Phila 1% SalesTax Rise

From the Inquirer

Nutter wants to hike sales tax; will save libraries, pools, health centers
By Jennifer Lin, INQUIRER STAFF WRITER Posted on Wed, Mar. 18, 2009

In a bad news-good news press conference today, Mayor Nutter said he wants to impose a temporary one-percent sales tax to raise revenue - but added that he would direct some of the money to keep open libraries, pools, homeless shelters and community health centers.

Nutter said a sales tax for only three years could generate $340 million. He added that the measure would have to be approved by lawmakers in Harrisburg.

Standing on the baseball field at the Marian Anderson Recreation Center in South Philadelphia, Nutter said, "No one likes to propose raising taxes. It's not the most comfortable place to find myself, but the alternatives are worse."

The proposed sales tax comes on the heels of an announcement Monday by the mayor that he also wants to increase property taxes.

The mayor tempered the news of his proposed sales tax by outlining all the services that the money could save, such as:

Keeping open all libraries;

Maintaining the hours of all recreation centers;

Maintaining all eight community health centers;

Retaining 3,390 slots for after-school programs;

Retaining all services for abused and neglected children;

Maintaining funding for homeless shelters.

Previously, his administration had been examining big cuts in each of those areas.

In addition to asking the General Assembly for approval to impose a three-year sales tax, the city also is asking for relief for how it amortizes the unfunded portion of its pension fund. Under the city's proposal, the timeline for that liablity would be stretched over 40 years instead of 20.

Nutter said if those two measures are not approved, the cuts in essential services would be drastic. "It is absolutely a place where none of us wants to go," Nutter said.

The reaction to the Mayor's announcement was mixed.

A coalition of unions, homeless advocates, churches and anti-poverty groups had mixed reactions to today's announcement.

Many were relieved that there would not be cuts to the city's homeless system or community health centers.

But they saw a sales tax as too punitive to the city's poorest residents.

If the city has to raise revenue via higher taxes, the approach should be more "fair and equitable," said the Rev. Jesse Brown, of the Calvary Lutheran Church in West Philadelphia.

The mayor, Brown said, is not seeking to raise the business or wage taxes. "It should not only be individuals of the city who are responsible for closing the budget with higher taxes, but also businesses."