Ravenstahl proposes tax on sugary drinks
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If Pittsburgh Mayor Luke Ravenstahl has his way, sales of sugary drinks one day might be refreshing the city treasury.
Mr. Ravenstahl on Tuesday said he's interested in emulating Philadelphia Mayor Michael Nutter's plan to impose a 2 cents-per-ounce tax on the sale of drinks such as soda, sweetened tea, energy drinks and flavored water.
Diet drinks and fruit juices would be exempt.
Mr. Nutter estimates the proposal will net Philadelphia $77.2 million a year. Joanna Doven, Mr. Ravenstahl's spokeswoman, estimated that Pittsburgh could reap $25 million a year. She said the figures are based on consumption statistics from the Rudd Center for Food Policy and Obesity at Yale University.
The proposal comes as Mr. Ravenstahl, who proposed a tax on university tuition and then dropped the idea last year, continues to seek ways to bolster city coffers. One problem is coming up with an additional $15 million a year for the troubled pension fund.
Mr. Ravenstahl will discuss the possible sugary drink tax during meetings next week with lawmakers in Harrisburg. Officials previously said he was making the visit to discuss other possible revenue sources, such as increasing the EMS tax on people who work in the city from $52 to $144 annually and extending the payroll-preparation tax to nonprofit groups.
All three proposals would require legislative approval. Ms. Doven said the cash-strapped city needs as many options as possible.
"We just can't afford to put all our eggs in one basket," she said.
The Pennsylvania Beverage Association, which represents bottlers, franchise holders and suppliers, has opposed Mr. Nutter's proposal and said it hopes officials here "will reject this plan before it even takes shape."
"If the Philadelphia idea is exported to Pittsburgh, the cost of juices, soft drinks, energy drinks, and even flavored milk could increase significantly -- making the prices of groceries even higher. And, the cost of fountain drinks in restaurants and convenience stores could be affected, too," Tony Crisci, the association's legislative counsel, said in a statement.
"The last thing Pittsburghers need is another drink tax," he said, referring to an Allegheny County tax on served alcohol.
Ms. Doven said Mr. Ravenstahl and Mr. Nutter were to discuss the tax proposal by phone Tuesday. Mr. Ravenstahl also sent his counterpart a letter of support.
"Know that you have an ally across the state that is ready and willing to join you in this fight," the letter said.
After abandoning the tuition tax proposal amid criticism from students and universities, Mr. Ravenstahl convened a panel of government, academic and civic leaders, called the New Pittsburgh Coalition, to generate revenue ideas. No consensus has been reached by the panel, whose members have conflicting interests.
Mr. Nutter introduced his sugary drink tax March 4, and it's being debated by the city council.
Philadelphia does not need legislative approval for the measure because the tax would be considered part of its business privilege tax, Ms. Doven said. Pittsburgh no longer has a business privilege tax.
Mr. Nutter's plan would tax sugar-sweetened drinks sold at stores, restaurants and vending machines.
He said the taxes would finance obesity-prevention programs, generate operating revenue for the city and encourage a healthier lifestyle. The proposal is part of his Healthy Philadelphia Initiative.
The beverage association has joined a coalition of groups, including unions representing workers in the beverage industry, in opposing Mr. Nutter's proposal.
First Published March 17, 2010 12:00 am