When temporary means FOREVER

Seventy years ago Johnstown, PA was partially destroyed by a flood. You can see video of terrified residents running from the rising rivers here.

As a result of that flood, the state of Pennsylvania enacted an “emergency” tax on all alcohol sold in the Commonwealth. Intended for rebuilding, the “temporary” tax started at 10%. And indeed it was only temporary, because in 1963, it was upped to 15%. LOL.

Then in 1968 they said, “This temporary tax has been a little too not temporary. We need to raise that shit up to 18%.”

And the people rebelled and the people told their politicians they would not vote for them if they didn’t repeal that temporary emergency tax that had become a permanent punishment on buying alcohol in PA.

No, they didn’t. The people it seems aren’t even that aware that the tax still exists. That we’re paying an extra 18% to buy alcohol on top of the 6% sales tax.

But it hasn’t been done away with. This once temporary tax now generates $200 million a year for the general revenue fund, despite efforts by a few legislators like Marshall to repeal it.

“Since 1997, I think there have been about 13 bills to repeal or reduce the tax,” he recalls.

And all have gone nowhere, says Marshall, because so few people know about this 18 percent hidden tax.

The Johnstown Flood Tax has been with Pennsylvania so long after it finished its job that nobody really thinks it’s going to end any time soon. The key to ending it is public education. If more people know about it and complain to their legislators, it may be repealed.

Is that all we need to do, you guys?

Get mad?

Let’s do that, please?

Think the State can’t afford it?

Pennsylvania collected $1.8 billion in General Fund revenue in May, which was $33.9 million, or 1.9 percent, more than anticipated, Secretary of Revenue Daniel Meuser reported today. Fiscal year-to-date General Fund collections total $24.3 billion, which is $539.4 million, or 2.3 percent, above estimate.

That’s one month. This is ridiculous that we’re still paying this and we’re not pissed about it. Let’s get pissed. Let’s email our representatives. Let’s let them know we’re not voting for them unless they vote to repeal this “temporary” tax. Let’s get vocal.

Let’s privatize the PLCB for the love of beer.

Just temporarily.

[wink]

 

 





61 Comments


  1. bucdaddy
    June 7, 2011 11:59 am

    “For the love of beer.”

    You have no idea how much I heart you for that.



  2. toni
    June 7, 2011 12:03 pm

    Federal Income Tax was supposed to be temporary too. They liked it so well it became permanent in 1913. Anytime u let a politician in your pocket, he’ll never take his hand out. Wanna bet our stadium tax somehow doesn’t go away once we’ve paid off 3 sports venues???



  3. Jaime
    June 7, 2011 12:18 pm

    Couldn’t some of our dying school districts benefit from that money?



  4. bucdaddy
    June 7, 2011 12:21 pm

    I just love how politicians take a dollar out of your left pocket, subtract a hefty overhead that includes their own bloated salaries, put 70 cents back in your right pocket and expect you to throw them a parade.



  5. AngryMongo
    June 7, 2011 12:22 pm

    Someone’s gotta pay for Corbet’s new Suburban…and the Lt. Governor’s. Oh and their wives’ Traverse, too.



  6. Dan (Not Onorato)
    June 7, 2011 12:36 pm

    Corbet said we all had to tighten our belts…he actually wanted an Escalade but he “settled” for a Suburban. Oh yeah thats right, he didnt know anything about it.

    Take away the Johnstown tax and enact an extraction tax for all of that Marcellus gas theyre pulling our of the ground but not paying for.



  7. Joe K.
    June 7, 2011 12:41 pm

    I saw that too today about Corbett’s new cars. Not that I’m against them having decent cars, but that he has made such a big deal about fiscal responsibility. Maybe he should a little Ford Focus or something.



  8. jdp
    June 7, 2011 12:42 pm

    70 years ago? The news reel says 1889. Then there were more floods down there…maybe thats why the tax never went away?

    Really though? Tax alcohol. Beats taxing my income more esp since I can’t drink. Maybe they could spend the money a little more wisely tho – schools, potholes, Suburban’s for everyone?



  9. Mad Max
    June 7, 2011 12:46 pm

    A)NO SUCH THING AS “TEMPORARY” TAX!

    B) One of those Byzantine, assorted-mix tax charges on your landline phone bill )still there) was to fund 1898
    Spanish-American War!!!!



  10. Dana
    June 7, 2011 12:57 pm

    As a college student who has turned 21 in the last year and spent more money on booze than food so far this month, I’d be more than happy to continue paying this tax if it meant state education funding wouldn’t be cut by 50%. The fact that I’m paying it doesn’t make me mad; it’s that I’m paying it and school districts are still laying off teachers and my tuition is probably going to skyrocket this fall.



  11. Jake
    June 7, 2011 1:12 pm

    @jdp – Johnstown has been flooded a number of times, but the big flood was huge and essentially wiped downtown Johnstown off of the face of the earth.

    While it’s ludicrous that the alcohol tax is still attached to the Johnstown flood, I would still much prefer paying into the general fund through vice taxes where I can largely control my spending rather than increases to the income tax (or property tax) that I can’t mitigate.



  12. djh
    June 7, 2011 1:15 pm

    The budget that passed in the PA house cuts $471 million for health and human services for women, children and people with disabilities and you are now calling for cutting more taxes so you can get a 20 dollar case of IC Light for 18 bucks plus sales tax? WTF?



  13. Sarah
    June 7, 2011 1:53 pm

    @Jake and @djh

    Amen. At a time when the State barely has enough money to keep going it is ridiculous to think about cutting taxes on vice goods. If you don’t like the price of your case of beer, don’t buy it, but leave the general fund alone. Yinzers love of beer is all that is keeping us going.



  14. MadMax
    June 7, 2011 2:20 pm

    @ Jake_
    Good point!

    Do people realize that telephone tax for the 1898 Spanish-American War was fromTHE CENTURY BEFORE F’ING LAST??



  15. Ex-Pat Pittsburgh Girl
    June 7, 2011 2:22 pm

    Just a note — Writing your Congressional representative will have little impact on this state tax. Writing your State legislator will also likely have little to no impact on it, but at least you’ll be directing your letter to the appropriate governmental entity.



  16. Cassie
    June 7, 2011 2:23 pm

    @Dana, so very true.



  17. Me
    June 7, 2011 2:24 pm

    Yeah, this one I can’t get all righteously indignant about given current budgetary realities and massive cuts being made to what I consider to be vital services. As others have noted I’d rather a tax I can avoid than one I can’t.



  18. Virginia
    June 7, 2011 2:48 pm

    If I may, of course this isn’t about taxing alcohol as much as it’s about the principle of the matter.

    The State government would have us believe that every corner has been cut and that’s why education has to be cut. Working in nonprofits, I have seen the waste in the PA budget. It’s gross.

    Why do we expect the State to become fiscally responsible with our tax dollars, to stop wasteful spending, when we allow them to tax us perpetually for one thing that they promised us would be temporary? We give them our money and don’t ask questions about it and suddenly they’re all driving Escalades.

    I’m exaggerating, of course, but the point is that they should tax us for Education if that’s what they feel needs to happen. Not tax us for one thing and seventy years later not have enough respect for us to say, “Let’s do away with that and create a new tax on alcohol for Education.” Or something.

    Otherwise, they’ll enact a new “temporary tax” and say, hey, they don’t seem to mind when these become permanent.

    I don’t mind paying taxes. I mind how these temporary becomes permanent and we aren’t calling the government on it.



  19. Butcher's Dog
    June 7, 2011 2:48 pm

    Remind me again why we aren’t taxing the extraction of the gas from Marcellus shale. Oh, yeah…companies will go elsewhere for the gas. But wait…every single state around us taxes that extraction. Where the hell are they gonna go?

    And it’s real smart to balance the budget by cutting education funds. That way even more kids will be out on the streets after school kicking the crap out of others and getting it posted on Youtube. Not that that kid last week would have been in the debate club or anything, but as more activities get cut there’ll be more free time. Idle minds and hands are and always have been the Devil’s Workshop.



  20. Tina
    June 7, 2011 3:05 pm

    If the liquor stores are privatized, the 18% and 6% taxes will still exist.
    Have you ever looked in the cooler at a liquor store? That is what all the wine shelves will look like if a store doesn’t have the purchasing power of the entire state that it has now. While there are a few stores in other states that have good selections, generally they have the stuff that sells a lot and that is it. Enjoy your Arbor Mist!!
    If they changed the name of the tax, you wouldn’t be able to make such a big deal out of it.
    Have you even read anything about the $3 Billion dollar deficient? The Governor and GOP can’t even use the $500 million coming in to replace education cuts that have already resulted in higher property taxes all around our region, and now you want to give up another $200 million?
    It is amazing that you can be so insightful on so many things, but be a closed minded conservative on other things. Privatize! Less Government! Less taxes! Any proof that any of those things work? They sound good and have been the rhetoric of your party for years, yet no one can show any positive proof that any of those always work in the long run.



  21. MadMax
    June 7, 2011 3:35 pm

    @Tina-

    Are you sniffing glue or or you a PALCB union hack?????

    PA State Stores SUCK, ALL THE TIME!!!!

    Privatize them!!



  22. Lauren
    June 7, 2011 3:42 pm

    @Tina Um, and government intervention and more taxes do work? Is that how the government (read: taxpayer funded) stimulus got the economy back on track? Is that why the Post Office and Amtrak turn a profit every year? That *is* positive proof that government intervention doesn’t work. If the Republican party actually, you know, followed their own rhetoric instead of spending like drunken sailors, then maybe there would be more evidence that the government should not be involved in every facet of our lives, including liquor purchases. Unfortunately, politicians are politicians and are only looking out for themselves and the interest groups that fund their election campaigns, regardless of party affiliation. Until people get mad about that, nothing will change.



  23. CrashJK
    June 7, 2011 3:46 pm

    FREE MY BEER ! Destroy the LCB and the unions running the state stores (hey, Walmart is hiring)….Repeal the tax…FREEDOM on the rocks !



  24. Stephen
    June 7, 2011 3:50 pm

    The concept of the “slealth tax” has such a long and storied history i’m surprised anyone is alarmed when it happens. If the government can tax you without letting you know they will do it. And who can blame them? As Virginia says, no one gets angry about it.

    I don’t get too terribly upset about it because they’re going to take my money either way. I’d like to know and I resent it when it happens but at the end of the day my wallet is the same weight.

    For what it’s worth, state run booze shops are an awful idea and given how few other states do this the justification for not privatizing them is pretty flimsy. I will never understand Pennsylvanians unhealthy loyalty to such and outdated and unproductive concept. Excuse me if I don’t get upset if wine selections degrade if it saves taxpayers money.

    But i’ll glady keep state stores open if we get to privatize schools and universities instead. Those horrible dream-killing dinosaurs need to be ripped up from the roots, stripped down, and sold to the highest bidder.



  25. spoon
    June 7, 2011 3:53 pm

    See what happens when I give Ginny beer *muuwhahahaha*

    btw check out this site: http://www.johnstownfloodtax.com/

    18% is only part of the bullshit alcohol taxes we pay and last year’s fiasco beer raids in Philly brought to light how mismanaged the freaking PLCB is.

    How are those wine kiosks workin out for ya? Well you know, WHEN they work.



  26. Monty
    June 7, 2011 3:56 pm

    Tina — It’s not polite to get into name-calling. But if you’re going to do it, at least have the courtesy to call her Vaginny. Anything less is just half-assed.



  27. Registered Dem
    June 7, 2011 3:57 pm

    @Tina – Have you ever been out of state??? Seriously. 48 other states have privatized the sale of alcohol and manage to offer decent and indeed greater selections of wine, spirits and beer (in one place, no less) than PA state stores. It’s called the free market and I have no doubt that some enterprising businessman will come along and set up a wine specialty store if demand dictates. Not to mention the fact that you would arguably be able order your rare coveted wine on the internet if PA got with the program.

    As for the flood tax, I don’t think Ginny was arguing for less taxes. That’s a rather conclusory leap you’ve taken based upon … actually, I don’t know what. She simply called for the politicians to man up and, rather than rely upon the (sorely needed) proceeds generated by the flood tax, pass a tax on the appropriate services. Maybe it’s alcohol, maybe it’s shale gas, maybe it’s real estate, but call a spade a spade.

    And don’t get me started on the *130* municipalities and almost 50 public school districts in Allegheny County alone… Bigger isn’t always better, but that sort of fragmentation sure isn’t helping the botoom line either.



  28. Paul
    June 7, 2011 4:23 pm

    @Lauren – problem was they didn’t do nearly enough stimulus. Limiting spending during a recession is not the way out of a recession. Also, I’m not sure privatizing everything is the answer either.

    The real problem is we need more jobs. More jobs == more people with incomes == more revenue for the state.

    As far as privatizing state stores. I really don’t care one way or the other.



  29. asl87
    June 7, 2011 4:33 pm

    Sure, privatize all you want, but that puts hundreds of men and women out of well-paid, family-sustaining jobs that provide benefits. Definitely the most compassionate choice.

    Honestly, there has to be a middle ground. Get rid of the 18% tax, levy a much larger tax on the Texas and Louisiana oil companies getting rich off of OUR resources, and allow beer and wine to be sold in supermarkets while keeping liquor in state stores. See how easy that was? Tada!



  30. rickh
    June 7, 2011 4:39 pm

    @Tina, it sounds like you may need a fews pulls from that jug of Arbor Mist. The PLCB is outdated, unwanted and not needed.



  31. VAgirl
    June 7, 2011 4:54 pm

    Agree that the PLCB needs to be privatized. I do not mind the 18% but let’s bring it to the surface. Transparency in gov., no I am not smoking crack, and a reduction in the size of our state government (legislators).



  32. ColdCan45
    June 7, 2011 5:48 pm

    Wow! I didn’t realize what I have been missing out of by not drinking! Whoda thunk I was not paying taxes and here all I thought I was doing was not turning my hard earned money into urine.

    Amazing.



  33. Ginny's Dad
    June 7, 2011 7:12 pm

    @ Tina

    Sorry to pile on but the government track record is dismal. Medicare, Medicaid, Social Security, Post Office, Amtrak, Fannie Mae and Freddie Mac, are government controlled and going broke. They may have good intentions but are grossly inefficient and wasteful.
    To quote John Adams, our 2nd President, “Facts are stubborn things; and whatever may be our wishes, our inclinations, or the dictates of our passion, they cannot alter the state of facts and evidence.”



  34. KGC
    June 7, 2011 8:21 pm

    @Paul.. not enough stimulus?? Are you that devoid of critical thinking?

    TARP was $800 Billion. The special GM/Chrysler deal was $16B. Obama spent $1.3 Trillion on stimulus ($800 Billion and $500 Billion).

    Most of the Obama stimulus went to prop up State and local government workers who are just now starting to feel the pain the rest of us started experiencing in 2008/2009. Only things the Obama stimulus did was saddle us and our children with massive debt and ‘kick the can down to road’ to now.. 2011 and 2012.

    Keynesian economics do not work. Want to create jobs? Stop the uncertainty now prevalant with the Obama administration. Repeal Obamacare. Cut government regulations. Undo the Gulf drilling moratorium. Drill in the NPR and ANWR.



  35. KGC
    June 7, 2011 8:22 pm

    Oops, should be ‘kick the can down THE road’.



  36. Lisa
    June 7, 2011 9:27 pm

    Ok, getting back to the Johnstown flood tax.
    1. It’s ludicrous to think about cutting taxes when schools are laying off reading specialists and gifted teachers and music teachers (Didn’t I see a post here a while back about how awesome Pittsburgh’s arts scene is? How do you think it got that way? We have great arts education programs here).
    2. We will always tax alcohol, because people will pay it. I don’t remember there being a huge drop in alcohol consumption when Allegheny County enacted it’s tax on poured drinks. People like booze. Period.
    3. Enacting legislation to end a tax, just to enact the same tax under a different name for the sake of “transparency” is a complete waste of time and money, and is a distraction to real bills that need to be passed. Do you realize we still don’t have a law that bans texting while driving?



  37. Lisa
    June 7, 2011 9:29 pm

    P.S. But I’m all for privatizing liquor stores. And for that matter, allowing wine and beer to be sold in grocery stores.



  38. Butcher's Dog
    June 7, 2011 9:49 pm

    @Stephen: schools and universities are dream-killing dinosaurs? Seriously? Were you using sarcasm and I missed it? Cause that arts education stuff mentioned by Lisa…that’s a huge dose of dreams being born, not dreams dying. In my own little corner of the commonwealth I mid-wived a thousand dreams being born for every one I laid in a coffin. Priorities should not always be made based on anyone’s bottom financial line.



  39. Donncha
    June 7, 2011 10:22 pm

    Ginny, I’m a third-generation resident of Johnstown. My grandfather watched the flood of 1889 from atop Westmont Hill. My parents survived the Flood of 1936. I went through the Flood of 1977. So, I think maybe I can speak with a modicum of authority on the tax, the Johnstown experience and, because of my roles as both a reporter and a member of the current administration, taxes.
    First off, a few housekeeping details. Your screen cap of the residents “fleeing” the rivers is a sore point in my family. My late aunt was part of that evacuation and it stemmed from a false report that the Quemahoning Dam, 15 miles south of town, had burst. It was part of the reason my father jumped out of the back of a police wagon as people began to panic.
    The 1936 flood was not caused by a broken dam, as was the one 47 years before. It was caused by a heavy snowfall that was followed by a rapid melt that clogged the rivers with debris, caused them to back up, then slowly lapped into the city, filling it from the bottom up.
    This was a rather prosaic flood, and the crews really needed a bit more drama.
    The newsreel crews were strategically located at various points to capture the residents “fleeing” the oncoming flood. To her dying day my aunt suspected the newsreel crews of triggering the false alarm. I would like to think nobody would do such a thing. But, whatever its origins, your screen cap shows the result of a false alarm that sent one 19-year-old young man dashing waist-deep, down a road and, eventually, to Indiana County.
    The tax later imposed provided little, if any, actual relief to Johnstown. The city’s major revival stemmed from a huge public works project inaugurated during a visit to the city by Franklin Delano Roosevelt. The mayor at the time, Daniel Shields, accompanied the president on his visit where he pledged that Johnstown would, from that day forward, be flood free. This was a remarkably optimistic view of presidential powers. But FDR sent in millions of dollars to pave the river walls, so that water and debris would never again combine to clog the flow. Essentially, he turned the Little Conemaugh, Stonycreek and Conemaugh rivers into giant spillways. In my youth, I never saw them crest because they were so deep and slippery.
    My father helped to pave those rivers. The pay was good, the work was steady and two generations grew up always assuming that every river was paved.
    That was the actual financial relief that helped Johnstown through the Great Depression and The Flood of 1936.
    In the days after the Flood of 1977, as I was recovering from a case of dysentery caused by the stinking, fetid waters in which I slogged, I read a story in The Johnstown Tribune-Democrat about the flood tax. We didn’t know it existed. Turns out the thing had been passed and nobody even remembered it. I can tell you that, once again, it was not state money that pulled the town through; it was a huge FEMA and Housing and Urban Development recovery program spearheaded by the city’s new congressman, John P. Murtha.
    So there we have it: The Johnstown Flood Tax. It was a temporary relief effort that, once in the flow, could not be turned off.
    I have spent the last four months living and working in Harrisburg as part of the new governor’s administration. I went there convinced, like one of your earlier posters, that the problem with the stimulus was that we did not spend enough. The mathematics of fiscal pump-priming would suggest that the Obama administration should have put in a minimum of $4.5 trillion to jump start the economy. I actually accepted this theory until learning what happens on the other end.
    The best example is the state’s education budget. The prior administration was already in the middle of a bad recession — I mean, that’s why there was a stimulus to begin with. So, to cover costs in other areas, they reduced the state’s share of the education budget for two years running, but increased spending by plugging in stimulus monies. OK, maybe that could work if the money was used only as a stimulus — meaning one-time, big spending items to generate building and sales.
    But many districts simply used that money to cover their own costs. Don’t forget, when federal and state tax revenues fall because people are out of work, local taxes will also fall. Districts used it for general funds, including salaries. So, when the stimulus stopped, there was a horrible financial shock. The Corbett budget restored the state’s share, but district spending and budgeting had gone on as if that money would always be there.
    The stimulus, which worked fine on paper, had one flaw: it didn’t work in practice.
    The lesson here is that to curb spending we have to, well, curb our spending. And simply creating a new tax to meet the need of a moment is a dangerous thing. There will always be another moment, and another need. That’s why, 75 years after my dad jumped into the water to flee a non-existent dam break, we still have a Johnstown Flood tax. We’ve had another flood since then and the waters have long ago receded. All that remains is the tax.



  40. Ginny's Dad
    June 7, 2011 10:56 pm

    @ Donncha

    Very interesting and informative. Thanks for taking the time to share it.



  41. unsatisfied
    June 7, 2011 11:16 pm

    @ asl87………you said, “Sure, privatize all you want, but that puts hundreds of men and women out of well-paid, family-sustaining jobs that provide benefits. Definitely the most compassionate choice.”

    I say, “those jobs are OVER-paid….like, PAT-driver-OVER-paid. the folks who work at state stores….in my experience…..are everything less than helpful to the point that they HAD TO TAKE CLASSES in how to not be jagoffs. and, even so, those classes didn’t work.”

    @ tina……….I have lived in several different states. in fact, I now live out of PA again. and, I can tell you, that the selection of wines in my local grocery store is 50 times that of the basic PA state store. in quantity and in quality. for reals.

    so, for the love of my PA brethren (and sisteren) — I hope that you get your privatization. and, your elimination of this bullshitzky tax. and, when you do, it’s gonna be beautiful.

    and, as for mad max — mad max sounds one hell of a lot like that ball-scratcher bojangles or whatever his/her name was.



  42. SpudMom
    June 8, 2011 8:43 am

    @unsatisfied – I suspected Mad Max of being Bojack/Beaujaques as well. Glad I’m not the only one that thought it.



  43. Government 101
    June 8, 2011 2:39 pm

    Pitt Girl, you do know that Congressman work in Washington DC and NOT in Harrisburg, right? For all your preachin you might want to at least get the civics part right…



  44. Butcher's Dog
    June 8, 2011 3:50 pm

    Well, there’s times I suspect unsatisfied might be bojack on meds. It’s true that Mad Max is a far likelier candidate.



  45. Mandy
    June 8, 2011 4:31 pm

    Government 101 – are you for real? Here’s a civic lesson for you. There is a state congress and a Federal congress. Those that are members of the PA State congress do indeed work in Harrisburg.



  46. Eric Williams
    June 8, 2011 7:31 pm

    Taxes, when they are truly necessary at all, should be related to that which they pay for. General fund my ass.



  47. unsatisfied
    June 8, 2011 10:14 pm

    @butcher’s dog…….I’lllllll never tell.



  48. MadMax
    June 8, 2011 11:18 pm

    I’ve found my niche!



  49. Government 101
    June 9, 2011 8:28 am

    Mandy, you ignorant loser…there is a General Assembly in Harrisburg, there is no state Congress you moron. Seriously, that is one of the dumbest things i’ve ever heard! You should really remain quiet and let people think you are a fool instead of opening your mouth and removing all doubt.



  50. Ginny's Dad
    June 9, 2011 8:46 am

    @ Government 101

    General Assembly or Congress, who cares. They basically perform the same function. Calling Mandy a “loser”, “moron” and “fool” tells me that you are a very bitter person who really needs to lighten up.

    Maybe Mandy is a nurse or EMT who helps save lives. Or perhaps her husband is serving in the military. You are way too judgmental.