McCullough Lauds Decision

Allegheny County Councilman today expressed his support for the decision made by Common Pleas Judge Judith F. Olson's to restrict drink tax revenue solely for Port Authority use.

McCullough says the judge made a brave decision and restored the rule of law in Allegheny County. The Councilman says the next step is for County Executive Dan Onorato to address the council and explain his intentions for the $12 million in tax revenue.

Onorato Will Not Appeal Ruling on Drink Tax Cash Appropriations

Allegheny County Executive Dan Onorato yesterday announced that he will not appeal Common Pleas Judge Judith F. Olson's decision to restrict drink tax revenue solely for Port Authority needs. He says that as per the judge's ruling, the $12 million slated for the county's transportation budget will be given to PAT for capital needs in 2009 and 2010, and that he will not raise property taxes to mend the deficit left in the county budget. Onorato mentioned that layoffs could possibly make up part of the deficit.

Meanwhile, although the drink tax was cut from 10 percent to 7 percent on Jan. 1, some bar owners continue to charge the same price for drinks. Some owners cite the poor economy for their price increase. Though it would not be illegal to charge more for drinks, County Treasurer John Weinstein says it would be illegal if the drink tax still appeared as 10 percent on patron's bills.

F.A.C.T. Hearing

After filing a lawsuit against Allegheny County on Dec. 18, F.A.C.T. members appeared in front of Judge Judith Olson in the Allegheny County Court of Common Pleas. They argued that the county is not allowed to use surplus money raised from the 10 percent drink tax or the $2 per-day tax on car rentals on anything other than the region’s Port Authority transit system. Allegheny Councilman Chuck McCullough said road and bridge restoration and repair should not count as an earmark.

However, Allegheny County Solicitor Michael Wojcik said the drink tax and car rental tax under Act 44 is "to provide financial support for transit systems." More constricted wording could have clearly marked the money for only the Port Authority to use.

Judge Olson said a decision on whether to place an injunction will be issued as quickly as possible.

Drink Tax Fight Goes On

Starting in January the Allegheny County tax on poured drinks will drop from 10% to 7% but that does not satisfy Kevin Joyce. Joyce manages the Carlton Restaurant in Pittsburgh and is a member of the Friends Against Counterproductive Taxation (FACT) board. He says he wants to see that tax rolled back to at least 3%. His group has been fighting against the tax since its inception. FACT is currently involved in an appeal to overturn a court ruling that prevented a question that would the drink tax to 0.5% from appearing on the November ballot. A hearing in that appeal is expected in late January with the goal of placing it on the May ballot. Today the group argues before a judge that the county must spend the funds on Port Authority operations and not on other transportation projects as is specified by the 2009 budget. Joyce says in 2008 the county will collect $44-46 million. That is $17-20 million more than needed for the Port Authority. Joyce says the county could roll the tax back to 3% and still meet PAT’s needs. However, he says had it not been for the efforts of FACT the tax would still by at 10%. Fact has also filed a lawsuit claiming that the county’s plans to use drink tax money to fund other transportation projects is illegal.
Joyce says the 10% tax has had a big impact on his sales. He says since January food sales have been up $42,000. That would usually result in $12-13 thousand in additional liquor sales. Instead, he says, liquor sales dropped by $100,000. He thinks the damage has been done and the lowering of the tax will not be enough to change the mind set that it is too expensive to drink in a bar or restaurant in Allegheny county.
Joyce says his patrons see the drink tax in a separate line of their bill so they will see a price reduction in January but for bars that do not present itemized checks they will have to decide what to do with their pricing. He says he thinks many will lower their prices but he says many bars have seen prices increase and sales drop so they may need to leave the prices where they are. He feels restaurants and bars are hurting with the tough economy and lawmakers need to understand how much worse the tax has made it. FACT plans to be active in upcoming county council elections in an effort to “change the face of county government.”

Lawsuit filed against Allegheny County Council

The people of F.A.C.T. (Friends Against Counterproductive Taxation) have filed a lawsuit against the Allegheny County Chief Executive and Council about how surplus drink tax dollars can be used. Kevin Joyce, F.A.C.T. member and owner of The Carlton Restaurant in downtown Pittsburgh, says the drink tax and car rental tax revenue is strictly raised for the Port Authority. The tax surplus is estimated to be between $17 and $20 million by the end of the calendar year, which the county council decided to transfer to a general county fund at a recent meeting.

The general fund could use the money to improve county roads and transportation. However, Joyce says it is a loose link to say the drink tax money is fixing a road where a Port Authority bus travels.

Onorato Plans To Lower Drink Tax In 2009

County Executive Dan Onorato says when he presents his budget proposal to county council he will recommend the drink tax be lowered starting in 2009. County Council member Jim Burn will introduce legislation needed to reduce the tax, but drink tax opponent Kevin Joyce says the proposed reduction is not an acceptable compromise. Onorato says any revenue that exceeds what is needed to fund the port authority will be used for infrastructure needs in the county.

The drink tax is currently on pace to exceed the proposed amount of revenue, Onorato said when he came up with his figures for what he felt the tax would bring in he wanted to be fiscally responsible and not over estimate the figures. The $2 a day car rental tax will not be changed for 2009.

Challenge Filed to Drink Tax Petitions

Citizens Against Raising Taxes on Property (CARTOP) will challenge the petitions filed to put a question reducing Allegheny County’s drink tax from 10 percent to 0.5 percent. The challenge must be filed by 5:00pm Tuesday. CARTOP President Shawn Flaherty says the petitions included names like Steelers Mascot Steely McBeam and signatures from people who do not live in Allegheny County. He says of the more than 44,000 signatures submitted, only 16,000 are valid. That would be well below the 23,000 needed. Flaherty says his organization is ready to go before a judge and point out every signature that is invalid. A three-judge panel threw out both drink tax referendums, but that decision has been appealed.

Friends Against Counterproductive Taxation Challange the Drink Tax

FACT, or Friends against counterproductive taxation held a press conference downtown at the Carlton Restaurant to announce their "Whiskey Rebellion 2" which is a campaign against the Allegheny County Drink Tax. They Provided estimates of what they say are going to be the total lost revenue as a result of the drink tax. FACT projects by years end 63 million dollars of sales will be lost in the county. Over the first 16 weeks FACT claims 21 Million Dollars have been lost. FACT Executive Director Michele Burchfield has challenged Dan Onorato and Rich Fitzgarald to a public debate over the tax as an attempt to reach an amicable solution.

Onorato Unveils Positive County Finance Information

Standard and Poor's Ratings Services has raised Allegheny County's debt rating from "A" to "A+" and Moody's Investors Services has changed the County's outlook status from "stable" to "positive." Allegheny County Chief Executive Dan Onorato says that these positive reports are a result of a tightened budget and sound fiscal planning that must continue in the future. Onorato cited these ratings and the fact that Allegheny County has not raised property taxes in 6 years against his opponents of the drink tax who claim he mismanaged the county. He says the choice is between a drink and car rental tax, or an increase in property tax and he refuses to increase property taxes. The Chief Executive challenged the homeowners of Allegheny County to join his side of the drink tax debate. Throughout the 6 years Onorato has been in office, neighboring counties all raised property taxes by at least 19%, while Allegheny County has not raised property taxes at all.