New Jersey Lawmakers Push “SODA POP” Act to Save Struggling Historic Diners from Extinction
New Jersey’s identity as the “Diner Capital of the World” faces an existential threat as rising costs and changing consumer habits force a wave of closures among the state’s most iconic eateries. In a bid to stem the bleeding, state legislators are advancing the “Saving Our Diners and Protecting Our Past Act” (SODA POP Act), a targeted financial lifeline designed to keep these cultural landmarks in business.
The Legislation: A Tax Shelter for History
Spearheaded by State Senator Paul Moriarty (D-Atlantic/Camden/Gloucester), the SODA POP Act (bills A6283/S2165) proposes a two-pronged tax relief strategy for independent diners and family-owned restaurants that have operated for at least 25 years.
First, the bill would create a “historic diner and restaurant registry” managed by the Division of Travel and Tourism. Establishments accepted into this registry would be exempt from charging the state’s 6.625% sales tax on food and beverages consumed on-premises. This move is intended to lower the bill for customers, potentially driving up foot traffic.
Second, the legislation offers direct relief to owners: a tax credit of up to $25,000 annually to offset the cost of ingredients. To qualify, the business must be a small business under federal guidelines, family-owned, and operate from a fixed location. “We have a duty to help them thrive,” Moriarty stated, framing the diners not just as businesses, but as essential community hubs.
Background: A Crumbling Institution
The urgency behind the bill stems from a stark reality: the chrome-and-neon landscape of New Jersey is dimming. Over the last decade, the state has lost dozens of its estimated 450 diners, including beloved institutions like the Cherry Hill Diner, the 24-hour Americana Diner in West Orange, and the Bendix Diner in Hasbrouck Heights.
Historically, diners thrived on New Jersey’s density and 24-hour culture, serving as neutral ground for politicians, shift workers, and families alike. However, the post-pandemic economy has been brutal. Inflation has skyrocketed the cost of eggs, bacon, and coffee, while labor shortages have forced many formerly 24-hour spots to close famously early—sometimes as early as 3 p.m.
Objections and Economic Realities
While the bill has bipartisan support, economic analysts and industry insiders warn that tax cuts alone may not be enough to reverse the decline.
The “Band-Aid” Argument: Critics argue that a $25,000 tax credit is a drop in the bucket against the massive overhead of running a large facility with an extensive menu. For diners operating on razor-thin margins, the fundamental business model—huge menus and round-the-clock service—may simply be outdated in an era of specialized fast-casual chains like Chipotle or Sweetgreen.
State Revenue Concerns: Exempting a sector of the hospitality industry from sales tax could reduce state revenue at a time when New Jersey faces its own fiscal pressures. There are concerns about where the line is drawn—why save a 25-year-old diner but not a 20-year-old struggling bistro?
Changing Demographics: No amount of legislation can legislate consumer taste. Younger generations are less likely to view diners as a primary social hub, and the decline of the “third shift” workforce has reduced the demand for 3 a.m. disco fries.
Despite the headwinds, proponents argue that without intervention, New Jersey risks losing a irreplaceable piece of its architectural and cultural soul. The bill is currently moving through the legislature, with supporters hoping to pass it before more “Open” signs are turned off for good.
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njsendems.org
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bloombergtax.com
