City asks the state Supreme Court to hear beverage-tax suit

The Kenney administration wants a final legal decision on the sweetened-beverage tax.

In a King's Bench application filed Thursday, city attorneys asked the state Supreme Court to hear the case, currently under appeal in Commonwealth Court, arguing the pending litigation is stalling programs the tax was created to fund.

"The importance, scale, and overall impact of these initiatives - which will remain in limbo as long as a legal challenge to the [tax] remains pending - warrants immediate review of respondents' appeal by this court on an expedited schedule," the application says.

Attorneys for those appealing the tax - the American Beverage Association, along with local restaurants and merchant associations - did not oppose the motion. According to the application, the appellants disagreed with other items in the application, which they will address in a future filing.

The city argues that if the tax is still under appeal come September, the city pre-K program, funded by the levy, will not expand. The city has funded 2,000 new pre-K seats through this fall.

"We feel like we need to be financially conservative," said city spokeswoman Lauren Hitt. "If we don't have the tax, we can't do pre-K."

The city says a pending appeal would also force it to delay borrowing $300 million for renovations of parks, recreation centers, and libraries. As a result, the William Penn Foundation, which has pledged $100 million toward the project known as Rebuild, would withhold $95 million pledged to the initiative, according to the application.

William Penn has already given the program $5 million, which would allow Rebuild to move forward with planning and design, Hitt said.

The 1.5-cent-per-ounce tax on sweetened beverages went into effect this week and is projected to bring in $92 million per year.

Money collected from the tax while it is under appeal will be put into reserves specifically earmarked for pre-K, community schools, and Rebuild, Hitt said.

This is the second King's Bench motion filed in the case. In November, the Pennsylvania Supreme Court declined an application by the attorneys challenging the tax. The city did not oppose the motion.

"We are hopeful this motion will lead to a different outcome," Hitt said. "We think that the case is in a different procedural posture."

Last month, attorneys challenging the tax asked for an expedited schedule in Commonwealth Court. If the case stays there, arguments would be heard the week of April 3.

jterruso@phillynews.com

215-854-5506 @juliaterruso