Mayor Nutter unveiled a plan to raise $95 million for the cash-strapped school district and City Council appears to be on the fence about it.
Nutter is seeking a 5 percent hike on the liquor-by-the-drink tax and a new $2 per pack cigarette tax, which would bring in $22 million and $45 million, respectively. Both require state enabling legislation.
But the clock is ticking and Council's drop dead deadline to pass a budget is June 30.
"We do require state enabling legislation to even have a vote or a debate," said Council president Darrell Clarke. "Time is winding down. We have approximately a month and a half left. So whatever is going to happen in Harrisburg would need to happen relatively soon."
And while some say it's a long shot, state Sen. Anthony Williams was optimistic.
"For those who question whether it's achievable, because this is enabling legislation from Harrisburg --which is going to generate about $60 million with $30 million coming from collections here --all three home runs in Harrisburg."
Both city and state legislators would likely face intense opposition from the restaurant and tobacco industries.
"From my long term experience in dealing with these particular industries, I suspect they're going to fight tooth and nail," said Councilman Jim Kenney, who added he is against a tax on booze.
"Here is the problem with the liquor tax: we collect 40 percent of it," Kenney said. "So, we have 10 a percent tax which we have 40 percent collection rate...so the solution to that is taking the 40 percent of the people who pay and hitting them with 5 percent more. It's just patently unfair."
Nutter pledged to step up tax collections to bring in an additional $28 million from property taxes and other taxes that help fund schools.
Also on the table is a bill sponsored by Councilwoman Maria Quinones-Sanchez that would raise extra money for schools through a business tax known as the use-and-occupancy tax (U&O). Under the bill, a quarter of the revenue raised from U&O, which currently goes directly to the school district, would go to the city. The total take from the tax is expected to increase under the Actual Value Initiative and could bring in between $32 million and $72 million, most of which would go to the school district.
"We have to do something," said Councilman Curtis Jones Jr. "We're running out of runway. September is going to come whether we're ready or not."