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Onorato says he'll go to mat for drink tax
Friday, May 02, 2008

If restaurateurs and bar owners want a fight over Allegheny County's 10 percent drink tax, Chief Executive Dan Onorato says he will give it to them in court, on the ballot and anywhere else, because the alternative is to raise property taxes, which he won't do.

"I am trying to manage the finances of this county and [the restaurateurs and bar owners] are fighting me, but they're not telling people the whole story," Mr. Onorato said yesterday.

He proposed the drink tax and a $2-a-day tax on car rentals last year to fund the county's $30 million subsidy of the Port Authority. The levies, which were approved as part of the county's $727.6 million budget, were implemented this year.

A group of restaurateurs and bar owners, Friends Against Counterproductive Taxation, on Wednesday filed an amendment to its December lawsuit trying to overturn the drink tax.

The group, which is seeking to have the case certified by the court as a class action on behalf of all liquor license holders in the county, also plans efforts to force another vote in County Council on the tax, and then a November referendum.

Mr. Onorato said attempts to put political pressure on his administration will not work, saying he will hit back where voters feel most vulnerable -- on issues concerning their homes.

Citing property tax increases in five counties around Allegheny since 2002, Mr. Onorato said, "If we take away the drink tax, the only option I will be left with to fund mass transit will be a property tax increase. Nobody is telling that side of the story. How will people feel about raising their property taxes by 25 percent?" he said.

Mr. Onorato and other administrators said Armstrong, Beaver, Butler, Washington and Westmoreland counties all have seen 19 percent to 35 percent increases in property taxes since 2002, while Allegheny County's were unchanged.

"When I took office four years ago, I drew the line on property taxes. Since then, I have had a proven record of downsizing government. Not only have I not raised taxes, I have absorbed the inflationary costs of keeping our tax rate at what it was in 2002," Mr. Onorato said.

Some have criticized Mr. Onorato for adopting a base-year assessment system that keeps property values frozen at 2002 levels, negating any possible revenue growth in property taxes.

Citing a Wall Street Journal story about how cities, counties, and municipalities across the country are raising property tax rates to fund local government and services like mass transit, he said that is precisely what he was trying to avoid when the Legislature gave him the option of using drink and car rental taxes for the Port Authority.

"I wanted to use part of [Allegheny County's 1 percent] sales tax, but Harrisburg said no. They gave us the drink and car rental taxes because those were the options that have been tried in Philadelphia and other cities," he said.

The drink tax is here to stay, Mr. Onorato said, unless its opponents "can come up with serious alternatives." So far, they haven't, he said.

Karamagi Rujumba can be reached at krujumba@post-gazette.com or 412-263-1719.
First published on May 2, 2008 at 12:00 am
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