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Uwchlan projects $854,000 2026 budget gap driven by one employer’s EIT loss; supervisors weigh tax and fee increases
Summary
Staff reported a projected combined 2026 budget of $27.6 million and an $854,000 deficit largely caused by a $766,000 earned‑income‑tax shortfall tied to a single employer; supervisors discussed restoring the general‑fund millage to 2005 levels and possible service‑fee adjustments and will present the budget at the November business meeting.
Township staff told supervisors the draft 2026 combined operating and capital budget totals $27.6 million and that a projected plan deficit of $854,000 is primarily driven by a $766,000 shortfall in earned‑income‑tax (EIT) revenue, which staff said stems from a large employer leaving or reducing payroll within the township.
Staff said the package of adjustments under consideration would include restoring the general‑fund millage to its 2005 level (which staff described as the first increase in general real‑estate tax since 1989), raising certain utility and service fees (including sewer and trash charges) and revising the hydrant fund contribution. The presentation noted the adjustments are intended to balance the 2026 budget; staff emphasized that longer‑term capital‑funding needs remain under discussion with the township’s financial advisor.
Board members debated whether to make large one‑time contributions to community organizations while facing the structural shortfall. Staff said the downtown library made a capital request (the transcript recorded both a presentation figure of $250,000 and later board discussion that referenced a $50,000 annual plan spread over five years); supervisors did not finalize any commitment and discussed a smaller near‑term contribution with the intention to revisit future payments depending on budget performance. Brandywine Valley Active Aging requested $4,000; several supervisors expressed support for that smaller contribution.
Supervisors also discussed offering volunteer incentives for firefighters through an earned‑income‑tax or real‑estate tax credit modeled on the county program. Staff estimated the township share of an earned‑income‑tax credit would be roughly $5,000 annually with minimal administrative cost if the township simply mirrors the county eligibility rules and asks Keystone (the EIT collector) to apply the credit. Staff and supervisors said coordinated action with other municipalities and outreach to the school district could increase the program’s impact.
Staff will present the full 2026 draft budget at the upcoming November business meeting and seek permission to advertise the budget and supporting rate changes for public review.
