HARRISBURG, PA — Scranton and other fiscally distressed cities could triple the local services tax to help them move out of Act 47 status under legislation that won final legislative approval with a 43-5 Senate vote Thursday.
This option would be available to Act 47 municipalities only as an alternative to an increased earned income tax already available to them.
Gov. Tom Corbett is expected to sign the bill after a review, said spokesman Jay Pagni. He has 10 days to review the provisions.
The local services tax could potentially triple from $52 annually to $156 annually for individuals working in those municipalities but those earning under $15,600 annually would be exempt from the higher local services tax.
HARRISBURG — Scranton residents could see their taxes rise under legislation approved unanimously Wednesday by the Senate.
The measure would require that Scranton levy a tax on residents equal to or more than its 0.75 percent commuter earned income tax.
This stipulation is included in a late amendment added to the bill by the sponsor, Sen. John Eichelberger, R-30, Hollidaysburg. The goal here is to treat all Act 47 municipalities — including those like Scranton that have distressed municipal pension plans subject to Act 205 — the same, said Sen. John Blake, D-22, Archbald.
Ten other municipalities levy a pension-related earned income tax, but they levy it on both commuters and resident workers, he added.
The Pennsylvania League of Cities and Municipalities Core Communities In Crisis Task Force met at Albright College for their third and last session. Allentown Mayor Ed Pawlowski told the group on Thursday that “our cities will start to topple like dominos in five to ten years.” Reading’s Mayor, Tom McMahon, was less optimistic stating he predicts two to three years.
The task force calls for systemic reform via the state Legislature for such items as public pension plans and labor contract laws. Archaic codes, inflexible taxing structures, mandated personnel benefits and rising costs are placing huge burdens on cities and municipalities across Pennsylvania.
Reading Mayor Tom McMahon asked the question, “How much more can we extract from people?” Pottstown feels your pain. Many here are asking the same question!