A controversial Philly parking tax-cut proposal has collapsed

City Council Majority Leader Cherelle Parker abandoned her controversial proposal to cut Philadelphia’s parking tax Tuesday after fierce criticism from progressives and urban development advocates.

Parker’s legislation would have lowered the parking tax rate from its current 25% to 17%, in exchange for promises from parking lot operators to improve wages for workers. But the commitment for higher pay couldn’t be written into law and was therefore unenforceable. The bill generated outrage from progressives, who said the companies shouldn’t need a tax break to pay living wages, and from urbanists who favor dense neighborhoods and oppose car-centric infrastructure.

The collapse of the parking tax bill came as Council and Mayor Jim Kenney continued their protracted negotiations over the city budget for the fiscal year that begins July 1. Lawmakers have been meeting with Kenney administration officials privately for more than a week with no resolution on key areas of disagreement such as cutting the wage tax, increasing funding for violence prevention programs, and how to spend $1.4 billion in federal pandemic relief funding.

If it follows its usual procedures, Council must reach a deal on the budget and tax proposals by Thursday to approve them in time.

» READ MORE: What’s holding up Philly budget talks? Everyone wants a slice of stimulus money — or to be mayor

Parker’s bill was one of several tax-cut proposals that factored into the negotiations. To build support for the measure, she struck a deal that detailed promises of increased wages and benefits between two Philadelphia lot companies, Parkway Corp. and Brandywine Realty Trust, and Service Employees International Union Local 32BJ, which represents parking workers.

But the bill collapsed when other operators, especially those not based in Philadelphia, wouldn’t sign on to the agreement, according to Parker and the union.

In a committee meeting Tuesday, Parker said she pushed for the legislation in an effort to get quality jobs for working people.

”I will continue to stand with low-wage essential workers and do everything I can to bring them out of poverty,” Parker said in an impassioned floor speech. “This will not deter me one instant from continuing to work toward a day when every worker in the city of Philadelphia is paid a real wage with real benefits.”

She blamed out-of-state parking lot operators for not signing on to the agreement, a reluctance she called “unconscionable.”

“They’ve made a decision to continue to pay poverty wages rather than come to the table to negotiate,” she said.

The parking tax rate is still scheduled to fall to 22.5% on July 1, when a temporary increase enacted last year expires.

Gabe Morgan, vice president of 32BJ, said the union appreciates Parker’s efforts to provide “a potentially historic opportunity for underpaid parking workers through her leadership of the Parking Tax Bill.”

“It is unfortunate that many big institutions in the city and national corporations ... didn’t take the opportunity to join the rest of the city’s parking and commercial real estate companies in creating a pathway out of poverty for thousands of workers,” Morgan said.

Urbanists applauded the bill’s downfall.

“These cuts would have given away money to an industry that pollutes, congests, and endangers our city; that exploits its workforce; that caters toward suburban car commuters — when we should be focused on the struggles of everyday Philadelphians,” said Daniel Trubman, an organizer for the group 5th Square, which advocates for priorities like transit, parks, and high-density housing.

Council also adopted an amendment to Kenney’s bill to cut the city wage tax Tuesday. The amendment leaves intact his proposed tax cut for Philadelphia residents, but reduces the size of the cut he proposed for nonresidents who work in the city.

Council adopted the amendment in a voice vote, but did not advance the tax-cut bill, which is tied up in negotiations over the budget.

» READ MORE: The pandemic took a big bite out of Philly’s tax base. What happens if suburbanites keep working from home?

Kenney had proposed reducing the wage tax on city residents from 3.8712% to 3.8398%, which would reduce city tax revenues by $10.6 million next year.

For nonresidents, the mayor proposed a cut from 3.5019% to 3.4201%, which would cost $18.9 million. The Council amendment would instead lower the nonresident rate to 3.4481%, at a cost of $12.4 million.

Kenney’s separate proposal to cut the business income and receipt tax appears to lack support among lawmakers.

As other budget bills remained tied up in negotiations, Council advanced legislation to spend $13.9 million to accelerate the purchase of Tasers for Philadelphia police officers. The bill, sponsored by Council President Darrell L. Clarke and introduced in November after the police killing of Walter Wallace Jr. in West Philadelphia, would authorize the city to enter into a five-year contract to purchase 4,500 Tasers.

The officers who shot Wallace while responding to a mental health crisis were not equipped with such electroshock weapons, and the killing prompted calls to outfit all officers with the devices.