Bill to hike liquor-drink tax stalls in City Council

Posted: June 14, 2013

IS MAYOR NUTTER'S proposal to increase the liquor-by-the-drink tax to aid the struggling school district dead?

City Council President Darrell Clarke opted not to call up the bill for a committee vote yesterday. It would help plug a $304 million budget gap by raising the tax from 10 percent to 15 percent.

The nine votes needed to ultimately pass the bill weren't there, but Clarke wouldn't say the bill was dead. He stressed that the city needs state-enabling legislation for Nutter's proposed hike to the booze tax, which would raise $22 million.

But the same is also true for another Nutter proposal - a $2-per-pack tax on cigarettes that would raise $45 million for the schools, which a Council committee approved two weeks ago.

So, what's keeping the booze tax hike in limbo?

For starters, it's not clear if there's a consensus within the Philadelphia delegation in Harrisburg, and some Council members don't want to vote on a bill that might never get state authorization.

"The cigarette vote was 17-0. There was clearly a consensus for that," Clarke said.

Members also say the district's request from the city was for $60 million. The cigarette tax coupled with Nutter's promise to increase tax collections by $28 million would get schools more than the amount requested.

Still, Nutter, who was in Harrisburg on Tuesday lobbying for support for his plan, remains hopeful that Council will move forward with the liquor-by-the-drink proposal. The school district also asked for more than $100 million each from the state and the teachers' union, which will be a challenge to get on both counts.

"As tough an issue as this might be politically for some on City Council, it will be far worse for Philadelphia schoolkids next school year if we don't pass this legislation," said mayoral spokesman Mark McDonald.

Council must approve a plan by the end of the month.

Another option on the table that is within Council's control is a proposal by Councilwoman Maria Quinones-Sanchez that would raise $30 million for schools by increasing a business tax known as the use-and-occupancy tax. Nutter opposes the measure, and it's not clear if there is enough Council support for it.

In other news:

* A Council committee barely approved a proposal sponsored by Councilman Wilson Goode Jr. that would amend the 10-year property-tax abatement for new construction by capping the applicable value at $500,000. The abatement also would reduce gradually over 10 years.

* The committee also approved a $3.8 billion operating budget - about $50 million more than Nutter's proposal - that included more money for the Health Department, District Attorney's Office, Office of Arts and Culture and Sheriff's Department.


On Twitter: @Jan_Ransom

Blog: ph.ly/PhillyClout

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