A Common Pleas judge yesterday refused to stop Allegheny County's 10 percent drink tax from taking effect on Tuesday, but restaurateurs and bar owners said the legal fight is not over.
"We are disappointed because this is a bad day for the hospitality industry in Allegheny County, but from a legal standpoint, we have barely started [challenging the drink tax]," said Cris Hoel, an attorney for Friends Against Counterproductive Taxation, a lobbying group opposed to the levy.
The tax, which will take effect at 6 a.m. Tuesday, was enacted by Allegheny County Council on Dec. 4, as part of a dedicated funding stream for the county's $30 million subsidy of the Port Authority.
FACT, which comprises several Pittsburgh restaurants and bars, has requested a hearing for a preliminary injunction in Common Pleas Court to present "a more comprehensive case" against the new levy, Mr. Hoel said.
The group's bid to stop the tax temporarily this week, by arguing that it was both unconstitutional and impossible to enforce and collect by Jan. 1, was rejected yesterday when Common Pleas Judge W. Terrence O'Brien denied a motion for emergency relief.
"While many vendors covered by [the drink tax] ordinance will doubtless experience inconvenience and difficulty during the early weeks of collection of this new tax on alcoholic beverages, plaintiffs' offer of proof in this regard did not convince me that compliance with the ordinance is, as they allege, 'impossible,' " Judge O'Brien wrote.
"Furthermore," he added, "... plaintiffs have not shown that they are likely to prevail on the merits of the other issues raised."
Allegheny County Solicitor Mike Wojcik, who on Thursday told Judge O'Brien that even a temporary halt in the tax would throw the county's budget into disarray, said he is looking forward to the continuing legal challenge.
"I am pleased with the court's decision," he said. "The judge supported our position and I look forward to the next step."
County Chief Executive Dan Onorato welcomed the court ruling, saying "Judge O'Brien's decision allows us to hold the line on property taxes here in Allegheny County for the fourth consecutive year."
Mr. Onorato, who had vowed not to raise property taxes, asked state lawmakers this summer to approve Act 44, a highway funding bill that authorized the county to levy the drink tax and a $2-a-day tax on car rentals to fund mass transit.
"This ruling is a big disappointment," said Sean Casey, owner of the Church Brew Works in Lawrenceville.
A co-plaintiff in the suit together with the Big Burrito Restaurant Group, Mr. Casey said many restaurateurs and bar owners were hoping for an injunction because they need time to update their cash register systems.
"A lot of [restaurateurs and bar owners] want to comply with this drink tax, but we have a small window of time," he said. "We were hoping that [Judge O'Brien] would realize that."
Mark Gillie, a Pittsburgh general manager of MICROS Systems Inc., which sells, installs and updates cash register systems for restaurants and bars, said most of his company's clients likely will fail to update their systems by Tuesday.
MICROS, which has more than 260 clients in the county, has been flooded by requests from customers. So far, fewer than 10 percent of them have been served, Mr. Gillie said.
"We are disappointed the judge didn't grant the injunction," he said. "Many of our clients will not have time to retool."
Karamagi Rujumba can be reached at email@example.com or 412-263-1719.