Some businesses and individuals wishing to sell alcohol in Milledgeville will be able to save a little money now that a new ordinance is in effect.
The Milledgeville City Council evening approved a resolution Sept. 10 amending the ordinance governing the sale of alcoholic beverages within city limits. A vote on that measure was tabled at the council’s Aug. 27 meeting after a question was raised about whether raising fees on licenses and permits was appropriate under state law.
Chamber of Commerce Board of Directors member Matt Roessing addressed city council members at that meeting and referred to the code section that governs regulatory fees such as licenses and permits for alcoholic beverages. Council members elected to get more information on the rules before voting.
The approved ordinance eliminates some permit costs while slightly increasing others.
The mayor and city council held a 45-minute work session on the question Sept. 6 and City Manager Hank Griffeth went through the various expenses and revenue sources related to the sale of alcoholic beverages in the city. Griffeth began by reading a portion of O.C.G.A. 48-13-5, which states, “The amount of a regulatory fee shall approximate the reasonable cost of the actual regulatory activity performed by the local government.”
To address that, Griffeth said there are three city departments that deal with the permitting function of alcohol sales and alcohol use: the police department, fire department, and finance department. Griffeth said he talked with the heads of the police and fire departments.
“Both agreed, at a minimum, 25% of the work that’s done in their department is generated based on alcohol sales or alcohol usage in the city limits of Milledgeville,” Griffeth reported. “This is probably a low percentage, but I thought 25% was a good, conservative figure to use.”
Griffeth said 25% of non-administrative salaries in the police department totals $377,004.55. In the fire department, he said, only three employees – in the inspection department – deal with the regulatory fees. Twenty-five percent of those salaries equals $44,984.75.
Griffeth then explained he computed the salaries of members of the finance department who deal in issuing alcohol sales licenses and used only 10% of their salaries as a justifiable expense, “because I thought what they did as far as alcohol licenses were concerned was a lesser percentage than these two departments.” That total is $18,071.66.
Together, Griffeth said, those numbers add up to $440,060.96. On top of that, he said, the city pays FICA and pension costs, bringing expenses to just under $540,000.
Griffeth looked at the alcohol revenue generated in cities similar in size to Milledgeville, as well as those with colleges similar in size, to come up with a reasonable estimate of revenue here.
“We anticipated these fees will generate a little over $364,000,” he stated, then pointed to the expenses and revenues on his chart. “When this is what we anticipate generating and this is what we have determined it costs, I think we meet the letter of that intention.”
Griffeth explained that while he was researching applicable regulations, he learned that state law sets a maximum of $5,000 annually for licenses to sell distilled spirits. It had been set at $6,000 locally, thus reducing income for licenses by $10,000 to comply with the law.
He then referred back to code section 48-13-5, which prohibits charging administrative or registration fees as part of regulatory fees.
Griffeth said that means the city cannot count the application fee, which is $100. Based on 87 applications submitted in 2023 for 2024, that is a reduction of $8,700, he told council members. The reductions in the licenses and application fees leave a total estimated revenue of $345,500.
“Keep in mind now,” he continued, “we’re still trying to make sure that anything we’re charging equates to the cost of that regulation. So, with that figure going down, we’re even more safe in what we’re charging as meeting the cost of that regulation.”
Griffeth noted that several council members offered suggestions regarding possible fee reductions to benefit businesses, and individuals. Those included eliminating the additional $15,000 sales fee for outlets that sell on Sundays; eliminating the additional $1,500 catering fee; and removing the $725 special-events fee. Together, those reduce the estimated revenue to $328,275.
“I think we need to make up that application fee somehow,” Griffeth told council members. “Since we can’t do that as an application fee based on the Georgia code … I propose that retail-package- to-go beer and wine, instead of being $1,000, it becomes $1,050.” Typically, he said, those come in together, but are separate, providing a total of $100 to offset the application fee.
For consumption on premises, the city manager suggested that beer and wine fees increase from $800 to $850. Again, the two together mean a $100 increase. Those adjustments, Griffeth said, provide a total of $337,675 in estimated revenue.
“Compare that to what we say are our fees of regulation for sales of alcohol in the city,” he concluded, “we still meet the intent of that code, plus some.”
Griffeth said Tuesday afternoon that input from council members made him aware of their goals in the process.
“During a discussion with council members it became apparent that the potential to streamline fees and add value to the overall license fees was an important aspect of the fee updates,” he said.
Council members approved the amended ordinance unanimously Sept. 10, with no discussion.