Bethlehem Tax Bill to Go Up 7% Next Year

The Fahy bridge, as seen from Payrow Plaza

Skyrocketing pension costs, which have risen from $1.5 million in 2004 to $11.1 million next year, has forced Bethlehem City Council to impose a 7% tax hike next year. In a 6-1 vote at their December 20 meeting, with only David DiGiacinto opposed, it is the conclusion of a six-week budget process.

Mayor John Callahan proposed raising revenue by imposing an event tax, seeking voluntary contributions from nonprofits like Lehigh University and switching to a single trash hauler. But Bethlehem's 19 independent trash haulers, along with many of their customers, persuaded Council to postpone that decision.

There was little debate before a litany of votes in the numerous budgets adopted, from general fund to community development. Council members J. Willie Reynolds and Bob Donchez, who might be running against each other in the Mayoral race next year, agreed it was the "most difficult budget" each had ever faced. Donchez supported it because there were no layoffs in public safety. Reynolds warned, "It's only going to get more difficult."

Then followed what seemed like perfunctory votes, in which the word "aye" was repeated 147 times. That prompted city watchdog Mary Pongracz to joke, "I feel like we're on the H.M.S. Pinafore. I never heard so many 'ayes' in my life."

The tax hike approved by Council was whittled down from the 8.5% initially proposed by Mayor Callahan.

Council also unanimously authorized the administration to borrow up to $1.5 million from the escrow account to meet payroll in January.