Northern Central Railway asks New Freedom to return 2025 amusement tax after 2024 losses

Northern Central Railway (NCR) asked the New Freedom Borough Council on a public meeting night to return 100% of the borough's 2025 amusement tax to the nonprofit, citing heavy maintenance costs and revenue lost in 2024.

Ashley Zimmerman, executive director of Northern Central Railway, told the council that “Since 02/2013, we have brought 200,000 visitors to New Freedom, making a $3,500,000 impact to your county,” and that running the tourist railroad carries unusually high capital and federally mandated safety costs. She said mechanical failures to steam engine No. 17, an unexpected diesel engine compressor failure, and a bridge strike last November caused lengthy service interruptions and large unplanned expenses in 2024.

NCR explained the borough created a 5% amusement tax in February 2013 that effectively applies to NCR ticket sales, and that since 2013 NCR has paid $233,000 in amusement tax to the borough. Zimmerman said the group would like the borough to “see a 100% of it be back donated back to the organization due to the challenges that we had in 2024.”

Why it matters: NCR said it brings thousands of visitors—and customers for local businesses—into the borough each year, and it said the 2024 disruptions reduced its ability to operate excursions that support area restaurants, shops and lodging. Council members questioned whether rebating a tax to a single nonprofit is permissible and whether returning tax revenue would reduce ticket prices for riders or simply replenish NCR’s operating funds.

Council discussion focused on legal limits and fairness. Council members asked whether other municipalities charge a similar amusement or use tax; NCR responded that other municipalities do not levy the same amusement tax. Several council members said they were concerned that a full rebate would be treated as a selective benefit to a single entity rather than a general policy for all taxpayers. One council member noted the borough used amusement-tax returns in prior years to support events such as New FreedomFest and Smoke on the Rail.

Council direction and next steps: The council did not grant the rebate on the spot. Instead the council asked the borough solicitor, addressed in the meeting as “Mister Tilly,” to research two questions: (1) whether a borough may rebate tax revenue to a nonprofit and (2) whether a borough may lawfully target a specialty tax at a single company or entity. In the meeting a speaker also noted “Specialty tax is a thing,” prompting discussion of the ordinance’s original language and intent.

The council also agreed to place a fuller discussion on the agenda for next month and to take additional public comment when the topic returns to the agenda.

Ending: Council members said they would review the solicitor’s legal guidance and additional financial information from NCR before any formal action. The item will return to a future meeting for possible ordinance-level action or alternative relief mechanisms.