Allentown Mayor Ed Pawlowski delivered his proposed 2016 city budget to City Council Monday. The budget calls for nearly $99.9MM in spending and holds the property tax rate steady for an eleventh consecutive year!
In his message to City Council, Pawlowski said, “The Proposed 2016 Budget and Program of Services continues the austere and prudent management of the services we must provide to our great city. It meets the needs of the city in a cost effective manner.”
The proposed budget discontinues collection of the $5.00 city resident, or per capita tax, the administration of which is unduly burdensome for the minimal revenue that the tax generates.
The expected growth in real estate values via the rapid expansion of the Neighborhood Improvement Zone is beginning to occur, and the accompanying growth in new businesses in Allentown is keeping other tax and fee collections robust. However, the faster rate of increase in employee health insurance and other benefit costs is depleting the General Fund reserve significantly, and supplemental revenues are needed to balance the 2016 Proposed Budget.
The Business Privilege Tax, the $52 Local Services Tax, the Refuse Collection Fee and all other taxes and fees are assessed at their 2015 rate, including the Act 205 Earned Income Tax rate for non-residents at 0.28%. This administration is hopeful that we will be able to phase out this tax as the many positive initiatives that have occurred within Allentown begin to provide alternative and additional revenue sources to fund the services our residents, taxpayers and business owners so well deserve.
The city’s financial outlook was again bolstered by the ratings agencies. Moody’s gave the city’s 2015 General Obligation Bonds an A3 rating and termed the city’s outlook stable. Just two years ago the city’s outlook was negative. The rating from Standard & Poors improved from BBB+ to A+ with a stable outlook.
The 2016 spending plan adds a housing coordinator position in the Bureau of Planning to coordinate a citywide housing strategy and oversee the blighted property process, deploys additional police surveillance cameras in city neighborhoods, upgrades Mack South Fire Station and plans a Regional Shared Services 9-1-1 Telephone system with the City of Bethlehem, the County of Lehigh and the County of Northampton.
The proposed 2016 Budget and Program of Services will see a continuation of the austere spending and employment practices that this administration has pursued in the past. The proposed budget increases the residential earned income tax collected by the city from 0.83 percent to 1.15 percent, which will provide $5.5 million in additional revenue annually. The increase will cost a $50,000 wage earner $160 annually or approximately $3 per week or 43 cents per day. To maintain fiscal stability for the upcoming year, the city will lend $4.5 million from the Solid Waste Fund cash reserves to the General Fund, with reimbursement to the Solid Waste Fund occurring incrementally, thus balancing out its cash positions without effecting the General Fund cash reserves.
Pawlowski will formally present the budget to City Council on Wednesday, November 4 at 5:30pm.
Pawlowski thanked the directors of the city departments, bureau managers and supervisors for their diligence throughout the budget preparation process. “They prepare the numbers and work them and re-work them to help put together a spending plan that continues to provide Allentown taxpayers with outstanding services at reasonable costs.”