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Nazareth, Pa., United States

Thursday, November 19, 2015

Should NorCo Repeal $50 Million Emergency Loan?

(Updated 11/20/15, 12:40 am: This story inaccurately states  that Council would be unable to vote on the repeal until December. In fact, they were able to vote on 11/19/15, and voted NOT to repeal the emergency ordinance. I apologize for the misinformation.) 

At their November 5 meeting, Northampton County Council voted 6 to 3 to approve an emergency ordinance authorizing Executive John Brown to borrow up to $50 million so that the County can continue paying human service providers out of its own pocket during the state budget impasse. Fiscal Affairs Director Jim Hunter has since secured a line of credit with Lafayette Bank to borrow only what the County needs, starting sometime in December.

But is the state budget logjam finally breaking up? The Governor's spokesperson, Jeff Sheridan, claims there's a "tentative agreement," and is hopeful that the record-setting stalemate will be over by Thanksgiving. But there is no way of knowing just how long it will take for state reimbursement of human service providers.

Notwithstanding this uncertainty, Council will this evening consider repealing its $50 million authorization. It is unclear at this point who supports a repeal.

Under the County's Home Rule Charter, even if all nine members of Council agreed, this repeal could not take place before December 3, and by then, borrowing will likely be under way..

Northampton County's southern neighbor, Bucks County, is spending about $6 million per month of its own reserves for important programs like child protective services. But instead of borrowing, Bucks Commissioners have threatened to withhold between $4-5 million in taxes and fees it collects monthly for the state, and has already established an escrow fund for that purpose. Bucks stopped paying human service providers in July.

A breakdown of how counties are responding to the budget crisis is located here.

1 comment:

Anonymous said...

Bucks County is addressing this problem correctly. Shame on Northampton County for not following suit. If The County borrows the money they will spend it. Like everything else, I doubt if they are following the guidelines of the Home Rule Charter. This administration is a disgrace.