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Scranton council adopts 22% tax hike

Scranton City Council on Thursday adopted a 22 percent tax increase for 2013, a hike slightly less than the administration sought.

However, council President Janet Evans said Mayor Chris Doherty agrees with a 22 percent increase in each of the city's land and improvement tax millage rates and that he would sign the ordinance. Efforts to reach the mayor after the meeting were unsuccessful.

Acting on an emergency basis, the council introduced an ordinance to set the millage rates and then suspended rules to vote on advancing the ordinance on a second reading and then adopting it on a third reading.

The 22 percent millage rates were adopted in a 3-2 vote, with Mrs. Evans and Councilmen Frank Joyce and Jack Loscombe voting yes, and Councilmen Bob McGoff and Pat Rogan voting no.

Mr. Rogan opposed the tax increase. Mr. McGoff said he was not opposed to the tax increase but voted no because he said the city does not yet have assessed values for land and improvements, and as a result cannot know whether the rates will produce the amount of revenue for which the city has budgeted. Mrs. Evans said this is the way the rates are set each year, but Mr. McGoff disagreed.

The city has two separate property tax millages: one for land and the other for improvements/buildings. The administration's ordinance called for the millage rate for land of 96.701 mills last year to increase to 119.909 this year, or a 24 percent hike; and for the millage rate for improvements of 21.03 mills last year to rise to 26.288 mills this year, or a 25 percent rise.

Council amended the ordinance to increase the land millage to only 117.975 and increase the improvement millage to only 25.656, each of which represents a 22 percent increase, Mr. Joyce said.

The 22 percent hikes were the amounts the mayor had asked for at a surprise appearance before the council on Dec. 13, after judges in the city's commuter tax case said the city was avoiding a court-ordered tax hike to pay unfunded debt. At that time, the council agreed to the 22 percent spikes, but the next day the city submitted to the court millage rates for 24 and 25 percent increases in land and improvements, respectively. The difference was attributed to needing slightly higher millage rates to produce a 22 percent increase in revenue, because the amount collected would not be 100 percent, the mayor had said.

Council disagreed, however, and Mrs. Evans said council would stick to the 22 percent tax increase, a cumulative total stemming from two separate court orders to pay for two separate unfunded-debt packages secured last year.

Noting that the city's 2013 budget calls for a 22 percent tax hike, council finance chairman Frank Joyce said, "Raising taxes is the last thing anyone wants to see done, but this is a court-ordered tax increase and it's needed" for the city to survive.

Mrs. Evans added, "No one feels comfortable with this, but this tax increase is necessary to pay unfunded debt of 2012."

Resident Marie Schumacher questioned why the millages were being adopted on an emergency basis. Mrs. Evans said she was not happy with the millages being presented by the mayor as an emergency, but that if council enacted them over three meetings, the issuance of tax bills would be delayed and taxpayers would be penalized by having the time for the first early tax payment discount period decreased.

Council also unanimously introduced an ordinance to name city administration solicitor Paul Kelly and council solicitor Boyd Hughes as special counsels for financial borrowing matters, and to name Michael Judge of CaseCon Capital of Scranton as a financial adviser to the city. Mr. Hughes was absent from the meeting.

The mayor and council enacted a similar ordinance last year that allowed Mr. Kelly, Mr. Hughes and Mr. Judge to receive fees for any work they performed in securing lending for the city. In the case of Mr. Kelly and Mr. Hughes, this type of work was above and beyond their normal duties and the fees were warranted, officials said last year.

Some residents questioned the special-counsel designation. Bob Bolus asked if the solicitors again would earn fees above their usual salaries. Mrs. Evans said yes, "There will be additional fees depending on the financial transactions that will occur in 2013."

The special-counsel ordinance references possible transactions, such as a sale/leaseback of a city property needed to pay the landmark state Supreme Court arbitration award to the city's police and fire unions and a mandated increase in pension payments; unfunded debt that will be needed to replace some $4 million in a commuter tax that was rejected in December by a panel of county judges; and refinancing.

Residents also asked about the city selling an asset to raise funds. Mrs. Evans said she does not take selling a city asset lightly, but that she would support selling one that is an "albatross" on the city, and that such a sale would eliminate debt for which the city ultimately is on the hook to back. Asked after the meeting if she was referring to the Scranton Parking Authority, which she has previously described as an albatross, Mrs. Evans said no. She declined to be more specific about what asset to which she was referring as a candidate for a possible sale.

In other matters:

n Regarding a city plan to enhance the city's on-street parking meters, Mrs. Evans said the city is pursuing a "management agreement" with outside firm Central Parking, and not a lease of the city's parking meters.

n Asked by residents about whether the city would repeal a ban of big truck traffic on Lake Scranton Road that has not been enforced by the city. Mrs. Evans said that only council can repeal an ordinance and this council will not repeal the truck ban. "It is an ordinance that should be enforced," she said. However, police cannot enforce the ban until truck weight-limit signs are posted on the road, and the administration has chosen not to post signs or enforce the ban, she said. Lake Scranton Road resident Anthony Pamelia thanked council for the truck ban, even though it has yet to be enforced. He said he moved there in 2008 and when big trucks from the nearby DeNaples property travel on Lake Scranton Road, "It's like an elephant walking through your living room."

n Some residents applauded the mayor's announcement that he won't seek re-election this year to a fourth term. Les Spindler called it the "best news the city has received in a long time." Dave Dobrzyn said the city should consider limiting a mayor to two terms. Mr. Rogan agreed there should be term limits for a mayor and possibly for council members, too.

n The city has made payments recently to police and firefighters to pay court awards in arbitration cases that the city lost and the unions won, Mrs. Evans said. Regarding a health care arbitration dispute from 2010, the city paid $162,000 to the fire union and $199,000 to the police union; and regarding a strategic implementation team clerks arbitration dispute, the city paid $1.4 million to the police union, she said.

n Responding to residents' questions of whether the city has given or loaned Fire Engine 15 to the borough of Throop, council members said the city has loaned a spare, 1987 Sutphen fire engine to Throop. The borough had asked the city if it had a spare engine to loan while Throop's engine was out of service to be refurbished, according to a Jan. 4 letter to council from Scranton Deputy Fire Chief Al Lucas. "This has been a practice of mutual aid between communities in our area for many years. I am sure that if we are ever in need of reciprocity we will be offered the same," stated Deputy Chief Lucas, adding that the city has five reserve engines and one reserve truck. Mr. Rogan expressed concern with the engine loan and questioned who is paying for the insurance and maintenance of the loaned engine. It was not clear when the engine was loaned to Throop, and Mr. Rogan said a letter should be sent to the borough asking when it would return the engine.

n Voted 1-4 against asking for the resignation of city Businessman Ryan McGowan or for the mayor to fire him. This motion was made by Mr. Rogan, who believes Mr. McGowan has not done a good job and cast the lone yes vote for the motion. The other council members, who voted no and killed the motion, said hiring and firing is the mayor's prerogative. Mr. Rogan said that's correct, "But as a council, we could send him a message" by approving the motion. Mrs. Evans said council members should not bother with "exercises in futility" and instead should focus on the city's budget and finances. Mr. McGoff defended Mr. McGowan, saying he has worked tirelessly last year during the city's fiscal crisis. Efforts to contact Mr. McGowan after the meeting were unsuccessful.

n Voted 5-0 to adopt a resolution to accept a $100 donation from NEI Ambulatory Surgery Inc. of Mifflin Avenue to the Scranton Fire Department. The donation was made as a gesture of appreciation of the department's work.

n Voted 5-0 to table for a week resolutions concurring with the mayor's reappointments of the following five people: Joseph DeAntona and John Granahan to five-year terms on the Scranton Lackawanna Health and Welfare Authority; Jack DeLeo and Colleen Gleason to five-year terms on the Scranton Municipal Recreation Authority; and Stu Renda to a five-year term on the Scranton Sewer Authority. The resolutions were tabled because the council wants to ask the candidates to submit resumes for review. All of their prior terms expired Dec. 31 and their new terms would expire on Dec. 31, 2017. In the past, council has asked for resumes of appointees, and some council members have voted for those who submit resumes and against those who do not provide resumes. Either way, a council vote is symbolic because the appointments are made by the mayor.

Contact the writer: jlockwood@timesshamrock.com


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