Council votes ahead firefighter tax credit

Up to $600 tax discount could be available for firefighters

NORTH WALES >> A new tax break for firefighters in North Wales Borough is now moving ahead.

Council voted unanimously Tuesday night to direct staff to prepare a draft of a new ordinance creating a volunteer fire service tax credit in town.

“It actually did go through in the latter part of 2016, and more importantly, we have been working for about a year and a half with the North Penn Volunteer Fire Company on this,” said Borough Manager Christine Hart.

The tax credit is allowed under the state’s Act 172 of 2016, according to Hart and borough Solicitor Greg Gifford, who said it was meant to help local fire companies recruit and retain members and gives local municipalities two options for doing so.

“The state legislature gave municipalities an opportunity to give them a break on their real estate tax, or on their earned income tax. And all municipalities are doing earned income tax, because it makes more sense,” Gifford said, since some firefighters may rent property or otherwise not pay real estate tax.

Borough council did vote in September 2015 to voice their support for the bill, Hart said, but changes in borough administration since then have prevented the town from taking any further action since the bill became law. Other local municipalities that have passed their own versions include Hatfield, Montgomery and Upper Gwynedd townships, while Lansdale Borough passed a modified version contributing to a firefighter stipend program there.

The North Penn Volunteer Fire Company, which covers North Wales as well as parts of Lower Gwynedd Township, currently tracks firefighter activities using a points-based system, Hart told council, and that would likely be used by the fire company to determine who qualifies for the tax credit.

“The local fire company that covers our jurisdiction would have to have a policy in place, and bylaws amended, in accordance with this law, in order for us to consider giving the tax credit,” Hart said.

“I’m assuming, since council was favorable to this, and now it has passed as state law, this is something we would be looking to implement,” she said.

In early talks with the fire company, Hart told council, their leadership has said they would like to have the credit established and all of the new rules passed in time for them to file for the 2019 tax credit in early 2020. Doing so would require a formal draft be publicized via a council vote, publicly advertised for 30 days, then formally approved, while the fire company does the same, she said.

“I was hoping I could get a consensus to move along with this in the next two weeks, to have a draft ordinance ready for a vote to advertise at the next meeting. So we can keep the ball rolling,” Hart said.

Further details, including the text of Act 172 and a primer from the state Governor’s Center for Local Government Services, are included in the board’s meeting materials packet for July 9.

Councilman Sal Amato asked what the budget implications are for passing the credit. Gifford said if council proceeds to allow the maximum $600 credit allowable by law, somewhere around 25 to 30 firefighters could qualify, but not necessarily for the full amount, since the average earned income tax currently paid by those firefighters is roughly $350.

“The cap is $600, but (the credit) only goes up to what they would be paying the borough. So if it’s $350, they’d only get $350,” he said.

Council President Jim Sando then asked if council had any further questions or objections, and heard none.

“I think you have your answer, Christine,” he said, and Hart said she and Gifford would work with the fire company to prepare the formal draft.

North Wales borough council next meets at 7 p.m on July 23 at the borough municipal building, 300 School St. For more information visit www.NorthWalesBorough.org.