July 24, 2020 at 9:55 am EDT | by Lou Chibbaro Jr.
D.C. Council kills proposed ad tax assailed by media outlets
ad tax, gay news, Washington Blade
Council Chair Phil Mendelson dropped his proposed tax on advertising after an outcry. (Washington Blade file photo by Michael Key)

The D.C. Council on Thursday voted 11 to 2 to remove from the city’s Fiscal Year 2021 budget a proposed 3 percent sales tax on advertising that a coalition of community newspapers, including the Washington Blade and the D.C. lesbian of color publication Tagg magazine, said would have a detrimental impact on their ability to survive during the current economic downturn.

The Council vote was a dramatic reversal of its approval of the advertising tax two weeks earlier in a preliminary vote after Council Chair Phil Mendelson introduced the tax as a means of generating a projected $18 million in needed revenue for the city.

On Thursday, Mendelson introduced an amendment to the budget calling for the removal of the tax, acknowledging the groundswell of opposition that surfaced from media outlets and small community-based businesses that purchase advertising from the media outlets to promote their products or services.

Mendelson’s amendment identified specific provisions in the budget for which the size of proposed increases could be reduced to make up for the $18 million that the ad tax was expected to generate. Three of the provisions were for non-social services related programs such as capital building projects. One called for reducing a proposed increase in funds for the D.C. Department of Behavioral Health from $9.5 million to $5.5 million.

Following its decision to remove the ad tax the Council voted unanimously to approve the $8.5 billion Fiscal Year 2021 budget.

Representatives of a coalition of 10 local LGBTQ organizations initially expressed concern that the $18 million reductions proposed by Mendelson might include cuts to LGBTQ related city programs included in the budget. But representatives of two of the coalition groups — the LGBTQ youth advocacy group SMYAL and Capital Pride Alliance — told the Blade on Thursday the LGBTQ programs were not impacted by the reductions.

Capital Pride Alliance, which organizes D.C.’s annual LGBTQ Pride events, issued a statement on Tuesday on behalf of the coalition urging activists to send urgent email and Twitter messages to Council members urging them not to cut any of the several LGBTQ related programs that the Council approved in its first-round vote on the budget earlier this month.

The statement noted that in its preliminary vote on the budget two weeks ago the Council approved $2.7 million for LGBTQ related programs. Among them are a “wrap-around employment development program for transgender and non-binary folks, extended transitional housing for LGBTQ youth, and housing and meal assistance for LGBTQ seniors,” the coalition statement says.

Among the newspapers speaking out forcefully against the ad tax was the Washington Informer, one of D.C.’s two African-American newspapers.

“The term ‘Black Lives Matter’ applies to the Black Press that has never received its fair share of ad revenue comparable to what Black consumers spend,” the Informer said in an editorial. “The last thing we need now is a tax that will diminish what few dollars we rely on to stay alive,” the editorial said.

In a joint letter sent to all Council members last week, the Blade and Tagg said they understand the city’s need for additional tax revenue during the loss of revenue due to the coronavirus economic downturn.

“But this misguided measure will only further damage the local economy by taxing businesses that are already strained,” the joint letter said. “An additional three percent tax on our primary source of revenue will force some outlets to lay off additional staff and others to shutter entirely,” the two papers told Council members.

Council members David Grosso (I-At-Large) and Brianne Nadeau (D-Ward 1) were the only two among the 13 Council members to vote against Mendelson’s amendment to remove the advertising tax.

The two said they objected to the $5 million reduction in the originally proposed increase in funding for the Department of Behavioral Health, saying the reduction would impact low income people most in need of mental health services that the additional funds would provide.

Council member Mary Cheh (D-Ward 3) appeared to reflect the sentiment of the 11 Council members that backed Mendelson’s call to drop the ad tax when she noted that the Council and Mayor Muriel Bowser managed to craft a budget that did not cut any social services programs.

“It is nothing short of remarkable that this budget will increase social services in the midst of an epidemic,” she said.

Lou Chibbaro Jr. has reported on the LGBT civil rights movement and the LGBT community for more than 30 years, beginning as a freelance writer and later as a staff reporter and currently as Senior News Reporter for the Washington Blade. He has chronicled LGBT-related developments as they have touched on a wide range of social, religious, and governmental institutions, including the White House, Congress, the U.S. Supreme Court, the military, local and national law enforcement agencies and the Catholic Church. Chibbaro has reported on LGBT issues and LGBT participation in local and national elections since 1976. He has covered the AIDS epidemic since it first surfaced in the early 1980s. Follow Lou

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