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Council rethinks proposed tax hike

Tentative budget had included increase to fund tree maintenance

City Council on Wednesday approved a tentative budget calling for no tax increase — unlike one proposed last month that would have raised property taxes by 0.15 mill to pay for street tree maintenance.

Instead of a dedicated tax that would have raised $280,000 a year for trimming, planting and removal of street trees — relieving property owners of that responsibility in many cases — council will appropriate a little less than half that amount toward the program, for 2020 only.

“It was hard to justify a tax increase when we have a surplus,” said Mayor Matt Pacifico, speaking of a $5 million contingency fund, which along with a new vehicle replacement fund and a new grant-matching fund, represent a recent $11 million in unassigned funding.

Council plans to “start small and try the (tree maintenance) program as a pilot,” Pacifico said.

The program would be “year-to-year,” Councilman Bruce Kelley said. “Next year, we’ll look at the budget and see how it’s doing.”

But committing half the money for one year only, with the status of the initiative to be evaluated annually after that, doesn’t constitute the “sustainable plan” he proposed last month, Interim City Manager Peter Marshall said.

“You can’t make it sound like it is,” he added.

Creating a street tree maintenance fund was proposed originally because of dissatisfaction among residents who were ordered last year to trim or remove trees, mainly on Seventh and Eighth streets, that had been planted by the city in the 1980s and that were being struck frequently by Amtran’s new Compressed Natural Gas buses, which are higher than previous buses.

The city is not taking the money it’s allocating for program from the contingency fund, but rather is redirecting the proposed budget’s operating surplus of $134,000 that was identified last month.

Eliminating the previously proposed tax increase will keep millage at 5.129, so the owner of a property assessed at $100,000 would continue to pay $513, if the tentative budget is adopted Dec 4.

If the proposed tax increase had remained in place, that owner would have owed an additional $15.

The tentative budget also calls for earned income tax — the city’s other major revenue producer — to continue at current levels.

On Altoona residents, the city levies 1 percent for general revenue (half of which goes to the Altoona Area School District); 0.2 percent for general revenue as authorized under home rule; and 0.4 percent for support of pensions, according to Finance Director Omar Strohm.

On residents of other municipalities who work in Altoona, the city levies 1 percent for general revenue (split with the school district) and 0.4 percent for support of pensions, Strohm said.

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