A Jim Thorpe trolley company formed in 2021 will owe amusement taxes accrued since the beginning of 2023, the town’s borough council decided Thursday night.

Ed and Lynn Humphries of the Jim Thorpe Trolley Company approached council last week after receiving notice of the required tax payment in late September.

“We did not have prior notice,” Lynn Humphries said. “We are a couple who cashed in their retirement to start this company. We aren’t a large corporation. We do want to partner with the borough and school district to pay an amusement tax, but we are asking to start it in 2024 so it is not a financial hardship for us.”

Council on Thursday night unanimously voted to collect the tax starting from the beginning of 2023. The estimate for money owed through Oct. 1, Borough Manager Maureen Sterner said, is $17,500. Borough officials noted that the company would have the chance to enter into a payment plan to ease the burden of coming up to date with taxes owed.

“I feel this is a fair compromise,” Council President Greg Strubinger said. “The company started in 2021 and we could have collected the tax back to that date, but we are going on the recommendation of our tax collector to start in 2023. The trolley has really been successful since starting and council has been very supportive of it. We aren’t looking to hurt any company.”

The amusement tax in Jim Thorpe is collected by Berkheimer Tax Innovations. The tax is 5% of the cost of a ticket.

Humphries said the company had not been collecting the pass-through tax from its customers.

“It really came as a surprise to us,” she said. “We want to pay it and participate in this, we’re just asking for a little mercy.”

Strubinger said the burden does not fall on the borough to notify businesses they have to pay an amusement tax.

“There was a lot of publicity when the borough tried to collect amusement tax from the railroad,” he said. “That should have put the radar up for any businesses regarding this tax.”

Years of debate over Jim Thorpe’s ability to collect an amusement tax, which had accumulated to six figures, from Reading and Northern Railroad came to an end when a new state law was passed in 2020.

Part of Senate Bill 1188, passed in July of that year, says the amusement tax doesn’t apply to primarily freight railroads such as Reading and Northern, which runs scenic train rides out of Jim Thorpe.

Lehigh Gorge Scenic Railway temporarily stopped its rides out of Jim Thorpe on Nov. 25, 2019, as it went back-and-forth with Jim Thorpe borough over amusement tax money the municipality felt the train company owed.

Council member Michael Rivkin said Thursday while the payment plan offered to the trolley company will make things “more palatable,” he would like to see the borough get a better handle on collecting the tax before a similar debt piles up.

“It’s not the first time we have not been good at collection or enforcement,” Rivkin said. “I agree they should have been paying, but I also know we have been inconsistent. We need to fix that.”