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Owl Creek project to hike Tamaqua taxes

Published November 18. 2009 05:00PM

Tamaqua residents could be looking at a 2 mill tax increase under the proposed 2010 budget for the borough; however, officials are hopeful that between now and the final approval on Dec. 15 they may be able to whittle at least one-half of a mill out of that number.

Part of the increase includes 1.5 mills that will be dedicated to the Owl Creek Reservoir project, which was on the ballot in the November election and was approved by the voters. The other half-mill will be for the general fund.

"We're hopeful that we can get that number down and zeroed out," said budget and finance committee member Brian Connely, referring to the half-mill.

"We've moved things around; we've reduced some of the millage that we had for things, the Wabash Creek improvement project, the equipment fund," he said. The other major factor in the tax increase is the borough's obligation to the police pension fund which jumped $175,000 this year, due to downturns in the market, bringing the borough's total obligation to the MMO (minimal municipal obligation) to $220,001.

Councilman Tom Cara noted that Gov. Rendell passed an act which will reduce the borough's obligation by about $2,825.

Council President Micah Gursky responded, "A $2,000 relief isn't a savings on a $200,000 obligation. It's not going to ease our taxes."

After the meeting, Steigerwalt pointed out that there will still be approximately $360,000, including CDBG funds, in the Wabash Creek Improvement fund and the equipment fund will still have about $100,000 available.

Connely pointed out that for the second year in a row there are no plans to raise the water or sewer rates for the borough. He also promised that the budget and finance committee will continue to pare down the budget as much as possible.

"The increase could have been a heck of a lot more," he said.

Borough manager Kevin Steigerwalt said that 1 mill will bring about $72,000 to the borough. The current millage rate is 15.25 and it will jump to 16.75 under the proposed budget. Cara estimated that the average household will see a $70 jump in their tax bill.

The proposed budget includes $8,681,053 in expenditures for the borough in 2010, which includes grant money for both the Streetscape project and the Owl Creek Dam project.

The proposed increase did not sit will with Councilman Ken Smulligan. He questioned how many voters in the borough are not property owners and will not be affected by the increase that they voted for.

"It's a wonderful project and I know we have a matching grant, but it's going to hurt," he said. The borough has received a $5.1 million grant for the repairs to the dam from the state; however, it must come up with $1.5 million in matching funds. The borough has already partnered with the Schuylkill Conservancy to try to find funding through their organization which might help offset the $1.5 million obligation.

"It's too early to tell if we got that yet," said Gursky, referring to a grant that the conservancy has applied for. The borough also approved a request for proposal for the financing of the project, which will most likely be done over a 20-year term. Gursky explained that the borough would pursue financing and any additional funds that are obtained would be used to pay off the principal of the loan.

Later in the meeting, Smulligan asked if the property owners in the borough could be notified of the proposed increase.

"Voter turnout was only about 30 percent," he said. "A lot of people are going to see that price increase and not even know about it." Gursky noted that the borough will not likely have an opportunity like this again. "We have $5 million of a $6.5 million project," he said. "I think everyone wants to save the dams, but no one wants to pay for it." Gursky added that the borough has been cited for the poor condition of the dams and is required to either repair them or breach them.

"There is no money out there for that," he said. "Either we pay the $1.5 million to save them, or $2 million to breach them."

Councilman John Trudich added, "You're going to have to raise taxes either way you do it."

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