Property taxes in Lackawanna County would increase 4 percent next year under the tentative 2013 budget Commissioners Jim Wansacz and Corey O'Brien will unveil today, a relatively modest jump that will cost the average homeowner $31 annually.
The proposal sets aside $1.25 million to fund the economic development initiative the Democratic majority commissioners promised when they ran for office in 2011, but also includes the elimination of more than two dozen county jobs to help offset rising personnel and health care costs.
The commissioners said their economic development plan will put an emphasis on job creation to combat a 9.3 percent unemployment rate in the county that Mr. O'Brien called unacceptable.
"We need to take the bull by the horns, and we need to start investing in ourselves. That is what this budget starts to do," Mr. O'Brien said. "Is this budget going to cure all ills? No, but it is a start."
The commissioners will formally release the $91.7 million tentative budget during a public hearing today at 1 p.m. in the sixth-floor conference room at the Administration Building, 200 Adams Ave. Three more budget hearings are scheduled later in the week.
Under the plan, the county's real estate tax rate would increase 2.4 mills to 57.4 mills. With a mill equal to $1 in tax for every $1,000 of assessed property value, county taxes on a residential property assessed at the county average of $13,000 would climb $31 next year - from $715 to $746.
If approved, it will be the second property tax increase in as many years, coming on top of a 38 percent hike in 2012. It will also mean a near-doubling of the tax rate since 2004, when it was just over 29.2 mills.
Aside from funding economic development, the $3.1 million in new revenue generated by the millage increase will help cover a $4.3 million net jump in county expenses over 2012.
Those expenses will be further offset by the reduction in the county's work force.
The elimination of 25 to 30 positions, some of which are unfilled vacancies, is expected to save more than $1.2 million, Mr. Wansacz said. The budget does not specify the departments in which those cuts will occur.
The new cutbacks would follow a net reduction in the county work force of 581 employees since 2008.
Mr. Wansacz said probably the most onerous of the new expenses is $1 million in "surveillance fees" related to borrowing during the Cordaro-Munchak administration. The county is obligated to pay the fees in 2013 after its credit rating slipped to junk bond status in January.
The commissioners said the annual penalty will remain in place until the county earns another investment-grade rating. To that end, they said, the county will create and maintain a fund balance - essentially a rainy day account - to satisfy the expectations of the bond-rating agencies.
The budget projects the county will end this year with a fund balance of nearly $310,000 that will grow to more than $680,000 by the end of 2013, the commissioners said.
Mr. Wansacz said the administration is committed to breaking the pattern, dating back to 1989, of county property taxes jumping dramatically every four years.
Mr. O'Brien and former majority Commissioner Mike Washo interrupted the cycle by holding millage rates level from 2009 through 2011 but then approved the 38 percent hike for this year.
"We are not going to get out of this by playing games," Mr. Wansacz said. "The history speaks for itself. If we keep doing the things that everybody does, you can guarantee a huge tax increase every four years."
The $1.25 million for economic development will be split among three programs, the commissioners said.
Under a Small Business Administration fee waiver program, the county will offer a financial incentive for job creation by paying the fees associated with SBA-backed loans to employers that bring jobs to the county, Mr. O'Brien said.
A $300,000 to $400,000 annual investment by the county could leverage $10 million to $15 million in activity "and create a significant number of new jobs," he said.
"We don't have to administer anything. We are not creating bureaucracy to do it. All we are doing is, once they get to closing at their bank, we will cut a check to pay the SBA fees," Mr. O'Brien said.
Under a second program, the county will work with the Greater Scranton Chamber of Commerce to attract bioscience and biotechnology companies by offering incentives, which could take the form of no-interest or low-interest loans or direct grants, Mr. Wansacz said.
The final component will be a community reinvestment program in which the county will assist municipalities with worthwhile projects, such as upgrading streetscapes or rebuilding playgrounds. Mr. O'Brien said communities struggle to put together the funding for such projects.
"We want to get this money out on the street on an annual basis to help stimulate and spur the economy," he said.
Contact the writer: dsingleton@timesshamrock.com
County budget hearings
-âToday, 1 p.m., commissioners conference room, Administration Building, 200 Adams Ave., Scranton
-âTuesday, 5:30 p.m., Blakely Borough Building, 1439 Main St., Blakely
-âWednesday, 5 p.m., Clarks Summit Borough Building, 304 S. State St., Clarks Summit
-âThursday, 6 p.m., Carbondale City Hall, 1 N. Main St., Carbondale