Wednesday, July 23, 2014
Inquirer Daily News

First county tax hike in six years is likely, official says

Money needed to cover part of projected $24.3 million shortfall.

First county tax hike in six years is likely, official says

Bucks County probably will need to raise property taxes for the first time in six years to fund part of a $24.3 million shortfall in next year's budget, a county official said Wednesday.

"I don't know how we do it," Chief Operating Officer Brian Hessenthaler said about keeping taxes at 21.942 mills, or $785 for a home assessed at the county average of $35,800.

"I know it's a bad time, but we haven't had a tax increase in five years," Hessenthaler said. "You can only go to the well so many times."

If the preliminary $471.3 million budget — a 1.7-percent increase from this year — were adopted without using money in the rainy-day fund, taxes would increase 3 mills, or $108 on the average assessed home, he said.

The rainy-day fund has been used to keep taxes steady the past few years. But, because of the weak economy, it has dropped from $73 million in 2008 to an estimated $51.7 million next year. With a required 10 percent reserve, only about $4.6 million would be available for this budget.

Any tax increase should be much less than 3 mills, Hessenthaler said, with every line in the proposed budget under reviewed as the scheduled Dec. 21 adoption approaches.

"We're looking at the workforce. We're challenging revenue numbers, some may be low," he said. "We're looking at all costs."

On the revenue side, the rates charged by Neshaminy Manor might be low, possibly adding $500,000 to $1.5 million to the projected $37.2 million of income from the county's nursing home, Hessenthaler said.

Half of the budget shortfall is connected to salary increases and benefits for the county's 2,628 employees. The budget calls for a pay freeze for about 900 non-union workers and elected officials, and negotiated raises of up to 4 percent for union workers.

The projected contribution to the pension fund is $15.5 million, close to what it has been the past two years but significantly higher than the $1 million paid in 2008. Employees contribute 9 percent to the fund.

That did not sit well with several of about 20 residents who turned out Tuesday night for a public review of the budget.

Bill Laird of Doylestown Township said that his 401k has been hit hard the past few years and that county workers should "suffer a little bit. They have a guaranteed pension," but taxpayers are funding it.

Glenn Schoeffel of Buckingham, said he took a 30 pecent pay cut as a pharmaceutical worker and pays 100 percent of his 401k.

“There are no guarantees in life,” he told the commissioners. "I can't afford any more taxes, so do what you can."

Several residents also urged layoffs and increased worker contributions to healthcare coverage.

"Why can't you do what businesses do?" Jackie Walker of Hilltown Township asked. "If you start letting some people go, those people who have jobs are going to start producing more."

The workforce has been unchanged in three or four years, Commissioner Rob Loughery said. Staffing levels are set by the state and federal governments in many cases, Commissioner Chairman Charles Martin said. "We're required to have so many nurses for patients and so many guards for inmates."

A majority of the union employees make $50,000 a year or less, Commissioner Diane Ellis-Marseglia added.

The public session produced "several good ideas," Loughery said, such as possibly raising the pension contributions paid by newly hired workers, taking a head count to see "whether we are over mandated staffing levels," and analyzing essential hires versus non-essential hires.

"We need to do this not just for 2012, but 2013 and 2014," he said, "with a longer-term view in mind."

About this blog
Chris Palmer covers Bucks County for the Philadelphia Inquirer. His previous work has appeared in the New York Times and on several Times blogs, including City Room, the Local East Village and SchoolBook (which has since been taken over by WNYC). Contact him at cpalmer@phillynews.com, 610 313 8212 or on Twitter, @cs_palmer.

Ben Finley covers Bucks County for The Philadelphia Inquirer. He previously worked for The Associated Press, FactCheck.org and the Bucks County Courier Times, where he won more than a dozen journalism awards from organizations including the Education Writers Association, the Society for Features Journalism and the Pennsylvania Bar Association. He grew up in Columbus, Ohio and graduated with honors from The Ohio State University with a degree in journalism. Contact him at bfinley@phillynews.com, 610-313-8118 or on Twitter, @Ben_Finley.

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