Liquor stores could raise sales tax revenues in Keller if voters say yes

Keller residents could vote in November to allow liquor stores in the city.

Keller residents could vote in November to allow liquor stores in the city.

Keller’s first liquor store could open next year if a local businessman has his way.

North Texas businessman and Keller property owner Sahjit Singh financed a petition to put an alcohol measure before Keller voters this fall. If approved, the measure would pave the way for liquor stores to operate in the city.

City officials say having liquor stores in Keller would be more convenient for residents who have to travel to a nearby city to buy liquor. The move would also boost the city’s sales tax revenue—by up to $200,000 per year by some estimates.

Circulated between March 18 and April 18, the petition to allow liquor stores in Keller received 8,768 and verified signatures and was submitted to the city May 7.

It needs 7,426 verified signatures for an election to be called. The required number of signatures is equal to 35 percent of the number of votes cast by Keller residents in the most recent election for governor, according to Texas Petition Strategies, which gathered signatures for the liquor store petition.

Texas Petition Strategies has worked with similar petitions across the state, including in North Texas cities like Grand Prairie, Arlington, and Plano.

Keller City Council expects to receive the verified signatures and certify the petition at its June 18 meeting. At that time, the council will vote to call a Nov. 5 election.

In 1993, residents of Keller approved a proposal to allow beer and wine sales at local grocery and convenience stores. The proposal also allowed liquor sales for consumption at the city’s bars and restaurants.

This new measure would allow for off-premises packaged liquor sales from liquor stores. If the measure is approved, Keller voters will have approved all forms of alcohol sales in the city.

“The main reasons why people are in favor [of the measure] is they’re tired of driving to another area to buy liquor,” Texas Petition Strategies President John Hatch said. “For others, it’s a tax issue because … they know the revenue is going somewhere else.”

Sales leakage
According to a leakage report conducted by consulting and research firm The Retail Coach, Keller is losing an estimated $20.9 million per year in liquor sales. That represents roughly $418,000 in sales tax revenue, according to the report.

Much of that money is being spent at liquor stores in surrounding cities, such as Colleyville, Fort Worth, North Richland Hills, Roanoke, Trophy Club, Watauga and Westlake.

Keller Mayor Pat McGrail said allowing liquor stores to open in Keller would not only keep those dollars in the city, but it would also bring in customers from other cities, such as Grapevine and Southlake, that do not allow off-premise packaged liquor sales. He said that a conservative estimate calls for Keller to bring in at least $200,000 in new sales tax revenue each year if liquor stores are allowed to operate in the city.

The tax benefit
The result of that new sales tax revenue would be reflected on residents’ property tax bills, McGrail said.

“They’re going to buy [liquor] one way or the other, so if they’re going to buy it, let’s let them buy it here in Keller. We can keep the tax dollars in town and also bring another commercial development that will bring more tax dollars on the building itself,” McGrail added. “It’s money we can pass onto the citizens as far as further tax reductions.”

Property taxes generated from a liquor store could also help keep residents’ taxes low. As Keller runs out of space for new commercial development, tax revenue generated from liquor sales will play an important role in maintaining the current property tax rate, McGrail said.

“Because we’re 85% built out, there’s only so much more room for so much more commercial growth,” he said. “Once that’s gone, then there will be no new revenue coming to town, and something has to pay the bills. We’re going to do everything we can every year to lower property tax, and this will be another thing that will help us do that.”

Though a liquor store in Keller would aim to bring in customers from surrounding cities, Roanoke officials say they are not worried about losing sales at their local store, Liquor Stop.

“I don’t think we’re concerned that any of our businesses would suffer if something similar opens in a neighboring city because I think the market is there in this entire region to support them all,” Roanoke City Manager Scott Campbell said.

Potential for development
If residents vote in November to allow liquor stores in Keller, the city would look for a business “that fits the Keller culture,” said Trina Zais, Keller’s director of public services and economic development.

When Singh or another developer brings a proposal for a liquor store to the city, Zais said she will be looking for a shop with a minimum footprint of 10,000 square feet and a wide variety of choices.

“We’re really looking for that destination location,” Zais said.

She estimates Keller could support up to two liquor stores if they are spread across the city.
Singh, who is CEO of Simarn, a software, consulting and staffing business, owns a medical and office building in Keller. He is also constructing another property.

He plans to add to that portfolio with a liquor store expected to open fall 2020.

The store will be a new build. Singh is evaluating what brand and type of liquor store he wants to bring to Keller.

“Our plans are to operate an upscale package liquor store with a full range of fine wines, beers and specialty liquors that provides an enjoyable experience to our consumers with tastings, pairings, events, et cetera,” he said.

Singh initially plans to open one store in Keller but said he would consider building a second location depending on demand and the success of the first shop.

Timeline
If voters approve the alcohol measure in November, the city would update its unified development code later that month or by early December. That update paves the way for Singh or another developer to apply for a special-use permit for a liquor store.

Zais said she expects the permitting process to take six to eight weeks. It would take another five to six months to build a store.

Editor’s note: The original post has been edited to correct an error. The election will be Nov. 5.
By Korri Kezar
Korri Kezar graduated from the University of Texas at Austin in 2011 with a degree in journalism. She worked for Community Impact Newspaper's Round Rock-Pflugerville-Hutto edition for two years before moving to Dallas. Five years later, she returned to the company to launch Community Impact Newspaper's Keller-Roanoke-Northeast Fort Worth edition, where she covers local government, development, transportation and a variety of other topics. She has also worked at the San Antonio Express-News, Austin-American Statesman and Dallas Business Journal.


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