Wednesday, August 6, 2008

Dear Sean Casey and Friends....QUIT YOUR BITCHIN!

I am going to make a stand. The 1 or 2 people that read this blog and disagree with me be damned! I drink, and I like the drink tax. OK, I don't LIKE the drink tax, but overall, it serves a good purpose, and is at worst, is a minor inconvenience. What it is not, is a harbinger to the end of the restaurant and bar industry in Allegheny county as its opponents would have you believe.

The argument of the group known as FACT (Friends Against Counter-productive Taxes) has said that they do not feel it is their responsibility to bear the burden of helping out our local mass transit system, and that the tax will do more harm than good. First of all, for the record, I think it's sweet that they are all friends. I had no idea the local restaurant industry was such a close knit group.

Let's look at the arguments a little more closely shall we?

#1. What is the point of the drink tax? Right now, the Port Authority does not have a dedicated income source. It relies on state and federal grants, and fares in an attempt to meet its fiscal needs. The state (who is higher in the food chain by the way) has dictated that this funding will come from one of two places. Either a drink tax or an increase in property tax. Mr. Onorato and the city county government chose the drink tax.

#2 Why are bar and restaurant owners so angry????? Their main beef is that the drink tax will cause people to either decrease their drinking, or take it outside of Allegheny county, thereby causing a ripple effect where bars and restaurants would make less money, and possibly go out of business. Bottom line, they feel as though they are being unfairly targeted as the source of this tax that they feel they should not be involved in.
More specifically, their arguments are: 1. The tax is too high. 2. Problems with the Port Authority are not their problem. 3. The Port Authority has been stupid with money, and that is not their fault. 4. There are alternate methods for taxation, that will not cause the end of drinking in Allegheny county.

#3. My reaction: CALM DOWN. This is a classic example of Chicken Little screaming the sky is falling. I have yet to hear of a bar or restaurant that has had to close its doors for good because of the drink tax, and although I haven't seen figures, I have not heard one example in all the news and press coverage of this tax revolt about a substantial loss in business since the drink tax went into effect. Additionally, I will also respond to each previous point above with my own response.
1. 10 % does sound steep, granted. However, do the math. If you are drinking enough on a regular basis at a bar that 10% on your tab is too much , may want to seek help. Also, FACT has put a referendum in the November election to decrease the drink tax to 1/2 of 1 %. Honestly, why not just lobby for a repeal of the tax in the election? FACT claims their ballot as an "alternate solution". That's no solution, because nothing would be gained by the tax, it would rendered useless and more money would be wasted on its collection than made on the proceeds. In my mind, they are just being smart-asses because they are upset about the tax.
2. The fact is, the state of our transit system is every one's problem. Especially with gas prices that look like they've got no where to go but up. Investing in our transportation system is not pork, it makes sense.
3. I can't argue that the Port Authority has been dumb with its finances. There are many examples, including the approximately $400,000 in uncounted fares, and the fact that they have some of the highest labor costs of any transit authority in the nation. I will be the first to tell you reform is needed, and changes must be made to bring costs down, BUT that does not mean that they shouldn't get funding. It is possible to require reform AND fund them at the same time. The two ideas are not mutually exclusive.
4. First, see the response to #1. Again, reducing the tax that low is hardly an alternative. The other, less cynical alternative would be an increase in property tax. Did I mention how high this increase would be???? 25%!!!!! That is not a viable alternative. If FACT's main argument is that the tax is bad for business, imagine how bad a 25% increase in property tax would effect an already shrinking region! While it would be unlikely that someone would choose not to live in Allegheny County because of a drink tax, it would be much more likely for them to choose not to live in Allegheny County because of much higher property taxes. This could also spur on additional movement to surrounding counties where property taxes are lower. To me, that's a much greater consequence than paying an extra $2.00 on a $20 dollar bar tab.

Bottom line: The tax has had minimal consequences for local businesses, and has already beat projections for income generated (everyone knows we can drink in Western PA!), with no hard facts that business has decreased in Allegheny County. I am sick of hearing FACT's whining. We need to focus on the real issues that are holding our region back, and stop on the inconsequential crap. GROW UP RESTAURANT OWNERS


Anonymous said...

You are obviously oblivious. 10% is too high. They raised the money they needed in 7 months. Every bar turns in a slip every year with how much they make off the sale of alcohol. Dan Onarato knew there would be excess. It's not hard to see. How are you going to hold up businesses when small businesses are seeing declining numbers. Small bars and restaurants all over Allegheny county are closing due to increased liquor license rates and the drink tax.

East Busway Blogger said...

Do you have specific examples of "bars and restraunts closing all over Allegheny County."? The insinuation you are making is that there are rampant bar/restraunt closings and that is because of this tax. I am curious what references you have to make this statement. Do you have figures on how many bars/restraunts have closed, if that figure is up since the advent of the tax, and if the closing can be attributed the tax or some other reason?

Anonymous said...

You haven't driven around Pittsburgh lately? The amount of liquor bought by PA liquor license holders is down by 6.4% while in Butler, Washington, and Westmoreland they are up 10%. Funny Onorato was asked to do a study on the effects on small businesses and he declined. He knew there would be excess like I stated before.

East Busway Blogger said...

Because I live in the city, I have driven around the city. I've also driven through Bridgeville, Aspinwall, Tarentum, Penn Hills, to name a few. I haven't seen a mass increase in bars and restraunts closing. Come to think of it, I haven't seen any of the bars that I normally drive by close. There have been restraunts I have seen that have closed. However, there is nothing to suggest that it has anything to do with the tax. I can't even tell you if the restraunts that closed even served alcohol.

It's hard to prove a point by driving around. That's why I asked what numbers were available to back up your point. You quoted statistics about increases in alcohol sales in surrounding counties, but nothing to suggest that the number of bar and restraunt closures in Allegheny County has increased since this tax was implemented.

Eventhough you quoted stats on a sales drop in Allegheny County, that does nothing to prove or disprove your contention that bars and restraunts are being run out of business by the tax.

Lastly, I don't care about excesses, Dan Onorato was taken to court, and the court ruled that the proceeds from the taxes must be used to fund transit. It's a moot point.