Newark City Council narrowly struck down two options that would help raise new revenue. One would have implemented a tax of up to 3% on retail alcohol sales; the other would have raised the maximum lodging tax from 3% to 5%.
Newark’s non-police expenditures decreased by $500 thousand last year, but police costs increased by $1.9 million, largely due to salaries.
Council already turned down these two measures from City Manager Tom Coleman once but Coleman revived them after two new members joined the ranks.
Councilmember Corinth Ford voted in favor of both proposals Monday.
“We need to start considering the residents, the people who live in this town, not just the oligarchs and the wealthy people, but the residents,” Ford said. “Again, my constituents want me to vote aye, and that is what I am going to vote.”
Several Councilmembers agreed with Ford, saying they wanted to pass the resolutions to have new tools in the toolbelt, but that didn’t mean they would end up using them.
“I think this is something that we need to keep on the table as an option during the budget season,” Mayor Travis McDermott said. “So I'll just echo what Councilwoman Ford said and encourage everybody on the Council to at least support this option so we can move it forward and have it available to us if necessary for our budget process.”
Ford added it would be easier to get through the legislature than a completely new tax, too.
Councilmember George Irvine is new to Council and voted against the lodging tax change.
“I think that negative downstream effect is is not optional or optimal, and honestly, I think we'd lose business to the New Castle County hotels,” Irvine explained.
The vote needed six votes but only received five.
The retail alcohol sales tax would have brought in an estimated $150-300 thousand per year at the full 3% tax, according to City Manager Coleman.
“When looking at kind of what drives police activity over time, calls for service, etc, that the majority of that and – also resident complaints – the majority of that is off-site parties when talking about alcohol,” Coleman said. “So we’d focus this on carry out alcohol.”
Councilmember John Suchanec voted in favor.
“I would support this, just to keep the option open when we're doing the budget,” Suchanec said.
Councilmember Irvine was again in disagreement, voting against the measure. He said he sees pros and cons to the retail alcohol tax, but he thought the cons won out.
“I had different responses to this opportunity, this tax among my constituents,” Irvine said. “They don't want to pay more for their alcohol, and they're not, definitely not in favor of it, given the text that I received, of course, that's the sample… And they might indeed go elsewhere if the price goes up.”
The alcohol resolution also failed, garnering only four of the six necessary votes.
