Council debates 1‑mill tax increase to rebuild reserves and fund capital projects

Borough council debated a proposed 1‑mill increase to the property tax rate during the Nov. 5 meeting as staff outlined projections showing the extra revenue would stabilize operating reserves and create a modest capital fund for needed projects. Staff said the average residential assessment (about $291,800) would result in roughly a $292 annual increase on an average property if the full 1‑mill were approved, or about $24 per month.

Council members said the borough has spent down savings during recent years and faces recurring cost pressures — especially rising health insurance and personnel costs — that make continuing to rely on reserves untenable. “If we don’t act now, we keep kicking the can and will have fewer tools later,” a council member said during the discussion. Staff provided a five‑year projection showing that the 1‑mill step would enable the borough to keep a recommended operating reserve level (about 16.7% of operating expenses) while transferring several hundred thousand dollars annually into a capital reserve, smoothing the cost of large equipment and stormwater projects.

Councilors debated alternatives: larger immediate increases, deeper service cuts, or incremental smaller increases over multiple years. Several members said deep service cuts would reduce core services (roads, public safety, parks) that residents expect and could damage long‑term community health. Staff noted one option would be to fund immediate obligations while deferring capital work, but said that would likely increase costs later. The manager recommended combining a modest tax increase with ongoing operational reviews to find efficiencies and avoid future sharp increases.

Council also discussed outreach steps if it proceeds: a public FAQ/infographic explaining how tax dollars are spent, mailed notices with the tax change and examples of household impact, and a Dec. 3 special meeting slated for final adoption of the budget and the tax ordinance. No final vote was taken at the Nov. 5 meeting; council set next steps for formal introduction and public notification.

If the council approves the millage ordinance at the special meeting, staff said the borough would begin transferring a portion of the additional revenue to a designated capital reserve and use the remainder to restore operating reserves toward the 16.7% target, with planned annual reviews of budget assumptions and capital priorities.