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Controller reports steady tax receipts but flags higher-than-expected medical claims
Summary
The city's midyear revenue update showed real-estate taxes and earned-income tax collections near budget, while investment interest was lower; the controller warned of elevated medical claims (including about $500,000 in late hospital bills) and said staff will monitor trends ahead of the budget cycle.
City administration delivered a midyear financial update to the finance committee that showed the city's major revenue streams largely on track but flagged higher-than-expected medical claims through May.
"Our largest by far revenue stream for the city is real estate taxes," the controller said, noting real-estate collections of roughly $33.7 million year-to-date (about 96.7% of the budgeted amount). The update showed earned-income tax and mercantile receipts near prior-year levels and a modest shortfall in certain intergovernmental transfers tied to timing differences.
The controller highlighted medical and workers' compensation spending as an area of concern at midyear. He said the city is self-insured with stop-loss insurance and that "if there's an individual that hits a a a limit of $245,000, we have insurance that covers that." He also cited roughly $500,000 of hospital bills that arrived late because of billing coordination issues across the Lehigh Valley; those bills were for services provided in 2025 but not received until 2026 and have raised midyear medical totals.
Other expense notes included steady salary-driven savings when positions are vacant and fixed obligations such as pensions and debt service that are predictable. Staff said they will monitor the medical trend and present recommendations during the budget process if needed.
The committee received the report and were invited to submit questions to administration before formal budget deliberations this fall.
