Shamokin taxes to stay at 30 mills
SUNBURY - The City of Shamokin is permitted to raise its property taxes to 30 mills for the fifth year running, 5 mills higher than that allowed by law.
Robert B. Sacavage, Northumberland County president judge, again permitted the exception, issuing an order Thursday afternoon after presiding over an hour-long hearing that morning at the county courthouse.
The additional millage will allow the city to collect up to an estimated $175,000 in property tax above what's allowed under Third Class City Code.
There had been no objections filed to the city's petition, and no one attended the hearing to speak out against the plan, which city officials say is necessary to balance its $2.5 million budget and maintain its emergency and civic services.
Sacavage sided with the city, saying the tax exception was properly advertised and filed with the court, that the decision to seek the exception was made by elected officials at public meetings, and that Shamokin officials presented evidence that the extra millage is crucial to serve city residents.
"The court is not authorized to micromanage the city's budget. Rather, the court is charged only with determining whether the city has established by competent, credible evidence that the anticipated revenues of the city will be insufficient to meet the financial obligations of the approved budget," Sacavage wrote in his order on the case.
"The court finds that the testimony presented established not only that the additional millage is a necessity for the City of Shamokin to meet its monetary obligations under the approved 2013
budget, but that the very health, safety, and welfare of the residents of the city would be adversely affected should there not be an approved increase in millage," the president judge wrote.
Shamokin's collection rate on property taxes will all but prevent it from maxing out collection of the additional millage.
City Clerk Steve Bartos said during testimony at a hearing that the extra 5 mills would net Shamokin closer to $120,000.
Shamokin's collection rate for property taxes was 76 percent in 2011, down from 82 percent in 2010, according to last year's tax information.
What it means for a taxpayer is this: Instead of paying $25 on each $1,000 of assessed property, a property owner will pay $30.
For example, the owner of a home assessed at $30,000 would pay $750 in property tax if it were 25 mills. That bill rises to $900 under a 30-mill tax, and that's been the case the past four years.
The property tax is a substantial portion of the city's total tax levy, which in 2012 is 44.918 mills for property tax, debt service, recreation tax and library tax combined.
When Sacavage approved the exception last December, it came at the end of a brief hearing. This time around, the hearing lasted much longer.
The president judge asked many questions of Bartos, city Solicitor H. Robert Mattis and Mayor George Rozinskie. He questioned the amount of outstanding debt owed by Shamokin, the cost of salaries for elected and administrative officials and the effect a 25-mill tax limit would have on public services.
The city pays an estimated $290,000 annually for debt service, and recently refinanced $1.8 million on three outstanding loans, Bartos said.
The workforce is decreasing, he said, which has cut into both the local services tax and earned income tax. The collection of the latter dropped an estimated $55,000 over the past year.
The downtown business district is mostly retail and service oriented, and there is little in the way of manufacturing within the city limits.
The police and street departments combined make up nearly $1.7 million of the city's total budget. Both departments have vacant positions that have not been filled, and Bartos said there have been no substantial capital purchases for the street department since his hiring 20 months ago.
Union employees - police and street department - are contracted to receive annual 3-percent bumps in salary.
There is a proposal for a raise for both Rick Bozza, code officer, and for Bartos himself, both of whom are non-union.
The latter - a $9,350 bump to $45,400 - has ruffled some feathers, and Sacavage asked Rozinskie if it is valid.
"Mr. Bartos has done a good job while he's been here," the mayor said. "I think he deserves a raise."
If approved by city council, Bartos' new salary would be slightly higher than that earned by the managers of both Coal Township and Sunbury.
Proposed code changes
Sacavage's line of questioning had seemingly convinced him that the additional millage requested exceeds the cost to maintain civic ventures, including the city swimming pool, and that public services would be in jeopardy if the city's request were denied.
Bartos said there is a state Senate bill pending that would revise the Third Class City Code. If adopted in its present form, the bill would increase the maximum property tax millage from 25 to 30 mills and would also allow up to 5 mills of that total to be dedicated to costs for street lights.
While boroughs and townships are permitted to tax for street light costs, third class cities cannot, and those costs significantly eat away at funding that could be used for road repairs, Bartos said.
City council is expected to vote Monday on a final budget for 2013.