Shamokin PA
Intermittent clouds
Intermittent clouds

Soon citizens, not judge, will make call on city’s finances

A county judge for the 10th consecutive year on Monday gave Shamokin officials permission to levy a real estate millage that’s beyond the maximum allowed by state law and, for the fourth year, to double the earned-income tax rate.

No citizens testified Monday, testament to the process having become commonplace. Certainly no one favors paying more in taxes, but most realize how vital the approved rates are to keeping the city in the black financially and keeping services such as a full-time police force affordable.

Public involvement in the future of the city tax structure, however, is likely going to increase over the next year or two.

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Winning Mayoral Candidate John Brown favors following the advice of the city’s Act 47 team and pursuing having a Home Rule charter written for the city that would allow its exit from Act 47 as desired after five years, which would be in February 2020. While there are many aspects to Home Rule, a key is that it would allow a doubling of the earned-income tax from 1 to 2 percent to remain permanent.

But Home Rule — starting with filling the seats needed for a commission that would write the charter — is going to be a tough sell. It failed when the county tried it about a decade ago, in part because people simply don’t like change, and also because Home Rule is complicated. 

Meanwhile the state Legislature could ease pressure on cities like Shamokin that are in Act 47 or are otherwise struggling financially by amending the Third Class City Code to allow a permanent 2 percent EIT.

 The city is projected to finish this year with a surplus about the same as last year’s, $120,000. The 5 extra real estate mills generates an additional $115,000, while the extra EIT means about $840,000. Obviously, without that money, the city is back into the red, and unless there is an explosion of industry in the city or — just imagine — every single person and business pays their taxes, there will be no other way to make up those dollars.

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Brown and others on council may do a good job at educating the public on the value and importance of Home Rule and ultimately earn approval through voter referendum.

But with municipalities across Pennsylvania struggling financially, with the costs of pensions and health care continuing to rise, it seems an adjustment to the law pertaining to the EIT might be a more effective way — albeit a painful one for taxpayers — to keep these communities solvent.