CHAMBERSBURG–On Monday, Nov. 7, Chambersburg Town Council heard from Borough Manager Jeffrey Stonehill on the six-month development of a proposed 2023 Budget.
Each year, under local law, the Manager drafts a financial plan for the following fiscal year. Under the Borough Code, each borough in Pennsylvania must adopt a balanced budget by December 31 of each calendar year. According to statistics from the Pennsylvania Department of Community and Economic Development, in 2020 (the last year with records), Chambersburg had the largest budget among Pennsylvania’s 958 boroughs, and the 14th largest municipal budget in the Commonwealth.
Enclosed please find a complete summary of all the aspects of the proposed budget.
Chambersburg currently levies borough property owners for 4 types of real estate taxes:
- The Police Tax (“the General Levy”); all of which goes to the General Fund to offset the cost of Police Department operations.
- The Fire Tax; State law allows only 14% of this tax revenue to support wage and benefit costs for firefighters, the largest cost in the Fire Department budget. In other words, 86% of the Fire Tax collected may not go to pay for firefighter expenses.
- The Police Station Bond Tax; all of which goes to pay off the debt for the Police Station Renovation project. None of this tax pays for Police Department expenses.
- The Recreation Bond Tax; all of which goes to pay off the debt for the 2016 Recreation capital improvements (pool, tennis courts, playgrounds, Rec. Center roof, etc., built in 2016-2018). None of this tax pays for Recreation Department expenses.
These are the 4 types of real estate taxes. State law permits other types of real estate taxes, but Council has only selected these 4 types. These are the only uses of real estate taxes; no other employees, operations, or projects.
In the proposed 2023 Budget:
- The budget includes a 1 mil tax increase due exclusively to the Police Station Renovation project.
- The budget includes a 1 mil tax increase due exclusively to Police Department operating expenses.
- The budget includes a ½ mil tax decrease for the 2016 Recreation Bond Tax.
- The budget includes no change to the Fire Tax.
- Net total increase 1.5 mil or $25.50 per year for the average single family home inside the Borough. Township property owners do not pay taxes to the Borough of Chambersburg.
Finally, State law prohibits the levy of most types of taxes. No sales tax, no commercial tax, no liquor tax, no hotel tax, etc. Further, State law hasn’t adjusted the Act 511 tax rates since 1965.
The reality is that nowhere has inflation and supply chain issues more impacted the Borough of Chambersburg than in the provision of utilities. The Borough’s amazing managers have developed rates that remain some of the lowest in Pennsylvania, but must rise in 2023 merely to keep pace with the rising cost of operations. Chambersburg has the lowest composite utility rates in the Commonwealth of Pennsylvania, and that is not going to change in 2023. While some rates will rise, Chambersburg citizens and businesses continue to pay less or the least compared to any other rate payer in this area or the State.
Chambersburg has the lowest retail electric rates in Pennsylvania. Even with the fuel adjustment scheduled for January 2023, that will still be true. The Electric Department anticipates a 2% adjustment. That would mean about $2 per month more per residential customer, although results will vary based on weather, house attributes, etc. Unfortunately, not every Borough property is served by Borough electric. Furthermore, our neighboring utility, West Penn Power, has seen significant rate increases.
The Water Department needs a rate increase. What does a 5-cent increase in the Water Rate mean to the average residential household? The average residential household uses 170 gallons of water per day This usage equates to 70 “units” per month (1 “unit” = 74.8 gallons). The 2022 average monthly billing: $17.85 and the 2023 average monthly billing: $21.35. So, Water will increase by about $3.50 per month, but still the lowest rate in the area.
In response to the rising cost for vehicles, fuel, recycling services, and disposal at the landfill, the budget contemplates a trash rate increase for the first time in 3 years. The 2023 Budget includes a rate increase of 20%, raising the Borough’s monthly residential sanitation rate from $20.80 to $25 per month per residence, and the commercial rate to $13.32 per cubic yard. So, the Sanitation rate will increase by about $4.19 per month, but still one of the lowest rates.
Cost of gas will rise but the rate to deliver gas and the cost of operations remain unchanged since 2013.
No change, the new ERU system remains in place, as do the automatic discounts for commercial, industrial, church, and institutional customers through December 31, 2023.
In 2020, Town Council repealed the Ambulance Tax. This was in conjunction with the establishment of a new ready-to-serve mandatory Ambulance Fee on all water utility invoices (because water fees are attributed to the property owner or owner’s designee). A Police or Fire fee is specifically prohibited. However, emergency medical services are different. Beginning in 2023, there will also be proposed an increase to the monthly Ambulance Fee, which appears on utility bills. The surcharge, unlike a real estate tax, is broad-based. Utility customers of the Borough will continue to pay this flat fee. The Ambulance Fee will rise from a flat $7.50 per month per water service connection to a flat $9.50 per month per water service connection. This fee supports the Borough EMS service, but it is clearly not a tax because tax-exempt property owners pay it on their monthly water bills. The Ambulance Fee, which appears on utility bills, is different from the Ambulance Club. The Ambulance Club is a voluntary giving program, to help raise money for this struggling yet life-saving service provided by the Chambersburg Fire Department. Unfortunately, the Borough of Chambersburg is required to write-off as uncollectible over $1.7 million in patient user fees due to rules associated with Medicaid/Medicare.
The enclosed handout includes a QR Code and a link to the full proposed budget and all the documents on the Borough’s website, www.chambersburgpa.gov
Town Council is expecting to receive public comments on the proposed spending plan on Monday, Nov. 14, in Council Chambers, at 7 p.m.