Council Gives Preliminary Approval To Budget With Property Tax Hike, Stalls Soda Tax Legislation

City Council today gave preliminary approval to a temporary 9.9 percent property tax increase, but did not move Mayor Nutter's proposed soda tax legislation out of committee.

Nutter lobbied hard for a soda tax as part of his $3.9 billion budget plan. He originally proposed a tax of 2 cents per ounce, which faced massive opposition from the soda industry, local unions and business owners – who launched a huge campaign against the proposal. More recently he was gathering votes for a 3/4 cent per ounce tax, but couldn't get to 9 votes in time today.

"We need nine votes," said Councilwoman Marian Tasco. "The mayor has a week to talk to people."

Nutter's original budget proposal also included a $300 per-household trash fee. But council balked at the trash fee, preferring a property tax hike, which they said was less regressive. Still, many members didn't want to do a double-digit property hike, which led to the 9.9 percent agreement, set to last for two years.

The tax proposal must get final approval from Council next week.

Nutter has put the budget deficit for the coming fiscal year at up to $150 million. The property tax plan yields about $88 million annually. Nutter also agreed to cut an additional $17 million. If Nutter does not get the soda tax in some form, his aides have argued that the city's surplus fund balance will dip dangerously low. But some on Council weren't so sure.

"We have a proposal without sugar [beverage tax], which gives a $40 million plus fund balance," Councilman Darrell Clarke said.

Council also approved proposals to tax some tobacco products and increase trash collection fees for commercial properties, which will enhance revenues further.