By Moses Leos III
A “firestorm” is brewing between Buda and a business owner over back-taxes stemming from the city’s share of Texas Alcoholic Beverage Commission fees.
This Buda business owner is fighting the charges, saying the city never gave prior notification of that tax.
“There was no notification, no explanation. Just a bill in the mail for a large (amount),” Julie Renfro, owner of Tavern on Main, said. “It’s like, ‘Merry Christmas.’”
Renfro said she first became aware of the issue last Friday when she received a bill.
The statement stems from a 2012 ordinance that allowed Buda to collect 50 percent of fees beer and wine permit holders paid to TABC upon renewal. Renfro declined to give the amount of her bill from the city.
Renfro said Buda businesses have been billed by Hays County, which collects 50 percent of TABC fees.
But she said local business owners were never given any notification that the city was collecting the tax. The bill Renfro received had charged dating back to 2012.
“I was so taken aback and surprised, that I didn’t have an emotional reaction,” Renfro said. “I was confused. I honestly thought it was a misunderstanding or mistake. I had no idea what I was looking at.”
Renfro said the city was reminded of the tax after a staff report requested by council member Eileen Altmiller. The report showed which Buda businesses were delinquent to the city in terms of TABC fees.
According to the report, several Buda businesses owe the city for this tax.
In a letter to the Buda City Council and City Manager Kenneth Williams, Renfro claims those who acquired alcohol permits after the ordinance passed were informed of the tax.
However, she said those with existing permits – obtained before the ordinance passed – were never notified.
“I have never in the 7+ years of TABC licensure for businesses in Buda been notified of a fee owed to the City of Buda,” Renfro said in her letter.
Renfro then spoke with City Manager Kenneth Williams and City Secretary Alicia Ramirez to rectify the problem. Renfro said Ramirez admitted that it was “Buda’s mistake” that the notification wasn’t sent to prior permit holders.
According to Renfro, Williams said that she “should have known” about the tax.
“Both told me that it was up to us to know what goes on in the city,” Renfro said. “So I’m supposed to know that an ordinance was passed in 2012, which has assessed a large fee?”
Renfro turned to Buda Mayor Todd Ruge and council member Angela Kennedy for help.
Ruge said the city is still trying to figure out “where the disconnect” was and “where the responsibility” lies.
But according to Ruge, the understanding is that when business owners obtain a permit from the state, “they are liable for any local and county tax.”t
“Now we haven’t been sending out bills. But even without sending out…the majority of owners that hold a license, they understand the rules and come in and pay every year.”
Ruge said the city is now attempting to work with business owners that have delinquent taxes. He said the city is working to figure out the issue, which could mean sending out a bill through the mail every year.
By the end of the day Friday, Ruge said several business owners that had delinquent taxes had paid them. He said the city is working to reach out to business owners to provide relief.
“We don’t want to cause a hardship on anyone,” Ruge said. “But we are trying to set up meetings for those who haven’t paid.”
But for Renfro, a surprise expense now means her employees may not receive bonuses she had planned to give for the holidays.
The expense, she said in her letter, had an additional impact as it relates to pricing of her goods.
“Had I known I’d be paying this additional fee, it would have been reflected in my prices for the last 3 ½ years,” Renfro said in her letter to the city. “As it is, I am required to forego Holiday Bonuses to my employees in order to begin to set aside the money to make payment toward this bill. Happy Holidays to each and every one of you.”
