Trash Fee, Soda Tax Are Go
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Trash Fee, Soda Tax Are Go
Catherine Lucey
Top aides to Mayor Nutter today said the proposed trash fee and soda tax in the mayor’s budget plan would stave off service cuts and improve quality of life in the city.
City officials today laid out the details of the $3.87 billion budget plan for the 2011 fiscal year, which starts July 1. As first reported by the Daily News, the plan will contain a trash fee and a tax on sugary drinks. Here are the details:
- The trash fee would be $5.77/week or $300/year for property owners and would be placed on your real estate tax bill. Some low income households will qualify to pay a $200 fee instead. This fee would be effective July 1 and is expected to bring in $108 million annually.
- The sugary drinks tax would be 2 cents per ounce of soda, juice and other sugar beverages. That tax would be charged to retailers, as part of their business privilege tax. Presumably they would pass the charge on to consumers. It will yield $77 million a year, but because it won’t start until January 2011, this tax would generate $39 million in the 2011 fiscal year.
Officials said these new charges mean they will not have to make any major service cuts to close a projected budget gap of up to $150 million in the 2011 fiscal year. Over five years, that number will grow to $500 million to $700 million. That’s due to lower than expected tax revenues, coupled with some unplanned expenses, like the cost of snow removal.
“The budget was designed to avoid more service cuts,” said city Finance Director Rob Dubow. “When we looked at the budget this year there were two things we didn’t want to do: service cuts and we didn’t want to increase the rates of any of our existing taxes."
Last year the mayor had to close two budget gaps in several months, slashing $2.4 billion from the city’s five-year financial plan and drawing community outrage over his proposals to close libraries and cut services. This year's budget plan -- which the Mayor will formally unveil in his budget address tomorrow -- must now go to City Council for approval.
Nutter officials said the two new charges – which they said would be permanent -- would help them combat obesity and clean streets, in addition to generating revenue to balance the budget. A small amount of revenue from the charges would go to anti-obesity programs and street cleaning efforts. Mechanical leaf collection will be restored in the neighborhoods.
But some questioned the new charges. Brett Mandel, former head of the tax-reform organization Philadelphia Forward, said the trash fee would disproportionately affect those with lower incomes. The proposed trash fee is structured differently than in many cities, which use a “pay as you throw” model, meaning the fee is based on how much trash you put out.
“It’s a horribly regressive thing to do,” Mandel said. “It would be applied equally to folks regardless of their means. Even worse, if you’re going to make this a charge based on trash, it should be a charge based on what you throw out.”
Deputy Mayor for Transportation and Utilities Rina Cutler said the city chose a flat trash fee for the simplicity. She also said that citizens can get a financial boost through the Recycling Rewards Program, which provides coupons to neighborhoods with high recycling rates.
Tony Crisci, general counsel for the Pennsylvania Beverage Association, slammed the soda tax, saying it would cost jobs in Philadelphia, where there are two soda bottling companies.
“What ends up happening there, is there will be a reduction in sales. If there’s a reduction in sales, there will be a reduction in production. If there’s a reduction in production, there’s a reduction in jobs,” Crisci said. “This is clearly a grab for money.”
Deputy Mayor for Health and Opportunity Don Schwartz said a soda tax would help Philadelphia, which has the highest obesity rate of the top ten cities in the nation.
“We expect that over time, this will provide a good revenue source for obesity prevention,” Schwartz said.
Ok...it does ZERO good complaining on any of these post type sights. Don't you people understand, Nutter and the other lackey's do not care one bit about the city of Philadelphia and the people that live here. Once in office, they do as they please. A year from now, they will be crying again after they blow through this little windfall, and we will get hit with a "wear and tear on the walkways" tax. Concrete dont come cheap!!! I will say this, hell of a suit Nutter had on while he was announcing how much he was going to pick out of my pocket.— amass1972
Another tax another mass of tax paying Philadelphia residents making their way for the suburbs. Enough is enough already Nutter.- So only homeowners who already prop up the city by paying property taxes will be burdened with this trash tax? Philadelphians, are you going to lie there and take this? Vote out any council person who supports this tax and certainly vote out that disappointment who calls himself our mayor. I am a hard-core liberal and I promise to fight along anyone who wants to oppose this legalized "rob the citizens because we have power over them" tactic. I can promise this: I will never buy another thing in a Philadelphia store. Nutter won't be getting my 2 percent taxes. Eventually, that will make up for the extra $300 his stealing from my family.— Jame
- I'm really happy I live in the NE right near Rockledge, which is in Montco. I will be buying all of my soda there from now on, so congrats to the people of Montgomery CO, our idiot mayor has just provided you with more revenue. As for the garbage tax, that will really be a circus, between the people from the "hood' that won't pay anything, to those that live in apts. that won't pay anything, etc. Impeach this clown today!— drbob1
- What a pathetic excuse for an executive. You don't want to burden folks by raising "existing taxes" so instead you invent new taxes. All of which will go up, up, up as the city goes down, down, down. Well, maybe Philadelphians are THAT stupid to allow it.— GOOMBY
I've been debating about moving to Lehigh Valley when I get out of the Army...how is it up there? I have all my family in Philly, but hopefully, LHV seems nice and is far enough away from Philly.— kjuggs77- Is this guy serious? WHEN IS THE NEXT MAYORAL ELECTION? SEE YA NUTTER— madnvocal
- Ok come on rulz...sin tax??? LOL...Im sure I could find a nice vice or two in your closet to tax out the ying yang. nobody is perfect...stop being an elitist...— amass1972
- You wonder how Philadlephia got in such dire straits and then you witness first-hand 12 consecutive years of John Street and Nutter and it all becomes crystal clear. This is just tragic for Philadlephia.
Soda Tax??? HAHAHA....so when are they going to tax milk/milk products? Gallon of milk....TAX Pint of choc milk....TAX Coffee....whoa, dont use cream.....TAX— TheBlank- Does anyone really believe the "trash tax" is going to get paid? Won't most people just go dump their trash in empty lots instead of paying it? Not only will it NOT raise revenue it will make the city even trashier.
- this is what happens when poor people trade their vote for promises of the gov't taking care of them... someday, these citizens might develop a sense of shame once the well runs dry and stop depending on big brother to provide them with 'entitlements.' Nothing's free...— kjuggs77
- They need to get the city pensions under control ASAP. They start collecting money owed and then cut the bloated payroll and finally you can raise taxes if needed.— Taxpaying Voter
- Wait a minute. Didn't this start out as just a tax on soda? Now it's all sugary drinks? What BS. As for the trash fee, it pretty much amounts to a property tax hike if it's going to be tacked on to a homeowner's real estate tax bill. That means my mortgage payments go up. I bet someone figured that if they sent the $300 at the end of the year, people could revolt and protest by not paying.— The_Unknown-Poster
- How about ending the 10-year tax abatement instead? Collecting the Millions of dollars that have been lost to this alone could have helped toward averting the "crisis". Just think - the tax abatement recipients probably won't be paying it either, but their trash will still be collected. The same people will probably move away once the abatement is done.— dee99999
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David Gambacorta spent a small eternity writing about cops, drug dealers and serial killers. Now he’s writing about power and politics – which sometimes reminds him of the old crime beat. He joined the Daily News in 2005. And yes, he knows you’re not quite sure how to pronounce his last name. E-mail tips to gambacd@phillynews.com
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Jan Ransom, a native New Yorker, joined the Daily News in 2010 after graduating from Howard University. She has since written about the difficulty of filing police complaints, tax deadbeats and life after violent home invasions. She joined the Daily News City Hall Bureau in 2011 and has plunged headfirst into reporting on administration budget battles and City Council shenanigans. E-mail tips to ransomj@phillynews.com
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Sean Collins Walsh is from Bucks County and went to Northwestern University. He joined the Daily News copy desk in 2012 and now covers the Nutter administration. Before that, he interned at papers including The New York Times, The Dallas Morning News and The Seattle Times. E-mail tips to walshSE@phillynews.com
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