Acting on an emergency basis, Scranton City Council on Thursday adopted a 1 percent commuter tax.
An ordinance approving the new 1 percent earned income tax on nonresidents who work in the city initially was only supposed to be introduced Thursday. Council had issued a public notice Monday stating the ordinance would be introduced Thursday and then would be up for adoption on Oct. 25.
However, Mayor Chris Doherty and city Controller Roseann Novembrino issued an emergency certificate to council requesting that the ordinance also be seconded and adopted Thursday.
The commuter tax adoption, which was approved in a series of 4-0 votes by Council President Janet Evans and Councilmen Frank Joyce, Jack Loscombe and Bob McGoff, with Councilman Pat Rogan absent, now allows the administration to petition Lackawanna County court for approval to impose the tax, Mrs. Evans said.
"We felt time was of the essence. We could not take a chance of postponing a court date into 2013," Mrs. Evans said.
City Business Administrator Ryan McGowan, who attended the council meeting, said before the meeting that the emergency is that time is running out for the city to get a court hearing and approval this year, in order to have the commuter tax in place by Jan. 1.
Mrs. Evans and Mr. McGowan noted that in an unrelated court matter, the city last month sought a court date to seek approval for unfunded debt, and initially was given a date of Nov. 8, until it was moved up to Oct. 24. Mrs. Evans also noted that the city in January lost out on tax money from the sale of a hospital when the setting of the city's new tax rate had been delayed, and the city does not want any delays in implementing a commuter tax.
Mrs. Evans and the other council members said they do not want to impose a commuter tax, but the city's perilous financial situation leaves them no choice. Mrs. Evans said the commuter tax would run only for the next three years - or possibly less if the city's finances greatly improve - and noted the tax would have to be approved each year by the court.
Some city residents spoke against and for a commuter tax.
Resident Marie Schumacher said there was no emergency because a commuter tax is one of the key alternative revenues in the city's revised recovery plan that was adopted Aug. 23. The ordinance should not be "rammed through," but rather should be considered during at least two meetings, if not the usual three meetings, she said.
"It is taxation without representation. I think it's immoral," Ms. Schumacher said. "I would just encourage you to not pass this, and especially as an emergency. We've known this was coming since the revised recovery plan was passed, and this was part of it. So I don't know how we can consider this an emergency tonight."
Resident Lee Morgan said the city is "exploiting" and "fleecing" nonresidents with a commuter tax.
But resident Doug Miller supported the commuter tax and told the council, "Continue to stay the course and stand up for the (city) taxpayers."
Mrs. Evans said she also wished the legislation would have been brought before council sooner, but it had been under review by the state Department of Community and Economic Development and city officials were not able to introduce it any earlier. The city also is working under deadlines urged by the city's Act 47 recovery coordinator, Pennsylvania Economy League, for timely actions on several fronts under the recovery plan, Mrs. Evans said.
Ordinances typically are introduced, advanced on second reading and adopted on third reading, with each step taking place at a separate meeting. However, council can suspend rules on an emergency basis and introduce, advance and adopt an ordinance all at one meeting. That's what happened Thursday.
Mrs. Evans said outside the meeting that the city's passing of the ordinance on an emergency basis had nothing to do with mounting opposition to it. Mayfield Mayor Alexander Chelik also held a meeting Thursday in Olyphant to organize opposition to a Scranton commuter tax.
On Wednesday, the Greater Scranton Chamber of Commerce issued an online survey to its membership to gauge feelings about a commuter tax. Some chamber members have expressed concern that a commuter tax would make business more difficult, chamber President Austin Burke said in an interview earlier Thursday.
If the commuter tax is approved by a Lackawanna County Court judge, the city's nonresident earned-income tax would rise from the current 1 percent to 2 percent. The city's earned-income tax of 2.4 percent on city residents would remain unchanged.
A 1 percent commuter tax is expected to raise $2.5 million next year and $4 million in each of 2014 and 2015, officials said.
Upon advice of council Solicitor Boyd Hughes, the council also agreed to send a letter to the city's Single Tax Office asking it to review the leases of businesses operating at The University of Scranton and to ensure that they are paying city business privilege and mercantile taxes.
In other matters, council voted 4-0 on the following:
n To adopt a resolution approving a three-year contract with the city's clerical union, the International Association of Machinists and Aerospace Workers Local 2462. This resolution had been tabled by the council on Jan. 26 due to a legal dispute between the administration and council over control of two clerical positions within the council clerk's office. That dispute, however, was settled Oct. 1 and paved the way for the contract to be approved, Mr. Joyce said. The new contract calls for raises of 3.75 percent in 2013, 3.5 percent in 2014 and 3.75 percent in 2015, said clerical union President Eileen Hurchick.
n To introduce a resolution to provide a $150,000 loan at a 2.5 percent interest rate for a term of 15 years from Community Development Block Grant funds to 520 Madison Avenue Associates. In March, businessman William Nasser requested the loan from the city's Office of Community and Economic Development to furnish a new bed and breakfast that he plans to open. Mr. Nasser said in March that he has spent $1.2 million of his own money over the past decade renovating an 1882 home at 520 Madison Ave. In January, he received a special exception from the city zoning board for a B&B, and the loan was introduced by council on March 29, but then died in April in a 2-2 council vote due to delinquent taxes being owed on the property, Mrs. Evans said. Because those delinquent taxes were later paid, council reconsidered the loan, Mrs. Evans said.
n To introduce a resolution to provide a $150,000 loan at a 2.5 percent interest rate for a term of 15 years from Community Development Block Grant funds to Freckles and Frills Inc., a child care learning center moving to 515 Fig St. The center, owned by Elizabeth Keiper and Daniel Aguirre Solis, has been located on Pittston Avenue for more than 20 years and the new Fig Street location, a former parish center, allows for expansion, according to OECD. The loan will provide gap financing for working capital and costs engineering and design professional fees, according to the OECD. Mr. McGoff noted that the child-care center will be taking a formerly tax-exempt property and putting it on the tax rolls.
n To introduce an amended ordinance, to correct road-segment numbering in a no-parking zone in the 900 block of North Washington Avenue.
Contact the writer: jlockwood@timesshamrock.comOther business
In other matters, council voted 4-0 on the following:
-âTo adopt a resolution approving a three-year contract with the city's clerical union, the International Association of Machinists and Aerospace Workers Local 2462. This resolution had been tabled by the council on Jan. 26 due to a legal dispute between the administration and council over control of two clerical positions within the council clerk's office. That dispute, however, was settled Oct. 1 and paved the way for the contract to be approved, Mr. Joyce said. The new contract calls for raises of 3.75 percent in 2013, 3.5 percent in 2014 and 3.75 percent in 2015, said clerical union President Eileen Hurchick.
-âTo introduce a resolution to provide a $150,000 loan at a 2.5 percent interest rate for a term of 15 years from Community Development Block Grant funds to 520 Madison Avenue Associates. In March, businessman William Nasser requested the loan from the city's Office of Community and Economic Development to furnish a new bed and breakfast that he plans to open. Mr. Nasser said in March that he has spent $1.2 million of his own money over the past decade renovating an 1882 home at 520 Madison Ave. In January, he received a special exception from the city zoning board for a B&B, and the loan was introduced by council on March 29, but then died in April in a 2-2 council vote due to delinquent taxes being owed on the property, Mrs. Evans said. Because those delinquent taxes were later paid, council reconsidered the loan, Mrs. Evans said.
-âTo introduce a resolution to provide a $150,000 loan at a 2.5 percent interest rate for a term of 15 years from Community Development Block Grant funds to Freckles and Frills Inc., a child care learning center moving to 515 Fig St. The center, owned by Elizabeth Keiper and Daniel Aguirre Solis, has been located on Pittston Avenue for more than 20 years, and the new Fig Street location, a former parish center, allows for expansion, according to OECD. The loan will provide gap financing for working capital and costs, engineering and design professional fees, according to the OECD. Mr. McGoff noted that the child care center will be taking a formerly tax-exempt property and putting it on the tax rolls.
-âTo introduce an amended ordinance, to correct road-segment numbering in a no-parking zone in the 900 block of North Washington Avenue.