation. Memphis Retail Liquor Dealers' Asso. v. Memphis, 547 S.W.2d 244, 1977 Tenn. LEXIS 555 (Tenn. 1977). 3. Construction with Other Statutes. Since T.C.A. § 57-6-201 deals with wholesalers only it does not preempt this section, which deals with retailers only. Memphis Retail Liquor Dealers' Asso. v. Memphis, 547 S.W.2d 244, 1977 Tenn. LEXIS 555 (Tenn. 1977). T.C.A. § 67-4-701 does not repeal T.C.A. § 57-3-501 by implication because that section is an ad valorem tax while this is a fee. Memphis Retail Liquor Dealers' Asso. v. Memphis, 547 S.W.2d 244, 1977 Tenn. LEXIS 555 (Tenn. 1977). In taxpayers' action seeking a refund of inspection fees a city erroneously calculated, the trial court did not err by applying T.C.A. § 67-1-1807 because payment under protest was not a condition precedent to a suit for the recovery of a tax paid to a municipality; the tax at issue provided no explicit requirement to pay “under protest” but only provided that the inspection fee was to be paid to a municipality. Chuck's Package Store v. City of Morristown, — S.W.3d —, 2016 Tenn. App. LEXIS 446 (Tenn. Ct. App. Feb. 10, 2016). 4. Liquor by the Drink Establishments. Liquor by the drink establishments are granted a license under T.C.A. § 57-4-201 , and therefore do not qualify as “retailers” under T.C.A. § 57-3-501 . Overton Square, Inc. v. Foster, 615 S.W.2d 681, 1981 Tenn. App. LEXIS 492 (Tenn. Ct. App. 1981).