York City Council nixes sewer increase

Julia Scheib
City Councilman David Satterlee and He

Tuesday night, the York City Council removed $450,000 in expected revenue from the 2016 budget proposed by Mayor Kim Bracey.

Council members voted down a 6 percent increase in sewer fees, projected to raise $300,000 for improvements to the sewer system, and also rejected a resolution for the city to give notice that it will stop ceding its share of the realty transfer tax to the York City School District starting next July. The bill after that resolution, which would have taken action on that tax, was then taken off the table.

The city's share of the tax would have amounted to about $150,000 for the second half of 2016, and that amount was built into the budget as expected revenue, city Business Administrator Michael Doweary said.

York City Business Administrator Michael Doweary

As of now, the budget still includes a 1 percent property tax decrease and no layoffs or furloughs.

Sewer fee: "The bottom line is that those that use more water — families — will bear the brunt of this (fee increase)," Councilman Michael Helfrich said.

Helfrich has argued that the sewer fee increase, which ups the rate 50 cents per 1,000 gallons, would more than cancel out the property tax decrease for many low- and middle-income families, who use more water than couples or single people and who wouldn't feel the tax decrease as strongly as wealthier people or those with big commercial properties because their homes aren't worth as much.

Helfrich only needed the support of two fellow council members, but every member except Councilman Henry Nixon voted against increasing the fee.

Realty transfer tax: This tax brings in about $600,000 per year, Doweary said. By law, the city and the city school district should split it, but in a "gentlemen's agreement" years ago, the city agreed to let the school district have its share of the tax, and the school district agreed to let the city have the share of the local services tax it was entitled to.

Because the agreement is no longer fair, to the city's disadvantage, Doweary said, officials proposed that the city reclaim its portion of the realty transfer tax.

The school district, however, can't start collecting its share of the local services tax because the statute of limitations has expired, Doweary said.

Though Doweary introduced the proposal in July, council members seemed to feel blindsided when it was brought up Tuesday night.

The council had voted it down in 2012, Helfrich said.

City Council members Michael Helfrich and Renee Nelson

Addressing the council, York City School Board President Margie Orr said the school board hadn't heard about the city's decision to reclaim that tax revenue.

"When you hurt the school district to supplement the city ... who's getting hurt more?" she asked.

"We need all the support we can garner for the children of this city," she said near the end of the meeting.

Orr was upset that the tax revenue was being taken away when the state budget hasn't yet been passed. "We don't even know what we're getting from the state," she said.

Helfrich questioned whether the administration was taking the $150,000 it would gain from the transfer tax next year to make the tax cut possible. The 1 percent tax cut, he said, would amount to about $170,000 in lost revenue.

What now? Council members have until Dec. 31 to find the lost $450,000 elsewhere and pass a balanced budget.

They will gather ideas and will meet on Monday, Dec. 28 at a time that has yet to be announced.

Will the administration help them balance the budget after the cuts they've made?

"This is the mayor's budget. I can't say what will be offered," Doweary said. "But as far as the mayor's budget, this is it."

— Reach Julia Scheib at jscheib@yorkdispatch.com.