With time running out for a final budget deal, many in Philadelphia City Council are working on ways to avoid voting for a sugary drink tax.
A new proposal is drawing both support and opposition.
“I guess the rubber’s getting ready to meet the road and we are going to have to make some grown up decisions coming up,” said Councilman Curtis Jones during City Council’s regular session reminding his colleagues that a budget is due by the end of June.
Also during the weekly session, Councilwoman Blondell Reynolds Brown introduced a bill that would impose a 15 cents tax on containers, regardless of what kind of beverage is inside, in order to raise money without taxing soda and sugary beverages.
“Our numbers tell us that we could conservatively yield $64 million to $78 million, so does it fall short of the current proposal in front of us? It does, but we still have to negotiate the current proposal before us and we’re not there yet so this becomes part of our continued negotiations and discussions,” Reynolds Brown said.
Council President Darrell Clarke says he’s intrigued by the container tax proposal.
“I think it’s quite an interesting idea for the city of Philadelphia. I concur with the councilwoman’s notion that the universal nature of the proposals be it pre-K or recreation centers and libraries across the city are clearly citywide. I think having a sense that the tax should in fact be a tax that is broader in terms of the revenue sources,” Clarke said.
But Council Majority Leader Bobby Henon was quick to criticize the idea.
“The introduction of the container tax proposal made the myth of the grocery tax a reality,” Henon said. “The container tax touches nearly every drink on your grocery store shelves. Compared to the sugar-sweetened beverage tax, this tax will be impossible to avoid.”
During the same council session, Cindy Bass called for hearings on enforcing the existing liquor by the drink tax better.
“It’s really an honor system, you can pay, you can pay something, you pay a little something they stay off your back but how much auditing have we done with this program?” she asked. “And collection, and how much have we looked at it. I don’t think we’ve looked at it at all.”
She thinks it could collect an additional $36 million, but Mike Dunn, spokesman for the Kenney administration says the city captures 91 percent of the tax from all those who sell liquor, including Bars and Deli’s during the year it is owed and 97 percent by the end of the second year.
Dunn adds that all of the tax goes to the school district so it could not be used for the Kenney initiatives.
Bass says she was specifically told by the revenue department they don’t collect any tax from stop and go’s, small deli’s that sell shots of liquor as part of their daily routine. Dunn says they are trying to find the person that told the council member that because it is wrong.
The individual tax efforts can’t match the revenue projected for the sugary drink tax, which is expected to bring in $95 million a year. Mayor Jim Kenney wants to use that to pay for universal pre-K and repairs to recreation centers, among other things.
Council President Clarke hinted that a counter-proposal is on the way.
“When you have a number of proposals and I agree when you have a number of ideas you tend to have a better endgame as it relates to a solution for the problem,” he said. “When you have this one notion that this is the proposal accept it or not and not have the willingness to entertain other alternatives or maybe improvements, I don’t think you end up with a good process.”
Mayor Kenney says the so-called soda tax is the only way to bring in enough to fund his programs. He says a combination of taxes just won’t be effective.
“We’re at 3 cents an ounce and that’s where we are and that’s what will fund this,” Kenney said. “All the other jumping through hoops is not going to change the fact that’s where the money can come from with very little pain.”
Council normally tries to settle these issues by the end of May, but the hard deadline is the end of June.