A coalition of 50 businesses has sued Prince George’s County over a new $5,000 annual fee charged to liquor stores, tobacco shops, gun stores and storage facilities.
The county plans to direct the fee revenue to a new “Quality of Life Improvement Fund” to pay for a wide variety of programs, including those supporting child care, senior wellness, pedestrian safety and economic assistance.
The group of businesses, however, claim that the council is attempting to “impose unlawful and punitive taxes” on them. They’re calling on the Circuit Court for Prince George’s County to block the new law.
The lawsuit, filed July 31 by Joseph Greenwald & Laake attorney Timothy Maloney, states that “the Council has grossly exceeded the legislative authority delegated to it by the General Assembly and the Maryland Constitution.”
The County Council voted 9-2 to pass the measure during a tense meeting in April. Council members Jolene Ivey and Sidney Harrison, frequent dissenters of the council majority, voted against the measure.
Proponents of the fee chastised local business owners and repeatedly challenged the dozens who showed up to testify against the bill by questioning their contributions to their communities.
After voting for the new fee, council member Edward Burroughs said to the business owners gathered in the council chambers that “your free ride of proliferating this County without contributing at all to the residents of this County is over,” according to the meeting transcript.
WTOP first reported the existence of the lawsuit.
County Executive Aisha Braveboy, who allowed the bill to become law without her signature, wasn’t immediately available for comment, said her spokesperson Brian Fischer.
Council Chair Krystal Oriadha, who sponsored the bill that created the fee, also could not be reached for comment.
The bill states that Prince George’s County has 17.8 liquor stores per 100,000 residents, and that studies show that neighborhoods with a high density of these businesses are associated increased rates of violence, regardless of other community characteristics.
Countywide, though, Prince George’s has a lower concentration of liquor stores than most Maryland counties, according to the county’s health department.
Prince George’s and other counties have in recent years passed restrictions on hours of operation, location and signage for smoke shops in particular. Baltimore County is considering similar legislation to restrict them.
But the new Prince George’s law is broader and more punitive than these regulations.
The new law subjects liquor, tobacco, gun and storage businesses to a $5,000 annual use and occupancy permit fee.
Maloney points out in the lawsuit that a use and occupancy permit signifies that the county has inspected a building and approved its authorized use.
The county’s one-time use and occupancy fee for commercial buildings is typically around $370, which includes administrative and technology costs, the lawsuit states. The county generally charges the permit fee to defray the cost of inspections.
The plaintiffs have argued that by establishing a charge specifically to generate revenue for public programs, the law effectively creates a new tax on the targeted businesses, not a fee.
And county governments cannot impose new taxes without authorization from the General Assembly, according to the lawsuit.
State law grants counties the authority to impose property taxes, and the General Assembly has passed laws allowing Prince George’s County to adopt an amusement and admission tax, a piggyback income tax and energy taxes.
“The State has not authorized Prince George’s County to impose a tax or an impact fee upon alcoholic beverage stores, tobacco and electronic cigarette stores, stores that sell firearms, and self-storage facilities,” the lawsuit states.
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