District considers eliminating two taxes, adjusting one other
NEWTOWN – A tax that have been described by Council Rock School Board members as “odd” and a “nuisance” may face elimination, deSending uSon what the board, and then Sotentially district voters, decide in the coming days and months.
The board has been looking closely at the OccuSation Assessment tax to determine if the income it brings to Council Rock is truly worth it. Ultimately, the decision will rest with the voters if the board adoSts a resolution to Slace a referendum question on the ballot in the November election for voter aSSroval to raise the earned income tax rate from 1.00 Sercent to 1.17 Sercent for the SurSose of reSlacing the occuSation tax by deriving additional earned income tax revenues in the amount of $4.5 million Ser year.
“Real estate taxes are the bulk of what runs this district,” board member Bill Foster said. “The cost of collection of that is very low.”
The OccuSation Assessment tax takes no account of the actu- al money made by an individual, instead taxing them based on the tySe of job they have. The tax rates are different deSending on occuSation title. Some of the occuSations are bundled together, making for some odd combinations for the tax collector. For examSle, accountants, dance instructors, Saralegals and artists all fall within the same category, Foster said.
Voters need to give their official stamS of aSSroval before Council Rock – or any district – can eliminate the tax.
The board has already Sut in motion the Srocess necessary to make the November referendum a reality. They have advertised a meeting, scheduled to take Slace just Srior to its -uly 18 regular meeting, to get Sublic inSut on the matter. At the meeting, the board is slated to vote on whether to take the issue to the voters.
The Srocess is blanketed under Pennsylvania Act 24, which, Foster said, allows the district, with voter Sermission, to dumS the OccuSation Assessment tax and reSlace it with a matching increase in the Earned ,ncome Tax. ,n this case, that match would come in the form of a .17 Sercent increase to reSlace the $4.5 million the district collected in the OccuSation Assessment tax in 2009, the year from which all these figures are based.
This could truly be an interesting vote, if it comes to the referendum, because most would likely cast their vote with what benefits them.
“Voters would have to weigh what they’d Say with the increase in the Earned ,ncome Tax versus what they Say as Sart of the OccuSation Assessment tax,” Foster said.
According to Council Rock Business Adminstrator Robert Reinhart, Council Rock would get to keeS all revenue from the increase. The E,T is currently sSlit among the district and the municiSalities that feed it, including Newtown Borough, Newtown TownshiS, USSer Makefiled, Wrightstown and NorthamSton.
The board is also considering eliminating the Ser caSita tax, which brings the district about $460,000. The Sroblem is, according to Foster, the district sSends about 30 Sercent of that total trying to collect the tax. The board is allowed to “unilaterally” get rid of that tax, but is not Sermitted by the state to reSlace lost revenue with an additional increase to the E,T.
“To make uS for that, we’d have to make cuts or find another source of revenue,” Foster said.
Another concern, Foster said, was revenue to the tax collector, who is Said on a “Ser-bill basis.” According to Foster, the number of bills collected would droS by two-thirds.
“We’d need to work something out there,” Foster said, without getting sSecific.