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Allentown administration proposes 3.96% property‑tax increase with $25 garbage‑fee cut funded by interfund loan
Summary
At a special Allentown City Council meeting, administration proposed keeping a 3.96% property‑tax increase (estimated $1.5M revenue) while reducing a proposed garbage fee from $740 to $715 per unit; the general fund would lend roughly $1M to the solid‑waste fund, repaid over five years.
Allentown officials on Monday laid out an alternate 2026 budget scenario that would keep a 3.96% city property‑tax increase while trimming a proposed garbage‑collection fee by $25 per unit.
"What we are proposing is an alternative to what was initially proposed," Miss Patel, the administration presenter, told the City Council, describing a plan that would preserve a 3.96% real‑estate tax increase (estimated to generate $1,500,000 for the general fund) and reduce the proposed garbage fee from $740 to $715 per unit.
The administration illustrated effects with sample parcels. For a small parcel at 615 Whitehall Street, the plan would lower the annual total from $1,096.23 to $1,085.36 — a yearly savings of about $10.87 (about $0.91 per month). For a higher‑value parcel at 795 Benner Street, the alternate scenario raises the annual total from $5,346.26 to $5,503.84 — a $157.58 increase (about $13.13 per month).
To cover the $25 per‑unit reduction without immediately increasing other revenue, Miss Patel said the general fund would make an interfund loan to the solid‑waste fund for roughly $1,000,000 and that the solid‑waste fund would repay that loan over five years at about $200,000 per year. "So that would be about [a] million dollars that general fund can lend to the solid waste fund and repay over 5 years," she said.
A council member (identified in the transcript as Council member S3) questioned whether the $740 figure conflicted with earlier public messaging that described a $140 garbage fee increase; Miss Patel clarified that the $740 number is the projected per‑unit total for 2026 and the $25 reduction is a change to that proposed 2026 total.
Tom Beckett, the city's financial advisor, told council that interfund transfers and loans are common practice in larger municipalities and that the city's current liquidity and designated reserves make a $1M–$1.5M loan unlikely to materially affect credit ratings absent a structural, multi‑year deficit. "I think the level is important, and I don't think that 1.5 [million dollars] ... would move the needle much either," Beckett said.
Council members pressed on repayment sources and fairness to renters. Several members noted that owners often pass increased fees to tenants and asked for a larger sample of properties to assess distributional effects. Miss Patel said she prepared a sample covering all corners of the city but had not run the scenario for every parcel and agreed to expand the sample if possible.
No vote was taken at the special meeting; the administration and council framed this as an informational discussion. The chair noted future action on the budget is scheduled for December 10, with adoption proceedings to follow at 6:30 p.m.
