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Hollidaysburg plan shows $19K surplus

Borough to vote on 7 percent tax hike

HOLLIDAYSBURG — A final 2017 general fund budget with a $19,000 surplus was approved by Borough Council Thursday evening, and council members are to reconvene next week to vote on a 7 percent tax increase.

The finalized budget includes $2,867,000 in projected revenue, with expenditures predicted at $2,847,982 — a difference of $19,018.

While the budget passed unanimously, council was split on subsequent votes, which are required because of a countywide tax reassessment.

The reassessment, the first since 1958, is intended to bring the tax base closer to market values.

Municipalities must remain revenue neutral in a reassessment year to prevent a windfall, so Borough Manager James Gehret presented a tax base, which was recently approved by county officials. In Hollidaysburg, that number is $380,834,800.

“That is an increase over our old tax base of $31,764,476,” Gehret said.

Last year, with real estate taxes set at 34.75 mills, the borough collected $1,103,816. To remain revenue neutral with the new tax base, millage would have to be set at 2.897 mills, Gehret said.

Council members voted to accept that equalization, with Councilman Joseph Dodson dissenting. He did not elaborate on why he gave a no vote.

Despite receiving new tax base information from Blair County, numbers are not final, Gehret said. Residents who feel their assessments are unfair can appeal those values.

“At this time, there are currently 36 appeals that have be filed totaling $2,683,800,” Gehret said. “The borough also has the potential to have another 188 properties valued at $25.5 million to be appealed.”

It’s estimated that 30 percent of properties appealed may have their assessed values lowered, Gehret said. That means the borough could lose between $45,000 and $55,000 in tax revenue, he said.

During an assessment year, municipalities are allowed a 10 percent tax increase. To combat potential lost revenue from appeals, Gehret suggested an increase between 5 and 7 percent.

With the average residence valued at $148,000, the average taxpayer would pay an additional $30 if millage was raised 7 percent, Gehret said.

That additional revenue is essential, as this year’s budget includes a $25,000 contribution to the Intermunicipal Relations Committee, which oversee recycling in the borough, as well as increased pension obligations.

“We … had 6 people retire this year from the borough,” Gehret said. “They will be pulling pensions.”

If appeals are won and the tax rate is not increased, the borough may be forced to operate at a deficit, officials said. That did not sit well with Council President Joseph Pompa.

“The chances of nobody getting a reduction is impossible.” he said. ” Passing a budget with a deficit is not right.”

Councilwoman Stephanie Wertz agreed.

“Some people are definitely going to win the appeal,” she said.

Dodson seemed less convinced, calling the 30 percent figure “speculation.” Gehret agreed, but that speculation is necessary in this case, he said.

“Again, if I had better knowledge, I would have played the lottery tonight,” he said. “These are the best numbers that I can give you.”

Council members voted to accept the 7 percent increase, with Dodson again dissenting.

However, a final millage rate will not be voted on until next week, as the meeting was recessed and will reconvene next Thursday.

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