Monthly Economic Report – Sidewalk Cafés Boost City Revenues

Audit Date: May 28, 2015
Audit Categories
  • Financial
Controller: Alan Butkovitz

Executive Summary

For Immediate Release
May 28, 2015

Contact: Brian Dries

Sidewalk Cafés Boost City Revenues
City Controller’s economic report indicates more than $225,000 in license fees
generated over the last five years

April 2015 Economic Report

PHILADELPHIA – With many businesses welcoming the seasonal boost from outdoor seating, the City has also benefited by generating $227,599 over the last five years from sidewalk café licenses, according to the City Controller’s latest monthly economic report.

Since 2011, the city has averaged $45,500 annually from establishments that filed for a sidewalk café license. Revenues are generated by those who paid the annual $160 fee and obtained the license prior to establishing an outdoor seating area, as required by the Philadelphia Code.

While the current Fiscal Year 2015 total of $26,946 is much lower than prior year collections, it is expected to increase as a large portion of the license fees will be collected in June. A breakdown of annual revenues includes the following:
Fiscal Year – Total
2011 – $48,711
2012 – $54,702
2013 – $53,340
2014 – $41,900
2015 – $26,946

When comparing the 2014 total revenue collected under the $160 fee, it is assumed that 262 sidewalk licenses were issued. However, it is estimated that there are almost 370 outdoor seating establishments in Center City alone, resulting in a potential loss of $17,000 from entities who did not pay for a license.

The loss of revenue could be significantly more because estimates do not account for outdoor seating establishments in neighborhoods such as Manayunk, University City, Passyunk Square and Northern Liberties.

In addition to reviewing sidewalk café license fees, the Controller’s monthly economic report indicates that tax revenues for both the City General Fund and Pennsylvania Intergovernmental Authority (PICA) for April totaled almost $526million, which is a seven percent increase over last year. This included $476 million in to the General Fund and almost $50 million as the PICA portion.