During what one lawmaker called a “dumpster fire of a legislative process,” the D.C. Council on Tuesday debated an amendment to scale back a proposed 3% tax on advertising sales that would generate more than $18 million in the city’s $16.7 billion budget.
Lawmakers criticized the amendment, saying it didn’t address their concerns about how the tax would hurt newspapers and public libraries and describing it as another example of the council creating a last-minute tax policy without input from the public.
The debate became so heated that council Chairman Phil Mendelson proposed a one-hour recess to find a way to cut $18 million from the budget in order to scrap the ad sales tax. The council later postponed further debate and its second vote on the budget until 12:30 p.m. Thursday.
Mr. Mendelson, at-large Democrat, introduced the amendment just before Tuesday’s meeting. He said he was “surprised” to learn Monday night that the ad sales tax he had included in the budget was written as a value-added tax, meaning it would tax the creation of an ad instead of the placement of an ad, as he had intended.
The amendment would cut more than $1 million the council had allotted in the budget for the D.C. Public Library system to prevent shorter hours of operation during the pandemic.
Mr. Mendelson cited approval for the amendment from council member David Grosso, at-large independent and chairman of the committee that oversees the library system. Mr. Grosso said the libraries can handle the reduced funding.
“The way we are doing taxation — ad hoc tax here, tax there, tax there — is no way to do tax policy,” said council member Mary Cheh, Ward 3 Democrat, who pitched reviving the city’s tax policy commission and making it permanent.
A few lawmakers had expressed concern about the ad sales tax’s impact on local media when the council gave unanimous, preliminary approval to the budget on July 7.
Before Tuesday’s second and final vote on the budget, other council members expressed concerns about how the proposed tax would affect businesses in general and how cutting funds for libraries would hurt the most disadvantaged residents during the pandemic.
Council member Trayon White, Ward 8 Democrat, said he offered an amendment that included exemptions to the tax but it wasn’t cleared by the budget office.
Mr. Mendelson was unmoved.
“So here we are with, I would say, a 3% tax, which is modest, on expanding the sales tax bases, which is good public policy, that I know businesses are saying [it] will be the end of the world for them. But we heard that when we increased the sales tax on Uber. We heard that when we increased the sales tax on health clubs, and those increases were 6% not 3%,” he said, challenging his colleagues to find other ways to cut spending by the next meeting.
“We are not talking about Uber, and we are not talking about health cubs, alright?” said council member Kenyan McDuffie. “We are talking about the fact that a lot of these larger, corporate-driven papers don’t represent certain perspectives very well. They just don’t, alright?”
The Ward 5 Democrat said he had spoken with the owners of the local, independent newspapers The Afro, The Blade and The Washington Informer. They told him they already are facing revenue losses of 50% to 75% since the start of the pandemic, he said.
Those newspapers, Mr. McDuffie said, are more important now amid protests over police brutality and the pandemic, both of which disproportionately impact Black people.
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