At their Thursday night meeting, Northampton County Council adopted an ordinance that will give volunteer firefighters or employees (presumably unpaid) of an EMS nonprofit a rebate of up to $250 for county real estate taxes that have been paid that year by the volunteer or EMS employee. It was sponsored by Council member Lori Vargo Heffner. It's a great way to show appreciation to volunteer firefighters, whose numbers are diminishing. Northampton County joins Cumberland and Lehigh County as the only three counties offering this incentive.
This ordinance was supported by Heffner as well as Council members Tom Giovanni, John Cusick, Kerry Myers, Kevin Lott, Tara Zrinski and John Brown. Council member John Goffredo recused himself from the vote because he is himself a volunteer. He nevertheless interjected himself several times to argue ion favor of the tax break. He also voted for two amendments and against a Kerry Myers' motion to table.
Council member Ron Heckman was the Great Dissenter.
There is a statutory basis for this proposal. In 2016, the state legislature authorized municipalities to offer a real estate or earned income tax credit to active volunteers for up to 20% on their tax liability. This tax break was enacted in Bethlehem Tp the following year. In 2020, the General Assembly authorized counties and school districts to offer this tax credit as well, even up to 100%.
While there's certainly a statutory basis for this tax break, the real question is whether it is unconstitutional.
Pennsylvania's Constitution includes a "uniformity clause" providing that "[a]ll taxes shall be uniform, upon the same class of subjects, within the territorial limits of the authority levying the tax, and shall be levied and collected under general laws." Unlike other states with similar constitutional provisions, Pennsylvania courts have consistently interpreted this mandate very strictly. It was enacted in 1874 precisely to prevent state or municipal officials from giving preferential tax treatment to influential developers who line politicians' pockets with campaign contributions.
This, of course, was completely unsatisfactory to special interests looking for LERTAs, TIFs and other real estate tax breaks. So the state constitution also includes some exceptions enacted in 1968. These include churches, cemeteries, public properties, veterans' clubs and purely public charities. The exception also authorizes the state legislature to carve out exceptions for private forest and agricultural reserves and to create those special tax breaks for developers. It allows the state to create limited tax exemptions for the aged, infirm and disabled. Disabled veterans are expressly exempt.
I see no basis in the state constitution under which volunteer firefighters and EMS personnel are entitled to a tax break. This could be why Cumberland and Lehigh County were the only ones in the state to embrace this initiative.
This point was raised by Executive Lamont McClure. He expressed concern that the ordinance as well as the enabling statute violate the uniformity clause's mandate that "roughly requires ... that everyone is taxed the same." He added that it's unknown how many people will be eligible or how much it will cost the county. He agreed the proposal "comes from the right place." He finally observed that the ordinance would give paid EMS employees a tax break so long as their employer is a nonprofit, and this would be "fundamentally unfair" to the paid EMS workers of a municipality.
Council Solicitor Chris Spadoni said his "educated guess" is that the ordinance would survive a constitutional challenge.
Vargo Heffner claimed there were 50 volunteer companies. Goffredo said there were 38, and later said there were 35. It is clear that no one on Council has any idea who is or is not eligible.
So what?, you might ask. Who would dare challenge this in court? I suspect that paid EMTs or firefighters might have a problem with it. So might the municipalities that have paid fire departments. They already are subsidizing townships and boroughs who refuse to provide police protection, and now their citizens might be compelled to pay for eventual tax increases caused by this subsidy.
Here's another question. How much is this going to cost the county? How many active volunteers are out there? How many of them own real estate? Lori Vargo Heffner introduced a good idea but without getting some important data that might have an impact on the budget and revenue projections. It's good politics, but fiscally irresponsible.
I am surprised that Cusick and Zrinski, both of whom are running for Controller, would agree to this without having more data. So much for requiring accountability.