The Tribune Democrat, Johnstown, PA

Editorials

November 21, 2013

For a few dollars more | Council, again, will lean on commuter tax

JOHNSTOWN — Johnstown City Council almost discarded its favorite crutch last week.

Almost.

But, in the end, a plea by City Manager Kristen Denne resulted in a reversal of fortune – one that likely will affect the fortunes of the city and those who work here. That’s because council members Joseph Taranto, Frank Janakovic, Rose Howarth, Marie Mock, William Gentile Jr. and Pete Vizza and Mayor Thomas Trigona voted to accept the first reading of an ordinance that could increase the municipality’s earned income tax.

In layman’s terms, it was the first step toward raising the dreaded commuter tax.

At first, the council members were unanimous in their opposition to the measure. But Denne explained how the city’s $36.2 million budget for 2014 would have a large hole in it, how it would require layoffs and other cuts or necessitate an increase in property taxes and how the increase from 1.3 percent to 1.5 percent would bring in $400,000 and be used to hire two new police officers and a codes enforcement officer as well as ease some of the pension problems the city is facing.

Denne also reminded council it had to act immediately to meet a state Department of Community and Economic Development deadline of Dec. 1.

It was a tough decision, no doubt. But, in the end, the city likely will do what it has done for decades: ask those who work here to pony up even more money and make businesses wonder if it’s time to relocate to the suburbs.

Denne’s scenario convinced not just one or two of the council members to change their votes, but all seven of them.

“It was good to see council unified, and we were all voting the same way,” said council member Frank Janakovic, who also is the mayor-elect.

We’re not so sure the abrupt change was a good thing. We do believe it would be much better if our city leaders would find ways to avoid the commuter tax instead of reasons to extend it. The tax hike, which has not officially been approved, would cost an individual making $30,000 an extra $60 in taxes in 2014. It’s not a huge jump – $5 per month – but it comes just five months after the news that the city finished 2012 in the black.

That spurred hopes, or perhaps wishful thinking, that the city was finally headed in the right financial direction. Even if the city wasn’t yet ready to drop the commuter tax and get out of the Act 47 program for distressed municipalities, we thought, it might be able to avoid raising the earned income tax.

Not so, according to Denne and the council members. Janakovic told our Dave Sutor that, all told, if the council had opted against the measure, it could have cost the city between $1.5 million and $1.8 million.

“It was a bitter pill to swallow,” Vizza said of changing his outlook on the measure. “You never want to raise taxes, but for the public safety aspect, you have to protect the people. You have to protect the folks. For the people that are working, it’s unfortunate that they will have to pony up a few dollars, but, in this economy and in this town, we’re all blessed to be working.”

We just wonder how many will continue to work here and how many companies will decide to seek greener pastures (and paychecks) outside of the city.

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