Saturday, January 23, 2016

Governor Wolf? What Money Are You Spending in Johnstown?

Governor Tom "Control Yourself" Wolf, avowed defender of the Commonwealth's antiquated booze monopoly, just announced in Johnstown on Friday that LifePoint Health Business Services would be getting $612,200 in state funding "in exchange for a pledge to create 132 new jobs over the next three years" in Johnstown. He traveled to Johnstown to make the announcement, where he also announced that Johnstown would be getting more than $15 million in "additional state investments" to "align" with "Vision 2025, a framework for revitalizing greater Johnstown. That's what he went to Johnstown for, and his office Tweeted about the news from Johnstown while the Governor was in Johnstown.

Wait...state funds? For Johnstown? Aren't they already supposed to be getting millions from the Johnstown Flood Emergency Tax we're paying on every bottle bought at the State Store System? It's hundreds of millions of tax dollars, according to every State Store Supporter. So how come Governor Wolf wants to give them even more?
I don't know about you, chum, but this is on my mind
every time I have a cocktail. Here's to Johnstown!
Well...the wonks at the state department of Revenue will tell you that it was never called the ‘Johnstown flood tax,’ and that the tax was never directed specifically to Johnstown, but was always directed to the general fund. So there, and you're just stupid.

Except that rings incredibly hollow when you look into the actual details of the origin of the tax, which I happen to have handy. The bill is titled "AN ACT Imposing an emergency State tax on liquor, as herein defined, sold by the Pennsylvania Liquor Control Board..."and it's dated June 9, 1936, a little less than three months after the flood (which affected other cities in Pennsylvania, as far away as Lock Haven and Williamsport). There was no other 'emergency' at the time, so calling it the "Johnstown Flood Emergency Tax" is perfectly honest, and the people at Revenue are tap-dancing.

But they're dead right about one thing: whatever you call it, the tax was never meant to be only for Johnstown. It was just money, that went to the General Fund, for politicians to do with whatever they wanted. Nothing makes that more clear than the fact that they raised it, twice, 30 years after the flood was over.

The Johnstown Flood Emergency Tax is one of the classic examples of a "temporary" tax that never ever goes away. And back in 1936, we were still so happy just to be able to buy booze legally again after Prohibition that the bluenoses were able to nail an additional 10% tax on at the drop of a hat...or some rain. We're still paying it, even though that emergency is long over; hell, the 1977 Johnstown emergency is long over too. It doesn't matter...Pennsylvania will keep that 18% burden on the back of booze buyers forever. You pay more than your fair share. Kind of rankles, don't it?

Would privatization help this? No, the tax would still be in there. But we could take the opportunity to change it to a gallonage tax (which would make cheap booze more expensive, rather than the backwards way today's tax works), we could make it a more reasonable bite. That's the "Rewrite the Code" part.

Governor Wolf! Johnstown tax money for Johnstown! And when it doesn't need it any more...declare an end to the 'emergency!'


Anonymous said...

Flood money has a long history of being used for illegitimate purposes. Read the story of Dixie Square Mall in Illinois and you will get my drift. I think part of the problem is that very few people or businesses buy flood insurance. With the recent weekend storm you might see flood funds misused in NJ as well.

Anonymous said...

You should know that the Johnstown Flood tax is really just a liquor tax that that government never bothered to rename and if they ever privatize they will just continue with some other tax by another name.

Lew Bryson said...

I do know that. I SAID that. Read the damned post.

Anonymous said...

I can confidently assure you that most Philadelphians (including people in the four suburban counties) would flip their lid if they knew about this tax. Most of them however are probably completely oblivious to it though. Philly and its suburbs are really a whole different animal than the rest of PA. I would say Greater Philly belongs in NJ instead of PA. Most people in Greater Philly really don't give a f*** about the rest of the state (hell, a lot of folks in Philly itself neither know nor care much at all about the several dozen suburbs) so there would be a coup if these folks found out about this so-called "emergency" tax.