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Nazareth, Pa., United States

Thursday, December 04, 2014

Why We Need a 2 1/2 Mill Tax Hike

After ignoring the press during his first six weeks in office, Northampton County Executive John Brown conducted his first news conference in February. He blasted former Executives John Stoffa and Glenn Reibman for their failed leadership, calling the County a "drifting ship that "desperately needs a strong leader to grab the wheel and steer." Well, that drifting ship is now sinking after one year of John Brown at the helm. He has preferred government by consultant to talking to the people who actually work for the county. He hired a PR consultant who posted newsletters that say goofy things like, "We're thankful to John ... ." Employees are far from thankful. Morale is at an all-time low as Brown unilaterally decided to cut their health benefits, the first of many to come. At least 92 have decided to retire, including some long-time workhorses whose institutional knowledge will be impossible to replace. He has hurt the public by allowing staff shortages to accumulate. He alienated Council, too, when he decided to post armed guards at his door during a news conference. After proposing an illegal line of credit to balance the budget, Brown is now irresponsibly willing to keep just $1 million in reserve in a county that spends between $8-10 million per month, He spent $20 million more than he took in, which make Stoffa and Reibman look look pretty good. Instead of proposing the tax hike necessary to keep this County afloat, he's letting others do it for him.

Brown believes that if he proposes a tax hike, that might hurt his re-election chances. So instead of grabbing the wheel and steering, he's turned things over to Council. He's letting them lead while he protects himself.

The reality is that, whether it is a half mill or three, a tax hike will be unpopular. But this is the time to do it. There's no election right now. If they wait until next year, they are going to have to borrow money. The tax hike will be even larger, and it will be an election year.

The tax hike should be substantial. The County needs to make up at least $20 million. Like it or not, that is 2 1/2 mills of taxes. I get the incremental argument made by Scott Parsons and Ben Hedrcick of approaching the savings needed more gradually.  But the political winds will be blowing too strong next year. Now or never.

Don't count on Lamont McClure or Ken Kraft. Though a tax hike is absolutely necessary, these guys are so angry at Brown that I honestly think they are willing to spring more leaks in the U.S.S. Northampton so they can blame Captain Brown as the ship sinks. Posting armed guards at news conferences has that effect.
 
So this is up to the Republicans, and hopefully, Scott Parsons and Bob Werner. Nobody should propose or vote for a tax hike until certain that there are five votes. You can read Council members during a meeting and gauge what they will go for and what they won't. You would be better to have six votes or a commitment from Brown that he will not veto the increase. Otherwise, he could veto, and those voting for the tax hike will be tarnished.

 We'll see what happens tonight.

In the meantime, the amendments proposed at a brief budget hearing today actually spend money. Ken Kraft made an impassioned plea to fund docents, whatever the hell they are, at Hotel Bethlehem. Peg Ferraro wants $50,000 for the State Theatre, well beyond what they even had sought. This money comes from the hotel tax, not the general fund.

Scott Parsons is willing to restore $750,000 in funding for farmland preservation, with another $400,000 to go into environmentally sensitive lands. This money comes from a near $3 million slush fund in table games revenue. Parsons' argument is that this money can be used for community or economic development. That argument flies with farmland preservation, but I think it is a stretch with environmentally sensitive lands.

Hayden Phillips made a pretty good argument against this funding, stating it is his view that farmland preservation is designed to prevent development and force people into the city. I get his point, but think this funding helps farmers to continue farming. I don't believe it is part of the effort to encourage everyone to live in the cities.

Amazingly, no effort was made to assure that Council has control over the rest of that slush fund. That needs to be done. Giving one person control over that much money is an invitation for trouble.

I would also insist that money be set aside for employee medical expenses, and that Brown be called upon to increase benefits accordingly.

Lamont McClure has some cuts, probably at the jail, but he was sick and missed the meeting.

33 comments:

Anonymous said...

If Hayden Phillips is against Farmland Preservation, then he should propose putting a referendum on the ballot to see if voters want to get rid of it. The VOTERS voted for it, and WE are all paying 1/2 mill for Open Space. Hayden Phillips and John Brown don't have the authority to shut it down and take the money to use for pet projects and say "oh, we budgeted nothing for Open Space." Why not - we paid for it? Phillips can shut the fuck up and do what the voters voted to do, instead of voting against Open Space grants when they come up because of his tea bag principles. It is not his call. He casts his one vote in the voting booth, and that is all the say he has. Jack ass.

Bernie O'Hare said...

It is his call. He is one of nine votes, and owes the voters his best judgment. The referendum of which you speak authorized the county to borrow up to some figur, $35 million? It did not require that amount be borrowed. Council could have floated a $10 million bond and said that's it. John Stoffa decided on the half mill tax for a more economical, pay as you go approach. I believe that the farmland preservation should continue, especially since thT is the #1 industry in Pa. That is both economic and community development. The same is true of parks and trails. I am much less enthusiastic about environmentally sensitive land. I think it is hard to argue that is either economic or community development. Plus, I know our history, and we have made several dubious purchases in that area. We have helped a realtor and a failed golf course developer. I think the guidelines for those purchases should be revisited.

Anonymous said...

"and WE are all paying 1/2 mill for Open Space."

It is hard when you don't get your way but reality is reality. There is no 1/2 mill tax for open space. If there is it is illegal.

Bernie, there is not one Democratic council vote for a tax increase. This was a big election for the Republican team. John Brown has proposed a no tax increase budget. If the Republican team disagrees it is their responsibility to say, "a tax increase please".

That was a core message of their joint campaign.,they complained that Callahan and the Demo's running were tax and spenders. the Democrats running for county council were labeled old liberal tax and spend people. So the ball is in the new county councilmen's court. They won, they decide.

Bernie O'Hare said...

You are playing politics with the employees when you refuse to find the government. Since Scott Parsons said he could go for a half mill, and he is a Democrat, your assertion is necessarily wrong. I believe Kraft and McClure will vote no, but they really should work with Republican Council members. Brown has screwed all Council members, both Dem and R. I understand the desire to stick it to him, but it will ultimately be at the expense of the employee and the public.

Anonymous said...

Bernie, I worked for one of the Democratic candidate during the race. I am biased for sure. It was clear and I listened and read everything. The Republicans played on their ability not to raise taxes and the Democrats willy nilly history of tax increases.

As a pure partisan politico , I confess my motives ate not decenlty pure. However, in this last campaign I saw good people maligned for taxes they never voted for and accused of fiscal malfeasance that never happened by hyper partisan Republicans. Especially the tea party. So no, I don' think the Democrats on council should be the ones to tell a Republican County Executive to please raise taxes. I guarantee their Republican opponents next year will use that on their literature and so do you. The Republicans have five votes and that is enough to raise taxes. Let it all play out the way the campaign went.

People who vote and especially those that don't need to realize that their electoral actions and inactions have consequences.

A Shameless Partisan but willing to admit it.

Anonymous said...

Ferraro wants to give $50,000 to the State Theater? Seriously?? Is she a Republican or just a hypocrite?

This is why our taxes go up so this nonsense pay for votes nonsense can continue.

Anonymous said...

I agree, let Ms. Ferraro propose the tax increase and put it to a vote.

Anonymous said...

Holy shit snacks?????

I've been pretty quiet, but this ass clown takes the cake. Blaming Stoffa is one thing-you get to blame the last guy for about a year ito your first term. But blaming Reibman for fuck's sake? Why stop there? Why not President Franklin Pierce?

What a failed display of leadership.

Anonymous said...

Ferraro voted to accept a higher bid for Gracedale ambulance services despite contrary advice from the management firm she also voted for. She wants to give $50K to the State Theater. We don't need a tax increase. We need to stop wasteful spending like the kind Ferraro engages in at every meeting. The employees should know that Peg Ferraro spent their money and considers them to be whiny assholes.

Anonymous said...

The ship is sinking, the crew is bailing, the captain and first mate are stealing the rations. The crew that remains wait to see whats next.....

Anonymous said...

The days of giving away money to the State Theatre, Arts Quest are temporarily over. There is no healthy fund balance for this. It is similar to one's budget. If you cannot take care of necessities then you cannot donate money or spend on luxuries.

Council and the Executive need to put their heads together and fund the services they provide and fund the workforce.

Almost 100 employees retire by the end of the year. Loss of talent and expertise. Putting more stress and pressure on a beaten county workforce is a recipe for how the ship will start to sink in 2015.

Anonymous said...

wow, 2 1/2 mils..you know whom else will have low morale...the taxpayers and small businesses

Anonymous said...

Public services cost money. This is the correct response at this time. Could it have played out differently? Sure but our elected people failed us. Now the course correction is mandated. Just do it and turn the page. Live and learn from it.

Anonymous said...

Screw the State Theater..bunch of blue bloods. They need no such amount for any reason. They should be sued for the way they treat disabled clients who pay the same tix prices as regular people. F them!

Anonymous said...

Scott is right to go at it this way and build consensus for now and later as another increase will be needed next year and the year after that. It's called compromise and being able to count votes and give the other guy a chance to look decent doing it.

Anonymous said...

If Kraft and McClure want to be obstructionists..so be it. But at least this way..the peoples business gets addressed properly by virtue of real leadership.

Anonymous said...

wow, 2 1/2 mils..you know whom else will have low morale... Republicans who voted last year. How did that huge tax increase vote work for Dean Browning?

Bernie O'Hare said...

I see. How dare people tell the truth.

Bernie O'Hare said...

"Scott is right to go at it this way and build consensus for now and later as another increase will be needed next year and the year after that. "

I'd agree with this incremental approach, but the reality is that no tax hike will pass next year. You have to do it now.

Bernie O'Hare said...

"he days of giving away money to the State Theatre, Arts Quest are temporarily over. There is no healthy fund balance for this. "

The money dies not come from the fund balance. it comes from the hotel tax, a different source of revenue that must be used to promote tourism.

Anonymous said...

Scott may be using reverse logic here as a half mil won't put a dent in this revenue problem. Others..R's..will hopefully see the wisdom in going up a few more percent and then he will give in and it then is their raise and he supports their raise. It can work and you cut Kraft/McClure out of the equation altogether. Move on without them.

Bernie O'Hare said...

I actually agree with Scott. i like the idea of a half mil tax hike every year until the fund balance is where it should be. But the problem is that it will never work. Council members are very leery of a tax hike, and doing it several years in a row simply is not going to happen.

Anonymous said...

Lead and worry about reelection at the proper time. If you are a true leader..people will tell you so at the ballot box..maybe.

Peter J.Cochran said...

Most of the taxpayers can not afford to 'subsidize 'a State Theater.Why/the average person that pays taxes can't use the facility because the ticket prices are what the market will demand.Not to mention accessibility to those tickets .It's entertainment. OPEN SPACE -well if we pay for it, then the guys holding tax recites should be able to have access to a portion of that farm land to hunt or grown a garden . If the county bails out a private developer on a golf coarse the the county should then own a portion of 'stock' in it . In each case I mention somebody is receiving a benefit in financial gain at the cost to the rate payers collectively. Again entertainment that should paid for with 'discretionary income'.

Bernie O'Hare said...

Peter, let me explain this again bc I've apparently been unclear. The money for open space does come from the general fund. Your real estate taxes pay for it. But the money to subsidize the state theatre or docents in bethlehem come from the hotel tax. That is a tax on people who stay at the hotel, and the money mist be used to promote tourism. So your real estate tax dollars are not going for State theatre, ArtsQuest or the tourism in historic Bethlehem. That is discretionary income, as you put it.

I think the State Theatre does have its hand out all the time and gets too much money. But Peg's observation that it keeps the Easton restaurants busy on show nights is valid.

Knowing that this funding comes from hotel tax, do you still oppose?

Anonymous said...

The problem for the county is that they went way too long without raising taxes for the sake of political expediency. There should have been either consecutive years of small increases or every other year increases to keep the reserves at a decent level or to keep pace with inflation. Budgets need COLA too. Any operation that provides a service can not operate on fixed income indefinitely.

Now you're looking at large +1 mil increases and probably not just one, but several and it's going to hurt.

In a way I agree with the notion that previous executives share the blame for the present situation. I always found balancing budgets with reserves year after year to be an easy way out.



Ron Beitler said...
This comment has been removed by the author.
Ron Beitler said...

BOH, agree with you tying farmland preservation to economic development is valid. Farmland IS a form of industrial infrastructure. Ag directly or indirectly provides 1 of every 7 jobs in PA. Without farmland you don't have Ag industry.

We forget that. To boot it's one that requires very little in public infrastructure subsidies & services. That fact very quickly generates ROI for public dollars spent to permanently preserve. It's mathematically a winning investment every time.

Farmland generates no crime. No traffic. Adds to QOL. Increases property values. No kids into school districts. Definite and clear long term ROI. Even with Act 4 programs far more in property tax revenue than liabilities in services/infrastructure.

Where I also agree with you is that this argument doesn't hold up for the environmentally sensitive lands piece. Just doesn't. I believe in preserving sensitive tracts but wouldn't can't justify using money for economic development to do it. Works for farmland. Doesn't for fallow open space and environmentally sensitive lands. Those are worth preserving but not with Economic development money.

The Hayden Phillips comment...is basically nonsense. Single family home subdivisions cost more in services than revenue generated. Always. Commercial development is how you balance. But farmland is the most effective way. It's about balancing revenue and liabilities.

Preserving a little bit farmland is not going to all the sudden mean there is a lack of single family homes in the marketplace to purchase. Anyone who drives around any typical subdivision in the Lehigh Valley suburbs can plainly see that by the number of units for sale.

Peter J.Cochran said...

Bernie,I would not oppose if the City of Easton is getting the proper revenue proportionate to the increase in business done as the result of a 'draw' from the state .Is their any way to know that the difference is ? Would the State Theater not attract the same client base if ticket sales were to rise for the talent they buy? If I had 'DISCRETIONARY',will the offset keep me from seeing The Beach Boys.This is entertainment. I say this is the poor subsidizing the rich.This 'arts' theater pays no real estate taxes already but charges ticket prices that few Easton residents can afford.I suggest that we address the root of the problem be and introduce legislation which subjects all real estate ,except property owned by government ,to real estate taxes. This will expand the tax base and should result in lower tax payments for existing rate payers.

Anonymous said...

Tax and spend, tax and spend. Same old song just different singers.

So much for the so-called conservatives.

Anonymous said...

Good old Peg. Screw the retirees over a COLKA but give money to her fellow bluebloods at the State Theater. Andy Daub is happy!

Anonymous said...

Gotta say, the more Ron Beitler comments, the more I like him...

Anonymous said...

@5:33AM,
Get off your soap box about the Gracedale contract. The company that was denied the contract is closing their operations in the Valley because they could not successfully lowball other contracts as well.