Drink tax leaves bar owners on the rocks

Instead of dumping tea into the Monongahela River, Pittsburghers may soon be dumping… Instead of dumping tea into the Monongahela River, Pittsburghers may soon be dumping alcohol.

Allegheny County Council now has the ability to impose a 10 percent luxury tax on all poured alcoholic beverages and business owners are already outraged.

The proposal, designed to help the Port Authority, also authorizes a $2 tax on rental cars and went through the state legislature in July.

County councilman Bill Robinson introduced the proposal at the County Council meeting on Aug. 21.

Kevin Evanto, the communications director in Allegheny County chief executive Dan Onorato’s office, said that the county currently brings in $25 million in revenue for the Port Authority. However, the state is requiring an increase, which will likely force the county to pay between $25 and $30 million.

“The idea is to shift that $25 million away from property taxes to poured drink taxes,” Evanto said.

The property tax will not decrease – it will merely remain static while poured beverages and car rentals increase in price.

“There will be a full public process before it becomes law,” Evanto said. “There will be opportunities for people to voice their opinion.”

And people already have.

Sean Casey, owner of The Church Brew Works, has formed Friends Against Counterproductive Taxation along with owners of other well-known Pittsburgh restaurants and breweries to raise awareness and combat the bill, which will not apply to alcohol purchased in beer distributors or liquor stores. Casey is currently working to make the organization a nonprofit one to raise funds for his cause.

Kevin Joyce, owner of The Carlton restaurant, has teamed with Casey on the movement.

“It’s taxation on relaxation,” he said. “It falls directly on the backs of folks who like to go out to eat or to have a beer. It’s a tax on the consumer, and we feel very sure it’s going to affect our business.

“In our region, we’re concerned about keeping our young people and this is the kind of tax that hurts our young people,” Joyce said.

Tom Baron, president of Big Burrito restaurant group – the company that owns Mad Mex – says he thinks the tax is a terrible idea.

“Alcohol in Pennsylvania is taxed more than in any other state in the country, so it’s just unbelievable,” he said. “We know Philadelphia has this in place, but Philadelphia is a much different environment.

Does this mean that $2 draft specials will increase to $2.20? Or will bars and restaurants simply round up to the next dollar from now on to ensure their revenue?

Mad Mex is home to some of Pitt students’ favorite margaritas and drink specials, and Baron hopes the bill will be put to a stop before he has to make any decisions about his own prices.

“We’re organizing a good fight against it,” he said. “I don’t want to think about what I’d do if it happened. We won’t roll back our prices.”

Pitt student Nicole Borelli, a history and English major, said she’ll still go out about the same amount should this come into effect because it’s how she de-stresses.

“I don’t like it because obviously I’d have to pay more for my drinks,” she said.

Websites like www.beertown.org are also alive and on the move. While the site is for concerned alcohol supporters in all states, there is a link specifically for Allegheny County residents where opponents of the proposal can e-mail their senators.

Former mayor Tom Murphy proposed a similar bill in 2003, but Pittsburghers responded so negatively that the bill never made it through the legislature.

The proposal will be a part of Onorato’s budget plan, which he will put before the council in October. The final budget must be voted on by Dec. 31, the end of the fiscal year.

Joyce, Baron and other restaurant owners have met with council members and now the council is exploring the issue further and according to Joyce, they’re “asking the right questions.” “We’re fighting it very hard, and we really hope to prevail,” Joyce said. “We’ll just have to see.”