Taxes will increase in 15 of the 50 municipalities in Luzerne County that have a population of more than 2,000 people, according to a review of millage rates for 2013.
Rising pension costs, reductions in real estate tax collections and lingering problems in obtaining earned income taxes collected by the defunct Centax-Don Wilkinson agency were among issues municipal officials cited for the increases.
Officials in municipalities that did not raise taxes, including Pittston Township and the municipality of Kingston, said they also struggled with those issues, but they were able to tap alternate revenue sources and scrape up enough savings to avoid millage increase this year.
Most municipalities that raised taxes saw hikes between 20 to 27 percent, including the cities of Wilkes-Barre and Hazleton, the county's two most populous municipalities.
Hazleton's proposed increase from 2.48 to 3.05 mills, or 23 percent, will cost a homeowner with a property assessed at $100,000 $57 more per year. Wilkes-Barre officials estimate its increase from 96.63 to 121.63 mills, or 26 percent, will cost the average property owner $153 more per year.
The increases for other communities varied from as little as 1.4 percent in Harveys Lake, which increased the millage rate from 0.704 to 0.714 mills, to a 346 percent increase in Salem Township, which bumped its millage from 0.224 to 1.0 mills.
The increases will result in an increase of only $1 for a Harveys Lake property owner assessed at $100,000. A Salem Township property owner with that assessment will see taxes jump from $22 to $100.
Dallas Township saw the second-highest percentage increase, jumping from 0.52 to 0.97 mills, or 86 percent. That translates to a $45 increase on a property assessed at $100,000.
The other communities that raised taxes are: West Hazleton, Forty Fort, Avoca, Freeland and Exeter boroughs and the townships of Wilkes-Barre, Hunlock, Lehman, Jackson and Jenkins.
Officials in several municipalities said this year was exceptionally challenging due to steep declines in real estate taxes that were caused by the downturn in house sales, as well as property owners who won reductions on their assessments through the appeal process.
Frank Wagner, supervisor chairman in Dallas Township, said the township fared well in the first years following the countywide reassessment in 2009, but since then numerous property owners have won significant reductions.
When they did reassessment it was beautiful. We didn't have to increase taxes, he said. Then we started getting the ones that appealed their tax rates. It's unbelievable how much they cut.
There's also been a significant reduction in the number of new houses built, which detracted from the tax base, he said.
It wasn't something we liked doing, he said of the tax increase.
Mike Revitt, Wilkes-Barre Township administrator, said the township is looking at a $100,000 increase in what it has to pay into its pension funds in 2013.
Revitt said supervisors also were concerned about the uncertainty of when, or if, the township will get all the money it's owed from Centax. Problems with Centax hit the township exceptionally hard because, in addition to the earned income taxes, the firm collected several other taxes, including mercantile, business privilege and the sewer fees. The processing of those taxes and fees are far behind schedule.
Not only did we not get our earned income taxes, but every other collection slowed to a crawl and was virtually nonexistent, he said. It's a mess of monumental proportions.
Forty Fort Council President Joe Chacke said the 24 percent increase in millage, from 2.91 to 3.61 mills, is somewhat misleading. Chacke said the borough is eliminating its recycling fee, and 0.50 mills of the increase will be earmarked for those costs.
Chacke said the other .20 mill increase was needed to cover pension contributions, which will be more than $250,000 in 2013.
Officials in communities that held the line on taxes said they felt fortunate they could do so this year given the economic conditions and rising costs.
In Pittston Township, manager Savito Bonita said council worked hard to avoid an increase this year given it increased millage by a quarter mill last year to pay for emergency services. Bonita said the township is fortunate in that it does not have to rely as much on property taxes due to a strong business base, which brings in significant mercantile taxes.
Kingston administrator Paul Keating said most of the municipality's revenue comes from the earned income tax, which, fortunately, has continued to grow over the years due to increases in residents' salaries.
Still, this year was particularly challenging due to a big drop in real estate transfer taxes that resulted from a decrease in home sales. That revenue source previously brought in $320,000. He budgeted $190,000 for 2013, he said.
This year was, by far, the most difficult budget I've ever put together, he said.
The municipality was able to stave off an increase due, in part, to small savings in expenditures that have been achieved each year, he said.
You save a few thousand dollars here and there, and over time it turns into mills of property tax savings, said Keating. It's the little things over the years that help you compensate for these hurdles when you hit them.