Lancaster City Council adopts 2025 budget, raises earned-income tax to 1.1% and reallocates ARPA funds

Lancaster City Council on Dec. 17 approved the city's 2025 operating budget, voted to raise the city's earned-income tax (EIT) from 0.6% to 1.1%, and adopted several ordinances reallocating American Rescue Plan Act (ARPA) funds for city projects and housing programs.

The council's actions included passage of the administration's budget ordinance for 2025, a separate ordinance keeping the 2025 property tax millage unchanged, an ordinance increasing the EIT, and a set of ARPA appropriations that redirect previously awarded but unspent federal funds back into local programs such as a critical home-repair program and park improvements.

The decisions cap a meeting that featured extended public comment and several residents urging council to include tax-exemption or rebate mechanisms for low-income households before adopting Home Rule-era tax changes. Speakers also raised maintenance and safety concerns for bike lanes and city parks.

Council adopted the 2025 budget after public remarks from residents and advocates who asked for exemptions or rebates for low‑income residents and questioned administrative readiness to implement relief programs tied to the new Home Rule authority. Resident Tony Dastra pressed for exemptions and a rebate mechanism tied to municipal services; Arthur Morris and other residents questioned the timing and scale of the EIT increase and offered revenue projections that they said staff should review.

Mayor Saraki said the additional EIT revenue is intended in part to shore up the city's reserve ratio for bond-rating considerations: "our general reserve fund, which is currently, I believe, 14.7 percent, and we're trying to get it closer to 20," she said during the meeting.

Public commenters and several council members asked staff for follow-up analysis on implementation costs, the county tax-collection bureau's willingness to process Home Rule changes, and whether exemptions or rebate programs could be administered without burdening city staff.

Votes at a glance

- Admin…