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City commission talks tax options

The Williamsport Study Commission met Monday with the city treasurer and tax collector to discuss positions in government and possible tax changes using state Home Rule law.

Nicholas Grimes, who is the elected treasurer and tax collector, was told the draft charter, which is under development, consolidates positions held by the treasurer, tax collector and controller. They would be a part of a department of finance, overseen by a director of finance.

It is an attempt to “streamline” the finance department, according to Jennifer Ayers, commission chairwoman.

The treasurer/tax collector may be appointed and City Council establishes the departments, under the commissions’ draft.

The controller, meanwhile, may be an appointed individual or the work can be done by an outside firm, according to the draft.

The discussion turned on the current financial situation in the city, which has spent $2 million of its revenue to produce a no-tax-increase budget.

“In order to keep operating the way we are we would need $4 million,” Grimes said. “So we have to either raise revenue or spend less.”

He recalled the times when he sees mostly elderly residents on fixed-incomes, or a widow who recently lost her husband, who come to the tax office in tears because they can no longer pay their real estate tax.

“The bottom line,” said Commissioner Alison D. Hirsch, is, “we want to save the taxpayer money.”

Grimes said the treasurer/tax office has been able to find more than $1 million in taxes that were previously not collected by doing audits in-house.

He suggested it would be best to bring taxes in-house and expand the tax base.

Third-party contracting can, and does, cost less and it may cost more to do the work in-house, but the city builds better relationships, he said.

Grimes cautioned the six members at the meeting on some specifics regarding his department.

He said there is a lot of tax collection separate from that done by the treasurer.

The discussion went into the role non-profits play, specifically UPMC Susquehanna.

“The hospital has been wonderful,” Grimes said.

Despite the hospital taking away properties for its expanded campus, it pays the value of the property before the hospital officials purchased it, Grimes said.

“This goes on perpetually,” Hirsch said.

Additionally, the hospital pays the city a payment in lieu of taxes and provides services such as ambulance and drug testing,” Grimes said.

The two colleges in the city, likewise, provide annual payments in lieu of taxes, he said.

“So they are not tax-free despite public opinion,” Ayers said.

Grimes cautioned about trading real estate tax for a higher earned income tax and would be more in favor of expanding rebates, especially for individuals who are age 65 and over, and for those low-income resident who qualify financially.

The tax structure in the state is outdated, according to Grimes.

It was set up in the 1800s, when cities had the wealth. It has become reversed, with the townships and municipalities combined having the most population and the most affluence, he said.

Yet, the city taxpayers are supporting professional services such as police, fire, codes and streets and parks departments used by individuals who come into the city to work and pay $52 in local services tax.

The Home Rule charter would permit taxes to be collected under rules established by state law, Hirsch said.

The commission differs from the charter commission, which recently disbanded after nine months of research and work, to reach a final recommendation of a City Council-manager form of government to replace a strong mayor-council form that’s been in place since 1972.

Likewise, the Government Study Commission on Home Rule also has recommended in its draft charter a council-administrator form, but with some differences such as wanting a mayor to be elected at-large. The disbanded charter commission recommended a mayor be appointed amongst council and serve as its president.

The Government Study Commission has a few more meetings before it said it will be able to produce a charter using Home Rule law.

The law allows for more flexibility than is available under optional third-class city charter law.

The goal is to have the recommended questions put forth for voters in the Nov. 6 general election.

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