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Easton Commuter Tax Issue Undecided

The proposed tax was criticized by members of the public; city council members say they're undecided.

It seems a proposed increase of the Easton's Earned Income Tax (EIT) aimed at raising revenue from the city's commuters is nearly universally unpopular.

The proposal would 0.75 percent in addition to whatever EIT their own municipality imposes. Currently, residents are subject to a 1.75 percent EIT. The new tax would affect approximately 10,600 people.

A handful of commuters and city residents said the new tax would fail to achieve the city's aims, and would discourage more business in the city.

Speaking on behalf of Wolper Information Services, Adrian Shanker, of Bethlehem, said commuters buy lunch, fill up their gas tanks and patronize other businesses in the city, all of which may cease if the the commuter tax is implemented.

“We may not live in Easton, but we all spend money in Easton and thus contribute to the city's tax base...It is unfair to ask employees who already contribute to the local economy and tax base to pay additional taxes,” Shanker said. “This proposal will do a disservice to businesses already located in the city at a time when Easton should be incentivizing businesses to move to and stay in the city.”

His sentiments were echoed by co-worker Ashley Hope.

“I feel if we could develop ways to bring more business in to the city...there's a lot of opportunities to bring more revenue into the city without raising taxes,” she said.

Armand Christopher, of Stockton, N.J., a partner at USA Architects located on the seventh floor of the city-owned Alpha Building said the tax would be a real burden for the 19 people employed by the firm, coming at a time when pay cuts were just restored by the firm and raises were not even on the horizon.

“This commuter tax is in essence a pay cut,” Christopher said. “We sympathize with your problem, but my company has no iron-clad reason to remain in the city.”

Commuter Mitch Miller, of Allentown, was more blunt.

“I oppose it for the simple reason of 'no taxation without representation,'” Miller told council members. “I'd like to tax people that walk past my house, but I can't.”

Easton resident Drew Anderson was the only member of the public to speak in favor of the tax, but said the city should also tax telecommuters and require public employees to live in the city.

“Those in the public sector need to take a hard line and tell employees they need to live where they work,” he said. “You need to take more aggressive steps and take it to the next level.”

Mayor Sal Panto and city administrators say the commuter EIT is likely the least painful way to raise most of the needed funds to cover a projected $1.5 million shortfall in 2013 for increased city worker pension funds. The alternative is raising property taxes or the city's business privilege tax rate, they said.

State law allows the tax to be implemented by 'moderately distressed' municipalities, of which Easton is one, and the funds from the new EIT must be used for covering municipal pension costs.

“We can't raise taxes on residents any more,” Panto said. “The only thing we could think of was what other cities have done, and that's a commuter tax.”

City Finance Administrator Chris Hegele said the tax would cost the average non-resident employee $127.18 annually, and an employee making $25,000 would pay $3.61 per week.

“At least it's tied to income and it's tied to growth,” Panto said.

Hegele estimated the tax would raise $1.35 million annually, a number he said was derived from looking at the number of employees from various areas and comparing that to how much each would contribute. In municipalities whose own EIT exceeds 1 percent, Easton would collect the difference between that and 1.75 percent, meaning in many cases the city would not realize the full 0.75 percent of the commuter tax.

City council members said they were undecided about the proposal, but some seemed like it might be reluctantly embraced.

“I know this is going directly to pensions, but it frees money up in the general fund to support (programs like Main Street, the Ambassadors and Weed & Seed),” Councilman Mike Fleck said.

Councilwoman El Warner said she was 'on the fence' about the proposed tax.

“There's one day a year I'm a Republican, and that's the day I pay my taxes,” she said. “We impact people when we make these decisions, and they're hard decisions to make.”

Councilmen Ken Brown and Jeff Warren both said they want to see more financial information before they make a decision.

Warren added he feels the tax might not have the desired effect, especially when the city is hoping to partner with other local municipalities, which would encourage commercial development in exchange for reduced property taxes for years.

“In a sense, we're being hypocritical,” Warren said.

“I really struggle with this one,” said Councilman Roger Ruggles. “It doesn't seem like a fair exchange to tax people who have nothing to say about it.”

Though it's his proposal, Panto said he is unsure as well.

“I'm not completely sold on this...but right now, it's what the state allows,” the mayor said. “The foolish thing is to let it go and let my grandchildren pay $100 million in taxes. Someone has to take responsibility.”

City officials said they expect to vote on the matter sometime in May.

Ronnie DelBacco April 26, 2012 at 11:42 AM
....'moderately distressed' municipalities, of which Easton is one. Well, now that's a line we didn't hear from Panto during his re-election campaign. All we heard then was how wonderful he is and how he saved the city and hasn't raised taxes. When will the blind love affair with this guy end?? 69News showed a clip of Panto saying basically if they don't do this commuter tax they'll have to cut programs. GOOD! Cut them. We have to stop trying to fund what we cannot afford. It isn't heartless to let people keep there hard earned money. Taking more and more in taxes is the heartless thing to do. Someone call the police. There's another attempted robbery taking place.
Concerned Citizen April 26, 2012 at 02:54 PM
First of all if the commuter tax passes it will not be a tax raise on Easton citizens only commuters. The commuter tax is a good thing for Easton Citizens not so good for commuters who live outside Easton. Commuters come work in Easton taking jobs from the Citizens of Easton and take their money elsewhere. If you have not noticed Easton has alot of vacant homes and more people leaving every year and drug dealers moving in. Maybe if the cops, teachers, etc who work in Easton lived in Easton we can change things. As it stands now they give two shits about Easton and only care about their paycheck. I didn't hear as many people complain about the school taxes being raised maybe thats because the people complaining don't really live in Easton and could care less about Easton. I say pass the commuter tax and raise every year just like our property taxes. Maybe then our cops, teachers, etc might decide to move here and help clean up Easton. People like Ronnie DelBacco are the problem. They wanna work here but not live here.
gerald April 26, 2012 at 06:08 PM
Cut the size of government,cut the inflated wages and benifits,then you have the funds,you don't have unnecessary,penalizeing taxes.
Ronnie DelBacco April 26, 2012 at 07:24 PM
Concerned, I do live in Easton. Raising taxes on anyone in this economy is the wrong answer. As for property taxes, I have been trying to get the school board to seriously consider HB1776 for that very reason. Your argument holds no water.
DOCurmudgeon April 27, 2012 at 02:47 AM
Awmigod, Concerned Citizen, have you thought this through at all? No, of course not. If higher tax is imposed, there will be fewer businesses that will come to Easton! There will be a penaalty for working here ! I believe that Ronnie lives in Easton and works elsewhere; you sure don't know what you are taking about.

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